Dwarka Cement Works Limited Vs ITO (ITAT Mumbai)
Summary: The Mumbai Bench of the Income Tax Appellate Tribunal allowed the appeal filed by Dwarka Cement Works Limited against the order of the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre, which had confirmed penalty of Rs. 37,29,845/- under section 271(1)(c) of the Income-tax Act, 1961 for A.Y. 2015–16.
The assessee had originally filed its return under section 139(1) on 29.09.2015 declaring a loss of Rs. 1,15,25,958/-. The scrutiny assessment under section 143(3) was completed on 28.12.2017 accepting the returned loss. Subsequently, a section 148 notice dated 29.07.2022 was issued. In response, the assessee filed a return on 26.08.2022 disallowing bad debts of Rs. 1.18 crores, comprising a loan of Rs. 1.13 crores given to M/s Karnavati Securities Pvt. Ltd. and an advance of Rs. 5 lakhs towards purchase of a flat. The returned loss consequently stood reduced to Rs. (-) 30,057/-.
The reassessment was completed under sections 143(3), 147 and 144B on 02.05.2023, accepting the figure returned by the assessee without making any further addition or disallowance. Despite this, the Assessing Officer treated the reduction in the originally declared loss as concealment of income to the extent of Rs. 1,14,95,901/- and levied penalty of Rs. 37,29,845/- under section 271(1)(c).
