TMI Blog2020 (9) TMI 418X X X X Extracts X X X X X X X X Extracts X X X X ..... fact, the ground raised by the assessee was to delete the impugned additions on the ground that the receipts have been subjected to the tax in the subsequent year whatever the assessee had received from TANGEDCO. The Tribunal did not agree with the assessee and sustained the addition, if such is the factual position, the natural consequences that is to flow is to issue a direction to the assessing officer to take appropriate action in so far as the assessments from the year 2010-2011 to 2014-2015, during which the assessee has been taxed on the said receipts. If such a consequential direction is not issued, then, the assessee would be subjected to double taxation which is unauthorised in Law. This issue can clearly be brought within the scope of Sub-Section (4) of 260 A and the Court would be justified in issuing appropriate direction to the assessing officer to reopen the assessments from the year 2010-2011 to 2014 -2015 on this issue alone and examine whether the assessee has paid taxes on these receipts, which addition have been sustained in the impugned assessment year 2009-2010 and after affording an opportunity to the assessee redo the assessment only on this aspect. Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 92(C)(A) of the Act for determining the arm's length price in respect of the assesse's transaction on its associated enterprises. 4. The Transfer Pricing Officer [TPO] by an order dated 31.12.2012 stated that no adjustments was necessary to value the international transaction entered into by the assessee. The assessment was completed under Section 143(3) r/w Section 144(1) of the Act on 26.03.2013 computing the total income at ₹ 10,09,39,254/- under normal provisions of the act and by adding ₹ 41,76,92,807/- under the caption 'Delayed Revenue Recognition' as business income for the said assessment year and allowed deduction under Section 80IA of the Act. Further, the assessing officer treated the interest income of ₹ 5,93,84,195/- as income from other sources thereby denying the deduction under Section 80 IA of the Act. The assessing officer computed the book profit under Section 115 JB of the Act at ₹ 2,23,21,63,807/- under the caption 'Delayed Revenue Recognition'. Aggrieved by such order, the assessee filed an appeal before the CIT[A], who by an order dated 30.06.2016 partly allowed the appeal and rejected the grounds e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... art II and Part III of Schedule VI of the 1956 Act, it could have paid taxes correctly and claimed these payments as part of its bills to TANGEDCO. 9. The assessee in its appeal before the CIT[A] contended that the statutory auditors have not made any qualification in the audit report and the noting made in the audit report was misunderstood by the assessing officer to be a qualification by the statutory auditor. Further, the assessee relying on the decision of the Hon'ble Supreme Court in Appolo Tyres Vs. I.T.O., reported in [2002] TIOL - 185 - SC-IT questioned the power of the assessing officer with regard to the computation on book profits in so far as the accounts which are otherwise accepted under the Company Law. 10. The assessee further stated that they have prepared their accounts in accordance with schedule VI of the 1956 Act and the same were also consistent in the concept of 'Prudence' enshrined in AS 1 notified by the CBDT. These contentions were tested for its correctness by the CIT[A], who concurred with the assessing officer and on appreciation of facts, held that the books of accounts are not prepared as per 1956 Act. The decision in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other than the cost of raw materials for the goods-in-process and finished products, is likely to result in a distorted picture of the true state of the business for the purpose of computing the chargeable income. Such a system may produce a comparatively lower valuation of the opening stock and the closing stock, thus showing a comparatively low difference between the two. In a period of rising turnover and rising prices, the system adopted by the assessee, as found by the Tribunal, is apt to diminish the assessment of the taxable profit of a year. The profit of one year is likely to be shifted to another year which is an incorrect method of computing profits and gains for the purpose of assessment. Each year being a self- contained unit, and the taxes of a particular year being payable with reference to the income of that year, as computed in terms of the Act, the method adopted by the assessee has been found to be such that income cannot properly be deduced therefrom. It is, therefore, not only the right but the duty of the Assessing Officer to act in exercise of his statutory power, as he has done in the instant case, for determining what, in his opinion, is the correct taxable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . After elaborately hearing the learned counsels on either sides, this Court finds that the assessee has raised a specific ground before the Tribunal stating that the additions were made under the normal provisions of the Act as well as under Section 115 JB, which the assessee prayed for deletion and submitted that since it has received and admitted, the impugned receipts for the subsequent year, the additions made under the normal provisions of the Act, as well as under Section 115 JB of the Act, may be deleted and the rate of tax remains the same in all these years under Section 115 JB of the Act. In fact, the ground raised by the assessee was to delete the impugned additions on the ground that the receipts have been subjected to the tax in the subsequent year whatever the assessee had received from TANGEDCO. The Tribunal did not agree with the assessee and sustained the addition, if such is the factual position, the natural consequences that is to flow is to issue a direction to the assessing officer to take appropriate action in so far as the assessments from the year 2010-2011 to 2014-2015, during which the assessee has been taxed on the said receipts. If such a consequential ..... X X X X Extracts X X X X X X X X Extracts X X X X
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