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2014 (9) TMI 1141 - AT - Income TaxAdditional claim for exclusion from the total income on the ground that the receipt had been disputed by the project authorities - Held that:- Before determining the tax liability of the assessee for the year under consideration both the agreements have to be taken in to consideration. Therefore, in the interest of justice, we are remitting back the matter to the file of the AO for fresh adjudication with a limited purpose of deciding the year of taxation and amount to be taxed in the respective year/years after considering the above referred two agreements. The AO is directed to decide both the issues only after hearing the assessee. With these observations, ground no.2 is allowed in favour of the AO, in part. Prior period expenses - Held that:- We find that while deciding the issue the AO had not considered the method of accounting adopted by the assessee. It is a fact that the assessee was following completed contract method and reconginsing the revenue in a particular manner. It was showing all the expenditure in the work in progress till it got the bills from contractee in the year under appeal. The assessee had shown that both the expenditure had arisen during the year only. Considering the above, we are of the opinion that the FAA was justified in deleting addition of ₹ 90.02 lakhs. Addition of retention money - Held that:- We find that the disputed amount has direct nexus with the agreement entered between the assessee and the Contractee, that at the time of passing the assessment order the AO the agreement was not in existence. We are of the opinion that without considering the same proper taxability of the assessee cannot be determined. Therefore, in the interest of justice matter is being restored back to the file of the AO for deciding the issue in light of the agreement dated 11.11.2009.He is directed to afford a reasonable opportunity of hearing to the assessee before deciding the assessment-year in which the income has to be taxed. Ground no.4 is allowed in favour of the AO, in part. Insurance reimbursement in respect of assets destroyed in flood - Held that:- We find that the FAA had directed the AO to verify two facts about the claim made by the assessee, before taking final decision. While giving effect to the order of the FAA, the AO had allowed relief after verification. If the AO was not convinced he would have not allowed the relief to the assessee. The FAA had only indicated the principles that were to be followed for deciding the issue, but facts were to be verified by the AO. Considering these developments, we are of the opinion that the ground has become infructous and needs on adjudication. Addition of delayed PF contribution - Held that:- It is found that the assessee had paid the disputed sums before the due date of filing of return as envisaged by the provisions of section 139(1)of the Act. Therefore, confirming the order of the FAA, we decide ground against the revenue. Contribution to superannuation fund (SF) - allowable expenditure in the hands of the assessee - Held that:- We find that the AO had not given any reason for rejecting the claim made by the assessee except referring to the audit report. He did not call for any explanation from the assessee in this regard. The FAA while deciding the appeal has considered all the facts that were necessary to adjudicate the issue. It is a fact that assessee is an AOP and employees from HCC had joined it till the completion of the JV project. As per the service agreements contribution had to be made to SF and the assessee made payment to HCC SF. - Decided against revenue
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