TMI Blog2016 (5) TMI 1604X X X X Extracts X X X X X X X X Extracts X X X X ..... o have paid more amount to the assessee and since the assessee was unable to show that such income has been offered to tax either in this year or in the preceding or succeeding year, therefore, the office memorandum of the CBDT is not applicable to the facts of the present case. In view of the above discussion, we uphold the order of the CIT(A) and the ground raised by the assessee on this issue is dismissed. - ITA No. 1832/PN/2014 - - - Dated:- 20-5-2016 - Sushma Chowla, Member (J) And R.K. Panda, Member (A) For the Appellant : M.K. Kulkarni. For the Respondents : S.K. Rastogi. ORDER R.K. PANDA, MEMBER (A) 1. This appeal filed by the assessee is directed against the order dated 20-08-2014 of the CIT(A)-V, Pune relating to Assessment Year 2009-10. 2. Grounds raised by the assessee are as under: 1. On the facts and circumstances of the case and in law the appeal order passed by the Ld. CIT(A) confirming the additions made by the AO. and dismissing the appeal of the assessee is contradictory to law and hence without jurisdiction. It be set aside allowing the appeal of the assessee. 2. On the facts and circumstances of the case and in law the Ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irregularity by the ex-employee during the year under consideration and could recover Rs. 25 lakhs from him. Therefore, the balance has been charged to the profit and loss account for the year under consideration. The AO asked the assessee to give the details of bifurcation of the same and to explain as to why the same should not be disallowed as it pertains to earlier years. The assessee submitted the details from which the AO noted that the irregularity was started in F.Y. 2003-04 and continued upto F.Y. 2006-07. It was submitted by the assessee that the company came to know about the fraud only in this year and therefore after recovery of amount of Rs. 25 lakhs the balance was charged to the profit and loss account. 4. However, the AO was not satisfied with the explanation given by the assessee and disallowed the amount of Rs. 15,28,270/-. While doing so, he noted that the assessee company has not provided the dates of recovery and termination of the employee. Therefore, the same cannot he allowed in the year under consideration being expenditure of prior years. 5. In appeal the Ld.CIT(A) Upheld the action of the AO by observing as under: 9. I have carefully considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in appeal before us. 7. We have considered the rival arguments made by both the sides, perused the orders of the AO and CIT(A) and the paper book filed on behalf of the assessee. We find the assessee has lodged a complaint before the police authorities to the extent of Rs. 25 lakhs only. After the settlement was arrived on 08-09-2009 Shri E. Srinivas, Ex-employee of the assessee paid Rs. 25 lakhs to the assessee company. Since the assessee could not substantiate the claim of embezzlement of Rs. 40,28,270/- and has filed police complaint only to the extent of Rs. 25 lakhs, therefore, we do not find any infirmity in the order of the CIT(A) disallowing the claim of Rs. 15,28,270/- which remained unsubstantiated. The Ld. Counsel for the assessee before us also could not point out any mistake in the order of the CIT(A) nor could he give the proof of embezzlement of Rs. 15,28,270/-. We therefore do not find any infirmity in the order of the CIT(A) and uphold the same. The first issue raised by the assessee in the grounds is accordingly dismissed. 8. The second issue in the grounds of appeal relate to the order of the CIT(A) in confirming the addition of Rs. 1,78,77,487/-. 9. Fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the financial statements audited for the year 31-03-2009 are accepted by Excise and Service tax authorities, VAT authorities and other Government authorities. Therefore, no disallowance is called for. The decision of Hon'ble Delhi High Court in the case of On its Motion v. CIT in Writ Petition No. 2659/2012 order dated 31-08-2012 was also brought to the notice of the AO. 11. However, the AO was not satisfied with the above explanation of the assessee. He observed that the assessee has filed only a general reply but could not give proper reconciliation. The AO noted that it may be possible in some cases that the assessee might have offered the income in previous year or subsequent year based on booking of bills. The same can be considered only on production of proper records for verification and documentary evidence for the difference of Rs. 1,78,77,487/-. In absence of any proper reconciliation, the AO treated the same as income of the assessee. He accordingly made the addition of Rs. 1,78,77,487/- to the total income of the assessee. 12. Before CIT(A) the assessee reiterated more or less the same arguments and certain case laws were brought to his notice. However, he w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er in the preceding year or subsequent year, then also the assessee can get the credit. However, the assessee could not prove that the amount reflected in the Form 26AS has been offered to tax either in the impugned assessment year or in the preceding or subsequent year. He submitted that the various decisions relied on by the Ld. Counsel for the assessee are not applicable to the facts of the present case. 16. We have considered the rival arguments made by both the sides, perused the orders of the AO and CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find during the course of assessment proceedings the AO noticed that there is huge difference between the figure reflected in Form 26AS and the entries in the books of the assessee to the extent of Rs. 1,78,77,487. We find despite opportunities give by the AO the assessee did not give any reconciliation for which the AO disallowed the same which has been upheld by the Ld.CIT(A). We do not find any infirmity in the order of the CIT(A) confirming the addition made by the AO. Admittedly, the AO has held that if the assessee has offered the income either in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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