IL& FS RAIL LIMITED,GURUGRAM vs. DC/ACIT CENTRAL CIR-1, GURGAON, GURGAON

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘A’, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER And SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA Nos. 3427, 3428 and 3429/Del/2026 [Assessment Years: 2014-15, 2015-16 & 2016-17] IL & FS Rail Ltd. Vs DC/ACIT C/o IA India Accelerator Central Cir-1, Pvt. Ltd. Cabin No.C-17 Gurgaon 1st Floor, MGF Metropolis Mall, Mehrauli, Gurgaon Raod, Sector – 28, Gurugram, Sarhol, Haryana-122 002, Gurgaon PAN : AABCI 8621 F (APPELLANT) (RESPONDENT) Assessee by Shri Rahul Satija, Adv. Revenue by Shri Zafarul Haque Tanweer, CIT-D.R. Date of Hearing 05.08.2026 Date of Pronouncement 13.08.2026

ORDER PER NAVEEN CHANDRA [ACCOUNTANT MEMBER]: The above captioned three appeals are preferred by the assessee against the same order dated 28.01.2026, passed by Learned Commissioner of Income Tax (Appeals)-3, Gurgaon [hereinafter referred to as ‘ld. CIT(A)], under section 250 of the Income Tax Act, 1961 [hereinafter referred to as, ‘Act’] arising out of the separate assessment orders dated 30.12.2016, 23.03.2017 and 19.12.2018 passed by the DCIT, Circle-2, Gurgaon (hereinafter referred as ‘the AO’) u/s 143(3) of the Act for Assessment Years 2014-15, 2015-16 & 2016-17, respectively. 2. The assessee has raised identical grounds in all the appeals for AY 2014-15 to 2016-17. The grounds of appeal in ITA No.3427/Del/2026 for A.Y. 2014-15 is as under:

“1. Ground No. 1: 1.1. On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) [Ld. CIT(A)] erred in confirming the disallowance of subcontract charges amounting to Rs.20,18,00,000 under section 37 of the Income-tax Act, 1961 ('the Act') without appreciating the fact that such expenses were incurred wholly and exclusively in the course of business activities. 1.2. The appellant prays before Your Honour that the disallowance of expenses of Rs 20,18,00,000 be deleted. 2. Ground No. 2: 2.1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in confirming the addition made by the Learned Assessing Officer [Ld. AO] wherein the addition was made without disclosing the material or evidence relied upon and merely on the basis of the statement of Mr. Sanjay Drolia. The appellant was not provided an opportunity to cross-examine Mr. Sanjay Drolia despite the addition being based on his statement. 2.2. The action of the Ld. CIT(A) in confirming the addition without granting such opportunity is in violation of the principles of natural justice and is therefore unsustainable in law. Hence, the appellant prays before Your Honour that the addition so sustained be deleted.

3.1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in disregarding the explanations provided by Mr. Sanjay Drolia in his statement recorded on 23.12.2016 and in selectively relying on earlier statements as well as parts of the statement recorded on 23.12.2016, thereby wrongly disallowing the claim of subcontract expenditure amounting to Rs 20,18,00,000. 3.2. The appellant, therefore, respectfully prays before Your Honour that the disallowance of Rs 20,18,00,000 be deleted. 4. Ground No. 4: 4.1. On the facts and in the circumstances of the case and in law, Ld. CIT(A) erred in confirming the addition of Rs 10,09,000 made by the Ld. AO solely on the assumption that the appellant had paid commission for obtaining accommodation entries from M/s. Silver Point Infratech Ltd. 4.2. The appellant submits that no income can be brought to tax merely on the basis of assumptions and surmises without any concrete proof. The appellant therefore prays before Your Honour that the addition so sustained by the Ld. CIT(A) is arbitrary and unsupported by any evidence on record and hence should be deleted 5. Ground No. 5: 5.1. On the facts and in the circumstances of the case and in law Ld. CIT(A) erred in affirming the levy of interest under section 234A amounting to Rs 6,70,306. The appellant had filed the return of income within the due date prescribed under the provisions of the Act, and, therefore, is not liable for payment of interest under section 234A. 5.2. The appellant prays before Your Honour that the levy of interest under section 234A is unjustified and hence should be deleted. 6. Ground No. 6: 6.1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in affirming the levy of interest under section 234B amounting to Rs 1,10,60,049. 6.2. The appellant states that the levy of interest under section 234B of the Act will be consequential to determination of aforesaid grounds in appeal. The above grounds of appeal are without prejudice to each other. The Appellant craves leave to add, alter, amend, substitute and/or modify in any manner whatsoever all or any of the foregoing grounds of appeal at or before the hearing of the appeal.”

Order was pronounced in the open court on 13.08.2026.

Sd/- Sd/- (SATBEER SINGH GODARA) (NAVEEN CHANDRA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 13.08.2026 Priti Yadav, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi

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