TaxTMI 
TaxTMI 
2026 (2) TMI 63
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....e was at Rs. 20,87,25,840/-. An addition of Rs. 16,77,57,242/- was made by the virtue of para 7 to 7.9 of the aforesaid order. Another addition of Rs. 60,63,000/- was made by the virtue of para 8 to 8.2 of the aforesaid order. Another addition of Rs. 16,57,600/- was made by virtue of para 9 to 9.2 of the aforesaid order. Another addition of Rs. 1,82,82,000/- was made by virtue of para 10 to 10.4 of the aforesaid order. Another addition of Rs. 7,22,60,000/- was made by virtue of para 11 to 11.5 of the aforesaid order. Yet another addition of Rs. 4,46,630/- was made by virtue of para 12 to 12.1 of the aforesaid order. In the above manner the assessed total income of the assessee was computed & assessed at Rs. 47,59,29,192/- against the returned income of Rs. 20,87,25,840/-. That the aforesaid "Assessment Order" is hereinafter referred to as the "Impugned Assessment Order" for sake of brevity, convenience & ease. 2.2 That the assessee being aggrieved by the "Impugned Assessment Order" prefers the first appeal u/s 246A of the Act before the Ld. CIT(A) who by the "Impugned Order" has partly allowed the first appeal of the assessee on the grounds & reasons stated therein. 2.3 That ....
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....R for the revenue submitted that the assessee is in the business of "Soyabean" processing sector. They have kriti brand Soya Oil. They are also engaged in the business of "manufacturing & selling by products" related to Soya bean. The assessee is a listed company on the stock exchanges in India. That the case of the assessee was selected for scrutiny under CASS and that a statutory notice dated 28.06.2022 u/s 143(2) of the Act was issued to the assessee company which was duly served upon on the assessee company. Thereafter, a detailed questionnaire along with notice u/s 142(1) dated 22.09.2022 of the Act was issued & served upon the assessee company. Further the notices were too issued to the assessee company from time to time. The Ld. DR appearing for & on behalf of the revenue then invited our attention to para 4 of the "Impugned Assessment Order" which we reproduce as below: 4. During the assessment proceedings, various details were called for via different notices issued with details as follows: Sr. No. Particulars of notice Issued DIN Date of Issue of Notice Date of Compliance Remarks 1. Notice issued u/s. 143(2) of the Act TBA/AST/S/143(2)/....
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..... 142(1) of the Act whereby certain information/explanation/Documentary evidences; to support your claim made in the return of income filed for the AY under consideration were requisitioned. Despite lapse of sufficient time, no details / part details are made available by you, based upon which the assessment proceedings cannot be finalized. You may appreciate that the assessment proceedings in your case is getting barred by limitation of 31.12.2022 and as such very little time is left for its judicious finalization. By this, you are hereby given a FINAL OPPURTUNITY and advised to fumish all asked for information/explanation / Documentary evidences complete in all respect to support your claim on the issues raised. In absence of the details being submitted, you are requested to show cause as to why it may not be considered that you do not possess the information requisitioned and thus the assessment proceedings may not be finalized ex-parte under provisions of sec. 144 of the Act, based upon the facts and the information available on record" DIN: ITBA/AST/S/85/2022-23/1047247627(1) dated 11.11.2022 -You are advised to submit your response immediately by logging in ....
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....e Act. However, the assessee company has furnished the part details via different submissions, which were examined in detail, and couples of documents as submitted electronically were retained and made part of the records. 4.3 It can be seen that from the issuance of the initial notice dated 28.06.2022 till the issuance of the final notice dated 01.12.2022. the assessee company has merely submitted basic details and for all purposes placed its strong reliance upon the facts and figures reported in the final accounts and disclosed in the Audit Report filed claiming that the same has been certified by the qualified Charted Accountant. Even after grant of notices suggesting the completion of assessment proceedings ex-prate, the assessee company did not bothered to furnish the details called for legitimately under the provisions of the IT Act. As can be seen from the discussion made above the attitude of the assessee is found to be totally non-cooperative and recalcitrant. The question which arises at this stage is that what could have been the intention of the Assessee and reasons behind non furnishing of the details called for via various notices, in spite of receiving all t....
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....extremely doubtful. Subsequent to such findings it needs to be pointed out that under such doubtful credentials the assessee is completely divested of any right to claim in future that the principles of natural justice and equity have not been served by the assessing officer. In the event, that any such contentions are made before any subsequent proceedings before the appellate authority then the merit of such contentions have to be left to be decided upon by the respective appellate authority after taking into account the real purpose and real intention of the assessee company in making such claims, contentions and actions. It is seen that certain intelligent breed of assessees furnish remain non-compliant at the stages of the assessment proceedings, however later on they raise the bogey of 'Non-observance of principles of natural justice and equity or proper opportunity. This is done primarily as a preemptive measure to ensure future success. 5.1 As the assesses was provided umpleen numbers of opportunities, it cannot be said that there is an infraction of the principles of natural justice. The assessee was well appraised about the evidences gathered available on rec....
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....e Ld. DR for the revenue then invited attention to the fact that if the assessee company's accounts are SAP based, audited & genuine then what prevented them for availing the so many opportunities before the Ld. AO which are detailed in the "Impugned Assessment Order" & then laid emphasis on para 7, 7.1,7.2,7.3,7.4 of the "Impugned Assessment Order". It was submitted & repeated that once the assessee company is a listed company on BSE, once their accounts are SAP based & are audited that Perse does not mean & imply that in the scrutiny assessment they should not cooperate with the revenue officials on the contrary once the scrutiny assessment has come they should cooperate with the department & that they have to give all the material information & documents which are sought from them. Most of the Information in today's time are available on click of the mouse. The reasoning adopted by th Ld. AO is therefore, right. The paragraphs 7, 7.1,7.2,7.3,7.4 relied & read upon by the Ld. DR from the "Impugned Assessment Order" is reproduced by me as below: "7. The assessee company has made available the figures of total turnover recorded in the Books of accounts and the Gros....
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....of value and quantities are maintained on day to day basis on year to year basis consistently and as such financial statements of the co have been prepared to comply with the Indian Accounting Standards (Ind AS) including rules notified under the companies Act 2013. Since now we have almost complied with the questionnaire issued u/s. 142 (1), We request your good self to kindly accept the books results and do not make any estimate based on Gross profit. In this regard we also want to submit that variations in day to day prices of Raw material and Oil prices, which is very well known and which is not in control of the company In case of the manufacturing company it is yield of product which is significant and not G.P. we give following yield chart for 3 years from which it is quite evident that there is no fall in terms of production yield. Assessment Year % Yield 2021-2022 93.75% 2020-2021 92.66% 2019-2020 92.68% Above data is already reflected in TAR of concerned year. We therefore very humbly submit to kindly accept the book results The assessee company did not make available the following crucial information to avoid any verification and....
