The Assessing Officer before making adjustment or disallowance to the returned income according to the return filed by the assessee was duty-bound to intimate the assessee either in writing or in the electronic mode. However, no such intimation had been given to the assessee either in writing or in electronic mode before making the adjustment or disallowance. The Assessing Officer had not followed the mandate of the first proviso to section 143(1)(a) of the Income-tax Act, 1961 and consequently, the order passed u/s. 143(1) of the Act had to be quashed.

For the AY. 2020-21, the assessee filed its return in form ITR 7 u/s. 139(4) on March 31, 2021 and filed form 10B on March 30, 2021 whereas the extended due date for filing the return was February 15, 2021. The Assessing Officer disallowed the exemption claimed u/s. 11 of the Act on the ground that the Income-tax return and form 10B were filed late. Held, that the covid pandemic had spread all over the country and the entire country was brought to a standstill. Considering all these practical difficulties for making compliances, the Supreme Court had extended the period of limitation with respect to judicial or quasi-judicial proceedings. There was no delay in filing the return or form 10B. Therefore, the order of the Commissioner (Appeals) was set aside and the Assessing Officer was to allow exemption claimed u/s. 11 of the Act. (AY. 2020-21)