Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (12) TMI 387 - AT - Income TaxRevised return filed - difference between the income returned as per original return and the income as per revised return - refusal to accept the revised return of income and upholding the addition - HELD THAT:- Unless and until the AO rejected the Revised Return on the basis of discrepancies in Books of Accounts it is not possible to make such an addition. If there is any defect in the Books of Accounts he specifically point out the same and make specific addition. Being so, when the Books of Accounts are duly audited and approved by the AGM, the assessment has to be completed on the basis of Revised Return. There is no scope of taking the difference in income declared in the original return and revised return as additional income of the assessee. We are completely in agreement with the contention of the assessee that the Assessing Officer cannot consider the income declared in the original return based on the unaudited books of accounts over the income declared in revised return based on the audited books of accounts. We direct the Assessing Officer to complete the assessment on the basis of the Revised Return based on the audited books of accounts. This ground of appeal is allowed. Disallowance being sundry charges and additional ground is that said amount has not claimed as deduction in the Return of Income - HELD THAT:- It is appropriate to remit this issue to the file of Assessing Officer for reconsideration to decide whether it is revenue expenditure or capital expenditure , if it is a capital expenditure, depreciation is to be granted at applicable rate. Both additional ground and main ground are allowed for statistical purposes. Disallowance being 25% of charges of tools which are written off during the year - According to the Assessing Officer, it has to be grouped under the head Block of Assets and depreciation to be claimed at applicable rate - AO disallowed the amount and granted depreciation @ 10% - HELD THAT:- Assessee has been following the Inventory Policy on valuation of loose tools which is disclosed in Schedule 18 (vii) to audited financial statements. “Loose Tools are charged of consumption @ 25% p.a on the reducing balance method.” The net realizable value of inventory are considered and valued at 75% of the processing value. In our opinion, the method adopted by the assessee to value the loose tools is justified. The loose tools are neither plant nor machinery nor buildings nor furniture nor fixtures and method valued by the assessee consistently accepted by the revenue authorities. Accordingly, we allow this ground of appeal of the assessee.
|