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.....00 lacs. * For every query raised, the assessee company has simply furnished a readymade answer that the information is available in the Audit Report and is certified by the Accountant. However, it did not make any attempt to furnish a copy of even a single documentary evidence to prove its contention viz. copies of challans evidencing payment of TDS. Statutory liabilities etc. * Just making available the Audit report/cost audit report in the prescribed format duly certified by an accountant does not make the transactions recorded in the Books of accounts to be genuine. It is the mechanism of the Government, which has formulated a procedure of scrutiny assessment whereby an Assessing officer is cast upon a duty to check the veracity of the claims put forth by any assessee and recorded in form of transactions in the Books. * Had the books prepared by an assessee and certified by an accountant been reliable and final, there would not be any procedure for the scrutiny assessment and/or the investigation of the figures reported. * The assessee's submission that the variations in day-to-day prices of Raw material and Oil prices are not in the con....
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....e quantitative details of the different items consumed as Raw materials 1. Complete quantitative details of month-wise consumption of raw material and output of different items including Yield/Wastage recorded, during the AY under consideration with its yield %. 1. The company failed to furnish the contra confirmations of all parties disclosed in the Balance Sheet as 'Trade Payable' including all your creditors with complete names& addresses and PANs of these parties to prove their genuineness, wherever the transactions held with the creditor during the year exceeds Rs. 5.00 Lacs. 7.4 The part information made available by the assessee-company, through submission is completely in contradiction with the figures reported in the TAR (which has been relied upon heavily by the assessee-company throughout the assessment proceedings), the same also does not corroborates with the figures disclosed in the Final Accounts i.e. Balance Sheet and/or P&L account. Some of the glaring examples are reproduced herein below for reference: A. The assessee company submitted that - " -------- Complete details of payment made to persons covered u/s 40A(2)(b) gi....
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....ring activity of the same magnitude is not available, the assessee company's past records are considered to estimate the gross profit for the AY under consideration. The assessee company has submitted the details of the turnover and Gross profit disclosed during the current AY and past three AYs as follows: POINT NO.07 - Gross Profit Margin for Current Year and past three years Turnover Gross Profit G.P.Margin AY 2021-22 6,85,74,76,950.00 32,59,80,098.00 4.75% AY 2020-21 5,15,07,86,313.00 30,67,59,160.00 5.96% AY 2019-20 4,78,03,95,301.00 36,87,65,627.00 7.71% AY 2018-19 4,53,45,74,209.00 35,91,71,604.00 7.92% 7.9 In view of the discussion made herein above and based upon the data furnished by the assessee company, the average Gross Profit rate disclosed during the AYs 2018-19, 2019-20, and 2020-21 which works out to 7.20% is adopted to estimate fair gross profit for the AY under consideration. And applying this gross profit rate for the current AY, it estimates the Gross Profit at Rs. 49,37,38,340/-, which in actuality is disclosed at Rs. 32,59,80,098/-. Accordingly, the differential amount of Rs. 1....
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....ence of these details being made available, you are requested to show cause as to why the total expenditure booked under these head(s) may not be disallowed and added back to the total income-----" 10.1 In response, the assessee company has vide response dated 25.11.2022 simply submitted that " ------ Details of Brokerage and commission already furnished above.(Page No.32 to 37) However details of sales promotion exposure in under compilation ------. " 10.2 On verifications of the details furnished it is found that the assessee has submitted details of the Brokerage/Commission paid to different parties during the AY under consideration. The assessee completely failed to furnish the copy of the ledger account of expenditure booked under this head of expenses. Detailed note on nature of services rendered by these parties has not been submitted. Instead, short description is provided. The assessee also failed to furnish sample copy of at least one bill issued by all of these parties. Further, in most cases the assessee company has not provided for the PANs of these parties and thus it was mandatorily required to make TDS at enhanced rate of 20% applying provisions of....
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....A/AST/F/143(3)(SCNY20 22-23/1047502520(1) dated 18.11.2022, whereby it was requested to show cause as to why in absence of these details being furnished along with contra confirmations from selected creditors, all these liabilities may not be considered to be un-explained/non- existent and thus may not be disallowed and added back to the total income. 11.2 In response, the assessee company has vide response dated 25.11.2022 simply submitted that Details of Trade payable in desire format is under compilations- 11.3 It is noticed that till date the assessee company has not provided most of the basic details requisitioned vide notices issued, as early as dated 28.06.2022, 22.09.2022 and 03.10.2022 and seek adjournment on some pretext or other. The reply of the assessee company is considered but in view of the history of the assessee that, it keep seeking adjournment without providing any details, no adjournment is granted. 11.4 Till date, the assessee company failed to make available any details about the creditors, It failed to furnish the name & addresses, PANs of these creditors and any documentary evidences which can prove the genuineness of transactions....
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....t be any kind of substitute in form of additional evidence u/s 46A before the Ld. CIT(A). In the instant case most surprising aspect is that all the information which were required at the original assessment proceedings have reached & has come to be filed as additional evidence u/r 46A which approach is not permissible in law. The Ld. DR for the revenue further submitted that the Ld. CIT(A) without appreciating the applicability of Rule 46A in its correct perspective has blindly accepted the plea of the assessee company u/r 46A. The purpose of Rule 46A is not appreciated at all in the "Impugned Order". It was urged that Ld. CIT(A) failed to give sufficient time and reasonable opportunities to the Ld. AO to submit the remand report which required thorough verification of books & the additional evidences submitted by the assessee company before the Ld. CIT(A) while the Ld. AO has not filed the remand report within the meaning the Rule 46A that ipso fact does not means that the additional evidence u/r 46A should be admitted & accepted that too blindly. Rule 46A is statutory & mandatory in nature. Effective opportunity is required in meaningful manner. The Ld. CIT(A) ought not to have ....
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.... Export]. Total turnover was 685 Crores. Out of which 40 to 50% was of soya deoiled Cake. The Assessee Company is facing losses preceding two years. Oil business in profit. However profit is reduced due to export loss. The matter was part heard & was adjourned to 30.09.2025. On 30.09.2025 Ld. AR sought further time to clarify the facts & the matter was adjourned to 07.10.2025, as Part heard. On 07.10.2025 the Revenue sought "time to file copies of letters alongwith documents attached there to sent by the CIT(A) to AO to seek the Remand report & also to explain the reason as to why the Assessing Officer did not respond to the repeated letter sent by the CIT(A)" On 10.11.2025 by letter No.CIT(DR)/ITAT [Ind/2025-26 dated 10.11.2025] the Ld. DR has placed on record of this tribunal a letter bearing No:- DCIT-1(1)/Ind/2025-26 dated 13.10.2025 of DCIT-1(1) Indore wherein following is averred "On Perusal of case history noting as available on ITBA remand report has been called for on 27.05.2024 & submission of the Assessee [Copy enclosed] along with enclosure attached therewith. Further reminder on 14.06.2024 & 01.08.2024 has been issued by the Ld. CIT(A) on ITBA. " As per inf....
