TMI Blog2014 (10) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... the CIT(A) is upheld – Decided against revenue. - ITA No. 87/Jodh/2013 - - - Dated:- 15-9-2014 - SHRI HARI OM MARATHA AND SHRI N.K. SAINI, JJ. For the Appellant : Shri U.C. Jain, Shri Gautam Baid Shri Rajendra Jain. For the Respondent : Shri N.A. Joshi - D.R. ORDER Per: N K Saini: This is an appeal by the Department against the order dated 28/12/2012 of Ld. CIT(A)(C), Jaipur. The following grounds have been raised in this appeal: On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in:-1. deleting addition of ₹ 86,98,958/- made on account of difference in gross receipts as per TDS certificates vis- -vis as per books of account.2. deleting addition of ₹ 1,50,000/- made on account of disallowance of miscellaneous expenses. The appellant reserves its right to add, amend or alter the grounds of appeal on or before the date the appeal is finally heard for disposal. 2 Vide Ground No. 1, the grievance of the Department relates to the deletion of addition of ₹ 86,98,958/- made by the Assessing Officer on account of difference in gross receipts as per TDS certificate vis- -vis as per books o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ir responses to notices u/s. 133 (6) of the I. T. Act is ₹ 6,75,46,608/- only as against ₹ 7,88,38,504/- considered in the order. The detail of which is as under: - 1.RSMM Ltd., Jaisalmer (Statement showing the details of payment made to M/s. AKPTSSL w.ef April 2008 to March 2009 as per DLOI no. RSMM/CO/Cont/263/dated 19th March, 2005 as furnished in response to notice u/s. 133 (6) is being enclosed) 5,24,22,495.86 2.RSMM Ltd., Bikaner (furnished blockwise details of payments Block A 16,30,572/- Block B 32,77,053/- Block C 64,05,288/- As mentioned in the para 2 of the RSMM Bikaner letter38,11,199/- (The statement enclosed) 1,51,24,112.00 6.75.46.608.00 Thus, there appears apparent mistake in the computation of turnover as taken in the order and as revealed by the RSMM Ltd., Jaisalmer and Bikaner vide their responses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and oblige. Here it is needless to once again submit that service tax, sales tax, excise duty and other indirect taxes are not part of the income which is reflected in financial statement. This practice is customary and followed across the board. The adherence to this practice is consistent and the material available on record as well as the past history is testimony to it. From perusal of audited financial statements it is clear that service tax has not been included by the assessee in turnover. Nowhere in the financial statements direct/ administrative expenses your honour will find the service tax expenses as being debited. Thus, the receipt as manifested in the financial statement is exclusive of service tax, which is also in line with the trade practice followed by the trade and industry in relation to indirect taxes including service tax. In continuation to the earlier submission it is stated that the difference between receipts as per TDS certificates issued by the department and gross receipts shown in statement of accounts by the assessee are fully reconcilable. The reply furnished by the RSMM Ltd., Jaisalmer Bikaner in response to notice u/s. 133(6) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derlined peculiarity in accounting of the department vis-a-vis the assessee were same. Thus the phenomenon of difference in receipt stand fully deliberated and adjudicated. Therefore it is requested to appreciate the difference in receipt which is quite legal and accept the receipt as shown in the financial statement and delete the addition of ₹ 86,98,958/- and oblige. 5. The assessee further submitted to the Ld. CIT(A) that there was some error in calculation of the turnover by M/s. RSMM Ltd. and subsequently they informed vide letter dated 15/03/2012 that there were clerical errors and correct figures as communicated on 15/03/2012 should be read as against the figures communicated earlier. The Ld. CIT(A) forwarded the written submissions of the assessee to the Assessing Officer with a direction to examine the contention of the assessee and submit the factual report. The Assessing Officer submitted that the amount of ₹ 55,96,199/- was incorrect and correct amount from M/s. RSMM Ltd., Jaiselmar came to ₹ 50,04,040/-. He also informed that RSMM Ltd., Bikaner paid an amount of ₹ 1,61,68,306/- and the same payment was confirmed vide letter dated 07/12/2012. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax considered by the principal in TDS whereas assessee has not included in (Bikaner) Rs.16168306 1044194 5. Add: Excess credit allowed by Principal In Bill no. 1, 2 3 (verifiable from our ledger) 9686735 79826281 6. Less: Bills raised by us during FY 08-09 but Considered by principal in next FY (March 09) 5788353 7. Less: deductions made by principal out of Bills raised by the assessee Bill No. 13, 14, 15, 22 23 177984 (verifiable from out ledger) 8. Less: Rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s credit allowed by RSMM against bill nos 1, 2 3. Copies of these bills are enclosed herewith for your kind verification. As per these bills dated 13.5.2008 hiring charges are ₹ 159019/-, ₹ 794206/- and ₹ 1412622 whereas RSMM has passed these bills at ₹ 161807/-, ₹ 808129/- and ₹ 1437387/- (as per page 10, 11 12 of compilation). Total amount of bills raised by the assessee is ₹ 2365847/- whereas RSMM has allowed credit of ₹ 2407323/- leaving an excess credit of ₹ 41476/-. 