M/S EDAC ENGINEERING LIMITED,CHENNAI vs. CIT, DELHI

This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals), (National Faceless Appeal Centre) [NFAC], Delhi dated 08.12.2022 relevant to the assessment year 2018-19.

Brief facts of the case are that the assessee filed its return of income for the assessment year 2018-19 showing total income of ₹.8,28,89,780/- on 09.10.2018. The case has been selected for scrutiny. After following due procedure, the Assessing Officer has completed the assessment order under section 143(3) r.w.s. 143(3A) & 143(3B) of the Income Tax Act, 1961 [“Act” in short] dated 06.04.2021. In the assessment order, the Assessing Officer has noted that as per bank details, the interest credited to the assessee was ₹.2,56,00,104/-, whereas, the assessee has credited the income from interest at ₹.1,26,25,569/- only. The Assessing Officer issued show-cause notice to the assessee on 16.03.2021 followed by another opportunity on 22.03.2021. Since there was no compliance, the difference of interest of ₹.1,29,74,535/- has been added to the total income of the assessee under the head of income of other sources. On appeal, the ld. CIT(A) confirmed the addition made by the Assessing Officer since the assessee could not file any documentary evidence for its claim.

On being aggrieved, the assessee is in appeal before the Tribunal. When the appeal was taken up for hearing, none appeared on behalf of the assessee. Hence, we proceed to decide the appeal on merits after hearing the ld. DR.

We have heard the ld. DR, perused the materials available on record and gone through the orders of authorities below. Since the assessee has not responded to the notices of the Assessing Officer, the difference of interest receipt of ₹.1,29,74,535/- was brought to tax, which was confirmed by the ld. CIT(A). Admittedly, in this case, the information received from the bankers were not furnished to the assessee and based on the information allegedly received from the bankers, the Assessing Officer made the addition. In view of the above facts, we set aside the order of the ld. CIT(A) on this issue and remit the matter back to the file of the Assessing Officer to decide the issue afresh after considering the interest certificates and other details, if any, as may be furnished by the assessee by affording reasonable opportunity of being heard to the assessee. The assessee is also directed to furnish complete details including interest certificates before the Assessing Officer, which was filed before the Tribunal.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced on 12th April, 2023 at Chennai.