AT & T Global Network Services India Private Limited Vs ACIT (ITAT Delhi)
The appeal before the Tribunal arose from an order dated 23.03.2025 passed by the Commissioner of Income Tax (Appeals), concerning Assessment Year 2021–22. The core issue pertained to the disallowance of ₹85,25,109 claimed as deduction towards gratuity paid by the assessee during the year, which was denied by the Assessing Officer under section 143(1) of the Income Tax Act, 1961.
The assessee contended that the gratuity amount had actually been paid during the relevant year and was therefore allowable as a deduction under section 40A(7) read with section 37 of the Act. It was submitted that the disallowance arose due to an inadvertent reporting error in the return of income and the tax audit report. Specifically, the gratuity amount was incorrectly disclosed in one part of the income tax return and not reflected in the appropriate column of the tax audit report, leading to an inconsistency.
The assessee argued that the Central Processing Centre (CPC) made the addition solely based on this mismatch, despite the fact that the payment itself was not disputed. To substantiate its claim, the assessee produced documentary evidence, including an Actuarial Valuation Report demonstrating that the gratuity amount had indeed been paid during the year. It was further submitted that on similar facts in the case of a related entity, the appellate authority had deleted the disallowance based on such evidence.
