आयकर अपीलीय अिधकरण ‘बी’ (cid:586)ायपीठ, चे(cid:580)ई।

IN THE INCOME TAX APPELLATE TRIBUNAL‘B’ BENCH: CHENNAI (cid:373)ी मनु कु मार िग(cid:303)र, (cid:586)ाियक सद(cid:735) एवं (cid:373)ी एस. आर. रघुनाथा, लेखा सद(cid:735) के सम(cid:407)

BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI S.R. RAGHUNATHA, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No.821/Chny/2025 िनधा(cid:330)रण वष(cid:330) /Assessment Year: 2017-18 The Dy. Commissioner of Sathyabama Ramachandran, Income Tax, Vs. No. 15/16/17, Vision Towers, IInd Non Corporate Circle-8, Floor, Yogam Garden, Chennai. Alwarthirunagar, Tiruvallur 600 087.

[PAN:ASOPS4400J]

(अपीलाथ(cid:7278)/Appellant) ((cid:7079)(cid:7004)यथ(cid:7278)/Respondent)

अपीलाथ(cid:334) की ओर से/ Appellant by : Shri A. Raghava Simhan, C.A.

(cid:366)(cid:529)थ(cid:334) की ओर से /Respondent by : Ms. Gouthami Manivasam, JCIT सुनवाई की तारीख/Date of Hearing : 26.06.2025 घोषणा की तारीख /Date of Pronouncement : 23.09.2025 आदशे / O R D E R PER MANU KUMAR GIRI (Judicial Member):

The captioned appeal filed by the revenue is directed against order of the Ld. Commissioner of Income Tax (Appeals) (NFAC), Delhi [CIT(A)]

dated 08.02.2025 for Assessment Year 2017-18.

2. The revenue has raised the following legal grounds of appeal:

1. The order of the learned Commissioner of Income Tax (Appeals) in ITA. dated 08.02.2025 for the ITBA/NFAC/S/250/24- 25/1073052177(1) Assessment year 2017-18 is erroneous in law, facts and circumstances of the case.

2. The Ld.CIT(A) erred in deleting the additions made by the AO by accepting the claims of the assessee in violation to clause 3 of Rule

46A considering that there was no compliance in course of the assessment proceedings and the said claims were being made for the first time before the Ld. CIT(A).

3. The Ld. CIT(A) failed to appreciate that "transfer" includes relinquishment or extinguishment of rights and therefore reduction in the assessee's share of profits in M/s CRCL LLP amounted to transfer and accordingly the amount received on this account by the assessee was clearly taxable.

4. For these and other grounds that may be adduced at the time of hearing, it is prayed that the order of the learned CIT(A) may be set aside and that of the Assessing officer be restored.

5. The appellant craves leave to add or amend any ground of appeal before it is finally disposed off.

3. Brief facts are that the assessee has filed an appeal before the Income Tax Appellate Tribunal (ITAT) challenging the addition made by the Assessing Officer (AO) to the returned income under section 147/148 of the Income Tax Act, 1961. The key dates and events in the timeline of the assessee's proceedings are under:

On 04 November 2017, the appellant filed the original Return of Income (ROI), declaring an income of Rs.76,00,680/-. On 01.03.2018 a revised ROI was filed by the assessee, declaring an income of Rs.77,68,620/- and claiming a refund of Rs.800/-. Further, pursuant to notice u/s.148, on 11.03..2021 the assessee filed return declaring income of Rs.77,68,620/-

and seeking a refund.

4. The core issue revolves around the amount of RS.1,98,86,210/- received from Elior India Catering LLP, allegedly as part of the sacrifice in the profit-sharing ratio in the CRCL LLP. The Assessing Officer added this amount to the income of the assessee, considering it as "Goodwill"

receipt, which is included in the income from "Other Sources."

5. During the reassessment proceedings, the assessee contended that this sum was received for the reduction in the profit-sharing ratio and not as goodwill, and hence, should not be treated as income from other sources. The CIT(A) in his ruling, agreed with the assessee’s contention, stating that such receipt does not amount to goodwill under the provisions of the Income Tax Act and should not be included in the total income.

6. The assessee contends that there was a reduction in their profit- sharing ratio in the CRCL LLP (a limited liability partnership), specifically from 10% to 4.90%. The reduction in profit