Case Number: ITA 52/DEL/2021
Appellant: SHANKAR GAS & MFG CO. PVT LTD, New Delhi
Respondent: ITO WARD – 23(1), New Delhi
Assessment Year: 2015-16
Case Filed on: 2021-01-27
Order Type: Final Tribunal Order
Date of Order: 2022-03-31
Pronounced on: 2022-03-31
In the Income Tax Appellate Tribunal, Delhi Bench ‘SMC’, New Delhi, a significant case was presented involving Shankar Gas & MFG Co. Pvt. Ltd. The primary issue under dispute was the additions made by the Assessing Officer (AO) under Sections 68 and 69C of the Income-Tax Act, 1961, which were subsequently confirmed by the CIT(A). The appellant challenged these additions, leading to the current appeal.
The appellant, Shankar Gas & MFG Co. Pvt. Ltd., filed its return of income on 25.09.2015, declaring a loss of Rs. 33,10,618/-. However, during the assessment proceedings, the AO made an addition of Rs. 17,62,993/- under Section 68 read with Section 115BBE on the grounds that the appellant could not adequately explain the exempt Long-term Capital Gain shown in the return. Additionally, an amount of Rs. 44,074/- was added under Section 69C, being 2.5% of the accommodation entries obtained by the appellant amounting to Rs. 17,62,993/-.
The appellant raised several grounds challenging the CIT(A)’s order, focusing on the following:
The appellant’s counsel, Sh. Deepak Ostwal, CA, argued that the CIT(A) dismissed the appeal without adequately reviewing the evidence and details provided by the appellant. He contended that given another opportunity, the appellant could substantiate its claims and provide the necessary explanations for the additions made.
On the other hand, the respondent, represented by Sh. Om Prakash, Sr. DR, defended the CIT(A)’s decision and argued that the appellant failed to comply with the requirements and provide sufficient evidence during the original assessment and appellate proceedings.
The Tribunal, represented by Shri R.K. Panda, Accountant Member, carefully examined the submissions and the record. The key findings were:
Consequently, the Tribunal restored the issue to the file of the CIT(A) with specific directions for both parties to cooperate fully and avoid unnecessary adjournments.
The Tribunal ruled in favor of granting the appellant another opportunity to present its case before the CIT(A). The appeal was allowed for statistical purposes, and the CIT(A) was directed to reconsider the case and decide based on the merits and evidence provided by the appellant.
Final Judgment: The appeal was allowed for statistical purposes, and the case was remanded back to the CIT(A) for a fresh decision.
This case highlights the importance of compliance and providing adequate evidence during tax proceedings, as well as the judicial system’s readiness to ensure fairness by granting opportunities to rectify procedural lapses.
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