M/S SRIRAM CONSTRUCTIONS,HYDERABAD vs. ASST.COMMISSIONER OF INCOME TAX, CIRCLE-15(1), HYDERABAD

Brief facts are that the assessee is a Partnership Firm had filed its return of income for AY 2014-15 on 16/07/2014 admitting total income of Rs. Nil after claiming deduction u/s 80IB(10). The assessment was completed u/s 143(3) of the IT Act by making the following disallowances: a) Disallowance of claim u/s 80IB of the Act – Rs. 27,83,916/- b) Disallowance of payments made to land lords – Rs. 1,04,81,820/- c) Disallowance of cost of land - Rs. 6,97,125/- d) Disallowance of creditors for repairs & maintenance charges - Rs. 24,28,805/- 2 Sri Ram Constructions, Hyd.

At the outset, we find that the order of ld. CIT(A) was passed ex-parte without securing the presence of the assessee or its Authorised Representative. From the perusal of the order of ld. CIT(A), we find that he had merely reproduced the observations made by the ld. AO verbatim without giving his independent findings on various disallowances made. The ld. AR also stated before us that the said claims were very much allowed to the assessee by ld. CIT(A) in subsequent years. We, therefore, deem it fit and proper to remand the issue to the file of the ld. CIT(A) for de-novo adjudication on merits in accordance with law. Needless to mention that the assessee be given reasonable opportunity of being heard. We also direct the ld. CIT(A) to consider the subsequent years decisions passed by his predecessors while deciding the issue on merits. Accordingly, grounds raised by the assessee are treated as allowed for statistical purposes.

In the result, appeal of the assessee is allowed for statistical purposes. Pronounced in the open Court on 3rd September, 2020.