DEPUTY COMMISSIONER OF INCOME TAX, DELHI V. AMAZON SMART COMMERCE SOLUTIONS PRIVATE LIMITED, DELHI

ITA 4981/DEL/2024

AI Insights

The case involves an appeal by the Revenue against the order of the Learned Commissioner of Income-Tax (Appeals)/National Faceless Assessment Centre, Delhi, which arose from the order of the Assessment Unit under Section 143(3) r.w.s. 144B of the Income-Tax Act, 1961 for the assessment year 2020-21. The primary issues in the appeal included the claim of deductions, substantial investments by an unlisted company in non-business assets, refund claims, and expenses incurred for earning exempt income. The Assessing Officer had made several additions to the assessee's income, which were partly overturned by the CIT(A). The Revenue's appeal primarily contested the CIT(A)'s decision regarding the disallowance under Section 14A, which was dismissed by the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312953 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2020-2021
• Laws Referred To: Income-Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT KUMAR CHAUDHARY
• Keywords: Set aside; Earning of tax free income
• Section: 143(3); 142(1); 14A; 80G

Judgement Text

" INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “A”: NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI VIMAL KUMAR, JUDICIAL MEMBER ITA No. 4981/DEL/2024 Assessment Year: 2020-21 DCIT, CR Building, IP Estate, New Delhi PIN 1100 01 PAN No. AAECT4063H Vs. AMAZON SMART COMMERCE SOLUTIONS PRIVATE LIMITED, H-9, Block B-1, Mohan Cooperative Ind. Area Badarpur South, East Delhi, Delhi-1100 44 (Appellant) (Respondent) O R D E R PER VIMAL KUMAR, JUDICIAL MEMBER: The appeal of Revenue is against order dated 03.09.2024 of the Learned Commissioner of Income-Tax(Appeals)/National Faceless Assessment Centre (NFAC), Delhi (hereinafter referred as ‘Ld. CIT(A)’) arising out of order dated 24.09.2022 of the Assessment Unit (hereinafter referred as “Ld. AO”) under Section 143(3) r.w.s. 144B of the Income-Tax Act, 1961 (hereinafter referred as “the Act”) for assessment year 2020-21. Assessee by: N o n E Department by: Shri Ravikant Kumar Chaudhary, Sr. DR Date of Hearing: 28.04.2025 Date of pronouncement: 30.04.2025 ITA No.4981/Del/2024 2 2. Brief facts of the case are that the case of assessee was selected for complete scrutiny under CASS. The issues involved are as under: “i) Claim of any other amount allowable as deduction. ii) Substantial investment by an unlisted company in non-business assets. iii) Refund claim iv) Expenses incurred for Earning Exempt Income” 3. Notice under Section 143(2) of the Act dated 29.06.2021 was issued. Subsequently, notices under Section 142(1) of the Act dated 20.11.2021, 05.08.2022 along with questionnaire were issued and served on the assessee. The assessee furnished reply. Show-cause-notices dated 01.09.2022 and 19.09.2022 were issued. Replies were submitted by the assessee. Ld. AO through order dated 24.09.2022, made additions of Rs.16,91,620/- in respect of Education Cess, Rs.5,00,00,000/- in respect of disallowance under Section 14A and Rs.4,25,000/- in respect of disallowance of claim of deduction under Section 80G of the Act. 4. Against order dated 24.09.2022, assessee filed appeal before the Ld. CIT(A) which was partly allowed vide order dated 03.09.2024. Addition of Rs.5,00,00,000/- was set aside. ITA No.4981/Del/2024 3 5. Being aggrieved, the appellant/revenue filed present appeal. 6. Learned Authorised Representative for the Revenue submitted that Ld. CIT(A) erred in not considering the provisions of section 14A of the Act are not application in the instant case as no exempt income has been earned by the appellant for the year under consideration and accordingly no expenditure should be disallowed as no part of it has been incurred for the purpose of earning exempt income. 7. None appeared on behalf of the respondent/assessee on 20.02.2025 and today. 8. From examination of record in the light of aforesaid contentions, it is evident that the Ld. CIT(A) vide order dated 03.09.2024 held that provisions of section 14A of the Act are not applicable in the instant case as no exempt income has been earned by the appellant for the year under consideration and accordingly no expenditure should be disallowed as no part of it has been incurred for the purpose of earning exempt income. 9. In view of above specific observations, the arguments of Learned Authorised Representative for the Revenue being de void of merit are untenable. Ground of appeal no. 1 is dismissed. ITA No.4981/Del/2024 4 10. In the result, the appeal of the Revenue is dismissed. Order pronounced in the open court on 30/04/2025. Sd/- sd/- (PRADIP KUMAR KEDIA) (VIMAL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 30 /04/2025 Mohan Lal Copy forwarded to - 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi "