The power of the Income-tax Officer to make adjustments under section 143(1)(a) of the Income-tax Act, 1961 is limited to arithmetical errors, loss carried forward, deduction, allowance or relief which is prima facie inadmissible.

1. - In this writ petition, the petitioners have challenged the intimation received under section 143(1)(a) of the Income-tax Act, 1961 (hereinafter to be called as "the Act" ), whereby the petitioner was required to make payment of a sum of Rs. 20,243.

2. The grievance of the petitioners is that the Income-tax Officer has no jurisdiction under section 143(1)(a) of the Act to make variation in the rate of tax and has limited jurisdiction as provided in the said section.

3. The submission of learned counsel for the Department is that the assessment has been made on the same figure as was declared by the petitioner and it was only on account of the maximum marginal rate of tax as against the normal rate shown by the assessee that this demand was created. It has further been submitted that, in accordance with the provisions of section 167B of the Act since the shares of the members in the assessee's case were unknown, the Income-tax Officer was justified in applying the maximum marginal rate. The said section was amended by the Direct Tax Laws (Amendment) Act, 1989, with effect from April 1, 1989, and the maximum marginal rate was applied for the years 1989-90 and 1990-91. Since no reasons were shown by the assessee for applying the normal rate in the return, by applying the provisions of section 167B the tax has correctly been levied and charged. It was also submitted that the petitioner has an alternative remedy for submitting an application under section 154 of the Act during the relevant period.

4. I have considered the matter. The provisions of section 143(1)(a) are as under:

"143. Assessment. (1) (a) Where a return has been made under section 139, or in response to a notice under sub-section (1) of section 142,-

(i) if any tax or interest is found due on the basis of such return, after adjustment of any tax deducted at source or any advance tax paid and any amount paid otherwise by way of tax or interest, then, without prejudice to the provisions of subsection (2), an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 156 and all the provisions of this Act shall apply accordingly ; and

(ii) if any refund is due on the basis of such return, it shall be granted to the assessee:

Provided that in computing the tax or interest payable by, or refundable to, the assessee, the following adjustments shall be made in the income or loss declared in the return, namely:-

(i) any arithmetical errors in the return, accounts or documents accompanying it shall be rectified ;

(ii) any loss carried forward, deduction, allowance or relief, which, on the basis of the information available in such return, accounts or documents, is prima facie admissible but which is not claimed in the return, shall be allowed ;

(iii) any loss carried forward, deduction, allowance or relief claimed in the return which, on the basis of the information available in such return, accounts or documents, is prima facie inadmissible, shall be disallowed:

Provided further that where adjustments are made under the first proviso, an intimation shall be sent to the assessee, notwithstanding that no tax or interest is found due from him after making the said adjustments;

Provided also that an intimation for any tax or interest due under this clause shall not be sent after the expiry of two years from the end of the assessment year in which the income was first assessable. "

5. The provisions of section 167B of the Act are applicable where the shares of the members in the association of persons or body of individuals are unknown/indeterminate.

6. A bare perusal of section 143(1)(a) contemplates that the Income-tax Officer has to accept the return as it is and in the proviso, three exceptions have been given which confer the jurisdiction on him for making adjustment. Action under this section cannot be taken beyond the power permitted by these three exceptions. The third exception