DSP FINANCE PRIVATE LIMITED ,MUMBAI V. THE DEPUTY COMMISSIONER OF INCOME TAX -39(1)(1), MUMBAI

ITA 4263/MUM/2024

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The case involves DSP Finance Pvt. Ltd., the appellant, contesting an intimation order under Section 143(1) of the Income Tax Act, 1961, issued by the Central Processing Centre (CPC), which made certain adjustments to the taxable income for the assessment year 2020-21. The CIT(A) had dismissed the appellant's appeal as time-barred, believing the intimation was served immediately after its issuance. However, the ITAT found that the intimation was actually served later, within the allowable time frame for filing an appeal. The ITAT's decision to remit the case back to the CIT(A) was based on the need for a substantive review of the adjustments made by the CPC.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 471383 (ITAT-MUMBAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: D
• Assessment Year: 2020-2021
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R.R. MAKWANA
• Assessee Lawyers: NITESH JOSHI; PRERANA SHET
• Keywords: Set aside; Depreciation; Period of limitation; Time period of passing order
• Section: 250; 143(1); 32; 43B

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND MS. KAVITHA RAJAGOPAL (JUDICIAL MEMBER) ITA No. 4263/MUM/2024 Assessment Year: 2020-21 DSP Finance Pvt. Ltd., 11th floor, Mafatlal Centre Nariman Point, Nariman Point, Mumbai-400021. Vs. Dy. Director of Income-tax, CPC, Bengaluru-560500. Dy. CIT-3(1)(1), Aayakar Bhavan, Mumbai-400020. PAN NO. AAACD 3069 K Appellant Respondent Assessee by : Mr. Nitesh Joshi & Ms. Prerana Shet Revenue by : Mr. R.R. Makwana, Sr. DR Date of Hearing : 15/01/2025 Date of pronouncement : 21/01/2025 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 29.06.2024 passed by the Ld. Commissioner of Income-tax (Appeals) [in short ‘the Ld. CIT(A)’] for assessment year 2020-21, raising following grounds: 1. (a) The learned Additional/Joint Commissioner of Income (Appeals) [CIT(A)] under the face holding that there is a delay of nine months in filing the appeal under section 250 of the Act against intimation passed under section 143(1) of the Income Tax Act, 1961 (\"the Act\") dated September 13, 2022 by the Central Processing Ce dismissing the appeal of the Appellant in considering the merits of the case. (b) The learned CIT(A) erred in not appreciating the fact that the aforesaid intimation was actually served to the appellant on May 12, 2023. The a the time limit prescribed under section 249 of the Act and therefore the CIT(A) ought to have admitted the said appeal and decided the case on merits.. 2. Without prejudice to what is stated in 1 above: (a) The CPC while passing intimation under section 143(1) of the Income-tax Act, 1961 (\"the Act\") erred in determining a taxable income of a sum of Rs.231,32,24,150/ of sum of Rs.226,32,93,530/ erred in determining a sum of Rs.2,69,71,889/ appellant as against a sum of Rs.3,33,03,998/ appellant as per return of income filed (b) The CPC erred in making certain adjustment which do not qualify or fall under the a and accordingly the CPC was not justified in making the adjustments to total income while passing order under Section 143(1). (c) Without prejudice to what is stated in 2(b) above, CPC erred in disallowing a sum of being provision for gratuity which has been paid during the year before the due date of filing of the Income Tax Return. was disallowed in earlier years and the same ought to be allowed as business dedu year under appeal in accordance with the Explanation to Section 43B of the Act. (d) Without prejudice to what is stated above, the CPC erred in disallowing a sum of Rs.1,78,20,507/ between the depreciation charged as per Companies Act, 2013 which is debited to Profit and Loss account and the depreciation claimed as per the provisions of section 32 of the Act which amount ITA No. 4263/MUM/2024 1. (a) The learned Additional/Joint Commissioner of Income (Appeals) [CIT(A)] under the face-less appellate proceedings erred in holding that there is a delay of nine months in filing the appeal under section 250 of the Act against intimation passed under section 143(1) of the Income Tax Act, 1961 (\"the Act\") dated September 13, 2022 by the Central Processing Centre (CPC) and dismissing the appeal of the Appellant in- limine without considering the merits of the case. (b) The learned CIT(A) erred in not appreciating the fact that the aforesaid intimation was actually served to the appellant on May 12, 2023. The appeal was filed on June 09, 2023, which is within the time limit prescribed under section 249 of the Act and therefore the CIT(A) ought to have admitted the said appeal and decided the case on merits.. 