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....se to notices u/s 142(1) of the Act and show cause notice thereafter, partial response were submitted on 22.10.2022 and 25.11.2022 by the Accountant's staff of the company. Final opportunity was given by AO vide notice dated 01.12.2022, directing full response to be made on 05.12.2022. A request was made immediately by the company on 02.12.2022 to grant short adjournment of seven days upto 11.12.2022 only because the father of the Manager (Taxation) had expired on 21.11.2022 and she was unable to attend till 05.12.2022. Such request was not looked into as apparent from in the assessment order wherein it has been observed that there was no response by the appellant company hence assessment order u/s 144 read with section 144B of the Act was passed on 19.12.2022. SUBMISSIONS 01) We humbly submit that regular books of accounts are maintained by the appellant company and besides manufacturing activity, it is also also engaged in trading and sale of refined oil and total turnover including other income was Rs. 685.75 crores during the year. Purchases are being effected from registered dealers of MP as well from outside the State. The purchases/expenditure ....
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..../s 68 Rs. 7,22,60,000/- V) Disallowance out of traveling and conveyance expenses.(1/5th) Rs. 16,57,600/- VI) Delayed payment of PF & ESIC Rs. 4,46,360/- Total addition to returned income Rs. 26,64,66,202/- Our submissions against aforesaid additions made to total income before your honour for kind adjudication are as under :- I) Enhancement in Gross Profit u/s 145 of the Act : Rs. 16.77 crores The appellant company maintained day to-day quantitative records of purchase/sale, production, opening and closing stock of raw materials, finished products by-products as well traded goods having in-depth internal audit system. The accounts are duly audited under the Companies Act as well under Income tax Act. The Assessing Officer compared the gross profit earned during the year with A.Y. 2019-20 & 2020-21 as against gross profit earned at 4.75%. Therefore, in the show cause notice it was proposed to apply G.P. rate of 6.835% on disclosed turnover and to make an addition of Rs. 14,29,78,395/-. It was explained that the company complied with Indian Accounting Standards (Ind AS) and the records are also maintained under most mode....
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.... 91.28 81.02 28.69 Qty sold (In MT) 2138 1950 1715 Margin earned (Rs in crs) 19.52 15.80 4.92 Margin %age 63.23% 58.65% 26.34% II. Soya De-oiled cake :- I) Deoiled cake A.Y.2019-20 A.Y. 2020-21 A.Y. 2021-22 Particulars Rate/Kg Rate/Kg Rate/Kg Cost of Soya seed 35.17 38.50 44.04 Selling Price 33.25 35.39 39.28 Absolute earnings (Rs) -1.92 -3.11 4.76 Qty sold (In MT) 30679 26990 42779 Margin earned (Rs in crs) -5.88 -8.40 -20.37 Margin %age -5.76% 8.79% -12.12% Specimen copies of sale invoices of domestic sales and export sales of lecithin for A.Y. 2020-21 and A.Y. 2021-22 are annexed. (Annexure A1 & A2). Similarly, specimen copies of sale invoices of deoiled cake for both years are annexed (Annexure - B1 & B2). De-oiled cake in support of working mentioned in aforesaid table. It is evident that reduction in selling price on one hand and increased cost of production on the other hand resulted into reduction of pro....
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....red were not submitted in the format prescribed. The company maintained day-to-day quantitative records raw materials, finished goods etc. and month- wise summary of quantitative details are again annexed. Annexure-E) details regarding variation in day-to-day prices of raw materials and oil price which adversely resulted into fall in gross profit were not submitted. Besides the effect of COVID-19, the market prices of soya seed depends upon the crop whereas selling price depends upon import of oilsin the Country and export demand, of DOC/Lecithin. Thengharket rates are volatile. Details of day-to-day market price of refined oil, curde oil and soya seed are annexed. Annexure-F) Despite the implementation of SAP, the company requested for adjournments, thus deliberately delayed " the providing of confirmation. In fact, initially there was delay in making submission due to change of main account staff hence one more opportunity was requested on 02.12.2022 which was not granted. The company tried to submit the details on portal but the same was closed by AO hence such details were submitted on grievance portal on 09.12.2022. There was no deliberate attempt in any manner ....
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.... at source and employees benefit expenses including directors remuneration debited in P & L A/c. We submit that over-time and performance benefit given to staff on monthly/quarterly basis at Rs. 50,90,384/- was incorrectly accounted for under the head "Freight & Cartage" (note no. 34.6 of Balance sheet) which was corrected by the auditor while reporting TDS compliance in Clause no. 34A of TAR. In fact, in profit and loss account the figures are based on the ledgers including perquisite to directors. Mismatch so observed by the AO is reconciled as per details annexed for kind perusal. (Annexure- H) iii) In para 7.4D of the assessment order, the AO further observed that though quantitative details of opening and closing stock of raw materials, semi-finished goods and finished goods have been submitted but that they do not reconcile with the opening and closing stock details disclosed in the Balance sheet and column 40 of tax audit report. He therefore, concluded that serious defects lies in the books of account of the appellant company. Our explanation there against is as under :- It is humbly submitted that quantitative details of opening and closing stock of raw m....
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....ASS Parameters which suggest the rational and line of Investigation i.e. possibility of booking of bogus expenses in order to reduce the profit/taxable income. In fact, the purchases were effected from the suppliers who are duly registered under GST law and they had also uploaded details of sales effected by them to the appellant in monthly returns submitted under GST Law. They are also being assessed to tax and cannot be presumed to be a non-filer of return of income. Therefore, such presumption of bogus purchases without any evidence cannot be a basis for rejection of books of account. v) Lastly, we submit that in plethora of judgments it has been categorically held that books of accounts cannot be rejected when perfect day-to-day quantitative details are maintained by the appellant and no defects have been pointed out by the AO and Rejection of books of accounts without considering the past history is wholly unjustified, improper, bad in law. The AO passed the order u/s 144 of the Act though books of account were audited and tax audit report was also annexed with the return. The provisions of section 145 were invoked by the AO because of reduction in the gross profit be....
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.... are correct and complete but method employed coming is not such as to enable the AO to deduce the income of the assessee properly, the assessment of the income of the assessee could be made in such manner as the AO may determine". CIT vs. Anand Kumar Modi (2015) 2 ITJ Online 668 (Jharkhand) Held that "addition made after rejecting books maintained by assessee should be deleted when all quantitative details were available in hooks of account and account and accounts were regularly maintained. GVDI vs. DCIT (2014) 226 taxman 16 (Mad.) Held that "when assessee explained reasons for fall in G.P and revenue did not verify same by substantial materials, impugned order of the AO was to be set- aside". CIT vs. Smt. Sulochana Bhatia (2012) 208 taxman 224 (P & H) In this case, it was noted that assessee produced receipts and the AO had adopted method of estimation without there having any rational basis to support guess work. Nevertheless in the case, where the AO without recording any finding that the books of account maintained by the appellant were incorrect, proceeded to reject the books of account on the basis of his sweet will without having any documentary evidences....
