NIRANKARI JEWELS PVT. LTD.,DELHI V. DCIT CIRCLE-16(1), DELHI

ITA 2652/DEL/2024

AI Insights

The case involves Nirankari Jewels Pvt. Ltd., the appellant, contesting an adjustment made by the Central Processing Center (CPC), Bengaluru, regarding GST on closing stock disallowed under section 43B of the Income Tax Act, 1961, for the Assessment Year 2022-23. The appellant argued that the GST, which was unpaid on closing stock and disallowed in the preceding year, was paid in the current year and should be allowed. The Addl. CIT(A) upheld the CPC's adjustment, leading to the appeal. The Tribunal decided to remand the matter back to the AO to verify the payment details provided by the assessee.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 470458 (ITAT-DELHI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2022-2023
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KRISHNA K. RAMAWAT
• Assessee Lawyers: ASHU GOEL
• Keywords: Set aside
• Section: 143(1); 43B

Judgement Text

"ITA No.2652/Del/2024 Page | 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI “E” BENCH: NEW DELHI BEFORE SHRI MAHAVIR SINGH, VICE PRESIDENT & SHRI BRAJESH KUMAR SINGH, ACCOUNTANT MEMBER ITA No.2652/Del/2024 [Assessment Year : 2022-23] Nirankari Jewels Pvt.Ltd., 78-84, Edward Lane, Kingsway Camp, New Delhi-110009. PAN-AAACN5479R vs DCIT, Circle-16(1), Delhi. APPELLANT RESPONDENT Appellant by Shri Ashu Goel, CA Respondent by Shri Krishna K.Ramawat, Sr.DR Date of Hearing 21.11.2024 Date of Pronouncement 29.01.2025 ORDER PER MAHAVIR SINGH, V.P. : This appeal by the assessee is arising out of the order of Ld. Addl. Commissioner of Income Tax (Appeals)-1, Vadodara in Appeal No. ADDL/JCIT(A)-1 VADODARA/10001/2021-22 vide order dated 05.04.2024. The return of income was processed u/s 143(1) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) by CPC, Bengaluru vide intimation u/s 143(1) pf the Act, dated 29.07.2023 for Assessment Year (hereinafter referred to as ‘AY’) 2022-23. 2. The only surviving issue before us is as regards the order of Ld. Addl. CIT(A) confirming the action of the CPC, Bengaluru making adjustment u/s 143(1)(a) of the Act being GST on closing stock disallowed u/s 43B of the Act. For this, the assessee has raised following Ground Nos. 3 & 4 as under:- 3. “That Ld. CIT(A) is not justified in confirming the adjustment of Rs.19,18,733/- made by Ld. ADIT, Central Processing Center (CPC), Bangalore U/s 143(1)(a) which is not covered under various items of ITA No.2652/Del/2024 Page | 2 adjustment specified U/s 143(1)(a) of the Income Tax Act, 1961 and hence adjustment so confirmed needs to be deleted. 4. That Ld. CIT(A) is not justified in confirming the adjustment of Rs.19,18,733 made by Ld. ADIT, Central Processing Center (CPC), Bangalore which is on account of GST on Closing Stock disallowed U/s 43B in preceding previous year and allowable during the year which is based on surmises, conjectures, contrary to facts, provisions of law and hence adjustment so confirmed needs to be deleted.” 3. We have heard the rival contentions and gone through the facts and circumstances of the case. We noted that the assessee claimed before us that this amount of GST on closing stock claimed as input against GST payable on sales which has been disallowed in earlier years need to be allowed during the year. The assessee raised this issue before Ld. Addl. CIT(A) as under:- “That Ld. CPC, Bangalore is not justified in making adjustment of Rs.19,18,733/- being GST on Closing Stock disallowed U/s 43B in preceding previous year and allowable during the year claimed by the appellant which is based on surmises, conjectures, contrary to facts and provisions of law and hence, adjustment so made needs to be deleted.” 4. The assessee before Ld. Addl. CIT(A) submitted that Rs.19,18,733/- being GST unpaid on closing stock was not paid on or before the due date of filing of return of income for AY 2021-22 and hence, the same was added back to the return of income in the computation for the relevant AY 2021-22. It was claimed that while filing the return of income for the relevant AY 2022-23, the payment of Rs.19,18,733/- being unpaid GST was paid and claimed u/s 43B of the Act. The assessee vide reply dated 26.03.2024, before Ld. Addl. CIT(A), submitted Form GSTR-9 and challan for payment of Rs.3,57,504/- pertaining to AY 2021- 22 and not for the full amount of Rs.19,18,733/-. Now, before us, Ld. Counsel for the assessee only requested that the assessee will file the entire details before the Assessing Officer (“AO”) in regard to this payment of GST and hence, matter can be remitted back to the file of the AO for verification. ITA No.2652/Del/2024 Page | 3 5. After hearing both the sides and going through the facts of the case, we set aside the order of Ld. Addl. CIT(A) and that of the CPC, Bengaluru on this very issue and remand the matter back to the file of the AO on the issue of unpaid GST, which the assessee claimed to have been paid during the relevant AY 2022- 23. The AO will verify the payment of tax if paid during the year which remained unpaid in earlier AY 2021-22. In terms of the above, matter is restored back to the file of AO. 6. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced on 29th January, 2025. Sd/- Sd/- (BRAJESH KUMAR SINGH) (MAHAVIR SINGH) ACCOUNTANT MEMBER VICE PRESIDENT Dated: 29/01/2025 *Amit Kumar, Sr.PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI "