IBITOL TECHNOLOGIES PRIVATE LIMITED, AMBALA CITY,AMBALA CITY V. PRINCIPAL COMMISSIONER OF INCOME TAX, PANCHKULA , PANCHKULA

ITA 444/CHANDI/2024

AI Insights

The case involves M/s Ibitol Technologies Pvt. Ltd., which appealed against the revisionary order passed by the Pr. Commissioner of Income Tax, Panchkula, under section 263 for the Assessment Year 2018-19. The revision was based on the grounds that the assessment order, initially accepted by the Assessing Officer, did not adequately examine certain business expenses related to sales promotion, commissions, and salaries. The tribunal dismissed the appeal primarily due to the significant delay in filing, noting that the assessee consciously decided to wait until the consequential order was passed before challenging the revisionary jurisdiction.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 397932 (ITAT-CHANDIGARH)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-06-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANAV BANSAL LD
• Assessee Lawyers: TEJ MOHAN SINGH LD
• Keywords: Condonation of delay; Set aside; Business expenditure; Revision of order
• Section: 263

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, CHANDIGARH BEFORE HON’BLE SHRI LALIET KUMAR, JM AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं. / ITA No. 444/CHANDI/2024 (िनधाŊरणवषŊ / Assessment Year: 2018-19) M/s Ibitol Technologies Pvt. Ltd. C/o Tej Mohan Singh # 527, Sector 10-D Chandigarh बनाम/ Vs. Pr. CIT Panchkula ̾थायीलेखासं./जीआइआरसं./PAN/GIR No. AADCI-1911-J (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Shri Tej Mohan Singh (Advocate) – Ld. AR ŮȑथŎकीओरसे/Respondent by : Shri Manav Bansal ( CIT) – Ld. DR सुनवाईकीतारीख/Date of Hearing : 24-04-2025 घोषणाकीतारीख /Date of Pronouncement : 02-06-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. By way of this appeal, the assessee assails invocation of revisionary jurisdiction u/s 263 by Ld. Pr. Commissioner of Income Tax, Panchkula (Pr.CIT) for Assessment Year (AY) 2018-19 vide impugned order dated 31-03-2023 in the matter of an assessment framed by Ld. AO u/s.143(3) of the Act on 04-03-2021. The registry has noted delay of 328 days in the appeal, the condonation of which has been sought by Ld. AR on the strength of condonation petition. The Ld. CIT-DR has vehemently opposed condonation of delay on the 2 ground that the appeal was filed after the consequential order was already passed by Ld. AO. Having heard rival submissions, and upon perusal of case records, our adjudication would be as under. 2. It emerges that the assessee’s case was subjected to limited scrutiny to examine business expenses. The assessee filed various documents which were accepted by Ld. AO and the returned income was accepted vide assessment order dated 04-03-2021. 3. Subsequently, Ld. Pr. CIT, upon perusal of case records, sought revision of the order on the ground that issue of large sales promotion expenses was not properly examined and verified by Ld.AO though a query was raised by Ld. AO, in this regard. The Ld. Pr. CIT flagged issue of commission payment, salaries & wages, advertisement expenses and sales promotion expenses. Accordingly, the assessee was show-caused. The assessee assailed any interference in the assessment order on merits and sought dropping-off of revisionary proceedings. However, complete details were still not furnished. The Ld. Pr. CIT observed that the assessee was providing software installation services for USA based clients. Almost all the revenue was from export sales and it worked exclusively for IBITOL, LLC USA. On these facts, Ld. AO was required to examine how these expenses were incurred for the business of the assessee and also examine the genuineness of the same. Accordingly, the assessment order was set aside with a direction to the Ld. AO to frame fresh assessment after making requisite enquiries and verifications. Aggrieved, the assessee is in further appeal before us. The Ld. AR has stated that 3 consequential order has been passed on 18-03-2024 by the Assessment Unit. 4. Upon perusal of factual matrix, it could be seen that the impugned revisionary order was passed on 31-03-2023 and pursuant to the same, consequential order was passed on 18-03-2024 wherein apparently the assessee has been saddled with certain additions. Against the same, the assessee has filed further appeal on 22-04- 2024. At the same time, the assessee has challenged the revisionary jurisdiction and preferred this appeal on 22-04-2024 which is after the passing of consequential order. In other words, the assessee took conscious decision not to question the validity of revisionary jurisdiction till the outcome of the consequential order which is again appealable before higher authorities. On these facts, the appeal is liable to be dismissed at its very threshold on the ground of delay. In the condonation affidavit, it has been admitted that the impugned order was uploaded on the portal on 31-03-2023. The assessee was advised to challenge the validity of revisionary order in further appeal against consequential order. However, later on, the appeal was filed on coming to know that this order was appealable before Tribunal. The said reasoning to condone inordinate delay of 328 days could not be countenanced. The reasons adduced in the condonation petition are not convincing, in any manner. We order so. In the result, the appeal stand dismissed for want of delay. 4 5. The appeal stand dismissed. Order pronounced on 02-06-2025. Sd/- Sd/- (LALIET KUMAR) (MANOJ KUMAR AGGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated : 02-06-2025. आदेश की Ůितिलिप अŤेिषत / Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT, CHANDIGARH "