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2015 (12) TMI 503 - ITAT DELHI

2015 (12) TMI 503 - ITAT DELHI - TMI - Addition on account of difference between the receipts as per Form 26AS and the audited financial statements of the appellant for the subject AY - additions without invoking the provisions of Section 145 - Held that:- The Assessing Officer is duty-bound to make independent inquiry as to whether income has accrued to the assessee company as per the method of accounting regularly being followed by the assessee in respect of the transactions reported in Form N .....

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file of the Assessing Officer to make de novo assessment after affording reasonable opportunity of being heard to the assessee company. - Decided partly in favour of assessee for statistical purposes. - ITA No. 4447/Del/2015 - Dated:- 9-10-2015 - Shri H. S. Sidhu, Judicial Member And Shri Inturi Rama Rao, Accountant Member For the Appellant : Sh. Salil Kapoor & Shubham Rastogi, Advocates For the Respondent : Sh. P. Dam Kanunjana, Sr. DR ORDER Per Inturi Rama Rao, A. M. This appeal by the ass .....

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cumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) ['learned CIT(A)'] has erred in upholding the order of learned AO, wherein the learned AO has made an addition of INR 2,62,51,181 on account of difference between the receipts as per Form 26AS and the audited financial statements of the appellant for the subject AY. iii. That on the facts and circumstances of the case and in law, the learned CIT(A) has erred in upholding the action of the learned AO witho .....

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at the accounting treatment by the Appellant is a colourable device for evading taxes without appreciating the fact that the accounting treatment done by the Appellant is in accordance with mandatorily applicable Accounting Standards issued by the Institute of Chartered Accountants of India. v. That on the facts and in circumstances of the case, the learned CIT(A) has grossly erred in upholding the addition made by the learned AO disturbing the regular method of accounting followed by the assess .....

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nting regularly followed by the Appellant and that any action of taxing such revenue during the subject AY shall amount of double taxation, which is clearly not permissible. vii. Without prejudice the ground 2, 3, 4, 5 and 6 above, on the facts and in the circumstances of the case and in law, the learned CIT(A) has grossly erred in not allowing relief amounting to INR 53,92,010 being service tax, surcharge and education cess appearing in 26AS statement, despite the fact that the learned AO vide .....

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rred revenue arising on account of invoice raised by the Appellant for the work to be performed for various customers, duly evident from the submissions and copy of invoices submitted by the Appellant. ix. Without prejudice to the ground 2, 3, 4, 5 and 6 above, the learned CIT(A) has erred in upholding the action of the learned AO of considering total receipts as per Form 26AS as INR 7,41,20,909, as against INR 7,37,70,707 being amount actually reflecting in Form 26AS. x. Without prejudice to gr .....

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ssessment order for the subject AY. All the above grounds are without prejudice to each other. 2. The brief facts of the case are that the assessee is a company incorporated under the provisions of Companies Act, 1956. It is engaged in the business of providing outdoor advertisements. The return of income for the assessment year 2011-12 was filed on 30th September, 2011, declaring taxable income of ₹ 22,40,025/-. Later on, the case was selected for scrutiny assessment under the CASS and th .....

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s were ₹ 7,37,70,707/- as against the gross receipts declared in return of income of ₹ 4,78,69,728/-. The assessee company was called upon to explain the difference of ₹ 2,62,51,181/-. In response to the same, the assessee submitted that the difference arisen on account of advance receipt in respect of which no services were performed. However, tax was deducted at source by the payee on payment basis. Therefore, the Assessing Officer directed the assesee company to furnish the .....

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g remand report from the Assessing Officer, dismissed the appeal on 9th June, 2015, vide paras 6.4 & 6.5, which read as under: 6.4 I have carefully considered the submissions of the appellant, additional evidence submitted by the appellant, assessment order, remand report of the AO and rejoinder of the appellant on AO's remand report, I find that the appellant has received the amount of ₹ 2,62,51,181/- from its sister concern namely M/s Skyline Outdoor Media Pvt. Ltd. The appellant .....

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of income without offering the above amount for tax. The appellant has argued that they have not offered this amount during the year as the agreement between the appellant company and its sister concern M/s Skyline Outdoor Media Pvt. Ltd. provides that while M/s Skyline Outdoor Media Pvt. Ltd. will make the payment on the basis of bills raised by the appellant but the appellant will credit it in its account on the basis of actual work done. It was submitted that the appellant has offered the abo .....

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ugned income during the year under consideration i.e assessment year 2011-12 particularly when the group company has claimed the entire amount as deduction from its income of assessment year 2011-12. The argument of the appellant that the transaction is revenue neutral sounds hollow as the appellant has divided this income of assessment year 2011-12 in three years and claimed expenses in all these three years and has thereby reduced the net taxable income to a nominal figure. If the appellant ha .....

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ication for spreading over of income. In fact the appellant itself has raised the invoice for the full amount and there is no mention about any pending services being rendered, in future. This is clearly a colorable device adopted by the appellant in collusion with a group company where by the payment made by group company has been claimed as deduction entirely during the year itself but the appellant has not declared this amount as income for the year under consideration. In view of the above f .....

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ces were rendered and where as the tax was deducted at source by the payer i.e. Skyline Outdoor Media Pvt. Ltd. In support of this contention, he filed copies of the invoices raised. He further submitted that the information contained in Form No. 26AS cannot be the sole basis for making the addition. In support of this contention, he filed copy of the decision of the coordinate bench of ITAT, Delhi in the case of ITO Vs. Sh. Basant Kumar, ITA No. 4679/Del/2012, for AY 2009-10, dated 31st March, .....

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