DCIT Vs CNH Industrial [India] Pvt Ltd (ITAT Delhi)
₹72 Cr Added Due to Audit Typo? ITAT Says ‘Clerical Error’ & Deletes Entire Adjustment
CNH Industrial (India) Pvt. Ltd. filed its return declaring income of ₹684.72 crore. CPC issued a proposed adjustment u/s 143(1)(a), to which Assessee initially did not respond. Later, Assessee filed a grievance explaining that the tax auditor made an inadvertent reporting error in Form 3CD under Clause 14(b): instead of reporting closing inventory of AY 2022-23 (₹839.08 crore), the auditor wrongly reported opening inventory (₹766.99 crore). This mistake resulted in an artificial difference of ₹72,08,51,534, which CPC added to income in the final intimation u/s 143(1).
Assessee appealed before CIT(A) & submitted supporting evidence (inventory records, audited financials, reconciliation) to prove that the Form 3CD figure was a clerical mistake & no such addition was warranted. CIT(A), after verifying the evidence, deleted the entire addition of ₹72.08 crore.
Revenue appealed to Tribunal, arguing that CIT(A) should have remanded the matter to AO or directed Assessee to file a revised tax audit report.
Tribunal held that CIT(A) had rightly examined the evidence, found the reporting error to be genuine & had correctly granted relief. There was no requirement to remand the matter, since all facts were already on record. Tribunal also noted that CIT(A) has co-terminus powers with AO & can verify facts directly.
