INFOSYS LIMITED (SUCCESSOR TO SKAVA SYSTEMS PRIVATE LIMITED),BENGALURU vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 3(1)(1), BANGALORE, BENGALURU

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ITA 879/BANG/2026Status: DisposedITAT Bangalore29 June 2026AY 2021-223 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal condoned the delay in filing the appeal, considering the voluntary liquidation proceedings of the erstwhile company. The Tribunal set aside the CIT(A)'s order and directed it to decide the issue on merits.

What were the facts?

The assessee's return was processed, and interest under section 234C was computed at a higher amount than initially calculated. The assessee filed a rectification application, and the interest was recomputed, but the appeal against this recomputation was dismissed by the CIT(A) due to a significant delay.

What were the issues?

Whether the delay in filing the appeal due to company liquidation proceedings is a sufficient cause for condonation, and whether the CIT(A) should have decided the appeal on merits.

Which sections of the Income-tax Act were involved?

Section 234C,Section 154

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘A’ BENCH : BANGALORE

Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K.

For Appellant: Shri Padam Chand Khincha, CA
For Respondent: Shri N. Balusamy, JCIT-DR

IN THE INCOME TAX APPELLATE TRIBUNAL ‘A’ BENCH : BANGALORE

BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER

ITA No. 879/Bang/2026 Assessment Year : 2021-22

M/s. Infosys Ltd., (Successor to Skava The Deputy Systems Pvt. Ltd.), Commissioner of Plot No. 44, Income Tax, Electronic City, Circle – 3(1)(1), Hosur Road, Bangalore. Vs. Bengaluru – 560 100. PAN: AAACI4798L

APPELLANT RESPONDENT

Assessee by : Shri Padam Chand Khincha, CA Revenue by : Shri N. Balusamy, JCIT-DR

Date of Hearing : 26-05-2026 Date of Pronouncement : 29-06-2026 ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER

This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 22/12/2025 in respect of the A.Y. 2021-22.

2.

The brief facts of the case are that the assessee is in the business of software development and filed their return of income on 10/02/2022. The return was also processed u/s. 143(1) on 06/07/2022. In the said intimation, the CPC computed the interest liability u/s. 234C as Rs. 1,06,78,496/- instead of the interest calculated by the assessee at Rs.

Page 2 of 3 ITA No. 879/Bang/2026 1,15,593/-. Therefore the assessee filed an application u/s. 154 of the Act for recomputing the interest. The Ld.CPC considered the rectification application and recomputed the interest at Rs. 19,31,633/-. The assessee challenged the said recomputation before the Ld.CIT(A) with a delay of 472 days. The Ld.CIT(A) not accepted the reasons for the delay and dismissed the appeal on the ground of limitation.

3.

As against the said order, the assessee filed the present appeal before this Tribunal.

4.

At the time of hearing, the Ld.AR submitted that the erstwhile company M/s. Skava Systems Pvt. Ltd. went into voluntary liquidation during the year 2019. The Ld.AR further submitted that the liquidation proceedings were completed on 14/11/2024. The Ld.AR further submitted that only when the liquidation process was going, the excess levy of interest was noticed and thereafter the appeal was filed with a delay of 472 days and prayed to condone the said delay.

5.

The Ld.DR submitted that the pendency of the liquidation proceedings would not be a sufficient cause to condone the delay and prayed to dismiss the appeal.

6.

We have heard the arguments of both sides and perused the materials available on record.

7.

As seen from the facts and also the documents filed by the assessee, we noticed that the voluntary liquidation proceedings commenced in the year 2019 and ended in the year 2024. Therefore there is every possibility that the assessee might not have noticed the section 154 order. Moreover, the liquidator also appointed and therefore he might have missed to notice the communication sent by the revenue. In such circumstances, we are of the view that the reason stated by the assessee may be a genuine one. Further, the dispute on merits is the quantification of interest only.

Page 3 of 3 ITA No. 879/Bang/2026 Therefore the correct levy of interest has to be collected by the revenue. Therefore, the mater requires reconsideration on merits.

8.

We, therefore, set aside the order of the Ld.CIT(A) and direct the Ld.CIT(A) to decide the issue on merits after affording a reasonable opportunity of being heard to the assessee.

9.

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

Order pronounced in the open court on 29th June, 2026.

Sd/- Sd/- (WASEEM AHMED) (SOUNDARARAJAN K.) Accountant Member Judicial Member

Bangalore, Dated, the 29th June, 2026. /MS /

Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order

Assistant Registrar, ITAT, Bangalore

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