Case Law Details
ITO Vs Meyer Apparel Pvt. Ltd (ITAT Delhi)
In a recent case, the Income Tax Appellate Tribunal (ITAT) Delhi delivered a significant verdict in the matter of ITO vs. Meyer Apparel Pvt. Ltd., challenging the order of the Commissioner of Income Tax (Appeals) [CIT(A)] for the assessment year 2006-07. The crux of the dispute revolved around the addition of Rs. 3,70,00,000 made by the Assessing Officer (AO) under section 28(iv) of the Income Tax Act, 1961 [the Act].
Background of the Case
The Revenue contended that the CIT(A) erred in justifying the deletion of the addition of Rs. 3,70,00,000, arguing that the amount was never used by the assessee company as capital expense, but rather for day-to-day business operations. The grounds of appeal also raised concerns about the AO limiting himself to the directions of the ITAT while making the addition.
Revenue’s Arguments
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