HEALTH CARE AT HOME INDIA PRIVATE LIMITED,DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 10(1), C. R. BUILDING, DELHI, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘E’, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER And SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER ITA No. 8597/Del/2025 [Assessment Year : 2018-19] Health Care at Home India Vs DCIT Pvt. Ltd. Circle – 10(1) 4th Floor, Punjabi Bhawan C. R. Building 10, Rouse Avenue, Delhi – 1100 02 Delhi – 110 002 PAN : AADCH 0248 R (APPELLANT) (RESPONDENT) And ITA No. 8968/Del/2025 [Assessment Year : 2018-19] ACIT Vs Health Care at Home India Pvt. Circle – 10(1) Ltd. 4th Floor, Punjabi Bhawan C. R. Building Delhi – 1100 02 10, Rouse Avenue, Delhi PAN : AADCH 0248 R (APPELLANT) (RESPONDENT) Assessee by Shri Saujoli Maheshwari, C.A., Shri Amit Arora, C.A. and Ms. Manika Kausal, C.A. Revenue by Shri Ravi Kant Choudhary, Sr. D.R Date of Hearing 20.05.2026 Date of Pronouncement 04.06.2026 ORDER PER NAVEEN CHANDRA [ACCOUNTANT MEMBER]:

ITA Nos.8597 & 8968/Del/2025 Health Care at Home India Pvt. Ltd. vs. DCIT (A.Y. 2018-19) The above captioned cross appeal are preferred by the assessee as well as by the Revenue against the order dated 21.10.2025, passed by Learned Commissioner of Income Tax (Appeals)/NFAC, Delhi [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 order dated 13.09.2021, passed under Section 143(3) read with section 144B of the Act, for the assessment year 2018-19, by the Assessing Officer, National Faceless Assessment Centre, Delhi. 2. Since the above captioned cross appeals were heard together and the facts in issues are identical, both the appeals are being disposed of by this common order for the sake of convenience and brevity. 3. Brief facts of the case are that the assessee is a private limited company, engaged in providing health care services to patients at home. For the A.Y. 2018-19, the assessee filed its Return of Income (“ROI”) on 27.10.2018 declaring a loss of Rs.31,25,46,980/-. The case of assessee was selected for scrutiny under CASS and a notice under section 143(2) of the Act, was issued. Thereafter, notices were issued and submissions were made by the assessee furnishing information and documents as requested by the learned AO. The Learned Assessing Officer completed assessment under section 143(3) read with section 144B of the Act at a business loss of Rs. 28,84,04,819/- after making a

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ITA Nos.8597 & 8968/Del/2025 Health Care at Home India Pvt. Ltd. vs. DCIT (A.Y. 2018-19) disallowance regarding sales promotion expenses amounting to Rs.2,41,42,161/- being 30% of the total expense of Rs 8,04,73,870/- incurred. The Ld. AO has also disallowed the capital expenditure incurred on Intangible assets amounting to Rs.2,32,61,259/- under section 69C of the Act and made an addition of the amount to the total income of the assessee. 4. Aggrieved assessee was in appeal before the learned CIT(A). The learned CIT(A) gave part relief sales promotion expenses and deleted the addition u/s 69C. Aggrieved by the order of CIT(A), assessee is now in appeal before us with the following grounds: “1. That on the facts and circumstances of the case and in law, the Ld. AO/Ld. CIT(A) grossly erred in upholding the ad-hoc disallowance of 15% of sales promotion expenditure amounting to INR 1,20,71,000. 2. That on the facts and circumstances of the case and in law, the Ld. AO/ Ld. CIT(A) erred in sustaining the impugned ad-hoc disallowance of 15% of the Sales Promotion Expenses on the unfounded premise that a 'complete and verifiable nexus' for all categories of expenditure was not established, despite acknowledging the original disallowance of 30% as excessive and accepting the detailed submissions and evidentiary material duly placed on record by the Appellant. 3. That while doing so, the Ld. AO/ Ld. CIT(A) erred by not providing cogent reasoning, any specific defect, irregularity in the books of account or in the supporting documents placed on record thereby making the partial sustenance of such disallowance purely arbitrary and contrary to the settled principles of law. 4. That on the facts and circumstances of the case and in law, the Ld. AO/ Ld. CIT(A) failed to appreciate that an expenditure incurred wholly and exclusively for the purposes of the business of the Appellant is allowable in terms of Section 37(1) of the Act and has consequently erred in not granting the full deduction of the sales promotion expenditure, despite the same being duly established as business-related. 5. That while doing so, the Ld. AO/ Ld. CIT(A) failed to take cognizance of the fact that the Appellant had furnished comprehensive

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ITA Nos.8597 & 8968/Del/2025 Health Care at Home India Pvt. Ltd. vs. DCIT (A.Y. 2018-19) documentary evidence demonstrating the incurrence, business purpose, and genuineness of the expenditure for the same to be deductible/allowable in terms of Section 37(1) of the Act and the same does not require a one-to-one correlation between each item of expenditure and establishing direct nexus with the specific business outcome; thereby making the ad-hoc disallowance arbitrary and not tenable as per the law. 6. That on the facts and circumstances of the case and in law, the Ld. AO/ Ld. CIT(A) erred in considering the disallowance merely on basis of presumptions and trying to step into shoes of businessman for commercial expediency, without appreciating the business model and business requirements of the Assessee. The Appellant craves leave to add to or alter, by deletion, substitution or otherwise, any or all of the foregoing grounds of appeal at or before the hearing, and to submit such statements, documents and papers as may be considered necessary either at or before the appeal hearing.”

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ITA Nos.8597 & 8968/Del/2025 Health Care at Home India Pvt. Ltd. vs. DCIT (A.Y. 2018-19) the fact remains that the assessee could not establish a complete and verifiable nexus for certain categories of expenditure such as hospitality, client interactions and event related expenditure. On the other hand, the Revenue’s endeavour to disbelieve the explanation in entirety is also not justified. In this factual matrix, there is some element of failure to explain some of the expenditure, cannot be ruled out. Be that as it may, it is deemed appropriate, in larger interest of justice, that a lump-sum addition of 5% of the total expenditure on sales promotion of Rs 8,04,73,870/- only would be just and proper with a rider that the same shall not be treated as a precedent, so as to cover all loopholes. The ground of appeal no 1 to 6 is partly allowed. ITA No.8968/Del/2025 :

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ITA Nos.8597 & 8968/Del/2025 Health Care at Home India Pvt. Ltd. vs. DCIT (A.Y. 2018-19) 9. We further find that it is an unrebutted fact that the entire expense on intangible asset are recorded in books of account and supported by documents/evidences. We find that the AO has not brought any evidence to show that expenditure on intangible assets were not recorded in books or no explanation has been furnished by the assessee. In such facts and circumstances, the additions made under section 69C is not justified. We are therefore of the considered view that no interference is called for to disturb the decision of the CIT(A) on this issue. Grounds are dismissed.

Order was pronounced in the open court on 04.06.2026.

Sd/- Sd/- (SATBEER SINGH GODARA) (NAVEEN CHANDRA) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 04.06.2026 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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