DCIT Vs Astitva Exim (ITAT Surat)
Section 10AA Deduction Cannot Be Denied for Non-Provision of Partners’ Interest and Remuneration; Section 147 Reassessment Cannot Travel Beyond Recorded Reasons: ITAT Surat
The Revenue filed an appeal before the Income Tax Appellate Tribunal (ITAT), Surat against the order of the National Faceless Appeal Centre (NFAC)/CIT(A) dated 26.12.2024 for Assessment Year 2012-13 arising from reassessment proceedings under Sections 143(3) read with 147 of the Income Tax Act.
The assessee had filed its return of income on 29.09.2012 declaring nil income after claiming deduction of ₹16,82,06,879 under Section 10AA. The original assessment under Section 143(3) was completed on 25.03.2015 at nil income. Subsequently, the assessment was reopened under Section 147 based on information received from ADIT (Investigation)-2, Surat regarding an alleged excess deduction under Section 10AA arising from differences between import figures reported in the audit report and the data available with DGCIS, Kolkata. A notice under Section 148 was issued on 31.03.2019.
During reassessment, the Assessing Officer accepted the assessee’s reconciliation of imports as reflected in the audit report and the DGCIS data. However, instead of making any addition on that issue, the Assessing Officer made an addition of ₹11,68,26,920 on a different issue relating to disallowance of remuneration and interest payable to the partners. The reassessment under Sections 143(3) read with 147 was completed on 28.12.2019 determining the total income at ₹11,68,26,920.