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....ernational Forest Co v. CIT [1975] 101 ITR 721 (J&K) (v) M. Durai Raj v. CIT [1972] 83 ITR 484 (Ker) (vi) Action Electricals v. Deputy CII [2002] 258 ITR 188 (Delhi) and (vii) Kamal Kumar Saharia v. CIT [1995] 216 ITR 217 (Gauhati) (viii) CIT vs. Jacksons House (2010) 39 TDR 212 (Del. HC) (ix) CIT vs. Paradise Holidays (2010) 325 ITR 13 (Del. HC) (x) Ashoka Refractories Pvt. Ltd vs.CIT (2005) 297 ITR 457 (Cal.) (xi) ACIT vs. Manoj Pavecha (2015) 25 ITJ 689 (Trib. Indore) (xii) ITO vs. Girish Mehta (2006) 105 ITD 585 (Trib. Rajkot) (II) Disallowance of Foreign Currency Fluctuation loss : Rs. 60,63,000/ The appellant company exported goods outside India as well imported raw materials from abroad. Sale invoices are being raised in Foreign currency (Dollars) which are either discounted from Banks or realized against letter of credit opened by the buyers. The sale invoices are accounted for on the same day when the goods are exported outside India based on prevailing market rate of Foreign Currency. The Foreign remittances are realized through banks after the credit period depending the terms of su....
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....ance amount of Rs. 60,63,256/- was charged to profit and loss account vide not no. 34.22. Kindly appreciate that the amount of Rs. 69.49 lacs was offered as income for A.Y. 2020-21 on provisional basis hence its reversal at the commencement of A.Y. 2021-22 in the books of account was an allowable expenditure. Its disallowance has resulted into double taxation i.e. in A.Y. 2020-21 as well in A.Y. 2021-22. During the year there was foreign exchange fluctuation gain as well as loss of export sales and net gain credited to profit and loss account under separate head vide note no. 29.9 was Rs. 50,84,289/- as per annexed copy of account. Such amount of Rs. 50.84 lacs also includes Rs. 20,18,254/- being the amount of price variation amount due from foreign customers at the close of the year i.e. on 31.03.2021. this also proves the consistency of accounting policy observed by the company. It is undisputed fact that payment or receipts against import or export of goods were made through banking channel only. The Assessing Officer disallowed a sum of Rs. 60.63 lacs being the amount of foreign currency fluctuation loss incurred during the year against reinstatement of foreig....
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....es were at par with earlier year and with their efforts turnover was increased by 33% from previous year's turnover. The Director's traveling (domestic as well foreign) was Rs. 0.37 lacs only due to COVID-19 as compared to previous year expenses of Rs. 9.21 lacs. Comparative details of preceding three years are as under along with details of travelling expenses of Rs. 82.50 lacs incurred by staff :- S. No. Account head A.Y. 2021-22 A.Y. 2020-21 A.Y. 2019-20 01) Domestic (staff) 82.50 102.13 81.80 02) Domestic (Directors) 0.37 9.21 3.97 03) Foreign travelling (staff) 0.00 10.48 18.61 Therefore, disallowance made on adhoc basis at Rs. 16.57 lacs is wholly unjustified, improper, bad in law and deserves to be quashed (Annexure-P). VI) Delayed payment of Provident Fund Contribution & ESIC The Assessing Officer further disallowed Rs. 4,46,360/- towards delayed payment of Provident Fund Contribution & ESIC which was already added vide intimation u/s 143(1)(a) of the Act. Once the total income having been considered as per such intimation, by making again addition of Rs. 4,46,360/- resulted into ....
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....stries India Ltd Annexure - G-1 08) Reconciliation of Employees benefit expenses with balance sheet and TAR Annexure - H 09) Quantitative details of closing inventory of the appellant and its reconciliation with TAR Annexure - I & I-1 10) Details of foreign currency fluctuation loss and gain Annexure - J 11) Details of advertisement and publicity expenses Annexure - K 12) Details of testing and analysis expenses Annexure - L 13) Details of branding expenses Annexure - M 14) Details of brokerage and commission expenses Annexure - N 15) Details of sundry creditors payable as on 31.03.2021 with PAN & balance confirmation of 14 creditors Annexure - O 16) Details of travelling and conveyance expenses Annexure - P Submitted by Sd/- (CA. P.D. Nagar) Indore, Dated : 27.02.2024 3.15 The Ld. AR submitted that the remand report is not on record & there is no reason for non submission is given & put- forth as no information is available on record. There is no violation of Rule 46 A. The ld. AR has then placed on record of this Tribunal a letter dated 10.11.25 that on 28.06.2022 the....
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....ences were made which were considered by Ld. CIT(A) keeping in view the provisions contained in Rule 46A and deleted above additions against which the Revenue has preferred an appeal before your honours :- RESPONDENT'S SUBMISSIONS I & II) Enhancement in Gross Profit u/s 145 of the Act : Rs. 16.77 crores 1.1) The appellant company is a Public Limited Company listed on BSE/NSE did maintain day to-day quantitative records of purchase/sale, production, opening and closing stock of raw materials, finished products by-products as well traded goods under most modern SAP System following Indian Accounting Standards (Ind AS). The accounts are duly audited under the Companies Act by which are subject to internal audit, cost audit, secretarial audit and Tax audit under Income tax Act and verification at all levels by GST Department. Being Public Limited listed company quarterly, half yearly and annual results are published in newspapers and reported to SEBI, stock Exchanges showing comparative growth/decline. Purchases/expenditures incurred under various heads viz. professional charges, testing and analysis charges, advertisement etc. are properly suppo....
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....sp; Rate/Kg Rate/Kg Rate/Kg Turnover of Lecithin / Export 31.99 Cr. / 25.10 Cr. 28.28 Cr. / 22.63 Cr. 19.62 Cr. / 12.68 Cr. Cost of Production of lecithin 53.08 57.12 80.23 Average Selling Price 144.36 138.14 108.92 Absolute earnings( Rs) 91.28 81.02 28.69 Qty sold ( In MT) 2138 1950 1715 Margin earned ( Rs in crs) 19.52 15.80 4.92 Profit Margin on sales (%) 63.23% 58.65% 26.34% Increased cost and reduction in sale price & turnover reduced gross profit B. Soya De-oiled cake: (Turnover Rs. 178.28 Cr.) (Export 45.77%) Particulars A.Y.2019-20 A.Y. 2020-21 A.Y. 2021-22 Rate/Kg Rate/Kg Rate/Kg Total Turnover of Soya DOC 111.09 Cr. 104.13 Cr. 178.28 Cr. Cost of Soya seed 35.17 38.50 44.04 Selling Price of soya DOC 33.25 35.39 39.28 Absolute earnings (Rs) -1.92 -3.11 -4.76 Qty sold (In MT) 30679 26990 42779 Margin earned (Rs in crs) ....
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....lling price of finished goods depends upon import of oil in the Country and export demand of DOC/Lecithin. Details of day-to-day market price of refined oil, crude oil and soya seed were submitted on 09.12.2022 and before CIT(A), which are annexed. (Page No. 04 to 09 of PB) Para 7.3 at page 9 & 10 : Details of party-wise purchases & sales and address were not made available. (Rs. 637.98 crores) All suppliers of raw materials and distributors are Income tax assessees having PAN. Details of party-wise sales were submitted on 09.12.2022 & before CIT(A) which are annexed. (Page No. 14 to 17 of PB) Para 7.3 at Page 10 : Copies of all expenditure under different heads aggregating over Rs. 10.00 lacs not furnished Such details were submitted on Grievance Portal on 09.12.2022 and before CIT(A) as evident from page no. 01 to 03 of Paper Book. Para 7.3 at page 10 : Month- wise quantitative details of raw materials consumed and products manufactured were not submitted with its yield %. The company maintained day-to-day quantitative records raw materials, finished goods etc. Month-wise quantitative details of consumption of raw materials were submitted on 09.12.2022 and again....
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.... kg, 5 kg and 15 kg without its conversion into MT before AO. (Page No. 40 & 41 of PB) Para 7.5 of the assessment order : The AO considered CASS Parameters which suggest the rational and line of Investigation i.e. possibility of booking of bogus expenses in order to reduce the profit/taxable In fact, the purchases were effected from the suppliers who are duly registered under GST Act who uploaded details of sales effected by them to the appellant in monthly returns under GST Law. Such presumption of bogus purchases without any evidence cannot be a basis for rejection of books of account. 1.5) The assessing authority vide Para 7.8 and 7.9 at page 15 of Assessment order applied gross profit rate of 7.20% being average gross profit earned in preceding three years viz. A.Y. 2018-19 (7.92%), 2019-20 (7.71%) & 2020-21(5.96%) based on above observations as against gross profit earned at 4.75% on total turnover of Rs. 685.75 cores during A. Y. 2021-22. We submit that in plethora of judgments, principles have been laid down that while making the assessment, the Income-tax Officer is not entitled to make a pure guess without reference to any evidence or material. There must be....
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....R 392 (Del) at 403 Held "Any pick and choose method of rejecting certain entries from the books of account while accepting others without appropriate justification, is arbitrary and may lead to an incomplete unreasonable and erroneous computation of income of an assessee - (Para-24) 1.6) In substance, reasons for reduction in the gross profit were manifold such as :- (a) effect of COVID-19 during entire year which adversely resulted not only the working of the manufacturing activity but also substantial decrease in export turnover (b) Substantial increase in the raw material price due to insufficient crop of soyabean from Rs. 40/- per kg. to Rs. 59/- per kg, (c) substantial decrease in export realization of manufactured goods i.e. de- oiled cake and lecithin due to COVID-19. (d) Import of degum oil from outside India for refining at a higher cost, (e) Increased cost of manufacturing due to partial closed down of factory and absence of workers during COVID-19, (f) Increased logistic cost on finished goods within India etc. etc. 1.7) The company submitted detailed statements showing proper quantitative reconciliation of raw materials, finished goods and semi-fini....
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....100% was arbitrary and based on whims and surmises hence rightly deleted by Ld. CIT(A) vide para 9.1 at page 26 and 27 of appellate order. b) Disallowance out of Travelling & Conveyance Expenses Rs. 16.57 lacs : We submit that the nature of business of the company's turnover of Rs. 685.75 crores solely depends upon continuous traveling by marketing team. Due to COVID-19 directors travelling (domestic as well foreign) was Rs. 0.37 lacs only and staff travelling and conveyance were at par or rather less then earlier years as per comparative details of preceding three years, as detailed below, though turnover was increased by 33% from previous year's turnover S. No. Account head A.Y. 2021-22 A.Y. 2020-21 A.Y. 2019-20 01) Domestic (staff) 82.50 lacs 102.13 lacs 81.80 lacs 02) Domestic (Directors) 0.37 lacs 9.21 lacs 3.97 lacs 03) Foreign travelling (staff) 0.00 lacs 10.48 lacs 18.61 lacs TOTAL 82.87 lacs 121.82 lacs 104.38 lacs Details of travelling expenses of Rs. 82.50 lacs incurred by staff during A.Y. 2021-22 i.e. under appeal were submitted on the Portal on 09.12.20....
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.... arrival of goods purchased based on exchange rate of Dollar into INR but while making payment on due dates, there may be loss or gain which is business loss or business income recognized under the Act. It is obligatory for the company to consider the foreign exchange fluctuation (gain/loss) even on the amount due from export debtors at the close of the year as per IND-AS. Increase in dollar exchange rate is considered as accrued gain of the year of sale and provided as income and in case of adverse price fluctuation, loss is provided and charged to profit and loss account. Next year, such provision made on closing balances due from debtors is reversed and actual gain on sales realization is credited to profit and loss account. During the year, on the amounts due from foreign customers as on 31.03.2021, similar provision was made as accrued income at Rs. 20,18,254/- which proves the consistency of accounting policy. The company had provided for a sum of Rs. 60.63 lacs as accrued income on outstanding dues from export debtors in A.Y. 2020-21 which was reversed in year under appeal i.e. A.Y 2021-22 and charged to profit and loss account vide note no. 34.22 of the Au....
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....t applicable. Without considering nature of business and audited accounts maintained by the company and details of payments made in next month itself to many suppliers, amounts payable to all creditors were assessed to tax u/s 68 of the Act at Rs. 722.60 lacs as unproved/unexplained r.w.s. 115BBE of the Act vide para 11 to 11.5 at page 18 & 19 of assessment order. Such treatment of trade payables as unexplained cash credit u/s 68 of the Act without any evidence on record was wholly unjustified and bad in law hence deleted by Ld. CIT(A) vide para 10.1 & 10.2 at page 27 & 28 of the appellate order. VI) Additional evidences - Remand Report under Rule 46A We submit that in response to notices u/s 142(1) of the Act, admittedly partial response were submitted on 22.10.2022 and 25.11.2022 by the company. Final opportunity was given by AO directing full response to be made on 05.12.2022 but the company had requested for short adjournment of six days only i.e. upto 11.12.2022 because the father of CFO had expired on 21.11.2022. Thereafter, the appellant compiled all annexures with details and tried to submit the details on I.T. Portal on 09.12.2022 i.e. w....
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.... [Assessing Officer] has refused to admit evidence which ought to have been admitted ; or (b) where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by the Assessing Officer ; or (c) where the appellant was prevented by sufficient cause from producing before the Assessing Officer any evidence which is relevant to any ground of appeal ; or (d) where the Assessing Officer has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. (2) No evidence shall be admitted under sub-rule (1) unless the [Deputy Commissioner (Appeals)] or, as the case maybe, the Commissioner (Appeals) records in writing the reasons for its admission. (3) The Deputy Commissioner (Appeals) or, as the case may be, the Commissioner (Appeals)] shall not take into account any evidence produced under sub-rule (1) unless the Assessing Officer has been allowed a reasonable opportunity(a) to examine the evidence or document or to cross- examine the witness produced by the appellant, or(b) to produce any evidence or document or any w....
