PME Power Projects India Ltd Vs DCIT (ITAT Delhi)
ITAT Delhi held that in the event of defective return filed by the assessee, then the same need to be ignored and assessment is to be framed u/s 144. Thus, passing of assessment order under section 143(3) instead of 144 is invalid and liable to be quashed.
Facts- The assessee company is engaged in the business of manufacturing of power distribution transformers and EPC projects. The assessee filed its return of income for the Asst Year 2013-14 u/s 139 of the Act declaring income of Rs 107,56,68,480/- with self assessment tax payable of Rs 49,00,67,340/-, which was duly processed u/s 143(1) of the Act. In the said return, the assessee had offered the income on mercantile basis based on the invoices raised on the debtors and booked sales thereon. But the monies were not realized at all by the assessee company. Even the invoices raised by the assessee company were not even acknowledged by the Debtors.
During the course of scrutiny assessment proceedings, the assessee was asked to remove the defect of filing the return without payment of self assessment tax, for which a defect notice in terms of section 139(9) of the Act was duly issued by the learned AO on 29.10.2015. The assessee sought time from AO to make payment of the said taxes. Since the invoices per se were not even acknowledged by the Debtors, the assessee could not realize the sale proceeds from the Debtors and accordingly did not have monies in its kitty to make payment of self assessment tax. For non-payment of self assessment tax, AO treated the return filed by the assessee as an invalid return and made disallowance of various expenses and addition towards sundry creditors totaling to the tune of Rs 2,85,77,271/-.
