Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, DELHI BENCH: ‘I(2
Before: MS SUCHITRA KAMBLE, & SHRI PRASHANT MAHARISHI
ORDER PER SUCHITRA KAMBLE, JM This appeal is filed by the assessee against the order dated 15/03/2019 passed by CIT(A)- 34 for Assessment Year 2014-15.
The grounds of appeal are as under:-
“ 1. That on the facts and circumstances of the case, the order dated as 02.11.2016 passed by the Asst. Commissioner of Income-tax, Circle- 9(1),New Delhi [hereinafter referred to as "the Ld. A.O."] under section 143(3) of the Income-tax Act, 1961 [hereinafter referred to as "the Act"] and as upheld by the Ld. Commissioner of Income-tax (Appeals) -34, New Delhi [hereinafter referred to as "the CIT(A)"] is bad at law and void ab initio.
2. That on the facts and in circumstances of the case, the Ld. CIT(A) erred in upholding the disallowance to the tune of Rs. 55,69,690/ out of contractual services expenses being contingent in nature and disallowed under the provision of section 40(a)(ia) of the Act.
3. That on the facts and in circumstances of the case, the Ld. CIT(A) erred in upholding the disallowance of restructuring expenses of Rs. 1,07,75,000/ under section 37 of the Act. 4.1. That on the facts and in circumstances of the case, the Ld. CIT(A) erred in upholding the disallowance of provision of warranty cost of Rs. 26,65,716 being contingent in nature. 4.2 That on the facts and in circumstances of the case, the Ld.CIT(A) erred in upholding the disallowance of provision of warranty cost of Rs. 26,65,716/- being contingent in nature. 5.1 All the above mentioned grounds are independent and without prejudice to other; and 5.2. That the appellant carves the right to add, alter, amend and delete the ground(s) of appeal during hearing.
The assessee company is engaged in the business of manufacturing and sale of Air treatment equipment and particularly air handling units. The company is also engaged in the business of system solution being operated form Kolkata office. Return declaring total loss of Rs.1,64,64,017/- was filed on 28/11/2014. The Assessing Officer completed the assessment u/s 143(3) vide order dated 2/11/2016 after making addition on account of contractual service expenses at Rs. 55,69,690/-, restricting expenses Rs. 1,07,75,000/- and disallowance of provision on account of liquidated damages and warranty cost at Rs.41,78,951/-.
Being aggrieved by the assessment order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee.
None appeared on behalf of the assessee and there is no adjournment application on behalf of the assessee. The notice has been served to the assessee. Therefore, we are taking up the submissions of the assessee before the CIT(A) as well as before the Assessing Officer.
The Ld. DR relied upon the assessment order and the order of the CIT(A).
We have heard the Ld. DR and perused the material available on record. From the order of the Assessing Officer as well as the CIT(A) it is pertinent to note that the Assessing Officer as well as the CIT(A) has not taken the cognizance of any evidence produced by the assessee before the revenue authorities. There is no reason given by the CIT(A) as to why the addition has to be sustained. Therefore, it will be appropriate to remand back all the issues contested by the assessee to the file of the CIT(A) for fresh adjudication. Needless to say, the assessee be given opportunity of hearing by following principles of natural justice.