2. Without prejudice to what is stated in 1 above: The CPC while passing intimation under section 143(1) of the tax Act, 1961 (\"the Act\") erred in determining a taxable income of a sum of Rs.231,32,24,150/- as against a taxable income of sum of Rs.226,32,93,530/- as per Return of Income filed and rred in determining a sum of Rs.2,69,71,889/- refundable to the appellant as against a sum of Rs.3,33,03,998/- refundable to the appellant as per return of income filed (b) The CPC erred in making certain adjustment which do not qualify or fall under the adjustments specified under section 143(1) and accordingly the CPC was not justified in making the adjustments to total income while passing order under Section (c) Without prejudice to what is stated in 2(b) above, CPC erred in disallowing a sum of Rs.69,50,020/- under section 43B of the Act being provision for gratuity which has been paid during the year before the due date of filing of the Income Tax Return. was disallowed in earlier years and the same ought to be allowed as business deduction on payment basis during the assessment year under appeal in accordance with the Explanation to Section 43B of the Act. (d) Without prejudice to what is stated above, the CPC erred in disallowing a sum of Rs.1,78,20,507/- on account of difference een the depreciation charged as per Companies Act, 2013 which is debited to Profit and Loss account and the depreciation claimed as per the provisions of section 32 of the Act which amount DSP Finance Pvt. Ltd. 2 ITA No. 4263/MUM/2024 1. (a) The learned Additional/Joint Commissioner of Income-tax proceedings erred in holding that there is a delay of nine months in filing the appeal under section 250 of the Act against intimation passed under section 143(1) of the Income Tax Act, 1961 (\"the Act\") dated ntre (CPC) and limine without (b) The learned CIT(A) erred in not appreciating the fact that the aforesaid intimation was actually served to the appellant on May ppeal was filed on June 09, 2023, which is within the time limit prescribed under section 249 of the Act and therefore the CIT(A) ought to have admitted the said appeal and decided the The CPC while passing intimation under section 143(1) of the tax Act, 1961 (\"the Act\") erred in determining a taxable as against a taxable income as per Return of Income filed and refundable to the refundable to the (b) The CPC erred in making certain adjustment which do not djustments specified under section 143(1) and accordingly the CPC was not justified in making the adjustments to total income while passing order under Section (c) Without prejudice to what is stated in 2(b) above, CPC erred in under section 43B of the Act being provision for gratuity which has been paid during the year before the due date of filing of the Income Tax Return. The same was disallowed in earlier years and the same ought to be allowed ction on payment basis during the assessment year under appeal in accordance with the Explanation to Section (d) Without prejudice to what is stated above, the CPC erred in on account of difference een the depreciation charged as per Companies Act, 2013 which is debited to Profit and Loss account and the depreciation claimed as per the provisions of section 32 of the Act which amount was already disallowed in the return of income resulting in double disallowance. 3. The appellant submits that the Assessing Officer be directed: (i) To delete the disallowance under section 43B amounting to Rs.69,50,020/ amounting to Rs. 1,78,20,507 /; and to modify the a accordance with the provisions of the Act 2. The relevant facts, as presented, are that the assessee filed its return of income for the assessment year under consideration, which was processed by the CPC. Subsequently, an intimation order under Section 143(1) of the Act was issued on 13th September 2022, wherein certain adjustments were made to the returned income. Aggrieved by this intimation, the assessee preferred an appeal before Ld. CIT(A), which was instituted on 9th June 2023. The assessee contended that the intimation order dated 13th September 2022 was served upon it on 12th May 2023. Consequently, it was submitted that the appeal filed on 9th June 2023 fell within the statutory limitation period of 30 days, as prescribed under Section 249 of the Act, for filing an appeal before the Ld. CIT(A). Notwithstanding this contention, the