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....vs. Maa Umiya Agritech Pvt. Ltd (2023) 47 ITJ 497 (Trib.Indore) Held that "AO misconducted himself while passing the assessment order and therefore the record which was already filed before the AO was rightly considering by CIT(A) - therefore, there is no violation of Rule 46A - ITAT does not find any error or illegality in the order of CIT(A)". 3.17 From the records it is seen that the Ld. AR for & on behalf of the Assessee company had vide submission [pages 1 to 23]dated 05.06.2025 had relied upon the following judgments the index of which is reproduced by me as below :- Date of hearing : 05.06.2025 BEFORE THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE. ASSTT. COMMISSIONER OF INCOME TAX, INDORE VS. KRITI NUTRIENTS LTD, APPEAL NO. ITA/780/IND/2024 - A.Y. 2021-22 Copies of judgments relied upon by the Respondent S. No. Citation of the judgments Page nos. A Re : Adhoc disallowances of expenses not justified i) M/s. Vision Infinity Ltd vs.ACIT (2025) 54 ITJ 38 (Trib.Indore) 01 to 06 ii) Pr. Com. of Income Tax (Central) vs. Ķeti Construction Ltd (2025) 475 ITR 182 (MP) 07 to 1....
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.... opportunity to the assessing authority. The Court Held that there is nothing in the order of the CIT(A), that the assessing officer was confronted with the confirmation letters received from 19 buyers out of 28 buyers by the assessee from the customers who paid the amounts by cheque and asked for comments. Thus, the end result has been that additional evidence was admitted and accepted genuine without the assessing officer furnishing his comments and without verification which is an indispensable requirement. (Para-24). 03) Comm. of I.T. vs. NE Technologies India (P) Ltd (2016) 65 Taxmann 180 (AP) The fact that various documents furnished by the appellant before the CIT(A), were not brought to the notice of the assessing authority is not in dispute. What the Tribunal failed to note is that Rule 46-A(3) requires the assessing officer to be given an opportunity to examine the documents produced by the assessee for the first time before the first appellant authority. This mandate of Rule 46-A(3) could not have been dispensed with, as it is a statutory prescribed Rule of natural justice. (Para 9) [In respondent's case documents were filed on grievance po....
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....e before the Ld. CIT(A). The Summation of Rejoinder is as follows :- (1) Revenue has stated all facts earlier. (2) Sufficient time of compliance was given to Assessee for Six months by the AO. (3) It transpires that some other entity papers were filed. (4) No basic details were furnished during original Assessment Proceedings. (5) The Learned CIT(A) has carried out his own analysis of papers/documents/material. (6) No details were provided by the assessee to Ld. Assessing Officer for verification due diligence, inquiry etc. (7) The Assessee was aware of Assessment procedure including the fact that Assessments are time barring in nature. (8) In faceless Regime now the Assessee company should have cooperated with Revenue by timely compliances .. Medical sickness in family of concerned officers/ officials are excuses as Assessee is a big corporate Assessee. Assessee is having "SAP system" so information is all well tabulated why it was not parted to Dept. is surprising. (9) CIT(A) called for Remand report on Additional evidence & Ld. Assessing Officer could not provide the same. (10) ....
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....ent Order" at serial No .- (3) & (6) at majority of the time as is reflected in the Assessment Order that during the course of the assessment proceedings which got triggered with a notice u/s 143(2) of the Act on 28.06.2022 till the date of the "Impugned Assessment Order" which is dated 19.12.2022 the assessee company has remained non-compliant for the one reason or more. We are of the opinion and view that in the original assessment proceedings that too selected for "scrutiny" under "CASS" it is but incumbent upon the assessee company to furnish to the Ld. AO whatever is sought & requisitioned by him "within a reasonable period of time" needless to state that the original assessment proceedings [ scrutiny assessment] are subjected to the time limitation. The Ld. AO while carrying out the assessment proceedings seeks the informations, the requisite documents, materials, the evidences, books of accounts, audit report, balance sheet, the computation of the income, the bank statements, sundry debtors & creditors-lists, loans, unsecured loans, details of depreciation, the turnover, the product line, the profit margine, G.P. rates confirmation, the details about expenditures, income so ....
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....5.75 crores. The purchases/expenditure under various heads are properly supported by bills, MTRs, traveling bills etc. whereas on professional charges, testing and analysis charges, advertisement etc. TDS has also been made as reported in Tax Audit Report. There being continuous growth in the turnover year after year, expenditure were incurred genuinely and they are proportionate to the expenditure incurred in the earlier year as evident from the previous year(s) expenses narrated in the profit and loss account itself. Assessment orders in earlier years were also completed u/s 143(3) of the Act and considering the proper maintenance of accounts, book results were accepted. 02) The appellant furnished the return of income within prescribed time limit under section 139(1) of the Act on 14.03.2022 declaring the same at Rs. 20,87,25,840/-. The return was processed u/s 143(1) of the Act by CPC determining total income at Rs. 20,94,62,720/-by making addition of Rs. 4,46,360/-towards delayed payment of P.F. and ESIC and Rs. 2,90,525/-being payment of leave encashment paid before due date of return, which are subjudice in appeal. Thereafter, the return was selected for sc....
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....been any such occasion resulting into exparte assessment due to bonafide reasons stated above." 4.7 In the column No.11- the list of documentary evidence relied upon the following is stated in the form no.35- Document Name Description Detailed submissions with seven annexures uploaded on grievance portal on 09.12.2022 Detailed submissions with Seven annexures uploaded on grievance portal on 09.12.2022 4.8 In the column no. 12 of the form no.35 the following is stated: "12. Whether any documentary evidence other than the evidence produced during the course of proceedings before the Income-tax Authority has been filed in terms of Rule 46A 12. 1.If reply to 12 is Yes, furnish the list of such documentary evidence." 4.9 Basis what is stated above from para 4.5 to 4.8 we find that there is indeed an application for the additional evidence" to be taken on record before the Ld. CIT(A) & the same was "detailed by submission with seven annexures [270 pages] uploaded on grievance portal on 09.12.2022" the reference of which we find on brief statement of facts mentioned in column 11 of the form no.35 (supra). [para4.6][column 11(3) form 35] "01)....
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....- 03) Admittedly, in response to notices u/s 142(1) of the Act and show cause notice thereafter, partial response were submitted on 22.10.2022 and 25.11.2022 by the Accountant of the company. At the outset, such non-compliance was due to irresponsible attitude of the new staff member appointed during the year to handle tax matters who submitted incorrect details from the audited accounts of associate Pubic Limited Company. Such submissions not only resulted into mismatch of figures of Profit and Loss account, inventories etc. for the year under assessment but also resulted aforesaid additions which adversely effected the credentiality of the appellant company who had always been co-operative in prompt compliance of the notices issued by the Tax Department in early years. As regards fin opportunity vide notice dated 01.12.2022, the submissions were required to be made on 05.12.2022. A request was made immediately on 02.12.2022 to grant short adjournment upto 11.12.2022 only because the father of the Manager (Taxation) had expired on 21.11.2022 and she was unable to attend till 05.12.2022. Such request was not looked into and by observing that there was no response by the ap....
