MADHYA PRADESH MADHYA KSHETRA VIDUT VITARAN COMPANY LIMITED,BHOPAL vs. THE DCIT- 2-(1), BHOPAL
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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI B.M. BIYANI & SHRI PARESH M. JOSHI
आदेश/ O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by order of first-appeal dated 03.11.2023 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of penalty-order dated 31.03.2018 passed by learned DCIT-2(1), Bhopal [“AO”] u/s 271(1)(c) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2012-13, the assessee has filed this appeal on the grounds mentioned in Appeal Memo (Form No. 36).
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Madhya Pradesh Madhya Kshetra Vidut Vitaran Company Limited, ITA No. 551/Ind/2023 - AY 2012-13
The background facts leading to this appeal are such that the
assessee is an electricity distribution company. For AY 2012-13, the
assessee filed return declaring a loss of Rs. 10,82,05,00,000/-. The case was
selected for scrutiny and the AO passed assessment order dated 24.03.2015
u/s 143(3) reducing loss to Rs. 1,31,27,00,000/- due to certain
additions/disallowances. Thereafter, the PCIT-1, Bhopal [“PCIT”] found the
assessment-order passed by AO as erroneous-cum-prejudicial to the interest
of revenue, raising an issue that the AO had wrongly allowed deduction of
Rs. 57,52,00,000/- claimed by assessee on account of “Provisions for bad
and doubtful debt”. The PCIT carried such a view on the footing that the
deduction of “Provisions for bad and doubtful debt” is allowed only to banks
and financial institutions u/s 36(1)(viia) and not to assessee which is
engaged in electricity distribution. Ultimately, the PCIT passed revision-
order dated 23.03.2017 u/s 263 directing the AO to re-frame assessment
after examining the issue of deduction of “Provisions for bad and doubtful
debt”. Pursuant to such revision-order, the AO passed order of fresh
assessment dated 15.06.2017 u/s 143(3) r.w.s. 263 wherein he made an
addition of Rs. 57,52,00,000/- by disallowing the claim of assessee. This
addition/disallowance made by AO further reduced loss of assessee by Rs.
57,52,00,000/-. Therefore, the AO also initiated penalty proceedings u/s
271(1)(c) and ultimately passed penalty-order dated 31.03.2018 imposing a
penalty of Rs. 18,70,00,000/- qua the addition/disallowance of Rs.
57,52,00,000/-. Aggrieved by penalty-order, the assessee filed first-appeal to
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Madhya Pradesh Madhya Kshetra Vidut Vitaran Company Limited, ITA No. 551/Ind/2023 - AY 2012-13
CIT(A) but did not get any success. Now, the assessee has come in next
appeal before us.
Ld. AR for assessee carried us to Para 2 & 3 of impugned order passed
by CIT(A), reading as under:
“2. अपीलीयकाय�वाहीकेदौरान, �रकॉड�परउपल�िववरणकेअनुसार, यहदेखागया हैिकिनधा�रणवष�2012-13 केउपरो�िवचाराधीनअपीलके�लए���करिववादसे िव�ासयोजना, 2020 केतहतफॉम�5 िदनांक10.05.2023 (बकायाकरकेपूण�और अंितमभुगतानके�लएआदेश) कोनािमत�ािधकारीयानी�धानआयकरआयु�के�ारा जारीिकयागयाहै।चूंिकअपीलकता�नेिववादसेिव�ासयोजना, 2020 औरफॉम�5 का लाभलेनेकािवक�चुनाहै, जोपहलेसेहीनािमत�ािधकारी�ाराजारीिकयागयाहै, वत�मानअपीलको���करिववादसेिव�ास, अिधिनयम, 2020 कीधारा4 (2) के �ावधानोंकेअनुसारवापसले�लयागयामानाजाताहै।
प�रणाम��प, सां��कीयउ�े�के�लएअपीलकोवापसलेनेकेआधारपरखा�रज करिदयाजाताहै।” 4. Referring to above, Ld. AR submitted that the CIT(A) has dismissed
assessee’s first-appeal on a wrong assumption of fact that the assessee has
settled its case under ‘Vivad Se Vishwas Scheme, 2020’ [“VsV”]. He
explained that the correct position is such that the assessee settled under
VsV its case of dispute arising from assessment-order dated 24.03.2015
passed by AO u/s 143(3) and not the dispute arising from penalty-order
dated 31.03.2018 which was subject-matter of appeal before CIT(A). Ld. AR
has also filed copies of Form No. 1 to 5 of VsV at Pages 1-15 of Paper-Book
to demonstrate this correct position. Therefore, Ld. AR requested, the order
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Madhya Pradesh Madhya Kshetra Vidut Vitaran Company Limited, ITA No. 551/Ind/2023 - AY 2012-13
of first-appeal passed by Ld. CIT(A) deserves to be set aside and the case be
restored at the level of CIT(A) for a fresh adjudication on merit.
Ld. DR for revenue does not have any objection to the submissions of
Ld. AR.
The submissions made by parties as above are accepted and in view of
same, the impugned order passed by CIT(A) is set aside and the CIT(A) is
directed to re-fix the first-appeal of assessee and dispose of same on merit
after hearing assessee.
Resultantly, this appeal is allowed for statistical purpose.
Order pronounced in open court on 30/04/2025
Sd/- Sd/-
(PARESH M. JOSHI) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore िदनांक/Dated : 30/04/2025 Patel/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPYSr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
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