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2022 (4) TMI 621 - AT - Income TaxDifference of turnover - less turnover shown in income tax return as compared to service tax return - Difference of Receipt/turnover as per the income tax and as per the service tax return and as assessee has shown total receipts/turnover - HELD THAT:- The turnover reported in service tax return is not actual one as proper classification of services were not mentioned in the service tax return and his claim was proved from various other supporting documentary evidences. The difference of turnover was derived by grossing up the turnover mentioned in service tax return of first half by 50% and considered fully as works contract service liable to partial reverse charge. We find that the submission of the assessee were brushed aside by the Assessing officer and preferred calculating the turnover on the basis of service tax paid and ignoring for 26AS which is an authentic document to substantiate the actual turnover of the assessee. In the direction U/s 144A of the Act from the Addl.CIT, it was clearly directed that instead of applying statistical ratios emphasis should be given on invoices shown by the assessee and the corresponding entries in the company’s ledger. We find that all those evidences were placed before the Assessing Officer and before the ld. CIT(A). Before, Ld. CIT(A) the assessee has shown total 151 invoices, which were raised by the assessee company and the said company has paid ₹ 7,85,15,834/-. The assessee has shown the same at ₹ 7,84,40,700/- and the difference is not much. CIT(A) restricted the addition to the extent of profit on such differences. The profit on such differences can be made @ 10% which will be ₹ 7,513/- and accordingly, the addition was restricted to that extent. In response to notice U/s 133(6) of the Act alongwith reply of M/s Aarti Industries, We find the in Form 26AS were furnished, the Assessing officer ignored all those details. He also ignored reconciliation and written submission filed by the assessee. The direction of Addl.CIT under section of the Act were also overlooked and given two folds justification in support of his calculation of turnover of assessee. First relates to service tax return and other is that in earlier year i.e. A.Y. 2014-15, the addition on account of less turnover shown in income tax return as compared to service tax return were made and no objection was raised by the assessee on such proposed addition and no appeal was filed by the assessee. The said justification of the assessee was also not accepted by the ld. CIT(A). CIT(A) held that merely the assessee accepted the addition in earlier year to save the cost of litigation that does not give liberty to the Assessing Officer to make huge addition without pointing out specific defects in the books of assessee or reply received from contractee party. All the payments were received from M/s Aarti Industries Ltd. either by way of account payee cheques or RTGS only. There is no occasion for earing any out of book receipts from M/s Aarti Industries. And deleted the substantial part of the addition. We find that the order of Ld. CIT(A) is also based on factual analysis of Fo-26AS as well. Appeal of the Revenue stands dismissed.
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