Wig Brothers India Pvt. Ltd., Faridabad V. DCIT, New Delhi

ITA 5888/DEL/2016

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 7062 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 17-11-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRASKASH DUBEY
• Keywords: Capital asset converted into stock in trade
• Section: 45(2); 143(3); 45(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, G: NEW DELHI (THROUGH VIDEO CONFERENCING) BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.5888/DEL/2016 ASSESSMENT YE AR : 2013-14 WIG BROTHERS INDIA PRIVATE LIMITED, 618, SECTOR-21A, FARIDABAD, HARYANA-121001, PAN-AAACW3144L VS. DCIT, CIRCLE-27(1), C.R. BUILDING, NEW DELHI (APPELLANT) (RESPONDENT) APPELLAN T BY : SH. R. K. BANSAL, CA RESPONDENT BY : SH. PRASKASH DUBEY, SR. DR DATE OF HEARING : 24.03.2021 DATE OF PRONOUNCEMENT : 07.04.2021 ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE O RDER DATED 12.09.2016 OF THE LEARNED CIT(A)-9, NEW DELHI, RELATING TO AS SESSMENT YEAR 2013-14. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER:- 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE THE L D. COMMISSIONER OF INCOME TAX (APPEALS)-9, NEW DELHI, E RRED IN DISMISSING THE APPEAL OF THE COMPANY ON THE TECHNIC AL GROUND, THAT THE APPEAL WAS NOT FILED THROUGH E-FILING SYSTEM EL ECTRONICALLY, ALTHOUGH THE APPEAL WAS FILED MANUALLY IN PAPER FOR MAT WITHIN DUE TIME. ITA NO.5888/DEL/2016 2 THE OTHER GROUNDS OF APPEAL ARE SAME AS PER APPEAL FILED BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS)-9, NEW DELHI, W HICH ARE AS UNDER:- 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. ASSESSING OFFICER ERRED IN DISALLOWING A SUM OF RS.2,00,000/- ON ADHOC BASIS OUT OF VEHICLE RUNNING & MAINTENANCE EXPENSES OF RS .26,39,307/- AND RS. 29,97,461/-ON TRAVELLING & CONVEYANCE EXPEN SES INCURRED BY THE ASSESSEE COMPANY FOR BUSINESS PURPOSES OF TH E COMPANY. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. ASSESSING OFFICER ERRED IN DISALLOWING A SUM OF RS.1,00,000/- ON ADHOC BASIS OUT OF BUSINESS PROMOTION EXPENSES OF RS.9,09,864/- INCURRED BY THE ASSESSEE COMPANY FOR BUSINESS PURPOSE OF THE CO MPANY. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . ASSESSING OFFICER ERRED IN DISALLOWING A SUM OF RS.4,30,885/- IN DISALLOWING OUT OF SUNDRY CREDITORS OUTSTANDING BALANCES AS ON 31.03.2013 ON PERCENTAGE BASIS, WHOSE BALANCES WERE NOT CONFIRMED BY THE PARTIES. 5. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. ASSESSING OFFICER ERRED IN INITIATING PENALTY PROCEEDINGS U/S 271(1) (C) OF THE INCOME TAX ACT 1961 FOR FURNISHING INACCURATE PARTI CULARS/CONCEAL OF INCOME BY THE APPELLANT. 