Ankur Rice Industries Pvt. Ltd. Vs ITO (ITAT Agra)
In a recent order, the Income Tax Appellate Tribunal (ITAT) of Agra, in the case of Ankur Rice Industries Pvt. Ltd. Vs ITO, ruled in favor of the assessee by deleting a tax addition of Rs 3,48,918. The appeal, designated as ITA No. 118/AGR/2025, pertained to the assessment year 2016-17. The core issue before the tribunal was whether the Assessing Officer (AO) was justified in treating the amount of “salary payable” as income under Section 56 of the Income-tax Act, 1961.
The background of the case involved a scrutiny assessment of Ankur Rice Industries, a private limited company engaged in the manufacturing of rice. During the assessment proceedings, the company presented its books of accounts, which were duly audited and supported by invoices and vouchers. The AO raised a query regarding an amount of Rs 3,48,918, which was listed under the head of ‘other current provisions.’
In its submission, the company clarified that the sum represented salary that was payable to its employees as of March 31, 2016. It further provided documentary evidence to the AO showing that this liability had been fully discharged in the subsequent financial year. Despite these details and supporting documents, the AO disregarded the company’s explanation and proceeded to add the amount to the company’s income, citing Section 56 of the Act. This decision by the AO was subsequently confirmed by the NFAC (National Faceless Assessment Centre).
