Case Number: ITA 519/DEL/2019
Appellant: MGS Securities P.Ltd, New Delhi
Respondent: DCIT, Circle-16(2), New Delhi
Assessment Year: 2015-16
Case Filed on: January 24, 2019
Order Type: Final Tribunal Order
Date of Order: January 17, 2023
Pronounced on: January 17, 2023
The case ITA 519/DEL/2019 was filed by MGS Securities P. Ltd against the Deputy Commissioner of Income Tax (DCIT), Circle-16(2), New Delhi. The case pertains to the assessment year 2015-16 and was filed on January 24, 2019. The final order was pronounced on January 17, 2023.
MGS Securities P. Ltd, a company engaged in the business of buying and selling shares, securities, and other financial products/instruments, filed its return of income for the assessment year 2015-16 on September 25, 2015, declaring a total income of Rs. 97,93,290/-. The case was selected for scrutiny, and the assessment was framed under section 143(3) of the Income Tax Act, determining the total income at Rs. 1,34,45,830/-.
Aggrieved by the order of the Assessing Officer (AO), the assessee appealed before the Commissioner of Income Tax (Appeals) [CIT(A)], who dismissed the appeal on November 27, 2018. Subsequently, the assessee filed an appeal before the Income Tax Appellate Tribunal (ITAT).
The assessee raised several grounds of appeal before the ITAT, including:
The appeal was first listed for hearing on January 6, 2022, but was adjourned. It was listed multiple times, but neither the assessee nor their counsel appeared or filed an adjournment application. Consequently, the ITAT decided to dispose of the appeal based on the material available on record and after hearing the Departmental Representative (DR).
The DR submitted that the sole grievance of the assessee was the disallowance of Rs. 36,52,540/-. During the assessment proceedings, the AO noted that the assessee had claimed Rs. 38,76,143/- as interest expenditure. However, the assessee failed to justify the commercial expediency of loans given to various parties on an interest-free basis. The AO disallowed the interest expense to the extent of Rs. 36,52,540/-.
The ITAT noted that the assessee did not appear before the Tribunal on various dates, despite notices being issued. No material was placed by the assessee to controvert the findings of the lower authorities or to point out any errors in their findings. Consequently, the ITAT found no reason to interfere with the order of the CIT(A) and dismissed the grounds of the assessee.
In conclusion, the ITAT dismissed the appeal filed by MGS Securities P. Ltd. The final order was pronounced in the open court on January 17, 2023.
This case highlights the importance of justifying the commercial expediency of financial transactions and the necessity of appearing before the Tribunal to effectively pursue an appeal. The dismissal of the appeal emphasizes the need for assessees to provide sufficient evidence and actively participate in the proceedings to support their claims.
Order pronounced in the open court on January 17, 2023, by:
Sd/-
[N.K. CHOUDHARY]
JUDICIAL MEMBER
Sd/-
[ANIL CHATURVEDI]
ACCOUNTANT MEMBER
Delhi, Dated 17th Jan, 2023
Copy to:
By Order
Assistant Registrar, ITAT, Delhi Benches, Delhi
ITA 519/DEL/2019: MGS Securities P.Ltd vs DCIT – Assessment Year 2015-16 – Why the Case was Filed
Manage the increasing number of hearings effortlessly by leveraging the legal AI revolution We are India's Leading revolutionary AI-powered legal platform where you can get enough insights into top cases and judgements.
Research Platform