CHROMAPRINT INDIA PRIVATE LIMITED,COIMBATORE vs. DEPUTY COMMISSIONER OF INCOME-TAX, COIMBATORE

This appeal by the assessee is arising out of the order of the Commissioner of Income Tax (Appeals, National Faceless Appeal Centre (NFAC), Delhi in Appeal No.CIT(A), Coimbatore- 1/10155/2017-18 dated 07.07.2022. The assessment was framed by 2 the DCIT, Corporate Circle-1, Coimbatore for the assessment year 2015-16 u/s.143(3) of the Income Tax Act, 1961 (hereinafter the ‘Act’) vide order dated 29.12.2017.

The only issue in this appeal of assessee is against the order of CIT(A) confirming the action of AO in disallowing excess rent of Rs.10,59,120/- claimed as expenses without considering the evidences. For this, assessee has raised various grounds which need not be reproduced.

Briefly stated facts are that the assessee is a domestic company engaged in the business of manufacturing printed materials. The AO during the course of assessment proceedings, on perusal of P & L account of the assessee, noted that the assessee company had debited an amount of Rs.1,60,59,120/- under the head ‘rent’ and claimed the same as expenses. When enquired, the assessee produced evidences for rent paid to the extent of Rs.1,50,00,000/- but could not produce any evidence in respect of balance amount of Rs.10,59,120/-. Accordingly, the excess claim of rent expenditure amounting to Rs.10,59,120/- was disallowed and added to the returned income of the assessee. Aggrieved, assessee came in appeal before CIT(A).

The CIT(A) also confirmed the action of the AO by noting that the assessee has been issued five notices from 02.02.2021 till 14.06.2022. The assessee neither filed any submissions nor any adjournment letter. Therefore, he disposed off the appeal based on material available on record and dismissed the appeal of assessee. Aggrieved, assessee came in appeal before the Tribunal.

We have heard rival contentions and gone through the facts and circumstances of the case. Before us the ld.counsel for the assessee filed details of service tax paid on rent and rent amounting to Rs.1,60,59,120/- and also agreement for lease between assessee and Smt. L. Sundari to whom the total rent of Rs.5,40,000/- being paid for the premises No.45, Ganesh Nagar, G.N Mills Post, Mettupalayam Road, Coimbatore. The ld.counsel for the assessee, on query stated that these evidences were not produced before the AO or CIT(A) as the assessee was never provided opportunity and even the order of CIT(A) is ex-parte. We noted that the service tax paid on rent of Rs.5,19,120/- and rent paid to Smt. L. Sundari amounting to Rs.5,40,000/- needs verification. Hence, these evidences are remitted back to the file of AO who will reconsider these evidences and after verification, will allow the claim of

In the result, the appeal filed by the assessee is allowed for statistical purposes.