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2016 (10) TMI 625 - ITAT AHMEDABAD

2016 (10) TMI 625 - ITAT AHMEDABAD - TMI - Accrual of income - Addition to income made on the basis of AIR information received by the AO - it is assessee’s submission that the amount was received by the assessee in AY 2010-11 and has also been offered to tax in AY 2010-11 as the cheque was received in subsequent years and the amount was received as advance payment and therefore the income did not accrue to the assessee in AY 2009-10 - Held that:- We find force in the contention of the assessee .....

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DS be given to the assessee in accordance with law but in case the amount is found to be taxable in AY 2010-11, then AO is directed to give the credit of the TDS in AY 2010-11. The assessee is also directed to furnish all the required details promptly to the AO. - Decided in favour of assessee for statistical purposes. - I.T.A. No.514/Ahd/2013 - Dated:- 31-8-2016 - SHRI RAJPAL YADAV, JUDICIAL MEMBER And SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER For The Appellant : Shri N.B.Shah, AR For The Respond .....

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its return of income on 29/10/2009 for AY 2009-10 declaring total income of ₹ 3,69,55,273/-. The case was selected for scrutiny and thereafter assessment was framed u/s.143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") vide order dated 16/12/2011 and the total income was determined at ₹ 4,12,45,963/-. Aggrieved by the order of the Assessing Officer (AO), assessee carried the matter before the ld.CIT(A), who vide order dated 07/12/2012 (in Appeal No.C .....

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The Ld.CIT(A) has erred in law and on facts in confirming the addition of ₹ 40,00,000/- on account of alleged accrued income on the basis of AIR Information. 2. The Ld.A.O. as well as the Ld.CIT(A) erred in law and on facts in failing to consider appellant company s submissions filed before them. 3. Before us, at the outset, ld.AR submitted that though Assessee has raised various grounds but the solitary issue to be decided is with respect to addition of ₹ 40 lacs. 3.1. During the co .....

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redited the amount in FY 2008-09 but the payment was received by the assessee in April-2009, i.e. FY 2009-10 relevant to AY 2010-11 and it was accounted in AY 2010-11. The submission of the assessee was not found acceptable to the AO as he was of the view that since assessee had claimed credit for TDS on the aforesaid sum, it should have accounted the amount of ₹ 40 lacs in the year under consideration as the amount had accrued to the assessee. He accordingly made addition of ₹ 40 la .....

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. dated 10.7.2009. M/s.Alstom Project India Ltd. had duly deducted taxes on this payment. The credit of TDS made on this of payment ₹ 40,00,000/- has been claimed by the appellant in the current assessment year i.e. A.Y. 2009-10. Not only this, the appellant has also claimed expenditure towards discount allowed on the so-called advance payment of ₹ 40,00,000/- of ₹ 1,20,000/- in the current assessment year i.e. A.Y. 2009-10. The A.O. was of the opinion that the receipt of ͅ .....

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following Mercantile method of accounting. This fact is duly certified by the statutory auditors in form no.3CD dated 23.9.2009. The appellant has reiterated the method of accounting as mercantile system of accounting in the income-tax return for the A.Y. 2009-10, which was filed on 24.3.2010. As per the mercantile system of accounting the material date is the date on which cheque is issued. The receipt of proceed or the realization of cheque amount in the bank account cannot be the date of acc .....

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rce of ₹ 90,640/- on this payment of ₹ 40,00,000/-. The appellant has claimed credit of this TDS in the current assessment year i.e. A.Y. 2009-10. The credit of TDS of ₹ 90,640/- had already been allowed to the appellant during the current assessment year. As per the provisions of rule 37BA(3)(i), the credit of TDS is to be allowed in the Assessment Year in which the income is assessable. Since the credit of tax deducted at source of ₹ 90,640/- on the payment of ₹ 4 .....

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pellant has claimed discount expenditure of ₹ 1,20,000/- in the current assessment year i.e. 2009-10. Since the accrual of receipt of ₹ 40,00,000/- and discount allowance are intricately related, accordingly it will be logical if both these entries are accounted for in the same year. Strangely the appellant has accounted for the discount expenditure in the current assessment year while the receipt of ₹ 40,00,000/- is accounted for in the next assessment year. In my considered v .....

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8377; 40,00,000/- has accrued to the appellant in the current year and as per consistent method of accounting followed by the appellant the receipt of ₹ 40,00,000/- needs to be accounted for in the current assessment year. In view of above, addition of ₹ 40,00,000/- is confirmed. This ground of appeal is dismissed. 4. Aggrieved by the order of ld.CIT(A), assessee is now in appeal before us. 5. Before us, ld.AR reiterated the submissions made before the AO and ld.CIT(A) and further su .....

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dard Chartered Bank wherein the cheque was deposited. He therefore submitted that addition be deleted and more so that the addition would amount to double addition because the income has already been offered in subsequent year i.e. AY 2010-11. In the alternate, he submitted that the assessee be allowed the credit of TDS in subsequent years. Ld.Sr.DR on the other hand supported the order of lower authorities. 6. We have heard the rival submissions, perused the material available on record and gon .....

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