आदेश / ORDER

PER MAKARAND VASANT MAHADEOKAR, AM:

1. This appeal filed by the assessee is directed against the order dated 10.12.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi[hereinafter referred to as "CIT(A)"], under section 250 of the Income-tax Act, 1961[hereinafter referred to as "the Act"], arising from the assessment order dated 07.07.2022 passed by the Assessing Officer under section 143(3) read with section 144B of the Act for the Assessment Year 2020–21.

2. The brief facts of the case, as emanating from the assessment order, are that the assessee is a resident company engaged in rendering Information Technology and Information Technology Enabled Services. The assessee filed its return of income electronically on 12.02.2021 declaring total income at Rs. 0/-.

3. The case was selected for limited scrutiny under CASS and notice under section 143(2) was issued on 29.06.2021, followed by notice under section 142(1) dated 22.11.2021. In response, the assessee furnished details through the e-proceeding portal. The case was selected for scrutiny on the issues of “Introduction/Addition of high value intangible asset during the year” and “High liabilities as compared to low income/receipts”.

4. The assessee, during the course of assessment proceedings, submitted that it had claimed deduction under section 10AA amounting to Rs. 18,65,282/- in respect of export of software services from its eligible SEZ units and had filed the return declaring total income at Rs. Nil after such deduction. The assessee also furnished requisite details, including documents and submissions through the e-proceeding portal, which were examined by the Assessing Officer.

5. The Assessing Officer, after verification of the details submitted by the assessee and considering the explanation furnished, recorded that “on verification of the details submitted by the assessee, the income as declared by the assessee in the return of income is accepted.” However, as per the computation sheet forming part of the assessment order, the total income was determined at Rs. 18,65,282/- under normal provisions, and the tax liability was computed under section 115JB at Rs. 23,42,062/-.

6. Aggrieved by the assessment order, the assessee preferred appeal before the CIT(A). Before the CIT(A), the assessee reiterated that the Assessing Officer had accepted the returned income but failed to grant deduction under section 10AA in the computation sheet, which resulted in determination of income under normal provisions at Rs. 18,65,280/- instead of Nil. It was further submitted that due to non-grant of deduction under section 10AA, there was a consequential short grant of MAT credit to the extent of Rs. 4,84,973/-. The assessee also contended that interest under section 234C was wrongly levied at Rs. 90,032/- as against Rs. 47,875/- declared in the return, and that the company had commenced operations only from October2019 and hence was not liable to pay advance tax for the first two instalments.

7. The CIT(A), after considering the facts and submissions, the CIT(A) held that the Assessing Officer had inadvertently not granted the deduction in the computation sheet and accordingly directed the Assessing Officer to verify the claim and grant deduction under section 10AA as claimed in the original return. The appeal on this ground was treated as allowed.

8. With regard to the levy of interest under section 234C, the CIT(A) observed that interest under section 234C is consequential in nature and held that the assessee would have anticipated its turnover even if it was inoperative for the first six months. The reliance placed by the assessee on the decision in Kumari Kumar Advani (ITA No. 7661/Mum/2013) was held to be distinguishable. The CIT(A) further observed that waiver of interest under section 234C is within the discretion of higher authorities and not within the powers of the CIT(A). Accordingly, th