PPG Asian Paints Pvt Ltd Vs DCIT (ITAT Mumbai)
Summary: The appeal by PPG Asian Paints Pvt Ltd challenged the final assessment order passed under section 143(3) read with section 144C(13) of the Income Tax Act, 1961 for AY 2020-21. The assessee initially raised 18 grounds, covering transfer pricing adjustments, limitation, various expenditure disallowances, provision for bad and doubtful debts, an unexplained addition attributed to an intimation under section 143(1), interest and penalty.
At the hearing, the assessee did not press Ground Nos. 1 to 10 concerning the transfer pricing adjustment and related issues. These grounds were accordingly dismissed as not pressed. Ground No. 11 concerning limitation under section 153 was also not pressed, but the assessee requested that it be kept open. The Tribunal left Ground No. 11 open.
Ground Nos. 12 to 14 concerned 10% ad hoc disallowances of travelling and conveyance expenses, advertisement and sales promotion expenses, and miscellaneous promotion expenses. The Assessing Officer had considered the documentary evidence furnished by the assessee to be incomplete and made ad hoc disallowances. The DRP upheld the disallowances, noting that only part details and bank statements had been produced.
Before the Tribunal, the assessee undertook to furnish the necessary information and evidence and requested restoration of the issues to the Assessing Officer. The Revenue did not object to the matters being restored. The Tribunal therefore set aside Ground Nos. 12, 13 and 14 to the file of the Assessing Officer for fresh adjudication after providing the assessee an opportunity to substantiate the genuineness of the expenditure. These grounds were allowed for statistical purposes.
