DCIT, CIRCLE 22(2), NEW DELHI, NEW DELHI V. S A INFRASTRUCTURE CONSULTANTS PRIVATE LIMITED , NEW DELHI

ITA 2966/DEL/2023

AI Insights

The case involves an appeal by the Revenue against SA Infrastructure Consultants Private Limited concerning an order passed under section 154 of the Income Tax Act, 1961. The CPC had made certain disallowances related to TDS, GST liabilities, and belated payments of interest and remittances of EPF/ESI. The FAA set aside these disallowances on the grounds that the CPC did not issue a notice as required under section 154(3) before enhancing the assessment and increasing the liability of the assessee. The Tribunal dismissed the Revenue's appeal, supporting the FAA's decision and emphasizing the necessity of the notice for any rectification that affects the assessee's liability.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 23806 (ITAT-DELHI)
• Duration Of Justice: 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-10-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 03-10-2024
• Assessment Year: 2020-2021
• Appeal Filed On: 20-10-2023
• Other Referred Cases: Aparna Ashram vs. ADIT(E)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH TIWARI
• Assessee Lawyers: MANEESH UPNEJA; BALDEV RAJ
• Keywords: TDS
• Section: 154; 43B

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : G : NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER ITA No.2966/Del/2023 Assessment Year: 2020-21 DCIT, Circle 22(2), New Delhi. Vs SA Infrastructure Consultants Private Limited, M-22/A, Lajpat Nagar, New Delhi – 110 024. PAN: AAJCS4320H (Appellant) (Respondent) Assessee by : Shri Maneesh Upneja, CA & Shri Baldev Raj, Advocate Revenue by : Shri Manish Tiwari, Sr. DR Date of Hearing : 03.10.2024 Date of Pronouncement : 03.10.2024 ORDER PER ANUBHAV SHARMA, JM: This appeal is preferred by the Revenue against the order dated 22.08.2023 of the National Faceless Appeal Centre (hereinafter referred as Ld. First Appellate Authority or in short Ld. ‘FAA’) in Appeal No.NFAC/2019- 20/10094415 arising out of the appeal before it against the order dated 30.09.2021 passed u/s 154 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by the ADIT, CPC, Bengaluru (hereinafter referred to as the Ld. AO). ITA No.2966/Del/2023 2 2. Heard and perused the record. Stressing upon the ground of appeal, the ld. DR submitted that the ld. FAA has fallen in error in mentioning that the CPC should have given an opportunity of hearing before passing the impugned order u/s 154 of the Act. 3. On hearing both the sides, we find that CPC had exercised powers u/s 154 of the Act for making certain additions in the form of disallowance u/s 43B for TDS and GST liabilities; disallowance of belated payments of interest u/s 37; and disallowance of belated remittances of EPF/ESI. However, the Ld. FAA has deleted the same on the basis that the CPC had not complied with the mandate of law requiring the issuance of a notice. The Revenue has specifically placed on record a communication from the Deputy Director of Income-tax, Unit-IV, CPC Bengaluru that while passing the impugned order u/s 154 of the Act, no notice u/s 154(3) of the Act was issued. 3.1 The ld. AR has relied on the judgement of a coordinate Bench in ITA No.382/Del/2015 & ors., Aparna Ashram vs. ADIT(E), decided on 29.09.2017, to submit that in the absence of this notice u/s 154(3), no addition could have been made. 4. We find no justification in the grounds as raised before us as very apparently the exercise of powers for rectification u/s 154(1) of the Act has the effect of enhancing an assessment and increasing the liability of the assessee for which there is a necessity of a mandatory notice u/s 154(3) of the Act. When ITA No.2966/Del/2023 3 the requirement of a notice emanates from the Act itself, then, for no good reason the Revenue can question the order of the FAA setting aside the order passed u/s 154 of the Act, claiming there was no need of the notice. The grounds raised have no substance. The appeal of Revenue is dismissed. Order pronounced in the open court on 03.10.2024. Sd/- Sd/- (PRADIP KUMAR KEDIA) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 03rd October, 2024. dk Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asstt. Registrar, ITAT, New Delhi "