Case Law Details
ACIT Vs Indus Health Plus Private Limited (ITAT Pune)
Assessee didn’t submitted necessary details before AO. CIT(A) deleted the addition made by the AO on this score without calling for the remand report. Tribunal set-aside the impugned order.
Facts-
Revenue preferred an appeal against deletion of addition of Medical Check-up Provision (MCP). Facts are the assessee was set up with the objective of promoting Preventing Health Checkups/Health Diagnostics etc. in a network mode. The assessee created the MCP amounting to Rs.20,68,90,289/-, which was debited to the P&L account under the head ‘Operating expenses’. The AO called upon the assessee to explain as to how the MCP was created for Rs.20.68 crore. The assessee submitted that it had four different health packages for sale to customers during the year and there was a fixed cost involved for the medical check-ups under such packages, which was to be paid to the empanelled hospitals at the time of their performing the medical check-ups, which facility could be availed by its customers within three years from the date of sale of package. The assessee submitted that it created the provision of Rs.20.68 crore for the year under consideration on the basis of number of health packages sold. AO made the addition as the assessee neither submitted any basis for making the MCP nor furnished any package-wise details in respect of the working of the amount of the MCP. The assessee submitted all such details before the CIT(A), who concurred with the assessee’s point of view and deleted the addition. Aggrieved thereby, the Revenue has come up in appeal before the Tribunal.
Next issue is deletion of addition of Rs. 1,99,17,012/- in respect of ‘Escrow Disbursement Provision’ EDP created by the assessee for the year in question. Notably, in previous year the AO disallowed the closing balance of the EDP, for the year under consideration, the AO made disallowance of the difference between the Escrow Disbursement Provision at Rs.16,34,09,427/- and Escrow Disbursement Payment at Rs.14,34,92,415/-. The ld. CIT(A) deleted the addition.
Please become a Premium member. If you are already a Premium member, login here to access the full content.