Case Law Details
ITO Vs Kali Infra Pvt. Ltd. (ITAT Chennai)
Introduction: The case of ITO Vs Kali Infra Pvt. Ltd. revolves around the dispute arising from the assessment year 2013-14. The Revenue has filed two appeals against the order of the Commissioner of Income Tax (Appeals)-8, Chennai, dated 04.01.2018.
Detailed Analysis: The assessee company, engaged in infrastructure development, declared a total loss of Rs. 2,02,036/- for the assessment year 2013-14. During the scrutiny, the Assessing Officer (AO) noticed a claim of Rs. 15.09 Crs as ‘share application money’ pending allotment. Despite requests, the assessee failed to provide adequate evidence regarding the identity, genuineness, and creditworthiness of the parties involved. The AO considered the claim fraudulent and made additions under section 68 of the Income Tax Act.
The Commissioner of Income Tax (Appeals) (CIT(A)), however, deleted the addition, stating that the claim of ‘share application money’ was fraudulent and not supported by actual receipts. The Revenue, aggrieved by this decision, appealed before the Income Tax Appellate Tribunal (ITAT) Chennai.
The Tribunal observed discrepancies in the assessment order, noting the absence of discussion on how the ‘share application money’ was received and the lack of evidence to support the fraudulent claim. Accordingly, the ITAT directed the AO to verify the issue in light of the assessee’s claim, scrutinize the books of accounts, bank statements, and any other evidence provided, and decide the matter in accordance with the law.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
