TaxTMI 
TaxTMI 
2026 (9) TMI 984
X X X X Extracts X X X X
X X X X Extracts X X X X
....herein the Revenue has taken following grounds of appeal: "1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 2,99,65,837/- assessed under the head "Income from Business or Profession", without appreciating that the said income formed part of the total income determined during processing of return under section 143(1) and subsequently adopted in the assessment order passed under-section 143(3) of the Income-tax Act, 1961? 2. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that the addition of Rs. 2,99,65,837/- was without merit merely on the ground that the assessment order did not contain elaborate discussion or reasoning, without examining the correctness of the computation of income and the material available on record? 3. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating the assessed income as an apparent error arising from the intimation under section 143(1), ignoring the fact that the assessment was subsequently completed under section 143(3), whereby the earlier proceed....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d. CIT(A). 5. The Ld. CIT(A), thereafter referring to the documents on record including the ITR-6 acknowledgment, detailed computation of income, and the assessment order, stated that on verification of the assessee's return of income and computation of income, it shows and confirms that the return shows NIL income from "Business and Profession" whereas, the assessment order reveals "income from business and profession" at Rs. 2,99,65,837/- however, the order provides no discussion, reasoning, or justification for this figure. The Assessing Officer had merely adopted the figure in terms of the intimation under Section 143(1) of the Act. It was held that given that the assessee's primary documents clearly showed NIL business income, and the AO has failed to provide any basis for assessment of Rs. 2,99,65,837/-, under the head "Business Income", the addition was without merit and a clear/apparent error originating from Section 143(1) intimation that was wrongly taken into consideration by the Assessing Officer while completing the assessment under Section 143(3) of the Act. Accordingly, the addition of Rs. 2,99,65,837/- was held not sustainable, and the Assessing Officer was d....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... immediately moved a rectification application under Section 154 against the intimation under Section 143(1) on 12.12.2019, which was rejected vide order dated 19.12.2019. Thereafter, the Assessee filed a fresh rectification application under Section 154 against the intimation under Section 143(1) on 20.02.2020, which was again rejected vide order dated 22.02.2020. It was accordingly submitted that the assessee took all the necessary steps and inspite of that, no relief was granted and thereafter, the assessee filed the appeal before the ld. CIT(A) against the order passed Section 143(3) on 04.10.2024, and the ld. CIT(A) finally allowed the necessary relief to the assessee vide his order dated 16.01.2026. 8. It was submitted that in light of the aforesaid factual matrix of the case, it can be appreciated that firstly, the intimation under Section 143(1) was received subsequent to the initiation of scrutiny proceedings. Therefore, the Assessee could not have filed any appeal against the intimation order and once the assessment proceedings were initiated, the Assessee was hopeful that the Assessing Officer will appreciate the mistakes while processing the return of income, however....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the issuance of notice under section 143(1) of the Act and even on this account, the adjustment so made by CPC, Bangalore cannot be sustained in law and cannot be subject matter of adjustment as so done by CPC and the addition done in the hands of the assessee in terms of section 143(3) of the Act. Further, reference was drawn to the decision of Coordinate Mumbai Benches in case of National Stock Exchange of India Ltd vs. DCIT in ITA No. 732/Mum/2023, wherein, again it was held that where the case of the assessee was scrutinized under section 143(2) and assessment order under section 143(3) was passed, technically the doctrine of merger comes into picture. Therefore, the adjustment done by CPC gets merged into order passed under section 143(3) and order passed under section 143(3) only survives. It was accordingly submitted that there is no infirmity in the order so passed by the ld. CIT(A) and same be confirmed and the appeal of the Revenue should be dismissed. 11. It was submitted that in any case, where it is decided that the ld. CIT(A) has erred in granting necessary relief to the assessee, the assessee has separately moved an appeal against the intimation under section 143....