Indus Towers Limited Vs DCIT (ITAT Delhi)
The case involves cross appeals filed by the assessee and the Revenue against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), dated 04.02.2025, arising from an assessment under Section 143(3) of the Income Tax Act, 1961 for Assessment Year 2017–18. The primary issue in the assessee’s appeal was the refusal of the CIT(A) to admit and adjudicate additional grounds of appeal raised by the assessee. These additional grounds included claims relating to allowability of education cess and higher education cess as expenditure under Section 37(1), depreciation on generator sets, deduction of expenditure on abandoned capital work-in-progress, and determination of excess dividend distribution tax (DDT) paid to non-resident shareholders.
The Tribunal noted that the assessee had relied on Supreme Court decisions to support the admission of additional grounds. It further observed that a Coordinate Bench had earlier, by order dated 30.11.2023, specifically directed the CIT(A) to adjudicate these additional claims on merits, clarifying that appellate authorities are empowered to entertain new claims even if not raised in the original return. However, despite these explicit directions, the CIT(A) again refused to admit and adjudicate the additional grounds in the impugned order. The Tribunal held that such action amounted to non-compliance with binding directions of a higher appellate authority. It characterized this as a serious lapse and reiterated that the CIT(A) was obligated to admit and decide the additional grounds in accordance with law after providing an opportunity of hearing to the assessee. Accordingly, the Tribunal restored the matter to the file of the CIT(A) with directions for fresh adjudication, and the assessee’s appeal was allowed for statistical purposes. Other grounds on merits were not adjudicated as they became academic.
