STAR PAPER MILLS LTD.,KOLKATA V. D.C.I.T., CIRCLE - 4(1), KOLKATA

ITA 2571/KOL/2024

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Star Paper Mills Ltd. appealed against the order of the Commissioner of Income Tax (Appeals) which partly confirmed the addition of Rs. 5,51,81,527 as liabilities written back to their income for the Assessment Year 2023-24. The company argued that this amount was already included in their profit and loss account and taxed under the head 'profit and gain from business and profession'. The Tribunal examined the financial statements and the tax audit report, agreeing with the assessee that the addition constituted double taxation of the same income.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 314497 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2023-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

"आयकर अपीलȣय अͬधकरण, कोलकाता पीठ “ए’’, कोलकाता IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH: KOLKATA Įी Ĥदȣप क ुमार चौबे, ÛयाǓयक सदèय एवं Įी राक ेश ͧमĮ, लेखा सटèय क े सम¢ [Before Shri Pradip Kumar Choubey, Judicial Member &Shri Rakesh Mishra, Accountant Member] I.T.A. No. 2571/Kol/2024 Assessment Year: 2023-24 Star Paper Mills Ltd. (PAN: AAECS 0759 B) Vs. DCIT, Circle-4(1), Kolkata Appellant / ) अपीलाथȸ ( Respondent / Ĥ×यथȸ Date of Hearing / सुनवाई कȧ Ǔतͬथ 24.04.2025 Date of Pronouncement/ आदेश उɮघोषणा कȧ Ǔतͬथ 08.05.2025 For the assessee / Ǔनधा[ǐरती कȧ ओर से Shri Akkal Dudhwewala, Advocate For the revenue / राजèव कȧ ओर से Shri Abhijit Adhikari, JCIT Sr. DR ORDER / आदेश Per Pradip Kumar Choubey, JM: This is the appeal preferred by the assessee against the order of Ld. Commissioner of Income Tax (Appeals)- Addl/JCIT(A)-4, Delhi (hereinafter referred to as the Ld. CIT(A)] dated 06.11.2024 for AY 2023-24. 2 I.T.A. No. 2571/Kol/2024 Assessment Year: 2023-24 Star Paper Mills Ltd. 2. Brief facts of the case of the assessee are that the assessee filed its return of income for AY 2023-24 declaring total income of Rs. 85,01,46,040/- under the normal provision of the Act. The AO/CPC assessed the total income of the assessee at Rs. 90,57,18,400/- after making addition of Liabilities written back at Rs. 5,51,81,527/- and an amount of Rs. 3,90,829/- double addition made on account of the ICDS adjustment. 3. Aggrieved by the said order the assessee preferred an appeal before the Ld. CIT(A) wherein the appeal of the assessee has been partly allowed as the Ld. CIT(A) has confirmed the order of AO with respect to addition of Rs. 5,51,81,527/- under liabilities written back but deleted the addition on account of ICDS adjustment. Being aggrieved and dissatisfied the assessee preferred an appeal before us. 4. The Ld. A.R challenges the very impugned order thereby submitting that the Ld. CIT(A) failed to appreciate that the impugned sum had already been credited as offered to tax in the profit and loss account and therefore the addition of Rs. 5,51,81,527/- made by CPC amounting to double addition of the same sum. Hence, the authority be directed to delete the same. He has brought to the notice of the tribunal on the audited financial statement submitted in PB. He has also submitted the chart before us to prove the same. 5. Contrary to that the Ld. D.R supports the impugned order. 6. Upon hearing the submission of the counsel of the respective parties, we have perused the order of Ld. CIT(A). The sole grievance in this appeal relates to disallowance of Rs. 5,51,81,527/- made by CPC. The submission of the Ld. Counsel of the assessee is that during the year under consideration the company had credited Rs. 6,02,76,922/- as provision of liability no longer required written back as reflected in the note no. 24 “other income” of the audited financial statement filed by the assessee at page 15. The assessee has filed the breakup of the sum of Rs. 6,02,76,922/- credited in the profit and loss account which is herein below: 3 I.T.A. No. 2571/Kol/2024 Assessment Year: 2023-24 Star Paper Mills Ltd. On perusal of the above chart it appears to us that the amount of Rs. 5,51,81,527/- already formed part of profit and loss account and has already been offered to tax under the head profit and gain from the business and profession. The relevant extract of the Schedule Part A-P & L Ind-As which is as under: 4 I.T.A. No. 2571/Kol/2024 Assessment Year: 2023-24 Star Paper Mills Ltd. The relevant extracts of tax audit report is as under: 7. Going over the chart as well as submission made by the assessee we are of the view that CPC had erroneously made adjustment of Rs. 5,51,81,527/- u/s 41(1)(a) of the Act without appreciating the fact that the same was already credited and offered to tax in the profit and loss account. We find substance in the argument of the Ld. Counsel of the assessee is that impugned addition amounted to double addition. Accordingly, the appeal of the assessee is hereby allowed and addition of Rs. 5,51,81,527/- as liability returned back is hereby directed to be deleted. In the result, the appeal filed by the assessee is allowed. Order is pronounced in the open court on 8th May, 2025 Sd/- Sd/- (Rakesh Mishra /राक ेश ͧमĮ) (Pradip Kumar Choubey /Ĥदȣप क ुमार चौबे) Accountant Member/लेखा सदèय Judicial Member/ÛयाǓयक सदèय Dated: 8th May, 2025 SM, Sr. PS 5 I.T.A. No. 2571/Kol/2024 Assessment Year: 2023-24 Star Paper Mills Ltd. Copy of the order forwarded to: 1. Appellant- Star Paper Mills Ltd., Duncan House, 31, N. S. Road, Kolkata- 700001. 2. Respondent – DCIT, Circle-4(1), Kolkata 3. Ld. CIT(A)-Addl/JCIT(A)-4, Delhi 4. Ld. Pr. CIT- , Kolkata 5. DR, Kolkata Benches, Kolkata (sent through e-mail) True Copy By Order Assistant Registrar ITAT, Kolkata Benches, Kolkata "