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TMI Blog2022 (4) TMI 1276X X X X Extracts X X X X X X X X Extracts X X X X ..... aking the aforesaid adjustments u/s 143(1) of Income Tax Act on 31.10.2019 on a debatable and controversial issue. We would like to make respectful mention of order of Jabalpur Bench of ITAT in the case of Nikhil Mohine vs. DCIT [ 2021 (11) TMI 927 - ITAT JABALPUR] in which similar view has been taken. It is also well settled that retrospective amendment cannot be invoked to make addition by way of adjustment and intimation u/s 143(1) of Income Tax Act. This view was taken by the Hon ble Supreme Court in the case of CIT vs. Hindustan Electro Graphites Ltd [ 2000 (3) TMI 2 - SUPREME COURT] in which the view of Hon ble Kolkata High Court in the case of Modern Fibotex India Ltd. Anr.[ 1994 (3) TMI 17 - CALCUTTA HIGH COURT] was approved. We are of the view that the aforesaid additions by way of adjustment and intimation u/s 143(1) of Income Tax Act, were beyond the scope of Section 143(1) of Income Tax Act; and further, that the Ld. CIT(A) erred in law in confirming the aforesaid addition on a debatable and controversial issue. - Decided in favour of assessee. - ITA No.148/Del/2022 - - - Dated:- 25-4-2022 - Shri Kul Bharat, Judicial Member And Shri Anadee Nath Misshra, A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing ₹ 1,71,75,434/- were made by way of adjustments u/s 143(1) of Income Tax Act; vide intimation dated 31.10.2019. The assessee filed appeal before Ld. CIT(A) on 27.01.2022, which was disposed of by the Ld. CIT(A) vide impugned appellate order dated 06.01.2022; wherein the Ld. CIT(A) confirmed the aforesaid additions amounting to ₹ 1,71,75,434/. (C) Aggrieved, the assessee has filed this present appeal in Income Tax Appellate Tribunal ( ITAT for short) against the aforesaid impugned appellate order dated 06.01.2022 of the Ld. CIT(A). Vide order sheet noting dated 18.02.2022, Co-ordinate Bench of ITAT, Delhi ordered Early Hearing of this appeal; accepting the assessee s application for grant of Early Hearing. At the time of hearing before us, the Ld. Authorized Representative ( AR for short) for the assessee submitted that the Ld. CIT(A) should have deleted the additions, instead of sustaining the aforesaid additions amounting to ₹ 1,71,75,434/-. The Ld. Sr. DR relied upon the impugned appellate order dated 06.01.2022 of the Ld. CIT(A). (D) We have heard both sides. We have perused the materials on record. Relevant facts are not in dispute. Employees cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... krishna Aswini Kumar vs. Assistant Director of Income Tax [2022] 192 ITD 562 (Bangalore-Trib.) for Assessment Year 2019-20 (order dated 13.10.2021 in ITA No.359/Bang./2021); Continental Restaurant and Caf Co. vs. Income Tax Officer [2021] 91 ITR (Trib.) (S.N.) 60 (Bangalore) for Assessment Year 2019-20 (order dated 11th October, 2021 of SMC Bench of Bangalore); and TML Business Services Ltd. [2022] 93 ITR (Trib.) (S.N.) 35 (Mumbai) for Assessment Year 2017-18 (order dated 29th Dec., 2021). In the cases of Continental Restaurant and Caf Co. vs. ITO (supra), Nikhil Mohine vs. DCIT (Supra), Shand Pipe Industry Pvt. Ltd. vs. DCIT (supra); Digiqal Solution Services Pvt. Ltd. vs. Assistant Director of Income Tax (supra) and Gopalakrishna v/s ADIT (supra), the different Benches of Income Tax Appellate Tribunal have, in fact, specifically considered the aforesaid amendments brought to Income Tax Act by Finance Act, 2021; and have taken the view that the amendments are prospective in nature, having no application for the period prior to 01.04.2021. Even if Revenue does not accept the view, that the aforesaid amendments are prospective in nature having no application for Assessment Years ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Anr. [2006] 286 ITR 0533 (Gauhati); Tata Yadogawa Ltd. vs. CIT [2011[] 335 ITR 0053 (Jharkhand); God Granites vs. Central Board of Direct Taxes Ors. [1996] 218 ITR 0298 (Karnataka); Swamy Distributors vs. ACIT Ors. [2003] 180 CTR 0290; 139 Taxman 0310 (Karnatka), CIT vs. Eicher Goodearth Ltd. [2008] 296 ITR 0125 (Delhi); Smt. Shanta Chopra vs. ITO [2004] 271 ITR 0132 (Delhi); Kvaverner John Brown Engg. (India) (P.) Ltd. vs. ACIT, [2008] 305 ITR 0103 (Supreme Court). In this present case before us, the additions have been made by way of adjustments vide intimation u/s 143(1) of Income Tax Act, dated 31.10.2019. As on the aforesaid 31.10.2019, the aforesaid amendments to Section 36(1)(va) and Section 43B of Income Tax Act had not been enacted; but orders of Hon ble Delhi High Court (the jurisdictional High Court) in favour of assessee and against Revenue on this issue in aforesaid cases of CIT vs. AIMIL Ltd. (supra); and CIT vs. P.M. Electronics Ltd. (supra) were available. Accordingly, the aforesaid amount of ₹ 1,71,75,434/- could not have been added to assessee s income as on 31.10.2019 in the light of these binding precedents of the Hon ble Delhi Court in favour of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law. (d) Addition by way of adjustment and intimation u/s 143(1) of Income Tax Act on debatable and controversial issues is beyond the scope of Section 143(1) of Income Tax Act. Revenue was clearly in error in making the aforesaid adjustments. (e) Addition by way of adjustment and intimation u/s 143(1) of Income Tax Act, on the basis of retrospective amendment to Income Tax Act is beyond the scope of Section 143(1) of Income Tax Act. (f) In the present appeal before us, addition of aforesaid amount of ₹ 1,71,75,434/- has been made by way of adjustments and intimation u/s 143(1) of Income Tax Act, on a debatable and controversial issue, and Ld. CIT(A) did err in law, in not deleting this addition. (E) In the light of the foregoing conclusions in paragraph (D.2.1) of this order, we are of the view that the aforesaid additions of ₹ 1,71,75,434/-, by way of adjustment and intimation u/s 143(1) of Income Tax Act, were beyond the scope of Section 143(1) of Income Tax Act; and further, that the Ld. CIT(A) erred in law in confirming the aforesaid addition on a debatable and controversial issue. Accordingly, we set aside the impugned appellate order dated 06.01.2022 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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