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....2022 and that request was made immediately on 02.12.2022 to grant short adjournment upto 11.12.2022 only because the father of the Manager (Taxation) had expired on 21.11.2022 and she was unable to attend till 05.12.2022. The appellant submitted that such request was not looked into and AO observed that there was no response by the appellant company in the assessment order. 4.3 The appellant submitted that it tried to submit complete required details on the Portal on 09.12.2022 but the same was closed by the AO hence such details were uploaded in seven Annexures (270 Pages) on GRIEVANCE PORTAL on 09.12.2022 itself i.e much before the order passed under section 144 of the Act on 19.12.2022. During the course of appeal proceedings, the appellant submitted request for admittance of additional evidences as seen from Form 35. Therefore, the submissions of the appellant were forwarded to the AO for a remand report on 27.05.2024 along with reminders on 14.06.2024 and 01.08.2024 but till date no remand report has been received from the AO. Therefore, it is presumed that the AO has no comments to offer on the submission of additional evidences of the appellant. 4.4 As per ....
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....1962 and considered in deciding the present appeal on merits. " 4.12 The revenue in the present appeal has agitated the issue of "additional evidences" being admitted & taken into consideration by Ld. CIT(A) in passing the impugned order on merits by raising the ground no.6 which we have already detailed above (supra). Additionally the revenue has also taken serious objection on the issue of additional evidence primarily being that such additional evidences ought to have been filed by the assessee cooperate at the level of AO being fundamental evidences & it is the primary duty of assessee corporate to do so at the earliest time & in the instant case they could not file the same despite sufficient time of about six months at their disposal. The assessee cooperate therefore was "non complaint" & wanted to avoid the rigors of the scrutiny assessment on one pretextor the other as detailed minutely in the "Impugned Assessment Order". The revenue has urged that had these additional evidence [270 pages] would have been filed during the course of the assessment proceedings [ not on grievance portal on 09.12.2022 the Ld. AO could have conducted the due verification, cross verification, ....
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....was prevented by sufficient cause from producing the evidence which he was called upon to produce by the Assessing Officer ; or (c) where the appellant was prevented by sufficient cause from producing before the Assessing Officer any evidence which is relevant to any ground of appeal ; or (d) where the Assessing Officer has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. (2) No evidence shall be admitted under sub-rule (1) unless the ^84[Joint Commissioner] (Appeals) or, as the case may be, the Commissioner (Appeals) records in writing the reasons for its admission. (3) The ^84[Joint Commissioner] (Appeals) or, as the case may be, the Commissioner (Appeals)] shall not take into account any evidence produced under sub-rule (1) unless the Assessing Officer has been allowed a reasonable opportunity- (a) to examine the evidence or document or to cross- examine the witness produced by the appellant, or (b) to produce any evidence or document or any witness in rebuttal of the additional evidence produced by the appellant. (4) Nothing contained in ....
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....Section (4) of section 250, has to be exercised by the CIT(A) and there should be material on record to show that he, while disposing of the appeal, had directed further enquiry and called for the confirmation letters from the assessee even in respect of receipt of monies from customers by way of cheques. Rule 46A is a provision in the Income Tax Rules, 1962 which is invoked, on the other hand, by the assessee who is in an appeal before the CIT(A). Once the assessee invokes Rule 46A and prays for admission of additional evidence before the CIT(A), then the procedure prescribed in the said rule has to be scrupulously followed. The fact that sub-Section (4) of Section 250 confers powers on the CIT(A) to conduct an enquiry as he thinks fit, while disposing of the appeal, cannot be relied upon to contend that the procedural requirements of Rule 46A need not be complied with. If such a plea of the assessee is accepted, it would reduce Rule 46A to a dead letter because it would then be open to every assessee to furnish additional evidence before the CIT(A) and thereafter contend that the evidence should be accepted and taken on record by the CIT(A) by virtue of his powers of enquiry unde....
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.... (a) where the [Assessing Officer] has refused to admit evidence which ought to have been admitted ; or (b) where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by the [Assessing Officer] ; or (c) where the appellant was prevented by sufficient cause from producing before the [Assessing Officer] any evidence which is relevant to any ground of appeal ; or (d) where the [Assessing Officer] has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. (2) No evidence shall be admitted under sub-rule (1) unless the [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] records in writing the reasons for its admission. (3) The [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] shall not take into account any evidence produced under sub-rule (1) unless the [Assessing Officer] has been allowed a reasonable opportunity (a) to examine the evidence or document or to cross-examine the witness produced by the appellant, or ....
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....the evidence and rebut the same, has not been complied with. There is nothing in the order of the CIT(A) to show that the Assessing Officer was confronted with the confirmation letters received by the assessee from the customers who paid the amounts by cheques and asked for comments. Thus, the end result has been that additional evidence was admitted and accepted as genuine without the Assessing Officer furnishing his comments and without verification. Since this is an indispensable requirement, we are of the view that the Tribunal ought to have restored the matter to the CIT(A) with the direction to him to comply with sub-rule (3) of Rule 46A. In our opinion and with respect, the error committed by the Tribunal is that it proceeded to mix up the powers of the CIT(A) under sub- section (4) of Section 250 with the powers vested in him under Rule 46A. The Tribunal seems to have overlooked sub-rule(4) of Rule 46A which itself takes note of the distinction between the powers conferred by the CIT(A) under the statute while disposing of the assessee's appeal and the powers conferred upon him under Rule 46A. The Tribunal erred in its interpretation of the provisions of Rule 46A vis-&a....
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.... "Impugned assessment order". The assessee corporate in first six months of the assessment proceedings has been displacing continuous non-cooperation too hence the fact of passing of the "impugned assessment order" u/s 144 of the Act . It is also required to be noted & appreciated that the assessee corporate is not novice to the Income Tax proceedings including the appellate one. There are two e-mail by reminders on record i.e dated 14.06.2024 & 01.08.2024 from the Ld. CIT(A) to the Ld. AO for seeking the remand report which effectively works out to nearly 2-1/2 months time frame & simultaneously it cannot be a fact that the assessee corporate was unaware of such development while the studded silence from 27.05.2024 till 12.08.2024 [last date to file remand report] is noticeable on part of the Ld. AO but simultaneously as a good corporate citizen nothing also prevented the assessee to Air his grievance before the Ld. AO or the Ld. CIT(A) or on the grievance portal as to why no remand report from the Ld. AO is not forthcoming or as to why the Ld. AO is not calling them to participate in the remand proceedings. 4.16 We are therefore, of the considered opinion that in the first app....
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.... 13.10.2024 it is stated that "As per the information available on records no any letter has been received from the Ld. CIT(A) & the remand report has been called for & the reminder has been issued only through e-mail on ITBA". The revenue's expectation by virtue of this letter that in case of remand report a letter must come from the Ld. CIT(A) but in the instant case the remand report is called for by e-mail dated 27.05.2024 & reminders has been issued only through e-mail on 14.06.2024 & 01.08.2024 on ITBA. We are therefore of the view that in view of the mandatory & statutory nature of Rule 46A/46A(3) a letter as is the expectation of department should also go to the Ld. AO which should be well defined, speaking & clear. It should be lucid too. In the said letter the Ld. CIT(A) should state his requisitions as per Rule 46A/46A(3) on "additional evidence documents" filed by the assessee. Simply asking the remand report on portal from the Ld. AO shows that the powers u/s 46A/46A(3) are exercised in routine & cursory manner. The point which we are trying to drawn attention is that in Rule 46A/46A(3) every procedural requirement mentioned therein must be strictly complied with so th....
