NABH CONSTRUCTION AND DEVELOPERS PVT. LTD,MUNIKIRETI vs. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE(4)(1), RISHIKESH

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ITA 27/DDN/2022Status: DisposedITAT Dehradun09 April 2025AY 2017-18Bench: SHRI SATBEER SINGH GODARA (Judicial Member), SHRI M. BALAGANESH (Accountant Member)3 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal restored the appeal to the CIT(A) for de novo adjudication, allowing the assessee to file additional grounds and evidence. The CIT(A) was directed to consider these new submissions.

What were the facts?

The assessee, a construction company, had its income assessed at a higher amount than declared due to additions made by the AO for outstanding wages, hospitality expenses, and sundry creditors. The NFAC upheld the AO's order.

What were the issues?

Whether the additions made by the AO towards outstanding wages, hospitality expenses, and sundry creditors were justified. The assessee sought an opportunity to present further details and evidence.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 37(1)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DEHRADUN BENCH “SMC”, NEW DELHI

For Appellant: Shri K. K. Juneja, Adv
For Respondent: Shri Amarpal Singh, Sr. DR
Hearing: 21/03/2025Pronounced: 09/04/2025

O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in for AY 2017-18, arises out of the order of the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in ITBA/NFAC/S/250/2021- 22/1040862987(1) dated 16.03.2022 against the order of assessment passed u/s 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 09.12.2019 by the Assessing Officer, ACIT, Circle-1(4)(1), Rishikesh (hereinafter referred to as ‘ld. AO’).

2.

The assessee has raised the following grounds of appeal before us:- “1. Because the AO was not justified the addition of Rs. 32,42,175/- only which was related to outstanding payment of workers.

2. Because the AO was also not justified the addition of Rs. 27,40,268/- only which was related to expenditure toward temporary labour huts at various sites and labours meal expenses provided by the assessee.

3. Because the AO was further not justified the addition of Rs. 50,80,301/- only which was related to the outstanding credit balances of the Creditors.

3.

We have heard the rival submission and perused the material available on record. The assessee is a private limited company engaged in the business of civil construction work with Govt department and was also doing the business of trading. The return of income for AY 2017-18 was filed by the assessee company on 18.09.2017 declaring total income of Rs. 51,01,150/-. The assessee filed the tax audit report in Form 3CA and Form 3CD along with its annexures before the ld AO. The scrutiny assessment was completed u/s 143(3) of the Act on 09.12.2019 determining the total income of the assessee at Rs. 1,61,64,494/- after making the following additions:-

a. Addition towards current liabilities on account of outstanding wages payable:- Rs. 32,42,775/- b. Disallowances of hospitality of expenses u/s 37(1) of the Act- Rs. 27,40,268/- c. Addition towards sundry creditors having balance more than 5 lakhs- Rs. 50,80,301/- 4. The said assessment was upheld by the NFAC. The ld AR before us prayed for one more opportunity to be given to the assessee so that the entire details could be placed before the ld CIT(A). He also placed on record the various documents in the paper book together with confirmation from certain parties in the paper book. No serious objections were raised by the ld DR before us for restoration of this appeal to the file of the ld AO. Considering the same, we deem it fit and appropriate to restore this appeal Page | 2 to the file of the ld CIT(A) for de novo adjudication in accordance with law. The assessee is at liberty to file additional grounds, if any, and additional evidences, if any, in support of its contentions. The ld CIT(A) is directed to admit those evidences and pass an order considering those evidences, uninfluenced by observations made earlier by his/her predecessor. Accordingly, grounds raised by the assessee are allowed for statistical purposes.

5.

In the result, the appeal of the assessee is allowed for statistical purposes.

Order pronounced in the open court on 09/04/2025.

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