Appellant: Premier Roadlines Ltd., East Delhi
Respondent: DCIT, Centralized Processing Center, Bangalore
For the Appellant: Sh. Suresh Gupta, CA
For the Revenue: Sh. Girish Kumar Kohali, Sr. DR
Date of Hearing: July 26, 2022
Date of Pronouncement: August 29, 2022
Premier Roadlines Ltd. challenged an adjustment made during processing by the Centralized Processing Center (CPC) in Bangalore under sections 43B and 40A(7) of the Income Tax Act concerning unpaid gratuity for the financial year 2016-17.
The CPC made an adjustment of Rs. 8,81,042 regarding unpaid gratuity which was contested by the company. The company had previously declared this amount during the regular assessment proceedings for AY 2017-18, arguing that it had been duly considered by the Assessing Officer (AO) in the final assessment order issued after thorough inquiries.
The Tribunal noted that the AO had accepted the company’s explanation in the final assessment order without making any additions related to the unpaid gratuity. Consequently, the Tribunal found that the adjustment made by the CPC was not warranted since it had been addressed and resolved in the final assessment. Therefore, any adjustment made during the initial processing was deemed unnecessary and was reversed.
The Tribunal allowed Premier Roadlines Ltd.’s appeal, emphasizing that once an issue has been examined and settled in the final assessment, subsequent adjustments during processing that contradict these findings are invalid. This decision underscores the importance of coherent and consistent handling of tax assessments and the need for proper communication between different branches of the tax authority.
The appeal of Premier Roadlines Ltd. was allowed, providing relief from the adjustment initially made by the CPC. The order was pronounced in open court immediately following the hearing, illustrating the tribunal’s commitment to transparency and due process in tax dispute resolutions.
Premier Roadlines Ltd. vs. DCIT, CPC, Bangalore (2017-18): Gratuity Adjustment Dispute
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