DEPUTY COMISSSIONER OF INCOME TAX CIRCLE 3(4), MUMBAI, MUMBAI vs. IDBI BANK LTD, MUMBAI

Aggrieved by the assessment order, assessee preferred an appeal before learned CIT(A), who partly allowed first appeal by deleting the disallowance of expenses u/s. 40(a)(ia) amounting to Rs 58,25,41,577/- and disallowance of Rs. 1,04,245/- on account of depreciation on leased assets, further directing the assessing officer to verify the claim of assessee for grant of tax paid.

In response to the notice issued by the tribunal, learned DR appeared and participated in the hearing.

We have perused the records and heard learned representatives for both the parties.

The main point for consideration under appeal is as to whether in the facts and circumstances of the case, learned CIT(A) was justified in granting claimed relief to the assessee? 9. Learned DR has argued that the assessee did not submit the relevant documents before assessing officer in respect of TDS deduction for the year under consideration in compliance of direction of Hon’ble ITAT. Hence, learned CIT(A) was not justified in allowing the claimed relief to assessee. Prayed to set aside the impugned order. 10. Learned representative for the assessee has submitted that Hon’ble ITAT, vide order dated 11.09.2017 passed in ITA IDBI Bank Ltd. 3775/MUM/2017 specifically directed assessing officer to verify whether the assessee has duly deducted the TDS on the sum of Rs. 58,25,41,577/- claimed by the assessee and paid the same before the due date of filing of the return. Assessee further submitted that since the data was voluminous and huge, only sample data of TDS certificates was furnished, covering about 54% of the total amount. However, assessing officer did not grant relief on the ground that evidence was given only for Rs. 31.57 crores as against the total amount of Rs. 58.25 crores. Assessee has further submitted that learned assessing officer erringly disallowed the depreciation on leased asset amounting to Rs. 1,04,245/- u/s. 32 of the Act which was rightly allowed by learned CIT(A). Assessee has vehemently supported the impugned order and prayed to dismiss the revenue’s appeal.

We find that learned CIT(A) has with precision and unambiguously passed speaking impugned order. The relevant para no. 4.3, 4.7, 4.9 of the impugned order read as under: “4.3 In view of the above facts and submission made by the appellant, I find force in the contention of the appellant. Appellant has discharged its liability and submitted the relevant document in respect of TDS deduction for the year under consideration IDBI Bank Ltd. as per letter submitted before the AO by following the direction of Hon'ble ITAT. From the assessment order it appears that no further details were asked by the AO before denying the claim of the appellant. Otherwise also appellant has furnished the TDS certificates amounting to Rs. 31,57,03,761/- pertaining to the relevant assessment year out of total provision of expense of Rs. 58,25,41,577/-. Therefore, before disallowing the whole amount, AO would have pointed specific default in the TDS certificate submitted and asked for further details. Appellant has uploaded the relevant details during the course of appellate proceedings. Therefore, considering the observation of the Hon'ble ITAT and submission made by the appellant, I am to Rs. of the view that disallowance of expenses made by the AO u/s 40(a)(ia) amounting to 58,25,41,577/- is not sustainable. AO is directed to delete the addition of Rs. 58,25,41,577/- made on account of disallowance of provision for expenses. Thus, Ground no. 2 of the appeal raised is allowed. 4.7 I have carefully gone through the assessment order, grounds of appeal

In the result, the appeal is dismissed. Impugned order dated 03.08.2023 is sustained. Order pronounced on 06.09.2024.