Supreme Court: Foreign Companies’ Head Office Expenses in India are Capped under Section 44C  ||  SC Directs Trial Courts to Systematically Catalogue Witnesses and Evidence in Criminal Judgments  ||  SC Calls For Sensitising Future Generations on Equality in Marriage to Combat Dowry Practices  ||  SC: Separate Suits Against Confirmed Auction Sales are Barred; Remedy Available under Sec 47  ||  NCLT Mumbai: Oppression Claims Against Majority Shareholders Do not Justify Winding up a Company  ||  J&K&L HC Rules it Illegal and Inequitable to Deny Regularisation to a Daily Wager After 34 Years  ||  J&K&L High Court: Revisional Powers Must Be Used Within Reasonable Time; Merits Don’t Justify Delay  ||  Supreme Court: Compassionate Appointees Cannot Later Claim Entitlement to a Higher Post  ||  NCLAT New Delhi: Insolvency Pleas Cannot Be Admitted When Information Utility Records Show a Dispute  ||  NCLAT: Issuing Cheques For Another Entity’s Liabilities Does not Constitute Operational Debt    

DCIT vs. VKS Properties Pvt. Ltd. New Delhi - (Income Tax Appellate Tribunal) (18 Aug 2023)

When substantive addition has already been completed, no protective addition can be confirmed

MANU/ID/1195/2023

Direct Taxation

Assessee filed return of income declaring income of Rs. 85,626. In the assessment order, the AO has made an addition under Section 68 of the Income Tax Act, 1961 (IT Act) on account unexplained credit entries of Rs. 12,63,58,536 in the bank account of the appellant received from various parties on protective basis.

Against the assessment order, assessee appealed before the Learned CIT(A) who vide his impugned order has partly allowed the appeal by observing that the commission income earned on providing accommodation entries through the assessee company have already been assessed by the Assessing Officer in the hands of Anand Jain and Naresh Jain which has been confirmed by him in their respective appeals, hence, no further addition can be made in the hands of the assessee company and deleted the protective addition of Rs. 12,63,58,536.Against the order, Revenue is in appeal.

The commission income earned on providing accommodation entries through the assessee company have already been assessed by the AO in the hands of Anand Jain and Naresh Jain which has been confirmed by the Learned CIT(A) in their respective appeals. Therefore, Learned CIT(A) has rightly held that, no further addition can be made in the hands of the assessee company and therefore, directed to delete the protective addition of Rs. 12,63,58,536 made by the AO.

The issue in the instant appeal is squarely covered by the Delhi Tribunal's order in the case of Sh. Anand Kumar Jain vs. ACIT &Ors. wherein, on similar aspect and identical facts and circumstances, the Tribunal held that since the substantive addition has already been completed in the case of Sh. Naresh Kumar Jain, hence, no protective addition can be confirmed at this juncture in the case of the assesseei.e. Anand Kumar Jain and accordingly dismissed the appeal of the Revenue.

In view of facts and circumstances of the present case, Learned CIT(A) has rightly decided the issue in favour of the Assessee and deleted the addition in dispute, after elaborately discussing the issue in detail, which did not require any interference. Revenue Appeals are dismissed.

Tags : ASSESSMENT   DELETION   LEGALITY  

Share :        

Disclaimer | Copyright 2025 - All Rights Reserved