BALAJI TIRUPATI BUILDCON LTD (FORMELY KNOWN AS MEDIA TOYS LTD),GURGAON vs. ITO WARD - 4(2), NEW DELHI

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ITA 7582/DEL/2019Status: DisposedITAT Delhi01 August 2023AY 2010-113 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that the addition made under Section 68 was not sustainable because the assessee had neither shown any interest income nor claimed any TDS on it in its return. Therefore, the addition was deleted.

What were the facts?

The assessee's appeal concerned an addition of Rs. 17,90,671/- made by the AO and confirmed by the CIT(A). The addition was based on AIR information regarding interest income, but the assessee contended it neither earned nor received this income and it was not credited to its books.

What were the issues?

Whether an addition under Section 68 is justified when the assessee has not offered the income and has not claimed any TDS on it, despite AIR information suggesting receipt of payment.

Which sections of the Income-tax Act were involved?

Section 68,Section 194A,Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: A: NEW DELHI

Before: SHRI CHANDRA MOHAN GARG & SHRI PRADIP KUMAR KEDIA

Hearing: 13.06.2023Pronounced: 01.08.2023

ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of Ld. CIT(A)-2, New Delhi dated 27.06.2019 for AY 2010-11. 2. The grounds of assessee are as follows:-

1.

1. 1. That the order of CIT(Appeals) 2 (CIT A) dated 27-06-2019 confirming the addition made by Income Tax Officer Ward 4(2) (AO), is illegal, unjust and opposed to facts.

2. That the Ld. CIT-A and Ld. AO have both erred on Facts of the Case and in law, in making an assessment and confirming the addition on a non-existent person.

3. That the service of notice by affixture on 31-03-2017 in the name of non-existent person is an invalid service, the assessment in pursuance of such invalid service is illegal.

4. That the notice w/s 148 is illegal, since: a) Ld. AO has issued notice w/s 148 without proper application of mind and without recording proper satisfaction after due verification of records. b) Notice has been issued to a non-existent person which is an invalid notice.

Notice is issued on wrong foundation that no return was filed by the appellant, whereas the appellant had filed its return for AY 2010-11.

5. That on the Facts of the Case and in law, the Ld. AO and Ld. CIT-A have both erred in assessment of income of Rs. 17,90,671/- as if earned and received, when the appellant had neither earned nor received such interest income during the year as per copy of audited financial statements filed.

6.

That on the Facts and Circumstances of the case and in law, Ld. AO and Ld. CIT-A have both erred in confirming addition of Rs. 17,90,671/- u/s 68 of The IT Act, when no such amount was found credited in the books of account maintained by the appellant for the previous year, the illegal addition be deleted.

7.

That the illegal assessment be annulled and addition of Rs. 17,90,671/- be deleted.

3.

First of all, the ld. Assessee Representative (AR) submitted that the assessee does not want to press ground no. 2 hence the same is dismissed as not pressed.

Ground no. 5 & 6

4.

The ld. AR submitted that on the Facts of the Case and in law, the Ld. AO and Ld. CIT-A have both erred in assessment of income of Rs. 17,90,671/- as if earned and received, when the appellant had neither earned nor received such interest income during the year as per copy of audited financial statements filed. He further contended that on the Facts and Circumstances of the case and in law, Ld. AO and Ld. CIT-A have both erred in confirming addition of Rs. 17,90,671/- u/s 68 of The IT Act, when no such amount was found credited in the books of account maintained by the appellant for the previous year, the illegal addition be deleted. The ld. AR submitted that from the copy of return of income filed by the assessee and computation available at pages 5 to 7 clearly reveals that the assessee has neither earned nor received impugned interest income during the year and no such amount was credited to the books of accounts of assessee maintained and audited by the competent auditor therefore no addition, u/s. 68 or any other provision of the Act was required to be made.

5.

Replying to the above the ld Senior DR supported that orders of the authorities below and submitted that the AIR Information available through the system reveals that assessee had received payment of Rs. 17,90,671/- on which TDS of Rs. 1,79,067/- u/s 194A of the Act was deducted by the payee M/s. Ecos India Mobility and Hospitality Pvt. Ltd. The ld. Senior DR submitted that the payee did not respond to the notice u/s. 133(6) of the Act dated 13.10.2017 and it was received back unserved therefore the Assessing Officer was right in having adverse inference against the assessee therefore addition may kindly be upheld.

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