You asked for seized cash to be adjusted against your self-assessment tax and the CPC simply refused the credit. Should it have issued a s.139(9) notice instead?
The Tribunal allowed the appeal and directed that the money lying seized be appropriated towards the self-assessment tax liability. It recorded that no notice under s.139(9) had been issued by either the CPC or the jurisdictional Assessing Officer treating the return as defective, and that the assessee's request having been neither rejected nor decided amounted to acceptance.
Decided by the ITAT (Satbeer Singh Godara, Judicial Member and Manish Agarwal, Accountant Member) on 2025-10-31, reported as ITA No. 4498/Del/2025, assessment year 2024-25. It bears on section 139(9), section 139(9) Explanation, section 140A, section 132, section 132B, section 143(1) of the Income Tax Act 1961, in Assessment & Scrutiny, Demand, Recovery & Stay and Search, Survey & Block Assessment matters.
Where the tax shown as payable has not been paid in cash but the department is holding seized money the assessee has asked it to apply, the department's route, if it says the return is defective, is a s.139(9) notice. Denying the credit in processing without issuing one leaves the department with neither an accepted return nor a defect notice, and this is the order to cite.
Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere.
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The assessee company filed its return for assessment year 2024-25 claiming a refund and requesting that cash of Rs. 17,66,50,000 seized in a search under s.132 be adjusted against its self-assessment tax liability. The CPC denied the credit and raised a demand. The Commissioner (Appeals) upheld the denial, treating the claim as relating to advance tax rather than to self-assessment tax. No notice under s.139(9) was issued either by the CPC or by the jurisdictional Assessing Officer treating the return as defective.
The appeal was allowed and all grounds decided for the assessee. The money lying seized with the Revenue was directed to be appropriated towards the self-assessment tax liability.
The Tribunal recorded that no notice under s.139(9) had been issued by either the CPC or the jurisdictional Assessing Officer treating the return as defective (para 13), so the department had not taken the course the Act provides where the tax shown as payable has not been paid. It further reasoned that the assessee's request having been neither rejected nor decided amounted to acceptance, relying for that proposition on the Supreme Court's order in ACIT v. Marico Ltd. (2020) 117 taxmann.com 244 (SC) for the position that non-rejection of the explanation of the assessee amounts to the Assessing Officer accepting the view.
no notice u/s 139(9) of the act was issued either by CPC or by the JAO, treating the return of income filed by the assessee as defective
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Handle my notice → Ask a CA on WhatsAppThe Tribunal allowed the appeal and directed that the money lying seized be appropriated towards the self-assessment tax liability. It recorded that no notice under s.139(9) had been issued by either the CPC or the jurisdictional Assessing Officer treating the return as defective, and that the assessee's request having been neither rejected nor decided amounted to acceptance. This was decided by the ITAT (Satbeer Singh Godara, Judicial Member and Manish Agarwal, Accountant Member) and bears on section 139(9), section 139(9) Explanation, section 140A, section 132, section 132B, section 143(1) of the Income Tax Act 1961. It is reported as ITA No. 4498/Del/2025, assessment year 2024-25. Where the tax shown as payable has not been paid in cash but the department is holding seized money the assessee has asked it to apply, the department's route, if it says the return is defective, is a s.139(9) notice. Denying the credit in processing without issuing one leaves the department with neither an accepted return nor a defect notice, and this is the order to cite. If it applies to you, the first step is this: Make the request to appropriate seized cash against the self-assessment tax in writing and before the return is filed, and record it in the return.
The assessee company filed its return for assessment year 2024-25 claiming a refund and requesting that cash of Rs. 17,66,50,000 seized in a search under s.132 be adjusted against its self-assessment tax liability. The CPC denied the credit and raised a demand. The Commissioner (Appeals) upheld the denial, treating the claim as relating to advance tax rather than to self-assessment tax. No notice under s.139(9) was issued either by the CPC or by the jurisdictional Assessing Officer treating the return as defective. The matter was decided on 2025-10-31 by the ITAT (Satbeer Singh Godara, Judicial Member and Manish Agarwal, Accountant Member). On those facts the ITAT held as follows. The appeal was allowed and all grounds decided for the assessee. The money lying seized with the Revenue was directed to be appropriated towards the self-assessment tax liability.
