ACIT Vs Khadamat Integrated Solutions Private Limited (ITAT Mumbai)
Summary: The Mumbai ITAT dealt with the Revenue’s appeal and the assessee’s cross-objection for AY 2016-17 arising from the CIT(A)’s order dated 30.05.2024. The assessee, a 100% subsidiary of Public Services Company, Kuwait, had been incorporated in India to carry out medical screening of persons visiting Kuwait as part of the pre-visa process. Its Indian operations had subsequently ceased. There was a delay of 94 days in filing the cross-objection. Considering the assessee’s explanation regarding closure of Indian operations, communication with its Kuwaiti parent and the time taken for legal advice and approval, the Tribunal treated the delay as genuine, bona fide and unintentional and condoned it, relying on Collector of Land Acquisition v. Mst. Katiji and Others.
The assessee raised additional legal grounds challenging the validity of the assessment and the Section 143(2) notice. Since the grounds arose from material already on record and went to the root of the matter, the Tribunal admitted them relying on National Thermal Power Corporation Ltd. v. CIT. The assessee had filed its return on 29.11.2016 declaring total income of Rs.16,38,56,590. However, the statutory notice under Section 143(2), dated 01.08.2017, had been issued by an Income Tax Officer. The assessee contended that under CBDT Instruction No.1/2011 dated 31.01.2011, in a metro city an ITO was empowered to handle a corporate return only up to Rs.30 lakh, while a return above that monetary limit fell within the jurisdiction of a DC/AC. The Tribunal found that the assessee’s returned income was substantially above that threshold. It further noted that no fresh Section 143(2) notice had been issued by the officer who ultimately framed the assessment.
