M/s. JCL Infra Ltd., Uttar Pradesh V. Pr. CIT, Meerut

ITA 814/DEL/2017

AI Insights

The case involves M/s. JCL Infra Ltd., which appealed against the revisional order of the Pr.CIT, Meerut, concerning the assessment year 2012-13. The assessee, engaged in manufacturing railway track materials, had their return of income subjected to scrutiny, resulting in an assessment with certain additions and disallowances. The Pr.CIT, upon examination of the assessment records, invoked revisional powers under Section 263 of the Income Tax Act, citing lack of inquiry and discrepancies in the assessment order. The ITAT dismissed the appeal due to the absence of the assessee's representation and upheld the Pr.CIT's decision, emphasizing the need for a detailed inquiry into various financial aspects and compliance with tax deduction at source (TDS) regulations.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 121572 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2023
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 08-01-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 12-02-2017
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: TDS
• Section: 263; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “C” DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.A No.814/DEL/2017 Assessment Year 2012-13 M/s. JCL Infra Ltd., J. Sons House, Garh Road, C/o M/s. Deepak Street, Meerut Cantt. v. Pr. Commissioner of Income Tax, Meerut. TAN/PAN: AAACJ8106D (Appellant) (Respondent) Appellant by: None Respondent by: Mohd. Gayasuddin Ansari, CIT (DR) Date of hearing: 09 01 2023 Date of pronouncement: 12 01 2023 O R D E R PER PRADIP KUMAR KEDIA, A.M.: The captioned appeal has been filed by the assessee against the revisional order of the Principal Commissioner of Inco me Tax, Mee rut (Pr.CIT) date d 14.07.2014 passed under Section 143(3) of the Act concerning Assess ment Year 2012-13. 2. The assessee-compan y is engaged in the business of manufacturing of Point and Crossing, Switches, Switch Expansion Joints, Steel Sleepers, Fasteners and other related ite ms to Railwa y Track Material. The assessee filed return of income (R OI) sh owing total income at Rs.42,49,480/- for the Assess ment Ye ar 2012-13 in question. The return wa s subjected to scrutiny assessment and the assess ment was carr ied out at I.T.A No.814/Del/2017 2 Rs.44,16,649/- after making certain additions and disallowances. On exa mination of the assess ment records, the Pr.CIT invoked the revisional power conferr ed under Section 263 of the Act. A show cause notice dated 15.04.2015 was issued to the assessee showing the discrepancy in the action of the Assessing Officer while fra ming the assessment order. The show cause notice is reproduced hereunder: “ (i ) D u r i n g t h e c o u r s e o f e x a m i n a t i o n o f r e c o r d s , ba l a n c e s h e e t p r o f i t & l o s s A / c i t i s o b s e r v e d t h a t : ( i i ) T h e c a s e w a s s e l e c t e d u n d e r s c r u t i n y d u e t o h ig h r a t i o o f r e f u n d t o T D S a n d l a r g e i n t e r e s t e x p e n s e s r e l a t a b l e t o e x e m p t i n v e s t m e n t u / s . 1 4 A n o v e r i f i c a t i o n o f T D S i s a v a i la b l e o n r e c o r d s . ( i i ) S i m i l a r l y n o i n v e s t i g a t i o n w a s d o n e b y t h e A O i n r e s p e c t o f i s s u e r e l a t e d t o s e c . 1 4 A o f I . T . A c t . ( i i i ) I n n o t e 1 6 ( A ) o f a / c s i t i s m e n t i o n e d t h a t b an k g u a r a n t e e o f R s . 5 C r o r e h a s b e e n g i v e n i n r e s p e c t o f l o a n t a k e n b y s u b s i d i a r y C o . M / s S h r e e V a s u A u t o m o b i l e s L t d . O n t h e o t h e r h an d i n n o t e 1 2 b a n k g u a r a n t e e c o m m i s s i o n d e b i t e d i s s h o w n a t R s . 2 3. 4 9 . 5 9 1 / - . T h e e x p e n d i t u r e t o a b o v e b a n k g u a r a n t e e i s n o t a l l ow a b l e a s t h e s a m e i s n o t r e l a t e d t o y o u r b u s i n e s s . ( i v ) A O h a s n o t m a d e a n y e n q u i r y w h e t h e r T D S w a s d ed u c t e d o n f o l l o w i n g e x p e n s e s d e b i t e d t o P &L a / c a n d a n y s u c h f a i l u r e t o d e d u c t T D S w o u l d a t t r a c t t h e m i s c h i e f o f s e c t i o n 4 0( a ) ( i a ) o f I T A c t , 1 9 6 1 . ( i ) L e g a l & S e r v i c e c h a r g e s R s . 