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Income Tax Appellate Tribunal, “A’’BENCH: BANGALORE
Before: SHRI N.V. VASUDEVAN & SHRI B.R. BASKARAN
PER B.R. BASKARAN, ACCOUNTANT MEMBER:
The assessee has filed this appeal challenging the order dated 8.8.2019 passed by Ld. CIT(A)-7, Bengaluru and it relates to the assessment year 2016-17. The assessee is aggrieved by the decision of Ld. CIT(A) in passing the order ex-parte and dismissing the appeal of the assessee.
The appeal is barred by limitation by 141 days. The assessee has filed a petition explaining the reason for delay and also prayed for condoning the delay. In the petition, it is submitted that the assessee has since shifted its office and hence the order of Ld.
M/s. GMS Software Solutions, Bangalore
Page 2 of 4 CIT(A) was delivered to the security guard of the erstwhile business premises and the same was not intimated to the assessee by the landlord. When the penalty proceedings were completed by the A.O., the assessee came to know of the order passed by Ld. CIT(A). Thereafter, it has collected the order of Ld. CIT(A) from the landlord and filed the present appeal. The Ld. A.R. submitted that there was reasonable cause for the assessee in not filing appeal in time. Accordingly, he prayed that the delay may be condoned.
We heard Ld. D.R. on this preliminary issue and perused the record. Having regard to the submissions made in the affidavit by the assessee, we are of the view that there was reasonable cause for the assessee in not filing the appeal in time before the Tribunal. Accordingly, we condone the delay and admit the appeal for hearing.
The Ld. A.R. submitted that the assessee firm is engaged in the business of recruitment and supply of staffs predominantly to Information technology sector. He submitted that the return of income filed by the assessee was selected for limited scrutiny in order to verify the correctness of sales turnover/receipts offered to tax and also the claim of sales promotion expenses. Since the assessee did not furnish the details called for by the A.O., he disallowed the sales promotion expenditure of Rs.53,54,872/- and the same was confirmed by Ld. CIT(A). he Ld. A.R. submitted that the sales promotion expenditure actually represents discount given on the bills raised by the assessee against the software company. The Ld. A.R. invited our attention to the paper book and submitted that it has duly reconciled the receipts shown in form No.26AS with receipts declared in the profit & loss account. He submitted that a closure examination of these details would show that the sales
M/s. GMS Software Solutions, Bangalore
Page 3 of 4 promotion expenses represent discount given on fee charged by the assessee. He submitted that the assessee could not furnish the details before the tax authorities due to certain difficulties faced by it. Accordingly, the Ld. A.R. submitted that the assessee may be provided with an opportunity to present its case properly before the A.O.
We heard Ld. D.R. who strongly objected to the prayer put- forth by the assessee.
Having heard the rival submissions, in the interest of natural justice, we are of the view that the assessee may be provided with an opportunity to present its case before the A.O., since according to the Ld. A.R., it is a question of reconciliation of the receipts between Form 26AS and books of accounts. Accordingly, we set aside the order passed by ld. CIT(A) and restore all the issues to the file of the A.O. for examining them afresh. We also direct the assessee to fully cooperate with the A.O. in this regard.
In the result, the appeal filed by the assessee is treated as allowed for statistical purposes. Order pronounced in the open court on 4th Mar, 2022.