N.A.SPORTZ INTERACTIVE PRIVATE LIMITED,GOREGAON EAST, MUMBAI vs. MUM-C-(923)(1), CPC, AAYKAR BHAVAN, MUMBAI

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ITA 6337/MUM/2024Status: DisposedITAT Mumbai30 January 2025AY 2022-23Bench: SHRI B R BASKARAN, ACCOUNTANT MEMBER SHRI SANDEEP SINGH KARHAIL (Judicial Member)1 pages
AI SummaryAllowed for statistical purposes

What did the Tribunal hold?

The Tribunal restored the issue to the Assessing Officer for de novo adjudication. If verification confirms that the disallowances were already made in the return, the addition to that extent should be deleted to avoid double addition. The issue regarding interest under Section 234C was also restored.

What were the facts?

The assessee company filed its return of income which was processed under Section 143(1) of the Act. The CPC made an addition of Rs. 76,81,191, which the assessee claimed was a double addition as similar disallowances were already made in the return. The assessee's rectification application and subsequent appeal to CIT(A) were dismissed.

What were the issues?

Whether the addition made by the CPC under Section 143(1) resulted in a double addition, and whether interest under Section 234C was correctly levied.

Which sections of the Income-tax Act were involved?

Section 250,Section 143(1),Section 154,Section 37,Section 234C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH, MUMBAI

Before: SHRI B R BASKARANSHRI SANDEEP SINGH KARHAIL

For Appellant: Shri Ashok Bansal
For Respondent: Ms. Monika H. Pande, Sr.DR

Date of Hearing – 29/01/2025 Date of Order - 30/01/2025

O R D E R PER SANDEEP SINGH KARHAIL, J.M.

The assessee has filed the present appeal against the impugned order dated 28/09/2024, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [“learned CIT(A)”], for the Assessment Year 2022-23.

2.

In the interest of justice, the slight delay of 4 days in filing the present appeal is condoned.

3.

In this appeal, the assessee has raised the following grounds: - “

1. The learned authorities below have erred in not rectifying the apparent mistake of making additions in intimation u/s 143(1) aggregating to Rs. 76,81,191 to the appellant's income on the basis of Tax Audit Report, without appreciating the fact that the appellant has already made disallowances in the return filed.

2. Without prejudice. consequent to making additions, the CPC has erred in increasing the interest u/s. 234C from Rs. 5,86,856 to Rs. 6,88,487 without appreciating that section 234C interest is qua returned income only.”

4. The issue arising in ground no.1, raised in assessee’s appeal, pertains to a double addition made vide intimation issued under section 143(1) of the Act.

5. We have considered the submissions of both sides and perused the material available on record. The brief facts of the case are that the assessee is a company engaged in providing online sports content. For the year under consideration, the assessee filed its return of income on 31/10/2023 declaring a total income of INR 27,81,07,960. The return filed by the assessee was processed vide intimation dated 29/07/2023 issued under section 143(1) of the Act assessing the total income of the assessee at INR 28,57,89,150 after making total addition of INR 76,81,191. The addition to the total income comprises of the following: – (i) MSME interest of INR 2,581 disallowed under section 37 of the Act (ii) Gratuity paid of INR 12,45,659 (iii) Employee contribution to PF of INR 8765 (iv) Statutory bonus of INR 9,29,841 (v) Gratuity of INR 54,94,345

6.

Being aggrieved, the assessee filed a rectification under section 154 of the Act, however, DDIT, Centralised Processing Centre, Bengaluru, rejected the rectification request. In appeal against the rectification order dated 27/02/2024 passed under section 154 of the Act, the assessee submitted before the learned CIT(A) that the aforesaid addition of INR 76,81,191 made vide intimation issued under section 143 (1) of the Act was already added by the assessee in its return of income, and therefore, the impugned addition has resulted in double addition in the hands of the assessee. The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee on the basis that the issue was a controversial issue which is beyond the provision of section 154 of the Act. Being aggrieved, the assessee is in appeal before us.

7.

During the hearing, the learned AR reiterated the submissions made before the lower authorities and submitted that the CPC Bengaluru erred in making the addition of INR 76,81,191 without appreciating the fact that the assessee already made the aforesaid disallowances and added the same to its income while filing its income tax return.

8.

On the other hand, the learned DR submitted that this issue requires verification at the end of the Assessing Officer.

9.

Therefore, having considered the submissions of both sides and perused the material available on record, we deem it appropriate to restore this issue to the file of the Jurisdictional Assessing Officer for de novo adjudication after necessary verification/examination of the income tax return and computation of income filed by the assessee. We further direct that if upon verification it is found that the assessee has already made the disallowances in its return of income, which have been made vide intimation issued under section 143(1) of the Act, then the addition to that extent be deleted as otherwise the same would result in double addition in the hands of the assessee. With the above directions, the impugned order on this issue is set aside and ground no.1 raised in assessee’s appeal is allowed for statistical purposes.

10.

Since we have restored the issue raised in ground no.1 to the file of the Jurisdictional Assessing Officer, ground no.2, raised in assessee’s appeal, pertaining to the levy of interest under section 234C of the Act is also restored to the file of the Jurisdictional Assessing Officer for decision as per law. As a result, ground no.2 raised in assessee’s appeal is allowed for statistical purposes.

11.

In the result, the appeal by the assessee is allowed for statistical purposes. Order pronounced in the open Court on 30/01/2025

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