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Facts
The Assessee appealed against a CIT(A) order for AY 2006-07, challenging disallowances of expenses and depreciation, incorrect demand calculation, and alleged violation of natural justice. During the proceedings, the Assessee opted for the Vivad Se Vishwas Scheme-2024.
Held
The Income Tax Appellate Tribunal dismissed the appeal as withdrawn, noting that the Assessee had chosen to resolve the dispute under the Vivad Se Vishwas Scheme-2024. The dismissal includes a liberty to restore or revive the appeal if the VSV application does not materialize or is not accepted by the department.
Key Issues
Key legal issues involved challenges to disallowances of expenses and depreciation, incorrect demand, and violation of natural justice, though the appeal was ultimately dismissed as withdrawn due to the Assessee opting for the Vivad Se Vishwas Scheme-2024.
Sections Cited
143(3), 254, 32
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “C” BENCH MUMBAI
Before: SMT. BEENA PILLAI & SHRI GIRISH AGRAWAL
O R D E R
PER GIRISH AGRAWAL, ACCOUNTANT MEMBER:
This appeal filed by the Assessee is against the order of Ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi, vide order no. ITBA/NFAC/S/250/2024-25/1066368031(1), dated 03.07.2024, passed against the assessment order by National e-Assessment Centre, Delhi, u/s. 143(3) r.w.s. 254 of the Income-tax Act (hereinafter referred to as the “Act”), dated 26.04.2021 for Assessment Year 2006-07.
Grounds taken by the assessee are reproduced as under: “1.0 Re: The Commissioner of Income tax (Appeal) ('CIT(A)') concluded the proceedings by merely upholding Learned Assessing Officer's (L.d.AO) action without considering the submission made by the Appellant 1.1 The CITIA) has emed in not considering the submission dated 18 June 2024 although it has referred to another letter dated 18 June 2024 filed in relation to additional evidence.
1.2 The CIT(A) has completely ignored the above submission and concluded the proceedings alleging that no submission was made bill the date of its order.
2.0 Re: Disallowance of expenses on ad-hoc basis being 5% of the total expense of INR 15:47.02.015-INR 77,35,100 2.1 The CIT (AV Ld. AO has erred in making an ad-hoc disallowance of INR 77,35,100 being 5% of the expenses of INR 15,47,02,015 incurred by the Appellant 2.2 The Appellant submits that considering the facts and circumstances of the case and the law prevailing on the subject, the ad-hoc disallowance of expenses of INR 77,35, 100 incurred wholly and exclusively for the purpose of business and the action of the CIT (A) and Ld. AO in this respect is erroneous, misconceived and not in accordance with the law 2.3 The Appellant prays that the Ld. AO be directed to delete the aforementioned disallowance so made by him and to re-compute the Appellant's total income accordingly 3.0 Re.: Disallowance of depreciation on addition to the fixed assets - INR 49,55,280 3.1 The CIT(A)/Ld AO has erred in disallowing part of the depreciation claimed on the fixed assets for additions made during the aforesaid year 3.2 The Appellant submits that considering the facts and circumstances of the case and the law prevailing on the subject, the disallowance of part of depreciation under section 32 of the Act in respect addition made to fixed asset and the action of the CIT (A) and Ld. AO in this respect is erroneous, misconceived and not in accordance with the law.
3.3 The Appellant prays that the Ld. AO be directed to allow the part depreciation claimed by the Appellant and to re-compute the Appellant's total income accordingly.
4.0 Re: Non-consideration of relief granted by CIT(A) in respect of depreciation on feeder lines -INR 25,85,435 4.1 The CIT(A) Ld. AO during remand proceeding erred in not considering relief granted by CIT(A) in first round of proceedings vide its order dated 28 January 2011 allowing depreciation on feeder lines of INR 25.65,435.
4.2 The Appellant submits that considering the facts and circumstances of the case and the law prevailing on the subject, the disallowance of depreciation on feeder lines despite relief provided by CIT(A) is erroneous, misconceived and not in accordance with the law.
4.3 The Appellant prays that the Ld. AO be directed to grant relief already provided by CIT(A) vide order dated 28 January 2011 and re-compute the Appellant's total Income accordingly.
5.0 Re: Incorrect raising of demand amounting to INR 63,44,692 5.1 The CIT(A) has erred in upholding the calculation of demand of INR 63,44,692 done by the Ld. AO without any basis.
5.2 The Appellant submits that considering the facts and circumstances of the case, the Ld. AO ought to have appreciated that the disallowances made by him were already given effect to by the earlier order of the AO and there being set off of brought forward losses of earlier years towards the income of the year under consideration there could be no demand on account of these adjustments.
5.3 The Ld. AO has calculated and raised a demand of INR 63,44,692 after arriving at NIL income. This is because a refund of INR 64,70,687 was already issued to the Appellant. However, the Ld. AO erred in not considering advance tax credit of INR 45,00,000 and TDS credit of INR 51,10,673 claimed in the Income tax return while computing tax.
5.4 The Appellant further submits that the Ld. AO be directed to re-compute the tax liability accordingly.
6.0 Re: Violation of Principles of Natural Justice 6.1 The Ld. AO erred in concluding remand proceeding under section 143(3) r.w.s 254 of the Act without providing adequate time to collate the details and file the submissions.
6.2 The CIT(A) erred in concluding appeal proceeding without considering the detailed written submission filed by the Appellant.
6.3 The CIT(A) erred in not granting opportunity of being heard by virtual conference in respect of above grounds of appeal despite the specific request made by the Appellant in its submission dated
18. June 2024.
6.4 The Appellant submits that considering the facts and circumstances of its case and the law prevailing on the subject, the action of the CIT (A) and Ld. AO in this respect is erroneous, misconceived and not in accordance with the law.
7.0 Re.: General:
7.1. The Appellant craves leave to add, alter, amend, substitute and/or modify in any manner whatsoever all or any of the foregoing grounds of objections at or before the hearing of the appeal.”
Assessee has placed on record a written submission dated 10.03.2025, wherein it has opted to resolve the dispute in this appeal Owens-Corning (India) Pvt. Ltd.; AY 2006-07 under Vivad Se Vishwas Scheme-2024’ (VSV, 2024 scheme). Assessee has filed Form-1 dated 31.01.2025 against which the designed authority has issued a certificate in Form-2 determining tax refund position, under the scheme.
Considering these facts on record and assessee having paid the demand as required under the said scheme, we find it appropriate to dismiss the appeal as withdrawn, pursuant to the option availed by assessee for resolving the dispute in this appeal under VSV, 2024. Accordingly, appeal of the assessee is dismissed with a liberty to restore / revive the appeal, in case the application for ‘Vivad Se Vishwas Scheme-2024’ do not materialize or is not accepted by the department.
In the result, appeal of the assessee is dismissed.
Order is pronounced in the open court on 17 March, 2025