6. At serial no. 6 an amount of ₹ 5788353/- is mentioned which is the amount of bills raised by the assessee during the FY 2008-09 and included in the turnover of the assessee for this concerned year. The same is verifiable from the copy of ledger account submitted today. Copy of the bills dated 3.4.09 issued for the period of March 2009 are enclosed herewith to evidence the same. These bills were settled by RSMM in the FY 2009-10 and TDS was deducted therein. 7. At serial no. 7 an amount of ₹ 177984/- is mentioned which pertains to deductions made by RSMM out of bill nos. 13, 14, 15, 22 23. Copies of the said bills are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bikaner is as under: Gross Amount TDS M/s RSMM Ltd. Jaisalmer Rs.52422496/- Rs.148487/- Rs.5596199/- Rs.27639/- M/s RSMM Ltd. Bikaner Rs.16168366/- Total Rs.73594842/- The total turnover was accordingly arrived at ₹ 73594842/-. As regards the other contention raised by the appellant the AO has not addressed such issue and simply stated that the appellant is maintaining its accounts on mercantile basis and that the appellant has not made any correspondence on such issues. It may be noted that after such correction in receipts/ turnover as intimated by M/s RSMM Ltd. and also confirmed by the AO the total receipts shown by M/s RSMM Ltd. is arrived at ₹ 73594842/- as against ₹ 70139564/- shown by the appellant. After the necessary examination of facts regarding the variation in these two figures, the justification given by the appellant as also whether such justification is believable or correct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09-10. For making reconciliation between the turnover shown by M/s RSMM Ltd. vis-a-vis the appellant in respect of A.Y. 09-10, the amount has to be reduced from the turnover of M/s RSMM Ltd. Assessee during FY 07-08 but considered by 3597025 Principal during this concerned year Bill for April, 08 (appearing in statement filed by principal) 4. Add: Service tax considered by the principal The facts and circumstances of this issue is also similar as discussed in serial no. 2. It is note that the appellant has raised certain bills in respect of M/s RSMM Ltd. Bikaner | the detail of which is narrated at page 13 14 in tabular form: (** page no. 13-14 ) It is noted that in respect of bill dated 28.7.08 M/s RSMM Ltd. rightly did not deduct TDS on service tax. However in respect of bills mentioned at Sr. No. 1, 2 4 TDS was deducted on service tax of ₹ 1044194/- and accor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 41476 (verifiable from our ledger) 9686735 79826281 6. Less: Bills raised by us during FY 08-09 but Considered by principal in next FY (March 09) 5788353 7. Less: deductions made by principal out of Bills raised by the assessee Bill No. 13, 14, 15, 22 23 177984 (verifiable from out ledger) 8. Less: Rate Diff. bills not considered by principal Bill no. 16 to 21 265102 6231439 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2864727 354081 3218808 4. Bill dated 08.09.08 Page 10 of compilation 771112 95309 866421 866421 Page 11 of compilation 1181742 146063 1327805 1327805 Page 12 of compilation 1324338 163688 1488026 1488026 Total 3277192 405060 3682252 Keeping in view the above facts the turnover as declared by the assessee is to be increased by ₹ 41476/-. Therefore addition to the extent of ₹ 41476/- is confirmed. The appellant accordingly gets relief of ₹ 8657482/-. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have already extracted the same in former part of this order. From the explanation of the assessee which was thoroughly examined along with the reconciliation statement by the Ld. CIT(A), the only difference remained of ₹ 41,476/- which was the excess credit allowed by M/s. RSMM Ltd. against the bill Nos. 1, 2 3. In the said bills, the total amount raised by the assessee was ₹ 23,65,847/- whereas M/s. RSMM Ltd. had allowed credit of ₹ 24,07,323/-, thus, the difference was of ₹ 41,476/-. The said amount has been sustained as an addition by the Ld. CIT(A) on the basis of the explanation/reconciliation statement furnished by the assessee which was also forwarded to the Assessing Officer for his comments. In the present case, nothing is brought on record to substantiate that the explanation along with reconciliation statement furnished by the assessee was incorrect. We, therefore, do not see any valid ground to interfere with the findings of the Ld. CIT(A) on this issue. 10. The next issue vide Ground No. 2 relates to the deletion of addition of ₹ 1,50,000/- made by the Assessing Officer on account of disallowance out of miscellaneous expenses. 11. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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