आयकर अपीलीय अिधकरण, ‘‘सी’’ (cid:586)ायपीठ, चे(cid:580)ई IN THE INCOME-TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI (cid:373)ी ऐम. बालगनेश, लेखा सद(cid:735) एवं (cid:373)ी एस.एस. िव(cid:695)ने(cid:361) रिव, (cid:586)ाियक सद(cid:735) के सम(cid:407)

Before Shri M. Balaganesh, Accountant Member &

Shri S.S. Viswanethra Ravi, Judicial Member आयकर अपील सं./I.T.A. No.2043/Chny/2025 िनधा(cid:330)रण वष(cid:330)/Assessment Year: 2022-23 Shriram Finance Limited, Vs. The Principal Commissioner of [Since Shriram City Union Finance Income Tax – 3, Limited amalgamated with Shriram Chennai.

Transport Finance Co. Limited and presently known as Shriram Finance Limited], Sri Towers, Plot No. 14A, South Phase, Industrial Estate, Guindy, Chennai 600 032.

[PAN:AAACS7018R]

(अपीलाथ(cid:334)/Appellant) ((cid:366)(cid:529)थ(cid:334)/Respondent) अपीलाथ(cid:334) की ओर से / Appellant by : Shri R. Sivaraman, Advocate (cid:366)(cid:529)थ(cid:334) की ओर से/Respondent by : Shri C.N. Bipin, CIT सुनवाई की तारीख/ Date of hearing : 15.10.2025 घोषणा की तारीख /Date of Pronouncement : 08.01.2026 आदेश /O R D E R PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER:

This appeal filed by the assessee is directed against the order dated 28.05.2025 passed by the ld. Principal Commissioner of Income Tax – 3, Chennai for the assessment year 2022-23 under section 263 of the Income Tax Act, 1961 [“Act” in short].

2. Brief facts of the case are that the assessee filed return of income for AY 2022-23 on 31.10.2022 declaring total income of ₹.1548,25,20,310/- and subsequently filed revised return on 31.12.2022 declaring total income of ₹.1548,25,12,670/-. The case was selected for scrutiny and assessment under section 143(3) r.w.s. 144B of the Act was completed on 29.02.2024 by assessing the income of the assessee at ₹.1549,48,21,820/- after making a disallowance of ₹.1,23,09,150/- being interest under section 234D of the Act. After examining the assessment records, the ld. PCIT noted that the assessee’s claim of bad debt amounting to ₹.852,53,45,072/- debited to the P & L account has been allowed as deduction under section 36(1)(vii) of the Act. In the computation of income for the F.Y. 2020-21 relevant to the AY 2021-22, an amount of ₹.99,78,811/- was claimed as deduction under section 36(1)(viia)(d) of the Act relating to provision created during the year for bad debts. Since for F.Y. 2021-22, the amount of ₹.99,78,811/- was available as opening balance, bad debts claimed should have been restricted to ₹.851,53,66,261/-, the excess claim of bad debts of ₹.99,78,811/- should have been disallowed and added back to the total income of the assessee. Accordingly, by invoking the provisions of section 263 of the Act, the ld. PCIT show-caused the assessee vide notice dated 28.03.2025. In response to the show-cause notice, the written submissions filed by the assessee are reproduced under para 5 at pages 2 to 5 of the impugned order. After considering the submissions, the ld. PCIT observed that the Assessing Officer did not cause necessary enquiries and/ or to disallow/reduce the opening credit balance in the provision for bad debts which make the assessment order erroneous and prejudicial to the interests of Revenue and directed the Assessing Officer to recompute the taxable income.

3. The ld. AR Shri R. Sivaraman, Advocate submits that the notice issued by the ld. PCIT-3 on amalgamating company is bad under law. He drew our attention to page 1 of the paper book and submits that the ld. PCIT issued the notice dated 28.03.2025 on Shriram City Union Finance Ltd., which is not in existence since merged with Shriram Transport Finance Company Ltd. vide order dated 09.11.2022 of ld. NCLT, Chennai with effect from 01.04.2022. He submits that the name of Shriram Transport Finance Co. Ltd. was changed to Shriram Finance Ltd. with effect from 30.11.2022. He drew our attention to the letter dated 10.04.2025 at page 8 of the paper book and submits that the assessee brought the facts to the notice of the ld. PCIT b