Summary adjustment cannot recharacterise corpus donations, and belated Form 10B filing alone will not defeat exemption claims.

A summary adjustment under section 143(1) cannot be used to recharacterise a declared corpus donation as a voluntary donation unless the mistake is apparent from the return itself; the adjustment was therefore outside the scope of section 143(1) and unsustainable. Delayed filing of Form 10B is a procedural lapse and, where the report is furnished before completion of appellate proceedings, it does not by itself bar exemption under sections 11 and 12; the exemption could not be denied merely for belated filing. The additions were deleted and the assessee's claim was accepted.

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Issues: (i) Whether the treatment of corpus donation as voluntary donation could be made as an adjustment under section 143(1); (ii) Whether delayed filing of Form 10B could by itself deny exemption under sections 11 and 12.

Issue (i): Whether the treatment of corpus donation as voluntary donation could be made as an adjustment under section 143(1).

Analysis: The adjustment mechanism under section 143(1) is limited to the specified adjustments and cannot be used to convert a claim of corpus donation into voluntary donation unless the mistake is apparent from the return itself. The donation was shown in the return as corpus donation, and the character of the receipt was not such that it could be altered through a summary adjustment.

Conclusion: The adjustment was outside the scope of section 143(1) and was not sustainable against the assessee.

Issue (ii): Whether delayed filing of Form 10B could by itself deny exemption under sections 11 and 12.

Analysis: The filing of Form 10B was treated as a procedural requirement, and the record showed that the report had been furnished before completion of appellate proceedings. In such circumstances, late filing could not be treated as an absolute bar to exemption when the substantive requirement had been met.

Conclusion: Exemption under sections 11 and 12 could not be denied merely because Form 10B was filed belatedly.

Final Conclusion: The additions made by the tax authority were deleted and the assessee's claim was accepted.

Ratio Decidendi: A summary adjustment under section 143(1) cannot alter the character of a declared receipt unless the error is apparent from the return, and delayed filing of an audit report is only a procedural lapse that does not by itself defeat exemption when the report is subsequently available before completion of proceedings.

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