Appeal Against Disallowance and Penalty – Amrapali Biotech India Pvt Ltd vs ACIT Central Circle-2, New Delhi

Case Summary: Amrapali Biotech India Pvt Ltd vs ACIT Central Circle-2, New Delhi

Case Number: ITA 6056/DEL/2019
Appellant: Amrapali Biotech India Pvt Ltd, Ghaziabad
Respondent: Assistant Commissioner of Income Tax (ACIT), Central Circle-2, New Delhi
Assessment Year: 2015-16
Case Filed On: 16th July 2019
Order Type: Final Tribunal Order
Date of Order: 30th September 2022
Pronounced On: 30th September 2022

Introduction

The case of Amrapali Biotech India Pvt Ltd vs ACIT Central Circle-2, New Delhi, involves an appeal filed by the appellant challenging the disallowances and penalties imposed for the assessment year 2015-16. The case was heard by the Income Tax Appellate Tribunal (ITAT) Delhi Bench ‘A’ and involved two appeals: one related to quantum additions and the other concerning the penalty imposed under section 271(1)(c) of the Income Tax Act, 1961.

Background of the Case

Amrapali Biotech India Pvt Ltd, a company engaged in the business of food processing and trading of food grains, filed its income tax return for the assessment year 2015-16, declaring a total loss of Rs. 13,63,67,756/-. The case was selected for scrutiny, and the Assessing Officer (AO) completed the assessment under section 143(3) of the Income Tax Act, 1961. The AO made several disallowances and additions, reducing the declared loss to Rs. 6,11,72,361/-.

The AO’s additions included Rs. 3,07,07,298/- on account of disallowance of expenses, Rs. 4,44,88,097/- for alleged bogus purchases, and additional enhancements by the Commissioner of Income Tax (Appeals) [CIT(A)], including Rs. 20,27,16,335/- for further alleged bogus purchases, Rs. 49,40,145/- for scrap sales, Rs. 1,09,71,138/- for sales enhancement, and Rs. 1,42,96,302/- under section 37 for disallowance of expenses. The AO also imposed a penalty of Rs. 9,68,64,615/- under section 271(1)(c) for concealment of income and furnishing inaccurate particulars of income.

Amrapali Biotech India Pvt Ltd, aggrieved by these additions and the penalty, filed appeals before the CIT(A), who upheld the AO’s decisions. The appellant then escalated the matter to the ITAT, seeking relief from the quantum additions and the penalty imposed.

Proceedings Before the ITAT

The appeals were heard by the ITAT Delhi Bench ‘A’, with Shri Anil Chaturvedi, Accountant Member, and Shri Narender Kumar Choudhary, Judicial Member, presiding over the case. The hearings were conducted via video conferencing due to the ongoing COVID-19 pandemic.

The case was listed for hearing on several occasions, but the appellant consistently failed to appear or provide any response. Notices issued to the appellant remained unclaimed, and there was no cooperation from the appellant in pursuing the appeal. Consequently, the Tribunal decided to proceed ex parte, based on the material available on record and the submissions made by the Senior Departmental Representative (DR), Shri Kanav Bali.

Tribunal’s Decision

The Tribunal noted the negligent and non-cooperative approach of the appellant, who failed to appear before the lower authorities and the Tribunal despite being given multiple opportunities. The Tribunal observed that preferring an appeal requires not just formal filing but also actively pursuing it to ensure justice is served.

The Tribunal further noted that the CIT(A) had provided a detailed explanation for upholding the additions and the penalty, citing the appellant’s failure to furnish the necessary documents and evidence to support their claims. The Tribunal found no reason to interfere with the CIT(A)’s order, given the appellant’s lack of engagement in the process.

As a result, the Tribunal upheld the orders of the CIT(A), confirming the disallowances and the penalty imposed by the AO. The appeals filed by Amrapali Biotech India Pvt Ltd were dismissed due to the appellant’s failure to pursue the case effectively and substantiate its claims.

Conclusion

The appeal filed by Amrapali Biotech India Pvt Ltd against the disallowances and penalty for the assessment year 2015-16 was dismissed by the ITAT. The dismissal was primarily due to the appellant’s non-appearance and failure to cooperate in the appellate process. The Tribunal’s decision underscores the importance of actively engaging in the legal process when challenging tax assessments and penalties.

This case highlights the responsibility of taxpayers to diligently pursue their appeals and provide the necessary evidence to support their claims. The Tribunal’s decision serves as a reminder that mere filing of an appeal is insufficient; taxpayers must also take the necessary steps to ensure their appeals are heard and adjudicated on merits.

Order Pronounced in Open Court: 30th September 2022

Judicial Members: Shri Anil Chaturvedi and Shri Narender Kumar Choudhary

Assistant Registrar: ITAT, New Delhi

Appeal Against Disallowance and Penalty – Amrapali Biotech India Pvt Ltd vs ACIT Central Circle-2, New Delhi