DECCAN HEALTH CARE PRIVATE LIMITED,HYDERABAD vs. ASST. COMMISSIONER OF INCOME TAX, CIRCLE-17(1), HYDERABAD

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ITA 886/HYD/2018Status: DisposedITAT Hyderabad22 April 2021AY 2014-154 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal accepted the assessee's request to remit the matter back to the AO for de novo consideration. The AO is directed to examine the books of account and other documents to be submitted by the assessee.

What were the facts?

The assessee, engaged in pharma manufacturing, filed a return declaring a loss. During assessment, the assessee failed to furnish books of account and other details, leading the AO to make additions. The CIT(A) dismissed the assessee's appeal.

What were the issues?

Whether the AO was justified in making additions without proper examination of books of account, and if the assessee should be given another opportunity to produce documents.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, HYDERABAD BENCHES “B”: HYDERABAD

Before: SHRI SATBEER SINGH GODARA & SHRI LAXMI PRASAD SAHU

For Appellant: Shri P. Murali Mohana Rao
For Respondent: Shri Rohit Mujumdar
Hearing: 15/03/2021Pronounced: 22/04/2021

O R D E R PER L.P. SAHU, A.M.: This appeal filed by the assessee is directed against CIT(A) – 5, Hyderabad’s order dated 12/03/2018 for AY 2014-15 involving proceedings u/s 143(3) of the Income Tax Act, 1961 ; in short “the Act”.

2.

Briefly, the facts of the case are that the assessee company engaged in the business of manufacturing of Pharma Products, filed its return of income for the :- 2 -: M/s Deccan Health Care Pvt. Ltd., Hyd.

Assessment year 2014-15, declaring a loss of Rs. 1,57,87,429/- under normal provisions and book loss of Rs. (-) 5,33,44,675/-. The case was selected for scrutiny under CASS. As the assessee failed to furnish books of account and other details that were called for during the course of assessment proceedings, the AO made the addition of Rs. 21,12,408/- being estimated net profit @3% on sales of Rs. 7,04,13.619/- and also added other income of Rs. 53,886/- by passing an order u/s 143(3) of the Act.

3.

When the assessee preferred an appeal before the CIT(A), the CIT(A) dismissed the appeal of the assessee after considering the written submissions filed by the assessee before him, which were extracted by the CIT(A) in his order at pages 5 to 8.

4.

Aggrieved by the order of the CIT(A), the assessee is in appeal before the ITAT.

5.

Before us, the ld. AR of the assessee submitted that the books of account of the assessee have been audited by a qualified CA and no adverse remarks have been made by the Auditor. He submitted that the books of account and bills/vouchers are available with the assessee were not submitted before the AO during the course of assessment proceedings due to unavoidable circumstances. He,

:- 3 -: M/s Deccan Health Care Pvt. Ltd., Hyd. therefore, requested the Bench that if the matter is remitted back to the revenue authorities, the assessee will be able to produce books of account and all the necessary documents that are required for assessment.

6.

On the other hand, the ld. DR vehemently objected the request of the ld. AR and submitted that even though sufficient opportunities were provided to the assessee by the AO & CIT(A), he did not produce the required details.

7.

After considering the submissions of both the parties and perusing the material on record as well as the orders of revenue authorities, we accept the request of the ld. AR of the assessee for remitting the matter back to the AO for de- novo consideration. The AO is directed to examine in depth the books of account, bills, vouchers, etc. to be submitted by the assessee before him and decide the matter in accordance with law and on merits after providing reasonable opportunity of being heard to the assessee. We direct the assessee to appear before AO on or before 31st July, 2021 with all the relevant documents; at his own risk and responsibility to be followed by three effective opportunities of hearing.

:- 4 -: M/s Deccan Health Care Pvt. Ltd., Hyd.

8.

In the result, appeal of the assessee is treated as allowed for statistical purposes. Pronounced in the open court on 22nd April, 2021.

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