Law:

Section:

Section 143 of the Income-tax Act, 1961 - Assessment - Prima facie adjustment - Assessment years 1989-90 and 1990-91 - Whether as intimation sent pursuant to filing of returns without demand of tax or interest is an intimation under section 143(1)(a) - Held, yes Section 154 (as it stood prior to amendment with effect from 1-6-1999), read with section 143(1)(a), of the Income-tax Act, 1961 - Rectification of mistakes - Apparent from records - Assessment years 1989-90 and 1990-91 - Whether an intimation sent under section 143(1)(a) without demand of tax or interest can be rectified under section 154 - Held, yes FACTS The assessee filed loss returns for the assessment years 1989-90 and 1990-91. The Assessing Officer accepted the returns and sent intimations under section 143(1)(a). Regular assessment was completed for the assessment year 1990-91 under section 143(3). Later on, the Assessing Officer found that the intimations sent were incorrect inasmuch as adjustments towards prima facie inadmissible items had not been made. Accordingly, notices were sent under section 154 and assessments were rectified. On appeal, the Commissioner (Appeals) cancelled the rectification orders holding that the proceedings sent under section 143(1)(a) for the respective assessment years did not constitute intimation under section 143(1)(a). The Tribunal confirmed the orders of the Commissioner (Appeals). On reference : HELD The returns filed by the assessee were acknowledged on the date of filing them. For both the years, the returns were processed and intimations were sent, though without demand. The Commissioner (Appeals) and the Tribunal had also referred to those intimations issued under section 143(1)(a) which were not acknowledgements of filing of returns. The question, therefore, to be considered was whether a proceeding sent pursuant to filing of returns without demand of tax or interest was an intimation under section 143(1)(a). The proviso to section 143(1) makes it clear that besides acknowledgement of receipt of return, issue of an intimation under section 143(1)(a) is contemplated under the Act. If that be so, then the question is whether such an intimation can be…

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