1 7 , 0 6 , 4 5 5 / - ( i i ) R e n t & ( R a t e s & T a x e s ) R s . 3 0 , 9 8 , 6 2 0 / - ( v ) A s p e r n o t e 2 3 b a d d e b t s h a v e b e e n w r i t t e n o f f a t R s . 9 , 3 5 , 3 8 2 / - b u t n o d e t a i l i n t h i s r e g a r d h a s b e e n o b t a i n e d b y th e A . O . 3 . I n v i e w o f p a r a 2 a b o v e , t h e a s s e s s m e n t o r d e r p as s e d b y t h e A s s e s s i n g O f f i c e r i s a p p a r e n t l y e r r o n e o u s a n d p r e j ud i c i a l t o t h e i n t e r e s t o f r e v e n u e T h e r e f o r e , y o u a r e h e r e b y c a l l ed u p o n t o s h o w c a u s e a s t o w h y a r t a p p r o p r i a t e o r d e r u n d e r s e c t i o n 2 6 3 o f t h e I n c o m e T a x A c t , 1 9 6 1 m a y n o t b e p a s s e d i n y o u r c a s e. Y o u m a y a t t e n d m y o f f i c e a n d r e q u i r e d t o f u r n i s h y o u r e x p l an a t i o n e i t h e r i n p e r s o n o r t h r o u g h a n a u t h o r i z e d r e p r e s e n t a t i v e w i t h d o c u m e n t a r y e v i d e n c e s i n s u p p o r t o f y o u r c o n t e n t i o n a l o n g w i t h co m p l e t e b o o k s o f a / c s , b i l l s , v o u c h e r s , r e g i s t e r s & c o p i e s o f b a nk s t a t e m e n t s e t c . a s m a i n t a i n e d b y y o u o n 2 9 . 0 4 . 2 0 I 5 a t 0 3 : 0 0 P . M . ” I.T.A No.814/Del/2017 3 3. Thus, the Pr.CI T raised wide ranging discrepancies and lack of inquiry on several aspects of the assessment as per the show cause notice. In response, the assessee filed certain submissions and contended that the relevant details have been exa mined b y t he Assessing Officer in the assess ment proceedings. The Pr.CI T however was not satisfied with the reply of the assessee and claimed that necessary d etails and explanation which ought to have been obtained were not exa mined by the Assessing Officer while framing the assessment. In ess ence, it was alleged that the Assessing Officer has passed the assessment order without application of mind. Thus, the impugned assessment order is erroneous insofar as prejudicial to the interest of the Revenue. Consequently, the Pr.CI T Meerut has set aside the impugned order of the Assessing Officer with a direction to consider the issues as mentioned in the show cause notice afresh and ma ke detailed inquiry in accorda nce with law. 4. Aggrieved by the revisional action, the assessee preferred appeal before the ITAT. 5. When the matter was called for hearing, none appeared for the assessee. It is noticed that multiple opportunities were given to the assessee in the past owning to non attendance. It is thus gauged that the assessee is not interested in pursuing the appeal. Consequently, we are constraint to proceed ex-parte. 6. We have heard the submissions made on behalf of the Revenue and also perused the assessment order as well as revisional order. No separate paper book is available on record I.T.A No.814/Del/2017 4 fro m either side. 7. On perusal of the facts and circu mstances e merging fro m the case records, we do not find any mitigating circu mstances existing in the case to dislodge the revisional action of the Pr.CI T as allege d in the show cause notice. The Assessing Officer has failed to make an y i nquiry in respect of several issues such as clai m of bad debt, disallowance under Section 14A, nature of bank guarantee commission, deduction of TDS on expenses incurred etc. Fro m the revisional order, it is not known as to what defense has been put to justif y the assessment order. Under the circu mstances, to our mind, the Pr.CIT has rightly observed that the assessment order has been passed without application of mind and without looking into crucial aspects. No evidence has been filed on behalf of the assessee before the Tribunal in its rebuttal. Under the circu mstances, we see no reason to interfere with the revisional order. 8. In the result, the appeal of the assessee is dismissed ex- parte. Order pronounced in the open Court on 12/01/2023. Sd/- Sd/- [KUL BHARAT] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: /01/2023 Prabhat