Contact us   Feedback   Annual Subscription   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (5) TMI 1229 - ITAT MUMBAI

2016 (5) TMI 1229 - ITAT MUMBAI - TMI - Addition of difference in form No. 26AS showing the gross hire charges and as per the books of accounts of the assessee - Held that:- TDS were deducted by the recipient of service i.e. M/s Punj Lloyd Ltd amounted to ₹ 6,10,41,854/- whereas undisputedly, the assessee accounted only ₹ 5,56,09,575/- thereby resulting into short accounting of the said income to the tune of ₹ 54,32,279/-. The said difference was explained by the assessee to be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

also booked the corresponding expenditure in that year and the return of income was filed accordingly and was also accepted by the AO. We also find merits in the arguments of the ld. AR that the credit of service tax on the hire charges would not be available to the assessee had he booked the said hire charges under the current financial year. Looking to the totality of facts of the case , we are of he opinion that since the assessee has booked the full amount of hire charges as per Form No.26AS .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ed by the department in the subsequent year. We, therefore, are of the considered opinion that since the full amount of hire charges stood offered to tax by the assessee in two years , addition of ₹ 54,32,279/- can not be sustained as it will result in double taxation of the same income. Accordingly, we set aside the order of ld.CIT(A) and direct the AO to delete the addition - Decided in favour of assessee. - I.T.A. No. 201/Mum/2014 - Dated:- 25-5-2016 - Shri Sanjay Garg, Judicial Member .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

26AS of the assessee which showed the gross hire charges from Punj Lloyd Ltd of ₹ 6,10,41,854/- whereas as per the books of accounts of the assessee the amount was ₹ 5,56,09,575/-. 3. Brief facts of the case are that the assessee filed his return of income on 29.9.2010 declaring total income at ₹ 55,85,540-/. Initially the return was processed under section 143(1) of the Income Tax Act, 1961 (the Act) and thereafter the case was selected for scrutiny and the statutory notices u .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

assessee from M/s Punj Lloyd Ltd was ₹ 6,10,41,854/-, whereas as per the books of account the hire charges from M/s Punj Lloyd Ltd were to the tune of ₹ 5,56,09,575/- only and thus the assessee has shown less receipt by ₹ 54,32,279/-. Accordingly, the AO called for the explanation from the assessee as to why this amount should not be treated as concealed income and added to the total income of the assessee. In reply, the assessee vide his letter dated 17.1.2013 contended and su .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

satisfied with the reasoning of the assessee added the ₹ 54,32,279/- being the difference between the hire charges as per form 26AS and as per books of the assessee to the total income of the assessee on the ground that the assessee was following mercantile system of accounting and therefore, the income which accrued during the particular year should have been accounted for accordingly regardless of the fact, whether the bills raised or not. Aggrieved by the order of the AO, the assessee p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ystem of accounting. Similarly books of accounts of Punj Lloyd Ltd. would be based on mercantile system of accounting being a corporate entity. Thus method of accounting in the case of Punj Lloyd Ltd. and the instant assessee would be the same. If the method of accounting is the same, there should be consistency in respect of corresponding entries which may be expenditure in the case of Punj Lloyd Ltd. and would be income in the case of instant assessee. It is also undisputed that assessee had c .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that period of hire is from 11.3.2010 to 25.3.2010. Thus in this instance, date of invoice as well as period of hire both falls in the instant year. Another invoice dated 1.4.2010 representing amount of ₹ 5,51,500/- shows the period of hire from 26.3.2010 to 30.3.2010. Thus the services rendered by way of providing vessels falls in the instant year itself. Third invoice dated 31.5.2010 clearly shows the period of hire from 18.9.2009 to 27.9.2009 and represents an amount of ₹ 14,33,9 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ices in the instant year, the assessee had prepared invoice as per its convenience and not accordance with principles of accounting and therefore contention of the assessee cannot be accepted. On perusal of copy of TDS certificate issued by Punj Lloyd Ltd. is enclosed with Form. No.35 shows that Punj Lloyd Ltd. had made payments from 31.12.2009 to 28.2.2010 which invariably falls within the instant year. The assessee had taken another plea that corresponding expenditure were incurred In subseque .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

logically possible (i.e hiring vessels) incurring of expenses subsequent to the event of providing services of vessels to Punj Lloyd Ltd. Moreover the assessee had claimed TDS for impugned amount in the instant year itself. Had the claim of assessee was genuine as to accounting of the said receipts in subsequent year, it should have claimed corresponding TDS credit for the subsequent year as per Rule 37BA. Be that as it may, fact of rendering services in the extant year itself establishes that s .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ess income - Chargeable as - Assessment year 2005-06 - Assessee was deriving income from hiring of vehicles - During assessment proceedings, Assessing Officer noticed that amount of TDS certificates enclosed with return was more than receipts disclosed in income and expenditure account - Assessee explained that a portion of said TDS deductions was claimed in subsequent year and excess amount was also received by her in subsequent year and excess amount was also received by her in subsequent year .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

an appeal before us. 5. The ld. AR of the assessee has submitted before us that the assessee was providing services of chartering of vessels and bardges under his proprietary concern to M/S Punj Lloyd Ltd and was charging hire charges in lieu of these services for which the bills were used to be raised regularly . During the year, the assessee accounted for hire charges from M/s Punj Lloyd of Rs. ₹ 5,56,09,575/- whereas the said company booked hire charges at ₹ 6,10,41,854/- and ded .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f expenditure were accounted for in that year. The ld. AR also argued that had the bills of hire charges accounted for in the current year, credit of service tax on the said hire charges would not have been available to the assessee. The ld. AR finally submitted that if both the years were taken together i.e. assessment years 2010-11 and 2011-2012, the whole exercise of the department is rendered futile and waste of time as it became tax neutral for the reason that the assessee had paid the inco .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rayed that the addition made by the AO and sustained by the ld.CIT(A) deserved to be deleted otherwise it would have the effect of taxing the same receipt twice which is against the provisions of Income Tax Law. 6. On the other hand, the ld.DR relied on the orders of authorities below and submitted that the assessee has not followed the system of accounting in true and correct spirit and therefore the addition made by the ld.AO and sustained by the ld.CIT(A) be upheld as these authorities have j .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of the said income to the tune of ₹ 54,32,279/-. The said difference was explained by the assessee to be on account of the reasons that the bills for hire charges were raised in the next year 2010-11 relevant to the AY 20011-12 whereas M/s Punj Lloyd Ltd accounted the expenditure in the current year i.e F.Y. 2009-10 relevant to AY 2010-11 and also deducted TDS thereon. We find merit in the arguments of the ld AR and also note that the whole exercise by the AO is neutral tax unit as the as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version