TMI Blog2020 (8) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... r income because these were old record and on account of merger of assessee with other group companies, records were not easily traceable, which we have accepted. No documentary evidences except the details of the chart is furnished before us, therefore, these grounds of appeal are restored back to the file of assessing officer to decide the issue afresh after verification of facts and evidences in accordance with law. The assessee is also directed to furnish the evidence to substantiate its claim. In the result these grounds of appeal are allowed for statistical purpose. - ITA No. 7074/Mum/2016 - - - Dated:- 20-3-2020 - Shri Shamim Yahya, Accountant Member And Shri Pawan Singh, Judicial Member For the Appellant : Ms. Aarti Sathe (AR) For the Respondent : Shri Michael Jerald (Sr.DR) ORDERUNDER SECTION 254(1)OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER; 1. This appeal by assessee is directed against the order of ld. Commissioner of Income Tax (Appeals)-49 Mumbai in short ld. CIT(A) in Appeal No.CIT(A)-49/IT-102 103/2015-16, dated 07.10.2016 for Assessment Year 2007-08. The assessee has raised the following grounds of appeal: 1) On the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elected for scrutiny and assessment was completed under section 143(3) on 29.12.2009 accepting the return of income. Subsequently, the assessment was re-opened under section 147. The Notice under section 148 dated 18.02.2014 was issued and served upon the assessee. Following the reasons of re-opening were recorded. In this case the assessment was completed u/s 143(3) of the Income Tax Act 1961 on 22th December 2009 at a total income of ₹ 525128/-. Assessee has filed return of income on 30.10.2007 declaring total income at 525128/-.Perusal of the records reveal that for the period under consideration the assessee has shown total sales of ₹ 25,77,66,506/- and net profit of ₹ 10,09,11,188/- as per P/L account was shown. As per the computation of income, net profit from business activity of ₹ 10.09.11.188/- was increased to ₹ 10,49,36,726/- by way of ₹ 3,77,692/- on a/c of Disallowable prior period expenses, ₹ 44,2537- on a/c of Donation and 4,05,423/- on account of provision to gratuity. ₹ 36,87,656/- on account provision for doubtful debts and 35,642/- on account of disallowable expenses u/s 40A(3). The deduction u/s 80IB has been c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not a profit derived from activity of the eligible undertaking and hence is not attributable to the profit of the eligible undertaking. The assessee has included an the amount of ₹ 3,77,692/-, ₹ 4,05,423/-, ₹ 36,87,656/- and ₹ 35,642/- and disallowance on account of donation of ₹ 44,253/-, in gross total income and subsequently claimed the same also as deduction U/S 80IB. The disallowances u/s 40(a) and 40(a)(ia) cannot be construed to have been derived as or includable in the profit of the eligible undertaking and do not enhance the real income of the assessee. Further, disallowance of these expenses is due to non compliance of certain provisions of the Act, which does not enhance the actual income of the assessee. Therefore the claim of the assessee for 80IB deduction on disallowance on the above mentioned disallowances and donation is not a valid claim and income to that extent has escaped assessment. 4. In response to the notice under section 148, the assessee filed its reply dated 01.03.2014 and contended that return filed on 30.10.2007 may be treated as a return in response to the said notice. The assessee filed objection vide its objec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence, the assessee has relied upon the decisions of Hon ble Madhya Pradesh High Court in CIT vs. Satya Setia (143 ITR 486) and Hon ble Andhra Pradesh High Court in CIT vs. G.V. Rattiah and Co. (256 ITR 351). Along with the application, the assessee has filed charts showing the details of miscellaneous receipts from customer, bank charges (income), cancellation charges, details of sundry creditor and other balance written off. 7. The ld. AR of the assessee submits that Rule 29 of Income Tax (Appellate Tribunal) Rules, 1963 empowered the bench to admit the additional evidence. The additional evidence filed by assessee is relevant and goes to the root of the matter. The additional evidence may be admitted for better appreciation of the issue/ground raised by assessee. 8. On the other hand, the ld. DR for the revenue submits that in case, the Hon ble Bench considered the relevancy of document filed by assessee by way of additional evidence, the issues with regard to which the assessee has filed additional evidence may be restored to the file of Assessing Officer for examination and verification of evidence and to pass the order afresh. 9. We have considered the contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 263 was dropped. 11. Before lower authorities, the assessee submitted that case is re-opened after expiry of 4 years from the end of relevant A.Y., ignoring the fact that assessee has furnished all details before completion of original assessment under section 143(3). After the completion of original assessment, no new material has come in the notice of Assessing Officer, suggesting that income has escaped assessment. Such re-opening after 4 years when all material were placed before the Assessing Officer in original assessment is not permitted by law. 12. On the other hand, the ld. Departmental Representative (DR) for the revenue supported the order of the lower authorities. The ld DR further submits that the ld CIT(A) in its finding has not raised quarry and accepted the claim of assessee without verification of facts. So far as the contention of ld AR for the assessee that reopening was made after four year from the end of relevant assessment year and there is no allegation that there was any failure on the part of assessee in disclosing full and true material facts necessary for assessment for the year. The ld DR submits that ld CIT(A) in para 6.3 of his order has clearl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 to 3 is decided against the assessee. 15. Ground No. 4 and additional Ground No. 1 2 relates deduction of various components of income under section 80IB. Considering the facts that the assessee in its application for admission of additional evidence has accepted that the interest income of ₹ 15,95,359/- as a part of profit and other income of ₹ 35,74,507/- as a part of profit derived by eligible undertaking was not before lower authorities and that the assessee could not file details of other income because these were old record and on account of merger of assessee with other group companies, records were not easily traceable, which we have accepted. Though, no documentary evidences except the details of the chart is furnished before us, therefore, these grounds of appeal are restored back to the file of assessing officer to decide the issue afresh after verification of facts and evidences in accordance with law. The assessee is also directed to furnish the evidence to substantiate its claim. In the result these grounds of appeal are allowed for statistical purpose. 16. In the result the appeal of the assessee is partly allowed. 17. Order pronounced in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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