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Facts
The assessee, Dana India Technical Centre Pvt. Ltd., engaged in IT-enabled Design Engineering Services, filed its income return for AY 2020-21. The assessment under section 143(3) resulted in an addition of Rs. 1,17,29,063/- for unexplained professional charges under section 69C r.w.s. 115BBE. The CIT(A) dismissed the assessee's appeal, confirming the addition due to the non-submission of documentary evidence.
Held
The Tribunal accepted the assessee's application for admitting additional evidences, considering the interest of justice. The matter was restored to the file of the Assessing Officer with a direction to pass a fresh assessment order after providing the assessee due opportunity to produce additional evidences and supporting documents.
Key Issues
Whether the addition of professional charges as unexplained expenditure under section 69C r.w.s. 115BBE was justified, given that the assessee sought to admit additional evidence not considered by lower authorities.
Sections Cited
253(1)(a), 250, 69C, 115BBE, 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE
Before: SHRI R. K. PANDA & SHRI VINAY BHAMORE
ORDER
PER VINAY BHAMORE, JM:
This appeal filed by the assessee is directed against the order dated 06.11.2024 passed by Ld. CIT(A), Pune-11 [‘Ld. CIT(A)’] for the assessment year 2020-21.
The appellant has raised the following grounds of appeal :- “Based on the facts and circumstances of the case, Dana India Technical Centre Private Limited (hereinafter referred to as 'the Appellant) respectfully craves leave to prefer an appeal under section 253(1)(a) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act'), against the order dated
06. November 2024 passed by the Commissioner of Income tax (Appeals). Pune-11 ('the Hon'ble CIT(A)') under section 250 of the Act, on the following grounds:
On the facts and in the circumstances of the case and in law, the Hon'ble CIT(A) have erred on following grounds while passing its order under section 250 of the Act Grounds 1. Inappropriate addition of professional charges as unexplained expenditure to the total Income of the Appellant, amounting to INR 1,17,29,063 erred in disallowing professional charges amounting to INR 1,17,29,063 on account of unexplained expenditure u/s 69C r.w.s 115BBE of the Act even though the same has been duly accounted for in the books of accounts; erred in invoking section 69C of the Act without appreciating the fact that the said expenditure is already reflected in the books of accounts and the genuineness of the given expenditure can be explained by means of multiple sources including payments made through bank statements, supporting invoices, vouchers, etc. and thus invoking section 69C of the Act without conducting full and appropriate enquiry is unwarranted. The Appellant craves leave to add, alter, vary, omit, substitute or amend the above grounds of appeal, at any time before or at the time of bearing of the appeal, to enable the Honourable Income-tax Appellate Tribunal to decide this appeal according to law.”
3. Facts of the case, in brief, are that the assessee company Dana India Technical Centre Private Limited is a wholly owned subsidiary of Dana Global Product Inc., USA (Dana) and is engaged in the business of providing IT enabled Design Engineering Services. The assessee filed return of income on 19.01.2021 declaring total income of Rs.23,86,43,550/-. Vide order dated 22.02.2023 the assessment u/s 143(3) was completed by making following additions :- (i) Disallowance of health and education cess amounting to Rs.18,16,225/-. (ii) Addition of Rs.1,17,29,063/- on account of unexplained professional charges.
Being aggrieved with the above assessment order, the assessee preferred an appeal before Ld. CIT(A) challenging only the addition of Rs.1,17,29,063/- towards unexplained professional charges. Not being satisfied with the submissions of the assessee, Ld. CIT(A) dismissed the appeal filed by the assessee since no documentary evidence was filed by the assessee in support of its claim.
It is the above order against which the assessee is in appeal before this Tribunal.
We have heard Ld. Counsels from both the sides and perused the material available on record including the paper book furnished by the assessee. In this regard, we find that the assessee has filed an application before the Bench for admitting additional evidences/supporting documents. It was the contention of Ld. Counsel for the assessee that neither Ld. CIT(A) nor the Assessing Officer sought these documentary evidences therefore they were not produced in the earlier proceedings. Since Ld. CIT(A) has dismissed the appeal of the assessee merely on the ground of non- filing of above documentary evidences it is inevitable for the assessee to move an application for admission of above additional evidences/supporting documents which go to the root of the matter.
Considering the totality of the facts of the case and in the interest of justice, we accept the additional evidences and restore the matter back to the file of the Assessing Officer with a direction to pass assessment order afresh and as per fact and law in the light of the additional evidences. Needless to say, the Assessing Officer shall provide due opportunity of hearing to the assessee. The assessee is also hereby directed to respond to the notices issued by the Assessing Officer in this regard and to produce additional evidences/supporting documents, if any, in support of its contention without taking any adjournment under any pretext, otherwise the Assessing Officer shall be at liberty to pass appropriate order as per law. Thus, the grounds of appeal raised by the assessee are allowed for statistical purposes.