INDIANROOTS RETAIL PRIVATE LIMITED,NEW DELHI V. .ACIT CIRCLE 12(1), NEW DELHI

ITA 3987/DEL/2024

AI Insights

The case involves Indianroots Retail Private Limited appealing against the order of the Ld. CIT(Appeal)/NFAC, Delhi, which upheld various additions made by the Assessing Officer for the assessment year 2017-18. The additions included disallowances of expenditure on share services and additions under section 68 r.w.s. 115BBE of the Income Tax Act, related to the genuineness and creditworthiness of certain creditors/trade payables. The Ld. CIT(A) had dismissed the assessee's appeal for non-prosecution, applying the Multiplan decision. The Tribunal found that the Ld. CIT(A) failed to pass a speaking order and thus remitted the matter back for a detailed examination and a reasoned decision.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 31603 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2024
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2017-2018
• Other Referred Cases: Multiplan decision
• Laws Referred To: Income Tax Act
• Result in Favour of: Matter Remanded
• Court: TRIBUNAL
• Department Lawyers: OM PARKASH
• Keywords: Opportunity of being heard; Corroborative evidences; Carry forward of business losses
• Section: 250; 251; 48; 68

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “C”, NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER, AND SHRI YOGESH KUMAR US, JUDICIAL MEMBER ITA NO. 3987/Del/2024 A.YR. : 2017-18 INDIANROOTS RETAIL PRIVATE LIMITED, 402, ARCHANA COMMERCIAL COMPLEX, B-BLOCK ROAD, GREATER KAILASH-I, NEW DELHI – 48 (PAN: AADCJ2494H) VS. ACIT CIRCLE 12(1), NEW DELHI (APPELLANT) (RESPONDENT) Appellant by : None Respondent by : Shri Om Parkash, Sr. DR. Date of hearing : 10.12.2024 Date of pronouncement : 16.12.2024 ORDER PER SHAMIM YAHYA, AM : The Assessee has filed the instant Appeal against the Order of the Ld. CIT(Appeal)/NFAC, Delhi dated 10.6.2024, relating to assessment year 2017- 18 on the following grounds:- 1. In law and on the facts and in the circumstances of the case, the order u/s 250 of the Act passed by the Ld. CIT (A) is arbitrary and is without judicious appreciation of the facts and position in law, and thus, erroneous insofar as the same upholds the order passed by the Assessing officer. 2 | P a g e 2. That the Ld. CIT(A) was not justified by not appreciating the facts available on record i.e. Statement of facts, Grounds of appeal and passed the order without considering the same which is in contravention of the provisions of section 250(6) read with 251 of the Act. 3. In law and in the facts and circumstances in the case of the appellant, CIT(A) erred in upholding disallowance of the expenditure incurred on share services amounting to Rs. 2,60,85,624/- being excessive in nature without appreciating that the said amount being incurred on Arm's Length and after proper deduction of tax. The Id. CIT(A) failed to appreciate that allege expenses on share services were incurred to ensure the continuation of the benefit from the efficiencies of consolidation of services from group company without any intent of tax avoidance. 4. In law and in the facts and circumstances in the case of the appellant, CIT(A) erred in upholding addition of Rs. 5,26,821/- with respect of liabilities of stale cheques on assumption that such liability ceased to exist by invoking provisions of section 41(1) of the Act without appreciating that mere non- encashment of cheques does not mean that the liability of the Appellant ceased to exist, nor the provisions of section 41(1) of the Act is applicable on the facts. 5. In law and in the facts and circumstances in the case of the appellant, Ld. CIT(A) erred in upholding addition of Rs. 39,87,628/-under section 68 r.w.s. 115BBE of the Act on the premise that proof of genuineness and creditworthiness of the said creditors/trade payables not proved. 5.1 In law and in the facts and circumstances in the case of the appellant, CIT(A) erred in upholding addition of Rs. 39,87,628/-under section 68 r.w.s. 115BBE of the Act without appreciating that the transactions in question are normal trade transactions and cannot fall for addition under section 68 of the Act. 5.2 In law and in the facts and circumstances in the case of the appellant, CIT(A) erred in upholding addition of Rs. 52,52,982/-under section 68 r.w.s. 115BBE of the Act on alleged grounds that the Appellant did not submit any supporting evidence to substantiate its claim. 5.3 In law and in the facts and circumstances in the case of the appellant, CIT(A) erred in upholding addition of Rs. 52,52,982/-under section 68 r.w.s. 115BBE of the Act without appreciating that the transactions in question are normal provisions/ payable at year end and cannot fall for addition under section 68 of the Act. 3 | P a g e б. The appellant craves leave to add to alter, amend and/or withdraw any ground or grounds of appeal either before or during the course of hearing of the appeal. 2. In this case, AO made various additions and assessed the income at Rs. 92,40,610/- u/s. 115BBE and business loss carry forwarded at Rs. 24,66,041/-. Upon assessee’s appeal, Ld. CIT(A) dismissed the appeal of the assesse for non-prosecution by applying Multiplan decision. 3. Against the order of the Ld. CIT(A), assessee is in appeal before us. 4. We have heard the Ld. DR and perused the records. None appeared on behalf of the assesse, despite issue of notice, hence, we are deciding the appeal of the assesse exparte qua the assesse. Upon careful consideration, we note that it is incumbent upon the Ld. CIT(A) to pass a speaking order, but he has failed to do so. Therefore, in view of the aforesaid facts and circumstances of the case and in the interest of justice, the issues in dispute are remitted back to the file of the Ld. CIT(A) with the directions to pass a speaking order on the merits of the case, after giving adequate opportunity of being heard to the assessee. We hold and direct accordingly. 5. In the result, the Assessee’s appeal is allowed for statistical purposes. Order pronounced on 16/12/2024. Sd/- (YOGESH KUMAR US) Sd/- (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER SRBHATNAGAR Copy forwarded to:- 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR, ITAT Assistant Registrar "