assessee, while presenting its submissions on the merits of the case, did not file a formal application seeking condonation of the delay, if any, in filing the appeal. The Ld. CIT(A), however, was not convinced by th assessee’s claim that the intimation order had been served with a delay of over nine months. Instead, the Ld. CIT(A) concluded that the intimation order was served immediately after its issuance. ITA No. 4263/MUM/2024 was already disallowed in the return of income resulting in double disallowance. The appellant submits that the Assessing Officer be directed: (i) To delete the disallowance under section 43B amounting to Rs.69,50,020/-; (ii) To delete the disallowance of depreciation amounting to Rs. 1,78,20,507 /; and to modify the a accordance with the provisions of the Act The relevant facts, as presented, are that the assessee filed its return of income for the assessment year under consideration, which was processed by the CPC. Subsequently, an intimation order under Section 143(1) of the Act was issued on 13th 2022, wherein certain adjustments were made to the returned income. Aggrieved by this intimation, the assessee preferred an appeal before Ld. CIT(A), which was instituted on 9th June 2023. The assessee contended that the intimation order dated er 2022 was served upon it on 12th May 2023. Consequently, it was submitted that the appeal filed on 9th June 2023 fell within the statutory limitation period of 30 days, as prescribed under Section 249 of the Act, for filing an appeal before ). Notwithstanding this contention, the assessee, while presenting its submissions on the merits of the case, did not file a formal application seeking condonation of the delay, if any, in filing the appeal. The Ld. CIT(A), however, was not convinced by th assessee’s claim that the intimation order had been served with a delay of over nine months. Instead, the Ld. CIT(A) concluded that the intimation order was served immediately after its issuance. DSP Finance Pvt. Ltd. 3 ITA No. 4263/MUM/2024 was already disallowed in the return of income resulting in double The appellant submits that the Assessing Officer be directed: (i) To delete the disallowance under section 43B amounting to ; (ii) To delete the disallowance of depreciation amounting to Rs. 1,78,20,507 /; and to modify the assessment in The relevant facts, as presented, are that the assessee filed its return of income for the assessment year under consideration, which was processed by the CPC. Subsequently, an intimation order under Section 143(1) of the Act was issued on 13th 2022, wherein certain adjustments were made to the returned income. Aggrieved by this intimation, the assessee preferred an appeal before Ld. CIT(A), which was instituted on 9th June 2023. The assessee contended that the intimation order dated er 2022 was served upon it on 12th May 2023. Consequently, it was submitted that the appeal filed on 9th June 2023 fell within the statutory limitation period of 30 days, as prescribed under Section 249 of the Act, for filing an appeal before ). Notwithstanding this contention, the assessee, while presenting its submissions on the merits of the case, did not file a formal application seeking condonation of the delay, if any, in filing the appeal. The Ld. CIT(A), however, was not convinced by the assessee’s claim that the intimation order had been served with a delay of over nine months. Instead, the Ld. CIT(A) concluded that the intimation order was served immediately after its issuance. Based on this determination, the Ld. CIT(A) declined to co delay and, accordingly, dismissed the appeal as unadmitted. Aggrieved by the dismissal of its appeal, the assessee has preferred the present appeal before the Income Tax Appellate Tribunal (ITAT), raising the grounds as outlined above. 2.1 This matter, therefore, revolves around two core issues for adjudication: 1. The factual dispute concerning the actual date of service of the intimation order under Section 143(1) of the Act. 2. Whether the Ld. CIT(A) erred in declining to condone the delay in filing the appeal and, consequently, rejecting the same without adjudicating the merits. 