TaxTMI 
TaxTMI 
TaxTMI 
2024 (10) TMI 700
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....sessee. In response, ld. AR for the assessee attended and submitted relevant information as called for. 3. The assessee is a public sector construction company and 78.21% of equity shares are held by the President of India and operates through Ministry of Railway (MoR), Government of India. It implements various types of railway infrastructure projects assigned by MoR includes doubling (3rd/4th lines) gauge conversion, new lines railway electrification and major bridges. 4. It is relevant to note that the assessee has filed its return of income on 28.02.2022 and the case was selected for scrutiny on 28.06.2022 and subsequently, notice u/s 142 (1) dated 12.09.2022 was issued to the assessee and assessee submitted relevant information relating to various informations called for in questionnaire of notice u/s 142(1) of the Act on 26.08.2022. 5. It is relevant to note that intimation u/s 143 (1) was passed on 22.09.2022 with the total assessed income at Rs. 3317,74,52,060/- by the CPC by making the following addition :- (i) A sum of Rs. 26,54,02,75,354/- towards the additional amount of any liability of a contingent nature which has been allegedly debited to the profit and loss ac....
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....peal Centre erred in law and on the facts and circumstances of the case in passing the Impugned Order without considering that taxes can only be collected as per authority of law and not on account of any inadvertent mistakes in the tax-audit report that ought to rectified or deleted. Principles of Natural Justice 5. The Commissioner of Income Tax (Appeals) /National Faceless Appeal Centre erred in law and on the facts and circumstances of the case in not considering the submissions made by the Appellant before passing the Impugned Order. 6. The Commissioner of Income Tax (Appeals) / National Faceless Appeal Centre erred in law and on the facts and circumstances of the case in passing the Impugned Order without considering the documents substantiating that Rs. 26,54,02,75,345/- was inadvertently reported by the tax auditor in Form 3CD and not debited by the Appellant to the profit and loss account which goes against the principles of natural justice. 7. The Commissioner of Income Tax (Appeals) / National Faceless Appeal Centre erred in law and on the facts and circumstances of the case in not appreciating that the assessment order was issued by the Assessment Unit without i....
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....ase law compendium). 10. Ld. AR further submitted that it is also well settled that an assessee cannot be taxed on an amount on which tax is not legally imposable, even if an assessee may have chosen the wrong channel for the redressal of grievance. Reliance is placed on the decision of the Jodhpur Bench of the Hon'ble Tribunal in the case of Akbar Mohammad Prop. M/s Mohd. Rafique Associates v. The ACIT, CPC, Bangalore, 2022 (2) TMI 479 - ITAT Jodhpur (SI. No. 1 of the case law compendium). The findings in the case of Akbar Mohammad (supra) have been upheld by various benches of the ITAT in Muwahhid Educational Foundation v. The Commissioner Of Income Tax, NFAC Delhi, 2023 (2) TMI 919 - ITAT Bangalore, (Sl. No. 2 of the case law compendium), Madhya Pradesh Gramin Bank (formerly known as Narmada Jhabua Gramin Bank) v. ACIT, CPC-TDS Ghaziabad, 2022 (11) TMI 771 - ITAT INDORE (Sl. No. 3 of the case law compendium), and Shivganga Drillers Private Ltd. v. CPC, Income Tax, Indore Bangalore, 2022 (5) TMI 1427 - ITAT Indore (SI. no. 4 of the case law compendium). 11. Ld. AR further stated that in the instant case, there is no basis to pay tax on the addition of Rs. 26,54,02,75,345/- as t....
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....utta High Court, (page 59, SI. No. 13 of the paper book) * P.T. Lee Chengalvaraya Naicker Trust v. Income Tax Officer [2022] 143 Taxmann.com 252 (Madras) (page 64, SI. No. 14 of the paper book) * Saawariya Impex (P) Ltd. v. National E Assessment Centre, Delhi [2021] 131 taxmann.com 57 (Delhi), (page 76, SI. No. 15 of the paper book) * Sams Facilities Management (P) Ltd. v. National Faceless Assessment Centre [2021] 130 taxmann.com 376 (Delhi), (page 79, SI. No. 16 of the paper book) 14. Ld. AR further submitted that it is pertinent to highlight that the during the assessment proceedings the AO did not request clarifications regarding the amount mentioned as contingent liability in Form 3CD (pages 116, 117-119, and 121-124 of the paper book, SI. nos. 4, 5, and 7). As the Assessment Order under Section 143(3) of the IT Act was passed by the AO after the intimation by CPC, the AO ought to have followed the procedure provided under Section 144B of the IT Act. If such a notice would have been issued, the assessee would have had the opportunity to provide the clarification and bring the facts on record before the AO. Therefore, the justification for non-application of the procedur....
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....a notice u/s 143(2) of the Act and auditor has issued the audit certificates on 28.02.2022 wherein he has mentioned the details of contingent liability at Sl.No.21(a) of the auditor report which was filed by the auditor on 28.02.2022 wherein it was mentioned that the assessee has claims pending under adjudication in arbitration invoked by the contractor and cases pending in court. As per the statements submitted before us, we observed that this is wrongly mentioned by the auditor as the same was debited to the profit & loss account whereas it is relating to pending contingent liability as on the date. 18. Based on the return of income filed by the assessee on 28.02.2022 where the assessee has not made the abovesaid disallowance considering the fact that the assessee has not debited the same in its profit & loss account. Since the auditor has wrongly specified the details of contingent liability at point 21(a) of the auditor's report in Form 3CD, this lead to the understanding that the assessee had claimed the contingent liability u/s 37 of the Act during the year. The CPC by noticing the abovesaid information available in Form 3CD proceeded to make the addition of the same in the ....
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....at the intimation order does mot merge with the regular assessment when the Assessing Officer taxes the taxable income based on the intimation order u/s 143(1) of the Act. In this regard, he relied on the decision of the ITAT, Pune Bench and Bangalore Bench. We considered the facts of those decisions and present facts on record, in our considered view, for the simple reason that assessment u/s 143(1) of the Act was processed on 22.09.2022 without giving any opportunity to the assessee and even the assessment was completed u/s 143(3) of the Act on 28.12.2022 without following the procedure laid down u/s 144B of the Act may be for the reason that there is no addition proposed u/s 143(3) of the Act. There was absolutely no time for the assessee to file a rectification application u/s 154 of the Act and also the case was selected for scrutiny even before the intimation u/s 143(1) of the Act was passed. 22. It is well-settled law that assessee cannot be taxed at an amount which is not legally imposable. As per the facts on record, assessee chose to address the grievance against wrong order, however we noticed that the intimation u/s 143(1) of the Act was passed after selection of the c....