G K Winding Wires Ltd. vs Addl. CIT(OSD)

Per Raj Kumar Chauhan, Judicial Member:

The appeal of the asse ssee is d irected against the order dated 24.11.2025 of ld. CIT(A)/NFAC passed u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) wherein appeal has been dismissed against the assessment order dated 13.0 1.2021 for A.Y. 2018-19.

Brief facts as culled out form the orders of the authorities below are that the assessee filed its return of income for A.Y. 2018-19 declaring total income of Rs.17,44,97,800 /-. The case was se lected for limited scrutiny on the issue of expenditure of personal nature. The assessment was completed u/s 143(3) r.w.s. 143(3A) and 143(3B) of the Act, determining the total income at Rs.18,04,33,530/-. The Assessing Officer made an additio n of Rs.57,83 ,343/- on account o f d ifference in depreciation as per the Companies Act, 2013 and depreciation allowable under the Income-tax Act, 1961, and a disallowance of Rs.1,52,384/- towards emp loyees’ contributio n to Provident Fund. The assessee contended that the first addition arose due to an inadvertent error in the tax audit repo rt, which was subseque ntly acknowledged and corrected by the tax aud itor.

Aggrieved by the assessment o rder, the assessee filed appeal before the ld. CIT(A). During the appellate proceedings, it was noted that the assessee had also challenged the intimation issued u/s 143(1), w herein relief in respect of the additio n of Rs.57,83,343/- was subsequently granted . The ld. CIT(A), instead of adjudicating the grounds on merits, dismissed the ap peal as withdrawn.

Aggrieved by the impug ned order, the assesse e is in appeal before us and has raised the following grounds of appeal:

We have heard the ld. AR and the ld. DR. The ld. AR at the very outset submitted that the issues raised in the present appeal require proper verificatio n at the assessment stage. It was submitted that the addition o f Rs.57,83,343/- arose due to an inadvertent/ misinterpretation in reporting of depreciation in the tax audit rep ort and that the tax auditor had subsequently acknowledged the mistake and issued a certificate. It was further submitted that the assessee had also furnished a revised/corrected report and supporting mater ial.

The ld. DR, on the o ther hand, while supporting the judgme nt of lower authorities has left it to the discretion o f the Tribunal to consider the submissions for restoring the matter to the file of the Assessing Officer.

We have considered the r ival submissions and perused the material available on record. It is an undisputed fact that the ld. C IT(A) has not ad judicated t he grounds r aised by the assessee on mer its. The record also shows that the assessee has raised factual conte ntions regarding the alleged error in the tax audit report and the subsequent correction thereof. Further, the exact effect of the relief granted in the earlier proceedings u/s 143(1) and its imp act, if any, on the assessme nt comp leted u/s 143(3) requires verification by the Asse ssing Officer. In the interest of justice and considering the peculiar facts of the case, we deem it appropriate to set aside the impugned order of the ld. CIT(A) and restore the matter to the file of the Assessing Officer for fresh adjud ication. The Assessing Officer shall examine the claim of the assessee re garding the revised/corrected tax audit report, the co mputatio n of depreciation, the effect of the order passed in the proceedings arising from section 143(1), and the claim relating to employees’ contribution towards PF thereof. The Assessing Officer shall verify all the relevant documentary evidence and thereafter decide the issues afresh in accordance with law. Needless to say, adequate opportunity of being heard shall be afforded to the assessee. The assessee/appellant is also directed to make the necessary submissio ns/ detailed material before the Assessing Officer within the period of 60 days of this order.

In the result, the appeal of the assessee is allowed for statistical purposes.