TaxTMI 
TaxTMI 
2024 (5) TMI 1509
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....e Ld. CIT (A) has dismissed the appeal of the Appellant without appreciating the facts and thereby the merits of the case without affording an opportunity of being heard, thereby violating the principles of natural justice and rendering the order of the Ld. CIT(A) as infructuous. 3. On the facts and in the circumstances of the case and in law, the net disallowance under section 43B of the Act reported by the Appellant in the tax return is in accordance with that disclosed by the tax auditor in Form No. 3CD and hence, the adjustment of INR 6,12,81,302 is liable to be deleted. 4. That the confirmation by the Ld. CIT(A) of the disallowance of Rs 6,12,81,302 under section 43B of the Act, results in double disallowance given that such disallowance is already made by the Appellant in the tax return for AY 2 017-18. 3. Brief facts of the case are as follows: The assessee is a company engaged in the business of rendering software development services to its group companies. For the assessment year 2017-18, the return of income was filed on 29.11.2017 declaring total income of Rs. 108,32,16,980/-. The return was processed u/s 143(1) of the Act on 01.03.2019, wherein ....
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.... intimation u/s 143(1) of the I.T.Act is dated 01.03.2019. The assessee being aggrieved by the additions / disallowances made in the said intimation ought to have filed appeal before the CIT(A). The draft assessment order, DRP's directions nor the final assessment order has touched upon the issues of adjustment made u/s 143(1) of the I.T.Act. Therefore, the issue of addition u/s 43B and disallowance u/s 36(1)(va) of the I.T.Act arise out of the intimation issued u/s 143(1) of the I.T.Act dated 01.03.2019 and not from the final assessment order dated 28.07.2022. Therefore, since the cause of action stems out of intimation u/s 143(1) of the I.T.Act, this appeal filed by the assessee as against the final assessment order needs to be rejected. Therefore, grounds 3 & 4 as regards the merits of addition u/s 43B and disallowance u/s 36(1)(va) respectively are rejected. 9. In the final assessment order, the A.O. had included in the computation statement the figures from the intimation u/s 143(1) of the I.T.Act instead of the returned income (which are not subject matter of adjudication in draft assessment order and DRP's directions). In other words, the A.O. has adopted fi....
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....raised before the CIT(A). 8. The learned DR supported the orders of the Income Tax authorities. 9. We have heard the rival submissions and perused the material on record. In the instant case, the solitary issue raised on merits is regarding the addition of Rs. 6,12,81,302/- under section 43B of the Act. The above addition was made by way of adjustment in the intimation issued under section 143(1) of the Act on 01.03.2019. Assessee, although aggrieved by the addition made under section 43B of the Act, did not file appeal against the said intimation issued under section 143(1) of the Act (probably under the bonafide belief that the addition under section 43B of the Act would be discussed in the scrutiny assessment, since notice under section 143(2) of the Act was already issued on 05.09.2018 i.e., prior to the date of intimation). The FAO was passed on 28.07.2022 pursuant to the notice issued under section 143(2) of the Act wherein the AO accepted the income returned by the assessee. However, in the computation sheet annexed to the FAO, the AO had considered the income as per the intimation issued under section 143(1) of the Act, instead of the income as per the returned income....
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....st this when delay is condoned the highest that can happen is that a cause would be decided on merits after hearing the parties. ii. When substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred for the other side cannot claim to have vested right in injustice being done because of a non-deliberate delay. iii. There is no presumption that delay is occasioned deliberately, or on account of culpable negligence, or on account of mala fides. A litigant does not stand to benefit by resorting to delay. In fact he runs a serious risk. iv. It must be grasped that judiciary is respected not on account of its power to legalize injustice on technical grounds but because it is capable of removing injustice and is expected to do so. 12. Furthermore, the Hon'ble Apex Court in the case of United Bank of India Vs. Naresh Kumar and Others reported in (1996) 6 SCC 660 had observed that the procedural defects which do not go the root of the matter should not be permitted to defeat a just cause. It further held that as far as possible, a substantive right should not be allowed to be defeated on a....