Prima facie adjustment limits under section 143(1)(a) prevented disallowance of an unclaimed section 54 deduction.

An adjustment under section 143(1)(a) could not be made to disallow a section 54 deduction where no such deduction was claimed in the return of income. The processing of a return by intimation is limited to prima facie adjustments expressly permitted at that stage, and a disallowance cannot be sustained on the basis of a claim that does not exist in the return. The adjustment and resulting addition were therefore inadmissible and were deleted in favour of the assessee.

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Issues: Whether an adjustment under section 143(1)(a) of the Income-tax Act, 1961 could be made by disallowing a deduction under section 54 when no such claim was made in the return of income.

Analysis: The return was processed by way of intimation, and adjustments at that stage are confined to matters specifically permitted under section 143(1)(a). Since the assessee had not claimed deduction under section 54 in the return, the matter did not fall within the scope of a permissible prima facie adjustment. A disallowance on the footing of a non-existent claim could not be sustained in the intimation.

Conclusion: The adjustment and resulting addition were held to be inadmissible and were deleted, in favour of the assessee.

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