ITO WARD-20(1), NEW DELHI vs. POLTAVSKY- TPS POWER SERVICES LTD., NEW DELHI

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ITA 4884/DEL/2019Status: DisposedITAT Delhi28 June 2024AY 2010-11Bench: SHRI VIKAS AWASTHY (Judicial Member), SHRI AVDHESH KUMAR MISHRA (Accountant Member)5 pages

AI SummaryDismissed

Facts

The assessee's assessment for AY 2010-11 was completed under Section 144, resulting in additions of Rs. 3,91,67,316/- under Section 68 for unexplained bank credits and Rs. 28,38,943/- under Section 37 for interest expenses. The CIT(A) subsequently deleted these additions after considering additional evidence and a remand report from the AO, noting that a significant portion pertained to an earlier assessment year or was due to clerical errors/lack of verification.

Held

The ITAT upheld the decision of the CIT(A) to delete the additions. The Tribunal found no infirmity in the CIT(A)'s reasoned findings, as the Revenue failed to controvert them. The AO's own remand report had largely substantiated the assessee's submissions, indicating that the additions were erroneous, double-counted, or belonged to a different assessment year.

Key Issues

Whether the CIT(A) was justified in deleting additions made by the AO under Section 68 for unexplained bank credits, share application money, and under Section 37 for disallowed interest expenses, based on additional evidence and the AO's remand report.

Sections Cited

143(2), 142(1), 144, 68, 37

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “F”, DELHI

Hearing: 25/06/2024Pronounced: 28/06/2024

ORDER

PER VIKAS AWASTHY, JM:

This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-7, New Delhi (hereinafter referred to as ‘the CIT(A)’), dated 28.03.2019, for assessment year 2010-11.

The solitary issue raised by the Department in appeal is against deleting the addition of Rs. 1,47,17,316/- by the CIT(A). The contention of Department is that the assessee was not able to prove creditworthiness of the creditors and (A.Y.2010-11) genuineness of the transaction, despite that the First Appellate Authority deleted the addition. 3. The facts of the case as emanating from records are; the assessee company was established in technical collaboration with JSC Poltava Turbomechanical Plant of Ukraine. The assessee is purportedly engaged in the businesses of supplying Steam Turbine Parts of 200 MW to Government agencies. The assessee filed its return of income for the impugned assessment year on 12.10.2010 declaring total income of Rs. 18,39,697/-. Notice u/s.143(2) of the Income Tax Act, 1961 (in short ‘the Act’) was issued to the assessee on 19.08.2010. In response to the said notice, the Authorized Representative of the assessee appeared before the Assessing Officer (AO) and sought time to furnish details. The necessary details were furnished initially. Thereafter, the AO issued show cause notice u/s 142(1) of the Act, on 28.02.2013 making a detailed inquiry. In response to the said notice, the assessee furnished some documents through its Authorized Representative; however, no submissions explaining the documents were allegedly made by the assessee. The AO found documents furnished by the assessee not to the satisfaction; hence, another show cause notice was issued on 28.02.2013. The assessee again without furnishing any reply/detailed submissions to the notice only filed copy of bank statement. Since, the assessee failed to assist the AO and provide necessary details in the specified manner, the AO proceeded to complete assessment u/s 144 of the Act. The AO vide order dated 28.03.2013 made addition of Rs. 3,91,67,316/- u/s. 68 of the Act, on account of unexplained bank credits. The AO further disallowed interest expenses of Rs. 28,38,943/- u/s. 37 of the Act.