ITO, MUMBAI vs. VATIKA RAYONS PVT LTD., MUMBAI

ITA 2895/MUM/2025Status: DisposedITAT Mumbai05 September 2025AY 2014-15Bench: SHRI NARENDRA KUMAR BILLAIYA (Accountant Member), SHRI ANIKESH BANERJEE (Judicial Member)1 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) erred in deleting the addition made under Section 68. The Tribunal also found that the CIT(A) was not justified in considering interest income as business income and deleting expenses when no business activity was carried out.

What were the facts?

The Assessing Officer (AO) added Rs. 3,00,00,000/- to the assessee's income under Section 68 as forfeited share application money. The AO also disallowed certain expenses and added back interest income. The CIT(A) partly allowed the assessee's appeal.

What were the issues?

Whether the forfeited share application money is taxable under Section 68, and whether interest income and expenses are allowable when no business activity is conducted.

Which sections of the Income-tax Act were involved?

Section 68,Section 250,Section 143(3),Section 56

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Income Tax Appellate Tribunal, MUMBAI BENCH “F”, MUMBAI

Before: SHRI NARENDRA KUMAR BILLAIYA & SHRI ANIKESH BANERJEE

For Appellant: Shri Rasesh Shah
For Respondent: Shri Kavitha Kaushik (SR DR)
Hearing: 03/09/2025Pronounced: 05/09/2025

Per Anikesh Banerjee (JM):

The instant appeal of the revenue filed against the order of National Faceless Appeal Centre (NFAC), Delhi [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in shot, ‘the Act) for the Assessment Year 2014- 15, date of order 07/02/2025. The impugned order emanated from the order of the Learned Income-tax Officer, Ward 1(3)(4), Mumbai (in short, ‘the Ld.AO’) passed u/s 143(3), date of order 29/12/2016. 2 Vatika Rayons Pvt Ltd

2.

The brief facts of the case are that assessee is a domestic company. The Return of Income for the A.Y. 2014-15 was filed by the assessee on 26.09.

The order continues below.

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