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TMI Blog2023 (9) TMI 472X X X X Extracts X X X X X X X X Extracts X X X X ..... me appearing in Form 26AS for the Financial Year 2010-11. 3. That the Ld. AO and NFAC grossly erred on facts in not appreciating that such income was considered by Sargon Geosynthetics Limited (a Company amalgamated with Appellant w.e.f. December 19, 2008) from Sunway Construction SDN BHD during financial years 2006-07, 2007-08 and 2008-09 respectively. 4. That the Ld. AO and NFAC has grossly erred in facts and in law by framing the addition of income appearing in Form 26AS solely on the basis of non-responsiveness of notices issued under section 133(6) of the Income-tax Act, 1961 ("Act) to Sunway Construction SDN BHD, without examining and appreciating the evidence furnished by the Appellant in the course of proceedings before them. 5. That the Ld. AO/NFAC grossly erred in law in making addition of income of INR 300,73,421 under section 115JB of the Act without appreciating that the same is against the principles laid down by Hon'ble Supreme Court in the case of Apollo Typres Ltd. vs CIT (255 ITR 273). 6. That the Ld. AO/NFAC has grossly failed to appreciate in accordance with law, that they have limited powers of making adjustment (increase or reductions) as provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n received, be not added to the total income of the assessee for the year under consideration. In response thereto, the assessee submitted that the receipts from M/s Sunway Construction are pertaining to the job carried out in the financial years 2006-07, 2007-08, and 2008-09. Further, the aggregate work carried out and accounted in the books and reflected in the financial statements of M/s Sargon Geosynthetics Ltd is Rs. 3,74,56,144, which exceeds the amount as reflected in AIR and thus the amount of Rs. 2,99,89,133 and Rs. 84,288 already stands accounted in the books of M/s Sargon Geosynthetics Ltd. It was further submitted that no job has been carried out for Sunway Construction by the assessee. During the assessment proceedings, notice under section 133(6) of the Act was issued to Sunway Construction seeking information regarding the transaction with M/s Sargon Geosynthetics Ltd during the financial year 2010-11. However, in response thereto, no compliance was made by Sunway Construction, and no details were filed. The Assessing Officer ("AO") vide order dated 25/12/2018 passed under section 143(3) read with section 147 of the Act did not agree with the submissions of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat after 19/12/2008 M/s Sargon Geosynthetics Ltd. was a non-existing entity. Therefore, any sum received from any entity during the assessment year 2011-12 can only be in the name of the assessee and not in the name of the erstwhile entity. However, we find that the lower authorities have not examined the aforesaid aspect and merely on the basis of AIR information regarding details in Form 26AS of M/s Sargon Geosynthetics Ltd. made the impugned addition. Therefore, we deem it appropriate to restore the matter to the file of the AO for de novo adjudication after necessary examination of all the details furnished by the assessee including the details in Form 26AS of the assessee for the year under consideration. The assessee may also make necessary endeavour to obtain the information from Sunway Construction regarding its transaction with M/s Sargon Geosynthetics Ltd. and the period for which the impugned payment was made to M/s Sargon Geosynthetics Ltd. Since we have restored the matter to the file of the AO, the issue raised in grounds no.5 and 6 pertaining to the computation of book profit under section 115JB of the Act is also restored to the file of AO for de novo adjudication. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and served on the assessee. During the assessment proceedings, upon perusal of the computation of income, it was, inter-alia, observed that the assessee has claimed a deduction of Rs. 93,16,597 on account of gratuity paid. However, in the Tax Audit Report in Form 3CD no such amount was mentioned by the tax auditor in clause 26(i)(A)(a) which relates to any sum referred to in clauses (a), (b), (c), (d), (e) or (f) of section 43B of the Act. Accordingly, the assessee was asked to show to furnish details of the gratuity paid of Rs. 93,16,597 along with substantive documentary evidence and to explain why this payment was not quantified in the Tax Audit Report. The assessee was asked to show cause as to why the deduction claimed on account of gratuity paid be not disallowed and added back to the income for the year under consideration. In response thereto, the assessee submitted the details of the gratuity payment of Rs. 93,16,597. The AO vide order dated 22/12/2018 passed under section 143(3) of the Act did not agree with the reply filed by the assessee in the absence of documentary evidence in respect of payments made and the explanation regarding no remark in the tax audit report. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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