9911796707
TMI Blog2024 (12) TMI 491X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income-tax Act, 1961 (hereinafter referred to as "the Act") dated 22.12.2021 by the Assessing Officer, ADIT, CPC, Bangalore (hereinafter referred to as "ld. AO"). 2. The assessee has raised the following ground of appeal:- "Addition of Rs. 146,24,18,751/- to Book Profit, by Ld. AO (CPC, Income Tax Department) u/s 143(1) of the Act. (a) On the facts and in the circumstances of the case and in law the Ld. AO (CPC) erred in considering the original Book Profit of Rs. 3001,85,35,561/- which was subsequently revised to Rs. 2855,62,16,561/- on account of restatement of financial statements of the assessee by duly filing a revised income tax return and the Ld. AO made additions of Rs. 146,24,18,751/- to Book profit by grossly ignoring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 617,37,56,128/- and therefore the act of the Ld. CIT(A) is bad in law and without application of mind, and therefore, deserves justice. 3. Addition by Ld. CIT(A) of Rs. 15479,03,84,000/- to Book Profit on account of Reserves / Provisions as at 31.03.2019 (a) On the facts and in the circumstances of the case and in law the Ld CIT (Appeals) grossly erred in making additions of Rs. 15479,03,84,000/- on account of: i. General Reserves (Rs. 9313,52,94,000/-), ii. Debenture Redemption Reserves (Rs. 5714,55,92,000/-) and iii. Reserve Fund u/s 45 of RBI Act 1934 (Rs. 450,94,98,000/- being Closing Balances as at 31.03.2019, without understanding the fact that during the year under consideration, the assessee has not debited any reserves t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 22.12.2021 made by ADIT, CPC, Bengalure; 6. On the facts and in the circumstances of the case and in law, NFAC erred in making enhancement, in excess of its powers u/s 251(1) of the Act, 7. On the facts and in the circumstances of the case and in law, NFAC further erred in making enhancement without issuance of any formal notice in this regard, confronting the Assessee on this issue through a mere notice of hearing dated 28.12.2022." 4. We have heard the rival submissions and perused the material available on record. 5. The assessee is a company registered under the Companies Act, 1956 and is registered as Public Finance Institution u/s 4A of the Companies Act, 1956. The assessee company is engaged in leasing rolling stock asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year account for September 2020 assessee noticed that pending the hedging of currency risk associated with the External Commercial Borrowings (ECB) raised during the year 2018-19, National hedging cost built into the lease rentals actually recovered from Ministry of Railway (MoR) was due for refund was omitted inadvertently in the original return filed. The amount refundable to Ministry of Railways in this account pertaining to FY 2018-19 worked out to Rs. 146,24,19,000/- vide para 46(II)(d) of restated financial statement, out of total period adjustment of Rs. 146,24,19,000/- for the year 2018-19. Hence, the company has restated its financial statement of 3 years. Since, the aforesaid amount pertained to the year 2018-19, hence, same is be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... load all the relevant documents pertaining to the computation of book profit u/s 115JB of the Act, which was duly done by the assessee on 27.12.2022. This fact is duly acknowledged by ld NFAC which was in page 9 para 5.2.7 and 5.2.8 of its order further vide hearing notice dated 28.12.2022, the assessee was further asked to upload some more documents relevant to computation of book profit u/s 115JB of the Act. The same were duly uploaded by the assessee on 06.01.2023. This fact is mentioned in the order of the ld NFAC in pages 19 and 20 vide para 5.2.12 and 5.2.13. 8. During the appellate proceedings the ld NFAC, Delhi sought certain clarifications from the assessee with regard to income tax paid/ payable of Rs. 613,51,23,330/- to which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fund u/s 45 of the RBI Act-4,50,94,98,000/- Total 1,54,79,03,000/- 9. It is pertinent to note that that after seeking initial clarification from the assessee asking the assessee to upload certain documents for financial computation of book profit u/s 115JB of the Act, the ld NFAC either at the time of seeking clarification or thereafter did not issue any enhancement notice at all u/s 251(2) of the Act. It is trite law that without issuance of mandatory enhancement notice u/s 251(2) of the Act specifically showcasing the assessee as to how its income should not be enhanced by a particular figure on particular issues the ld NFAC does not have power as per statutory to enhance the income. Since, in the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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