AES ORISSA DISTRIBUTION PRIVATE LIMITED,BHUBANESWAR vs. DCIT, CIRCLE-2(1), BHUBANESWAR

आयकर अपीऱीय अधिकरण, कटक न्यायपीठ,कटक IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI N.S.SAINI, AM & SHRI PAVAN KUMAR GADALE, JM ITA No.256/CTK/2014 (नििाारण वषा / Assessment Year :2014-2015) AES Orissa Distribution Private Vs. DCIT, Circle-2(1), Limited, Bhubaneswar HIG-4, BDA Colony, Jayadev Vihar, Bhubaneswar-751013 स्थायी लेखा सं./जीआइआर सं./ PAN/GIR No. : AACCA 6658 H (अऩीलाथी /Appellant) (प्रत्यथी / Respondent) .. ननधाारिती की ओर से /Assessee by : Shri B.K.Mahapatra, AR िाजस्व की ओर से /Revenue by : Shri D.K.Pradhan, DR सुनवाई की तािीख / Date of Hearing : 10/05/2018 घोषणा की तािीख/Date of Pronouncement 14/05/2018 आदेश / O R D E R Per Shri Pavan Kumar Gadale, JM: This is an appeal filed by the assessee against the order of CIT(A)- 1, Bhubaneswar, dated 31.03.2017, passed in I.T.Appeal No.0249/16-17, for the assessment year 2014-2015. 2. The assessee has raised the sole substantive ground that the CIT(A) has sustained the addition of other current liabilities of AES India Pvt. Ltd. Rs.7,75,140/-. 3. Brief facts of the case are that the assessee is engaged in the business of power distribution, development of power projects and management services and filed the return of income electronically on 30.09.2014 for the assessment year 2014-2015 with total loss of Rs.70,13,200/-. Subsequently, the case was selected for scrutiny under CASS and notice u/s.143(2) and 142(1) of the Act along with

2 ITA No.256/2017 questionnaire was issued to the assessee. Since there was no compliance by the assessee, the AO based on the information available on record and dealt on the provisions of Section 145(3) of the Act made the best judgment assessment under provisions of Section 144 of the Act and made addition in respect of share application money and other current liabilities and assessee the total income of Rs.47,17,55,680/- and passed the order u/s.144 r.w.s143(3) of the Act, dated 30.11.2016. 4. On appeal before the CIT(A), ld. AR argued the grounds and reiterated the submissions. Ld. CIT(A) having considered the submissions of the assessee and findings of AO has granted relief by deleting the addition made in respect of share application money which is carry forward balance from earlier years and also investments represent related to the earlier years and whereas in respect of other current liabilities the CIT(A) observed in para 6.2 of the order and restricted the addition of other current liabilities at Rs.7,75,140/- and partly allowed the appeal of the assessee. The observation of the CIT(A) at para 6.2 is as under :- “6.2 I have considered the matter. It is clear from the copies of audited accounts for the FYs 2013-14 & 2014-15 that the ‘other current liabilities’ of Rs.3,31,81,800/- disclosed in the balance sheet as on 31.3.2014 include an amount of Rs.3,24,05,860/- which has been brought forward from the balance sheet as on 31.3.2013. The assessee’s plea is that no addition u/s.68 can be made for the AY 2014-15 for liabilities which existed prior to 1.4.2013. The contention of the assessee appears to be correct. The AO having jurisdiction over the assessee at present i.e. the DCIT, Cirlce-1(1), Bhubaneswar who was present at the time of appeal hearing could not object to the contention of the assessee that no addition could be made in the assessment for the AY 2014-15 of the other current liabilities to the extent of Rs.3,24,05,860/-. The AO sub mitted that because the assessment was completed ex part y/s.144, the correct fact were probably not noticed. Keeping in view the facts of the case, out of the total addition of Rs.3,31,81,000/- an amount of Rs.3,24,05,860/- is deleted. So far as the balance liability created

3 ITA No.256/2017 during the current year is concerned, addition for the same is confirmed since the Assessee had not produced the details thereof with supporting bills & vouchers in the course of assessment. “ 5. Aggrieved by the appellate order the assessee has filed appeal before the Tribunal. Before us, ld. AR of the assessee argued the grounds and submitted that other current liabilities represent the amount payable to M/s AES India Pvt. Ltd. which is parent company and the identity and creditworthiness of the transaction cannot be doubted and the action of the CIT(A) in sustaining the addition is contrary to law. Ld. AR emphasized that the assessee has filed detailed information in respect of liabilities and which was overlooked and ld. CIT(A) has restricted the addition and the ld. AR filed paper book to substantiate the claims. 6. Contra, ld. DR relied on the order of AO. 7. We have heard rival submissions and perused the material available on record. The sole substantive ground raised by ld. AR that the CIT(A) has sustained Rs.7,75,140/- under the provisions of Section 68 of the Act. Ld. AR demonstrated before us referring to the paper book ledger account and the copy of AES India Pvt. Ltd. and audited accounts where the facts have been reflected. The ld. AR drew our attention to the page 11 of the paper book where other current liabilities disclosed at Note 5 as payable to related parties M/s AES India Pvt. Ltd. of Rs.33,181.110 and also referred to the ledger account, copy of transactions between the assessee company and parent company. The company M/s AES India Pvt. Ltd has incurred these expenditure on behalf of the assessee company and supported its claim with the documents and prayed that an

4 ITA No.256/2017 opportunity be provided to explain below lower authorities. We considering the overall aspects and circumstances are of the opinion that these transaction between the assessee company and M/s AES India Pvt. Ltd. is not doubted but regular account transactions needs to be verified and examined. Accordingly, in the interest of justice, we remit this issue to the file of AO who shall examine and verify the claim and the assessee shall file details and cooperate in completing the assessment and the ground of appeal is allowed for statistical purposes. 8. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 14/05/2018. Sd/- Sd/- (N. S. SAINI) (PAVAN KUMAR GADALE) ऱेखा सदस्य / ACCOUNTANT MEMBER न्यानयक सदस्य / JUDICIAL MEMBER कटक Cuttack; ददनाांक Dated 14/05/2018 प्र.कु.मि/PKM, Senior Private Secretary आदेश की प्रनिलऱपप अग्रेपषि/Copy of the Order forwarded to : 1. अपीलाथी / The Appellant- AES Orissa Distribution Private Limited, HIG-4, BDA Colony, Jayadev Vihar, Bhubaneswar-751013 2. प्रत्यथी / The Respondent- DCIT, Circle-2(1), Bhubaneswar आयकर आयुक्त(अपील) / The CIT(A), 3. आयकि आयुक्त / CIT 4. 5. विभागीय प्रविविवि, आयकर अपीलीय अविकरण, कटक / DR, ITAT, Cuttack गार्ा पाईल / Guard file. 6. आदेशािुसार/ BY ORDER, सत्यापऩत प्रनत //True Copy// (Senior Private Secretary) आयकर अपीऱीय अधिकरण, कटक / ITAT, Cuttack