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....rcumstances of the case the Ld. CIT(A) is justified in deciding the case without giving sufficient time to the AO to submit remand report with sufficient time to the AO to submit remand report in the case which require through verification of books & additional evidence submitted by the assessee before the Ld. CIT(A)" we find substance in the ground raised by the revenue. Revenue is right that in order to carry out verification of books & additional evidence sufficient time is required. We therefore, concur with ground raised by the revenue as verification u/s 46A(3) is time consuming exercise where thorough inquiry & investigation is required to be made. Since sufficient time was not given there is a violation of principles of natural justice & the ends of justice in the final analysis require appraisal of evidence in order to compute & assess total income of the assessee. We are also of the view that Ld. CIT(A) having opted to seek a remand report in respect of documents submitted by way of additional evidence he should have waited for the remand report. The remand report was necessary for a adjudication of subject matter of the appeals. The Ld. CIT(A) besides two e-mail reminder....
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....ed therein to AO should be real. Opportunity should be full & complete. The reasonable period should be afforded to the Ld. AO so that the remand report can be submitted. Since Rule 46A/46A(3) is mandatory & statutory the Ld. CIT(A) should take proactive steps too. The opportunity of 2-1/2 months in our considered opinion is not effective & reasonable opportunity for obtaining remand report as it is must for FAA to dispose off the first appeal. 4.22 The bare and simple perusal of Rule 46A which deals with the production of additional evidence before the Dy CIT(A) & the Ld. CIT(A) starts with a negative note that the appellant shall not be entitled to produce before the Dy CIT(A) or as the case may be CIT(A) any evidence whether oral or documentary, other than evidence produced by him during the course of proceedings before the Assessing Officer. Further u/s 46A(3) the Dy CIT(A) or as the case may be the CIT(A) shall not take into account any evidence produced under sub Rule (1) unless the assessing officer has been allowed a reasonable opportunity:- (a) To examine the evidence or document or to cross examine the witness produced by the appellant, or (b) To prod....
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....the records in-terms of the section 250(2)(b) whether the Ld. AO was given any opportunity of hearing before the "Impugned Order" on merit was passed. We also observe & find that additional evidence filed by the assessee was complex and voluminous which required time hence according to our considered opinion more time & so also reasonable opportunities ought to have been afforded by the Ld. CIT(A) to the Ld. AO. The Impugned order is therefore in the violation of mandatory procedural provision of Rule 46A(3) of the Income Tax Rules 1962 as no adequate & effective reasonable opportunities was given to the Ld. AO for submission of remand report within the meaning of Rule 46A(3) of the Act. The two email reminders (supra) are not enough indication of adequate & effective reasonable opportunities. We also hold that deciding the first appeal without awaiting the Remand Report (46A(3)] amounts to denying the Ld. AO his statutory right & Results in the violation of principles of natural justice & in process the ends of justice has suffered. 4.23 We therefore, set aside the Impugned order as & by way of remand back to the file of ld. CIT(A) with a direction to him to obtain from the Ld.....
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.... Shashank Belkhode, Chief Financial Officer 2.84 0.00 Sent Swati Tiwari, Company Secretary 0.36 0.00 . Document 2 However, on verification of the col. 23 to form 3CD, Sh. Saurabh Singh Mehta is disclosed to have been paid remuneration of Rs. 54.00 lacs and commission aggregating Rs. 47,62,058/ -. No such commission is disclosed while submitting the details w.r.t. brokerage/commission payment made during the AY under consideration. Further, in the extract reproduced in point A, remuneration is disclosed to have been paid to Sh. Shiv Singh Mehta and Smt. Purnima Mehta. c. In the P&L account the assessee company has debited aggregate expenses of Rs. 874.84 lacs towards 'Salary & Wages' and Rs. 101.62 lacs towards 'Director's remuneration'. NOTE NO-21 EMPLOYEE BENEFITS EXPENSES. 874 14 31.1 Salaries & Wages 31.1.1 Dredu Remuneracon 31.12 PF on Director Remuneration 31.2 Contribution to provident and other fund 31.3 Staf Welfare Experses 101.42 4 8 5.76 77 1 38 12 1018 67 Total 1008 17 1 However, these figures do no corroborates with the details as furnished in col. 34(a) to form 3CD wherein details w.r.t. deduction or collection....
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.... Even the quantitative tallies of the inventory of opening and closing stock as submitted during the assessment proceedings and as disclosed in the form 3CD are also not in consonance. It proves the fact, that there lies some serious defects in the books of the assessee, which is prompting the assessee company, to not make available any details to this office to devoid it from making any enquiries." WE TA AKID Besides there are many more instances which can be quoted/ reproduced herein, which has potential, to highlight many more discrepancies which signals to underlying defects in the books of accounts. Document 5 r sheet Details Date Action/Description From To Document 27/05/2024 For Action CIT Appeal N FAC DCIT/ACIT 1 ( 1), IND DCIT/ACIT 1 ( 1), IND CIT Appeal N FAC Notings/Remarks: Remand Report requisitioned Signature: Added Additional RCIT Appeal NDCIT/ACIT 1 ( 14/06/2024 1), IND FAC emarks Notings/Remarks: Reminder sent for Remand Report - Reference to our earlie r mail on dated 27.05.2024, you were requested to submit the Remand Repor t on additional Evidences. Therefore you are again requested to submit th e same on or bef....
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....he appellant was prevented by sufficient cause which was duly considered by Ld. CIT(A) after giving repeated opportunities to the AO under Rule 46A. Thus there was no violation of Rule 46A. We trust your honour wili kindly consider aforesaid documentary evidence i.c. screen shot evidencing de-activation of Tab, for which we shall be grateful. Thanking your honours. Medtoday. Yours faithfully. Pomayar (CA. P.D. Nagar) Document 8 Income Tax Putal Government of india e-lProceedings Page 12:19 PM 7-Sep-2024 Closed 13-Feb-2024 Open 1-Mar-2023 Open Proceeding Closure Date : 06-Sep-2024 Financial Year : 2020-21 Proceeding Closure Order : 269252208 Download Closure Order cel Proceeding Name: Assessment Proceeding u/s 143(3) Assessment Year : 2021-22 3.15 BAN AAACK7170L Name of Assessee KRITI NUTRIENTS LTD 19-Dec-2022 Closed Closed 6-Dec-2022 e-Submission closed by officer Odel 17/12 herce want to JeciaVanno portal. opened 28-Jun-2022 Open Proceeding Limitation Date : 31-Dec-2022 Proceeding Closure Date : 19-Dec-2022 Financial Year : 2020-21 Proceeding Closure Onder : 231263868 Fle Appeal Download Clevere O....