Bollineni Developers Ltd. Vs DCIT (ITAT Hyderabad)
Summary: The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) partly allowed the appeal filed by Bollineni Developers Ltd. against the order dated 06/01/2025 passed by the learned CIT(A)-NFAC, Delhi for Assessment Year 2017-18.
The assessee company was engaged in the business of real estate projects, civil construction works and power projects. For A.Y. 2017-18, the assessee filed its return of income on 29/10/2017 declaring total loss of Rs.22,97,14,286/- under the normal provisions of the Income Tax Act, 1961. The revised return was filed on 30/10/2018 declaring total loss of Rs.11,75,58,268/-.
The assessment was completed under Section 143(3) of the Income Tax Act, 1961 on 30/12/2019. The Assessing Officer made an adhoc disallowance of 30% of site maintenance expenditure amounting to Rs.1,49,42,675/-, resulting in an addition of Rs.44,82,802/-. The disallowance was made on the ground that the expenditure was supported only by internal self-made vouchers and was not amenable to verification.
The CIT(A) sustained the addition made by the Assessing Officer. Aggrieved by the order, the assessee preferred an appeal before the Tribunal.
Before the Tribunal, the assessee submitted that the Assessing Officer had not rejected the books of account and had not pointed out any specific discrepancy in the site maintenance expenditure claimed. It was submitted that the assessee maintained payroll records for daily wage workers and obtained signatures after payment of wages at the site. The assessee also produced wage registers and cash payment vouchers before the Assessing Officer.