3. We have carefully considered the submissions advanced by the rival parties and thoroughly perused the material placed on record. The matter pertains to the appeal filed by th intimation issued under Section 143(1) of the Income (hereinafter referred to as \"the Act\") by the Central Processing Centre (CPC), Bangalore 3.1 Ground No. 1 of the appeal relates to the non appeal by the Ld. CIT(A) due to the alleged filing of the appeal after the expiry of the limitation period prescribed under Section 249(2) of the Act.During the course of the hearing before ITA No. 4263/MUM/2024 Based on this determination, the Ld. CIT(A) declined to co delay and, accordingly, dismissed the appeal as unadmitted. Aggrieved by the dismissal of its appeal, the assessee has preferred the present appeal before the Income Tax Appellate Tribunal (ITAT), raising the grounds as outlined above. atter, therefore, revolves around two core issues for The factual dispute concerning the actual date of service of the intimation order under Section 143(1) of the Act. Whether the Ld. CIT(A) erred in declining to condone the delay the appeal and, consequently, rejecting the same without adjudicating the merits. We have carefully considered the submissions advanced by the rival parties and thoroughly perused the material placed on record. The matter pertains to the appeal filed by the assessee against the intimation issued under Section 143(1) of the Income (hereinafter referred to as \"the Act\") by the Central Processing Centre (CPC), Bangalore Ground No. 1 of the appeal relates to the non-admission of the the Ld. CIT(A) due to the alleged filing of the appeal after the expiry of the limitation period prescribed under Section 249(2) During the course of the hearing before us DSP Finance Pvt. Ltd. 4 ITA No. 4263/MUM/2024 Based on this determination, the Ld. CIT(A) declined to condone the delay and, accordingly, dismissed the appeal as unadmitted. Aggrieved by the dismissal of its appeal, the assessee has preferred the present appeal before the Income Tax Appellate Tribunal (ITAT), atter, therefore, revolves around two core issues for The factual dispute concerning the actual date of service of the intimation order under Section 143(1) of the Act. Whether the Ld. CIT(A) erred in declining to condone the delay the appeal and, consequently, rejecting the same We have carefully considered the submissions advanced by the rival parties and thoroughly perused the material placed on record. The e assessee against the intimation issued under Section 143(1) of the Income-tax Act, 1961 (hereinafter referred to as \"the Act\") by the Central Processing admission of the the Ld. CIT(A) due to the alleged filing of the appeal after the expiry of the limitation period prescribed under Section 249(2) us, the Learned Departmental Representative (hereinafter \"Ld. DR\") was direc submit evidence establishing the actual date of service of the intimation order issued under Section 143(1) of the Act. compliance with the direction, the Ld. DR, during the hearing on 15th June 2025, submitted a report from the Assessing Officer (AO). The report categorically stated that the intimation order under Section 143(1) of the Act, dated 13th September 2022, was served upon the assessee on 11th May 2023. The relevant portion of the AO's report is reproduced below: \"On perusal of information available in the CPC 2.0 Portal, it is seen that the intimation u/s 143(1) of the Act dated 13.09.2022 vide DIN No. CPC/2021/A6/303385850 was served on the assessee on 11.05.2023 on the email ID [e-mail] and through SMS on Mobile No. filed for the year under consideration. The relevant screenshot of the CPC 2.0 Portal is attached for your ready reference. The initiation date of the said document is shown as 11.05.2023, and the delivery status is also dispatch is Email/SMS, and the status is shown as SUCCESS. Sd/- (Basant Kumar Arya) ACIT-3(1)(1), Mumbai\" 3.2 In view of the report submitted by the AO, it is unequivocally established that the intimation order dated 13th September 2022 was served upon the assessee only on 11th May 2023. Consequently, the appeal filed by the assessee before the Ld. CIT(A) on 9th June 2023 falls well within the statutory limitation ITA No. 4263/MUM/2024 Departmental Representative (hereinafter \"Ld. DR\") was direc submit evidence establishing the actual date of service of the intimation order issued under Section 143(1) of the Act. compliance with the direction, the Ld. DR, during the hearing on 15th June 2025, submitted a report from the Assessing Officer (AO). The report categorically stated that the intimation order under Section 143(1) of the Act, dated 13th September 2022, was served upon the assessee on 11th May 2023. The relevant portion of the AO's report is reproduced below: information available in the CPC 2.0 Portal, it is seen that the intimation u/s 143(1) of the Act dated 13.09.2022 vide DIN No. CPC/2021/A6/303385850 was served on the assessee on 11.05.2023 