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2022 (7) TMI 938 - AT - Income TaxRevision u/s 263 - 5% of bill amount never offered for taxation by the assessee - contention of the Revenue is that income has not suffered taxation, which has been rightly brought to tax by authorities below, which is vehemently disputed by assessee even in its grounds of appeal - HELD THAT:- We have prima facie observed that once the assessee has offered/credited total billed amount of Rs.4,40,43,593/- in its Profit and Loss Account (as stated by AO at para 5(i) of the assessment order) and merely receivables as at year end to the tune of Rs.22,02,368/- were set-off against creditors, then obviously instead of showing receivables in Balance Sheet as at year end, the assessee has reduced the creditors which are to be shown in Balance Sheet as at year end, but, prima facie it appears that the income has been fully brought to tax, which A.O. itself has admitted that the total receipt of Rs.4,40,43,593/- has been credited in the P & L A/c. We are of the considered view that the matter need to be restored back to the file of A.O. for limited verification as to whether the entire amount of billing has been credited to P & L A/c as income and suffered taxation or not, and in case, if 5% of the amount of receivable is merely set-off against the creditor instead of showing receivable in the balance-sheet, will not have any repercussion on the income chargeable to tax, provided 100% billing amount (including 5% receivable of the last fortnight aggregating to Rs.22,02,368/- ) was offered to tax by the assessee in return of income and due taxes paid. If that be so where merely receivables are set off against creditors although total billed amount is credited to P&L Account and offered for taxation and due taxes paid, we are of the considered view that no prejudice is caused to Revenue although it may be an accounting error. Thus, with these directions, we direct A.O. to verify whether such income to the tune of Rs.22,02,368/- was offered to taxation by assessee or not, or it is purely an accounting error of setoff of receivable against creditor. With these directions, we set aside the matter to the file of A.O. for carrying out limited verification as directed by us in this order. Appeal of assessee allowed for statistical purposes.
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