ITC INFOTECH INDIA LIMITED,KOLKATA vs. DCIT, CIRCLE 1(1),, KOLKATA

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ITA 2942/KOL/2025Status: DisposedITAT Kolkata16 July 2026AY 2021-20223 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the payments made during the year were allowable deductions under Section 43B, as certified by the tax auditor. The CIT(A)'s reasoning regarding the merger of orders was found to be incorrect.

What were the facts?

The assessee claimed deductions under Section 43B for payments made during the financial year, which were disallowed by the AO in the intimation under Section 143(1). The assessee's rectification application and subsequent appeal to the CIT(A) were rejected.

What were the issues?

Whether payments made during the financial year, disallowed in earlier years for non-payment, are allowable deductions under Section 43B. Whether the CIT(A) correctly dismissed the appeal based on the merger of orders.

Which sections of the Income-tax Act were involved?

Section 43B,Section 143(1),Section 154,Section 143(3),Section 144B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, KOLKATA ‘B’ BENCH, KOLKATA

Before: SHRI RAJESH KUMAR & SHRI PRADIP KUMAR CHOUBEY

For Appellant: Shri J. P. Khaitan, Sr. AR and Shri Bikash
For Respondent: Shri Sanjit Kumar Das, CIT-DR
Hearing: 06.07.2026Pronounced: 16.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘B’ BENCH, KOLKATA BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER I.T.A. No.2942/KOL/2025 Assessment Year:(2021-22) ITC Infotech India Limited, DCIT, Virgina House, 37, J. L. Nehru Vs. Circle -1(1), Road, Kolkata – 700071, Kolkata West Bengal [PAN: AAACI7376Q] (Appellant) .. (Respondent) Appellant by : Shri J. P. Khaitan, Sr. AR and Shri Bikash Chanda, AR Respondent by: Shri Sanjit Kumar Das, CIT-DR Date of Hearing 06.07.2026 Date of Pronouncement 16.07.2026 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: This appeal is preferred by the assessee against the order of the Learned Addl./Joint Commissioner of Income Tax (Appeals), Kochi (hereinafter referred to as the “Ld. JCIT(A)”], dated 03.10.2025 for the Assessment Year (AY) 2021-22.

2.

The only issue raised by the learned Authorized Representative (ld. AR) of the assessee during the course of hearing is against the order of ld. CIT(A) upholding the order passed by the Assessing Officer (In short, ‘the AO’) u/s 154 of the Income-tax Act, 1961 (In short, ‘the Act’), which in turn arises from the intimation passed u/s 143(1) of the Act wherein payments covered u/s 43B of the Act aggregating to Rs.11,25,44,273/- were not allowed despite the fact that the same were paid during the financial year and duly reported by the tax auditor in the tax audit report.

ITA No.2942/Kol/2025/A.Y. 2021-22 ITC Infotech India Ltd. vs. DCIT 3. The facts of the case in brief are that the assessee filed its return of income on 31.03.2022, declaring total income of Rs.597,52,93,915/-, which was processed by the AO, CPC u/s 143(1) of the Act wherein the AO disallowed the impugned claim by the assessee u/s 43B of the Act of Rs.11,25,44,273/- despite the fact that in the tax audit report, the tax auditor has stated the same to be allowable in para 10 of the tax audit report. We note that the said ground comprises of Rs.8,25,74,086/- in respect of bonus paid during the year, Rs.71,09,943/- in respect of miscellaneous items and Rs.2,08,60,243/- on account of leave encashment claim. The assessee moved a rectification application against the said order of the AO u/s 143(1) of the Act, but the same was rejected. The assessee filed an appeal before the ld. CIT(A) and the ld. CIT(A) also dismissed the appeal of the assessee by noting that rectification order against which the present appeal has been filed has merged with the subsequent assessment order dated 26.12.2023 passed u/s 143(3) r.w.s. 14B of the Act and thus, the present appeal against the rectification rejection order dated 15.11.2022 is treated as infructuous and hence dismissed.

4.

After hearing the rival submissions and perusing the materials available on record, we note that the assessee has disallowed three items in the earlier assessment years on account of non-payments u/s 43B of the Act. We note that these items were paid during the year and accordingly, the assessee claimed the deduction in terms of section 43B of the Act. We also note that the tax auditors have also reported the same to be related to the previous assessment years, which were disallowed earlier but allowable during the year as the same were paid during the year. We, further observe from the assessment order that the assessment order dated 26.12.2023 passed u/s 143(3) r.w.s. 144B of the Act that the income has been assessed by taking the income as order passed u/s 143(1) of the Act at Rs.6,08,78,38,190/- and therefore, the objection of ld. CIT(A) with regards to the intimation u/s 143(1) of the Act having been merged with the assessment order is not correct and cannot be accepted so far as the payments made u/s 43B are concerned. In our opinion, the AO has not dealt with the said disallowances made

ITA No.2942/Kol/2025/A.Y. 2021-22 ITC Infotech India Ltd. vs. DCIT by the AO, CPC while faming the assessment. Therefore, the assessee is legitimately entitled to challenge in appeal before the ld. CIT(A), which is filed against the rectification order passed by the AO.

5.

It is also undisputed that these payments were disallowed in earlier years for non-payment in terms of section 43B of the Act. We note that during the year, assessee has made payments in respect of three items and accordingly, claiming the same as deduction is correct , which have also been certified by the tax auditor in the tax audit report. Accordingly, we set-aside the order of ld. CIT(A) on this issue and direct the AO to delete the disallowances made. The appeal of the assessee is allowed.

6.

In the result, the appeal of the assessee is allowed.

The order is pronounced in the open Court on 16/07/2026.

Sd/- Sd/- (Pradip Kumar Choubey) (Rajesh Kumar) JUDICIAL MEMBER ACCOUTANT MEMBER Kolkata, Dated: 16/07/2026 SAMANTA आदेश �ȧ ĤǓ�ͧ �ͪ �\ Ē ȯͪ��/Copy of the Order forwarded to: \ �Ȣ�ȡ�ȸ/ The Appellant 1. 2. Ĥ×��ȸ/ The Respondent. 3. Ȳ�Ȳͬ��आयकर] �ǕÈ�/ Concerned CIT 4. आयकर] �ǕÈ�(अपील) / The CIT(A) 5. ��ȡ�Ȣ�ĤǓ�Ǔ�ͬ �, आयकर\ �Ȣ�ȣ�\ͬ ����,/ DR, ITAT, Kolkata 6. �ȡ�[ फाईल/ Guard file.

BY ORDER, // TRUE COPY // Asstt.Registrar, ITAT, Kolkata

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