UNIQUE RAIL ROAD CONSULTANTS PRIVATE LIMITED,HYDERABAD vs. DCIT., CENTRAL CIRCLE-1(3), HYDERABAD

Facts

The assessee, Unique Rail Road Consultants Private Limited, engaged in consultancy services, filed its return for AY 2015-16. The case was selected for scrutiny, leading the AO to make ad-hoc 10% disallowances on Travels & Tours and Vehicle Hire Charges, and a full disallowance of Site and Other Expenses, citing issues with supporting bills being in the name of an amalgamated entity (United Rail Road Consultants Pvt. Ltd.) or alleged double claims. The assessee contested that the assessment order itself was void as it was passed in the name of a non-existent entity following its amalgamation.

Held

The Tribunal dismissed the assessee's legal ground concerning the assessment in the name of a non-existent entity, as the assessee failed to formally intimate the AO about the amalgamation. However, it set aside the ad-hoc 10% disallowances for Travels & Tours and Vehicle Hire Charges, finding no doubt on the genuineness of expenditure and explaining the bill name discrepancy by amalgamation. The issue of Site and Other Expenses disallowance was remanded back to the AO for re-verification due to contradictory facts.

Key Issues

1. Whether an assessment order passed in the name of a non-existent entity after amalgamation is valid when the AO was not formally intimated. 2. Justification for ad-hoc disallowances of Travels & Tours and Vehicle Hire Charges despite no doubt on genuineness. 3. Whether Site and Other Expenses were double claimed.