The Mumbai Bench of Income tax appellate tribunal (ITAT) has recently ordered Jet Airways (India) Limited to pay a cost of Rupees 25,000 to the Prime Minister Relief Fund due to failing to comply with the notice issued by the Income Tax Department several times.
Assessee Jet Airways (India) Limited is a public limited company engaged in the business of scheduled airlines carrying out transportation of passengers and cargo and other allied services and was incorporated under the Companies Act, 1956 consisting of nine directors. The assessee filed its return of income dated 29.11.2016, declaring total income at Rs.Nil under the normal provisions and book loss of Rs.Nil under section 115JB of the Income Tax Act 1961.
Pursuant to the survey action under section 133A of the Income Tax Act 1961 conducted in the case of the assessee, assessee’s case was selected for scrutiny. It was observed that the assessee has entered into a large value international transaction as per Form No. 3CED with its Associated Enterprises (AEs) and also as per the survey report. Assessing officer issue notice for calling for details, documents, evidence, explanation, along with the copy of order under section 92CA(3) of the Act seeking for assessee’s explanation as to the transfer pricing adjustment proposed by the TPO.
Assessee has failed to furnish details before the A.O. except for a letter received from Shri Ashish Chhawchharia, Resolution Professional for Jet Airways (India) Ltd. stating that the assessee company was undergoing Corporate Insolvency Resolution Process (CRIP) as per Insolvency and Bankruptcy Code, 2016 as directed by the National Company Law Tribunal (NCLT) vide order dated 20.06.2019, seeking for the assessment proceedings to be kept as abeyance. Subsequent to this, the assessee was again furnished with the notice seeking for details, documents and explanation.
Thus assessing officers make addition which was more than that of the income computed by the assessee. Against this order assesee filed an appeal before the ITAT.
Vijay Mehta Counsel for the assessee contended that “since the assessee’s company was going through insolvency process before the NCLT, the assessee was unable to furnish the required documentary evidence along with the explanation proposed by the assessee in view of the various additions made by the assessing officer”.
Manoj Mishra counsel for the revenue vehemently opposed to remanding this issue back to the assessing officer for the reason that the assessee has been given sufficient opportunity before the lower authorities to present its case.
After considering the facts and materials the division bench of the ITAT comprising Prashant Maharishi, (Accountant) and Kavitha Rajagopal, Judicial Member) allowed the appeal filed by the assessee and the further directed to the assessee to pay cost of Rs.25, 000/- each in both these appeals for being delinquent before the lower authorities and the same is to be paid towards Prime Minister’s Relief Fund within 30 days from the date of this order. The assessee was also directed to appeal and fully cooperate with the assessing officer to present its case without any further delay.
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