Siti Networks Limited Vs DCIT (ITAT Mumbai)
Summary: Siti Networks Limited filed an appeal before the Mumbai Bench of the Income Tax Appellate Tribunal against the order dated 10.12.2025 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, for Assessment Year 2023-24. The appellate order arose from a penalty order dated 19.09.2025 passed by the Assessing Officer under section 270A of the Income-tax Act, 1961, under which penalty of Rs.21,77,57,030/- had been levied.
The assessee was engaged in distribution of television channels through analogue and digital cable distribution network, primary internet and allied services. For the relevant year, it made a provision of Rs.34,62,00,000/- towards diminution in the value of investments and disclosed the same under “Exceptional Items” in Note No.44 to the profit and loss account forming part of its audited financial statements. The return of income, filed on 26.10.2023, declared a loss of Rs.90,64,80,592/-.
The Tribunal noted that the correct figure of Rs.34,62,00,000/- was disclosed in Part A-P&L-Ind AS of the return. However, while entering the corresponding disallowance in Part A-OI, the assessee entered Rs.3,46,20,000/- instead of Rs.34,62,00,000/-. The return was processed under section 143(1) on 30.01.2024 accepting the returned loss.
The case was subsequently selected for scrutiny. Notice under section 142(1) dated 15.10.2024 sought details of expenditure under “Other Expenses” but did not point out the discrepancy or raise a specific query concerning the allowability of the provision for diminution in the value of investments. While preparing its response, the assessee itself informed the Assessing Officer through its submission dated 27.01.2025 that one zero had inadvertently been omitted while entering the add-back and offered the differential amount of Rs.31,15,80,000/- for disallowance.
