Case Law Details
Lake View Hospitality Vs DCIT (ITAT Mumbai)
As per the provision of section 43B of the Act, any sum payable by the assessee by way of tax, duty, cess or fee shall be allowable in computing the income of that previous year in which such sum is actually paid by the assessee. In the present case, as per the assessee, VAT liability was duly paid by the assessee before the due date of filing return u/s 139 (1) of the Act for the relevant assessment year. In support of its submission, the assessee has filed by way of additional evidence sample copy of challans as well as statement showing details of payment of VAT liability. In view of the submissions made by the learned AR, the additional evidences so filed by the assessee are admitted. Further, as these details could not be examined by the lower authorities, therefore, we deem it appropriate to remand this issue to the file of jurisdictional Assessing Officer for de novo adjudication, after necessary verification of the details filed by the assessee. We further direct that if upon verification it is found that the VAT liability was paid by the assessee before the due date of filing return under section 139(1) of the Act, then to that extent relief be granted to the assessee under section 43B of the Act. As a result, grounds raised by the assessee in present appeal are allowed for statistical purpose.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The present appeal has been filed by the assessee challenging the impugned order dated 09/12/2021 passed under section 250 of the Income Tax Act, 1961 (‘the Act’) by learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [‘learned CIT(A)’], for the assessment year 2017–18.
2. In its appeal, assessee has raised following grounds:
“1. The Ld. Commissioner of Income Tax (Appeals)-NFAC, [hereinafter referred to as the “Ld CIT(A)] erred in passing the order dated 09.12.2021 upholding the assessment under dated 28.02.2019 passed Intimation under section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as “of the Act”] by Ld. Income Tax officer 26 (2) (1), Mumbai (hereinafter referred to as Ld. A.O.] without appreciating the facts and circumstances of the case. Thus, the order dated 09.12.2021 passed by Ld. CIT (A) is bad in law and the same may be quashed.
2. The Ld. CIT (A) erred in upholding the action of Centralized Processing Center in making addition of Rs.1,07.07.160/- on the basis of the fact that no response was received from assessee. The Ld. CIT (A) had not appreciated the fact of spread of COVID which is main concern of not being able to file the documents and also not appreciating the fact of filing the adjournment in COVID time.
3. The Ld. CIT(A) failed to appreciate that the pandemic is hitting the world very badly and as informed by the government of India all the companies has asked their employees to do work from home to avoid spreading of the Covid. Due to closure of office all the documents were in office and our accounting team were doing work from home and were not in the possession of the physical documents which we were required to be presented before CIT(A). Hence we were not able to collect documents and to take advise for further legal course in the subject matter.”
3. The only grievance of the assessee in the present appeal is against disallowance of Rs. 1,07,07,160 under section 43B of the Act, by the Centralised Processing Centre, Bengaluru, while processing the income tax return under section 143(1) of the Act, which was upheld by the learned CIT(A) vide impugned order dated 09/12/2021.
4. The brief facts of the case, as emanating from record, are: The assessee filed its return of income on 31/10/2017 declaring loss of Rs. 60,71,766 and the said return was processed on 28/02/2019 vide intimation issued under section 143(1) of the Act, whereby disallowance of Rs. 1,07,07,160 under section 43B of the Act was made. Before the learned CIT(A), even despite notices being issued no details/submission was filed by the assessee. In the absence of any detail pertaining to payment of VAT liability, learned CIT(A) dismissed the appeal filed by the assessee and confirmed the addition made vide intimation issued under section 143(1) of the Act. Being aggrieved, assessee is in appeal before us.
5. During the course of hearing, learned Authorised Representative (‘learned AR’) submitted that assessee made the payment in respect of VAT liability before the due date of filing of return u/s 139(1) and thus the same is allowable under section 43B of the Act. In support of his submission, learned AR placed reliance upon statement showing details of payment of VAT liability along with sample copy of challans, which have been filed before us along with an application seeking admission of additional evidence under Rule 29 of Appellate Tribunal Rules, 1963. Learned AR further submitted that due to COVID related restrictions, office of the assessee was not properly functioning and therefore, necessary details could not be filed before the learned CIT(A).
6. On the other hand, learned Departmental Representative fairly agreed to admission of additional evidence filed by the assessee.
7. We have considered the rival submissions and perused the material available on record. As per the provision of section 43B of the Act, any sum payable by the assessee by way of tax, duty, cess or fee shall be allowable in computing the income of that previous year in which such sum is actually paid by the assessee. In the present case, as per the assessee, VAT liability was duly paid by the assessee before the due date of filing return u/s 139 (1) of the Act for the relevant assessment year. In support of its submission, the assessee has filed by way of additional evidence sample copy of challans as well as statement showing details of payment of VAT liability. In view of the submissions made by the learned AR, the additional evidences so filed by the assessee are admitted. Further, as these details could not be examined by the lower authorities, therefore, we deem it appropriate to remand this issue to the file of jurisdictional Assessing Officer for de novo adjudication, after necessary verification of the details filed by the assessee. We further direct that if upon verification it is found that the VAT liability was paid by the assessee before the due date of filing return under section 139(1) of the Act, then to that extent relief be granted to the assessee under section 43B of the Act. As a result, grounds raised by the assessee in present appeal are allowed for statistical purpose.
8. In the result, appeal by the assessee is allowed for statistical purpose.
Order pronounced in the open court on 01/07/2022