3. AFTER HEARING BOTH THE SIDES, WE FIND THAT THE ASSESSE E IS A PRIVATE LIMITED COMPANY, ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION . IT FILED ITS RETURN OF INCOME ON 27.09.2013 DECLARING TOTAL INCOME OF RS. 1,10,53,840/-, WHICH WAS SUBSEQUENTLY REVISED ON 28.09.2013 DECLARING TO TAL INCOME AT RS.1,17,05,910/-. THE ASSESSING OFFICER COMPLETED THE ASSESS MENT UNDER SECTION 143(3) ON 25.02.2016 DETERMINING TOTAL INCOME AT RS .1,24,86,800/-. THE ASSESSEE FILED THE APPEAL MANUALLY AND IN PAPER FORM O N 10.03.2016. HOWEVER, THE LEARNED CIT(A) NOTED THAT IN TERMS OF AMENDE D RULE 45 READ ITA NO.5888/DEL/2016 3 WITH RULE 12(3) OF THE IT RULES, 1962, THE ASSESSEE WAS REQ UIRED TO FURNISH THE APPEAL ELECTRONICALLY, EITHER THROUGH DIGITAL SIGNATURE O R THROUGH ELECTRONIC VERIFICATION MODE. THE FORM NO.35 WAS TO BE IN T HE SPECIFIED FORMAT PRESCRIBED BY THE PR. DGIT OR THE DGIT (SYSTEMS) IN ACCORDANCE WITH RULE 45(5) READ WITH NOTIFICATION 5/2016 ISSUED BY THE PR. DG IT (SYSTEMS) DATED 06.04.2016. THE CBDT EXTENDED THE TIME LIMIT FOR FILING E -APPEALS W.E.F. 01.03.2016 TO 15.06.2016 VIDE CIRCULAR NO.20/2016 DATED 26.05.2016. SINCE, THE ASSESSEE IN THE INSTANT CASE HAS F ILED THE APPEAL MANUALLY IN PAPER FORM AND DID NOT FILE THE APPEAL ELECTRONIC ALLY WITHIN THAT DATE I.E. 15.06.2016, THEREFORE, HE ASKED THE ASSESSEE TO INFORM WHETHER THE APPEAL HAD BEEN E-FILED BY 15.06.2016 OR ALTERNATIVELY, HE WAS EXEMPTED FROM FILING E-APPEAL IN TERMS OF CLAUSE (B) OF RULE 45(2) OF IT RU LES. IT WAS FURTHER INFORMED THAT IF NEITHER COURSE OF ACTION WERE APPLIC ABLE TO THE ASSESSEE, THE PAPER APPEAL FILED WAS TO BE TREATED AS NO N-EST. REJECTING VARIOUS EXPLANATION GIVEN BY THE ASSESSEE, THE LEARNED CI T(A) HELD THAT SINCE, THE ASSESSEE HAS NOT FILED THE APPEAL IN ELECTRONIC FO RM AND FILED THE APPEAL MANUALLY, THEREFORE, THE APPEAL HAS BECOME NON-E ST. HE, ACCORDINGLY, DISMISSED THE APPEAL FILED BY THE ASSESSEE IN LIMINE. 4. AGGRIEVED WITH SUCH ORDER OF THE LEARNED CIT(A), THE AS SESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND THE P APER BOOK FILED ON BEHALF OF THE ASSESSEE. IT IS AN ADMITTED FACT THAT THE LE ARNED CIT(A) HAS DISMISSED THE APPEAL IN LIMINE TREATING THE SAME AS NON-EST , SINCE, THE ITA NO.5888/DEL/2016 4 ASSESSEE HAS NOT E-FILED THE APPEAL AND HAS FILED THE SAME MANUALLY IN PAPER FORM. THE CO-ORDINATE BENCHES OF THE TRIBUNAL ARE T AKING A LENIENT VIEW IN SUCH CASES WITH A DIRECTION TO THE LD. CIT(A) TO ALLO W THE ASSESSEE TO E-FILE THE APPEAL AND DECIDE THE APPEAL ON MERIT. WE, DIRECT THE LD. CIT(A) TO ALLOW THE ASSESSEE TO FILE THE APPEAL IN ELECTRONIC MODE AND DECIDE THE APPEAL ON MERIT. WE HOLD AND DIRECT ACCORDINGLY. THE GRO UNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSE. ODER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARIN G ITSELF I.E. ON 07.04.2021. SD/- SD/- (SUDHANSHU SRIVASTAVA) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER DELHI/DATED- 07.04.2021 F{X~{T COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSISTANT REGISTRAR, ITAT, DELHI