on the email ID [e-mail] and through SMS on Mobile No. 8879189908 mentioned in the return filed for the year under consideration. The relevant screenshot of the CPC 2.0 Portal is attached for your ready reference. The initiation date of the said document is shown as 11.05.2023, and the delivery status is also shown as 11.05.2023. The mode of dispatch is Email/SMS, and the status is shown as SUCCESS. (Basant Kumar Arya) 3(1)(1), Mumbai\" In view of the report submitted by the AO, it is unequivocally established that the intimation order dated 13th September 2022 was served upon the assessee only on 11th May 2023. Consequently, the appeal filed by the assessee before the Ld. une 2023 falls well within the statutory limitation DSP Finance Pvt. Ltd. 5 ITA No. 4263/MUM/2024 Departmental Representative (hereinafter \"Ld. DR\") was directed to submit evidence establishing the actual date of service of the intimation order issued under Section 143(1) of the Act. In compliance with the direction, the Ld. DR, during the hearing on 15th June 2025, submitted a report from the Assessing Officer (AO). The report categorically stated that the intimation order under Section 143(1) of the Act, dated 13th September 2022, was served upon the assessee on 11th May 2023. The relevant portion of the information available in the CPC 2.0 Portal, it is seen that the intimation u/s 143(1) of the Act dated 13.09.2022 vide DIN No. CPC/2021/A6/303385850 was served on the assessee on 11.05.2023 on the email ID [e-mail] and 8879189908 mentioned in the return filed for the year under consideration. The relevant screenshot of the CPC 2.0 Portal is attached for your ready reference. The initiation date of the said document is shown as 11.05.2023, and shown as 11.05.2023. The mode of dispatch is Email/SMS, and the status is shown as SUCCESS. In view of the report submitted by the AO, it is unequivocally established that the intimation order dated 13th September 2022 was served upon the assessee only on 11th May 2023. Consequently, the appeal filed by the assessee before the Ld. une 2023 falls well within the statutory limitation period of 30 days, as prescribed under Section 249(2) of the Act. The Ld. CIT(A), in rejecting the appeal as time erred in not appreciating the correct factual position regarding the date of service of the intimation order. Accordingly, the finding of the Ld. CIT(A) on this issue is hereby set aside. CIT(A) has not adjudicated the appeal on the merits of the grounds raised therein, the matter is remitted back to the Ld. CIT(A fresh adjudication, confined to the merits of the grounds raised before him. The Ground No. 1 of the appeal of the assessee is allowed. The Ground Nos. 2 and 3, being alternative grounds, are dismissed as infructuous. 4. In the result, the appeal of purposes. Order pronounced in the open Court on Sd/ (KAVITHA RAJAGOPAL JUDICIAL MEMBER Mumbai; Dated: 21/01/2025 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// ITA No. 4263/MUM/2024 period of 30 days, as prescribed under Section 249(2) of the Act. The Ld. CIT(A), in rejecting the appeal as time-barred, has thus erred in not appreciating the correct factual position regarding the of service of the intimation order. Accordingly, the finding of the Ld. CIT(A) on this issue is hereby set aside. CIT(A) has not adjudicated the appeal on the merits of the grounds raised therein, the matter is remitted back to the Ld. CIT(A fresh adjudication, confined to the merits of the grounds raised Ground No. 1 of the appeal of the assessee is Ground Nos. 2 and 3, being alternative grounds, are dismissed as infructuous. In the result, the appeal of the assessee is allowed for statistical nounced in the open Court on 21/01/2025. Sd/- Sd/ KAVITHA RAJAGOPAL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai DSP Finance Pvt. Ltd. 6 ITA No. 4263/MUM/2024 period of 30 days, as prescribed under Section 249(2) of the Act. barred, has thus erred in not appreciating the correct factual position regarding the of service of the intimation order. Accordingly, the finding of the Ld. CIT(A) on this issue is hereby set aside. Since the Ld. CIT(A) has not adjudicated the appeal on the merits of the grounds raised therein, the matter is remitted back to the Ld. CIT(A) for fresh adjudication, confined to the merits of the grounds raised Ground No. 1 of the appeal of the assessee is Ground Nos. 2 and 3, being alternative grounds, are the assessee is allowed for statistical /01/2025. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER (Assistant Registrar) ITAT, Mumbai "