The Tribunal recorded that no notice under s.139(9) had been issued by either the CPC or the jurisdictional Assessing Officer treating the return as defective (para 13), so the department had not taken the course the Act provides where the tax shown as payable has not been paid. It further reasoned that the assessee's request having been neither rejected nor decided amounted to acceptance, relying for that proposition on the Supreme Court's order in ACIT v. Marico Ltd. (2020) 117 taxmann.com 244 (SC) for the position that non-rejection of the explanation of the assessee amounts to the Assessing Officer accepting the view. In the words reproduced by the source cited on this page: "no notice u/s 139(9) of the act was issued either by CPC or by the JAO, treating the return of income filed by the assessee as defective" The decision followed or applied ACIT v. Marico Ltd., (2020) 117 taxmann.com 244 (SC) - relied on for non-rejection of the assessee's explanation amounting to acceptance.
It was decided by the ITAT on 2025-10-31 and is reported as ITA No. 4498/Del/2025, assessment year 2024-25. Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere. A Tribunal decision binds the assessing officer and the Commissioner (Appeals) within that Tribunal's jurisdiction, and is persuasive before other benches. It is not binding on a High Court, and a contrary co-ordinate bench decision will be argued against you, so check whether the point has been taken the other way before you build a reply around it. On section 139(9), section 139(9) Explanation, section 140A, section 132, section 132B, section 143(1), the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. The appeal was allowed and all grounds decided for the assessee. The money lying seized with the Revenue was directed to be appropriated towards the self-assessment tax liability. It arises in Assessment & Scrutiny, Demand, Recovery & Stay and Search, Survey & Block Assessment matters, on section 139(9), section 139(9) Explanation, section 140A, section 132, section 132B, section 143(1) of the Income Tax Act 1961, and was decided by Satbeer Singh Godara, Judicial Member and Manish Agarwal, Accountant Member. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Check whether any s.139(9) notice was issued; if the department says the tax was not paid but never issued one, say so. Where the request was neither rejected nor decided, take the point that silence amounts to acceptance. Keep the distinction between advance tax and self-assessment tax in view; the appellate authority went wrong on it here.
Searched for later treatment; none was found. That is not the same as a source affirming it. This is an October 2025 order and nothing applying, doubting or dissenting from it has appeared on indiankanoon. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
The s.139(9) point is not the ratio of the order, which turns on the appropriation of seized money against self-assessment tax; the absence of a defect notice is recorded as part of the Tribunal's reasoning, at para 13. The order describes the Marico matter as the Supreme Court dealing with an SLP, which is what it was, so it should be read as an order on a special leave petition rather than as a judgment on the merits. A check against the document corrected the authority relied on: the order names it, with its citation and with the parties the other way round, as 'ACIT V. Marico Ltd. (2020) 117 taxmann.com 244(SC)', so the entry's 'Marico Ltd. v. Asstt. CIT' and its statement that no citation is printed were both wrong and have been replaced, and the s.139(9) observation has been pinned to para 13. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The appeal was allowed and all grounds decided for the assessee. The money lying seized with the Revenue was directed to be appropriated towards the self-assessment tax liability.
TaxSphere, “Kapoor Industries Ltd v CPC”, https://taxnotice.vittsphere.com/caselaw/case/kapoor-industries-v-cpc-no-139-9-notice-self-assessment-tax/ (validity last checked 2026-09-17)
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You never asked the Assessing Officer for more time, the return went invalid for want of proof of tax, and you have gone to the Commissioner under s.264. Will that work?
Neither your original nor your revised return carried the self-assessment tax. The officer ignored that and assessed you on the original return. Is the assessment good?
The officer declared your return invalid for non-payment of self-assessment tax and then assessed you under s.143(3) starting from the figures in that very return. Can he do both?
Is the list of defects in the Explanation to s.139(9) a closed list, so that the officer cannot call anything else a defect?
