Assessment framed in different status is liable to be cancelled

Ganna Vikas Parishad Vs JCIT (ITAT Delhi)

ITAT Delhi cancels the assessment made by the Assessing Officer (AO) due to the issuance of a notice in the status of ‘Local Authority’ and the subsequent assessment framed in the status of ‘Artificial Juridical Person.’ The tribunal refers to a precedent where a similar assessment was annulled on the basis of a mismatch in the status. As the AO issued the notice to the assessee as a ‘Local Authority’ and the assessment was framed as an ‘Artificial Juridical Person,’ the assessment order is declared invalid.

Facts- The assessee filed its return of income, in the status of ‘Local Authority’, at Nil income. The return was processed u/s 143(1) of the Income Tax Act, 1961 on returned income. Subsequently, the case was selected for scrutiny assessment. During scrutiny assessment proceedings the assessee was asked to explain as to how it is entitled for exemption of the income. The reply submitted by the assessee was not found acceptable by the Assessing Officer and he assessed the income by making addition of Sentage receipts.

CIT(A) dismissed the appeal. Being aggrieved, the present appeal is filed.

Conclusion- Coordinate Bench in the case of JCIT Vs. M/s. N.S. Committee held that cancelled the assessment on the basis that the AO had framed assessment in a different status.

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