TMI Blog2021 (4) TMI 677X X X X Extracts X X X X X X X X Extracts X X X X ..... while exercising his co-terminus power in the appellate proceedings he could have done so as per law meaning when he proposed to estimate the income of the assessee, the Ld. CIT(A) should have first of all rejected the audited books of account produced by the assessee in accordance to Section 145 of the Income Tax Act, 1961 (hereinafter referred to as the Act) which the Ld. CIT(A) has not admittedly done. So the estimation of Ld. CIT(A) fails being bad in law. Therefore we direct the deletion of estimated amount. It is not that assessee s case is that it has not claimed the credit for ₹ 2.14 crores, if that is so, then the presumption is that the corresponding receipt of ₹ 2.14 crores is not belonging to assessee. If that fact is correct, then no addition is warranted. However, on examination if it is found that assessee has claimed credit for TDS of ₹ 2.14 crores then the AO is directed to assess the income element embedded in these receipt which in the facts of the present case is N.P. of 1.22%. - I.T.A. No. 04/Kol/2020 C.O. No. 08/Kol/2020 - - - Dated:- 7-4-2021 - Shri J. Sudhakar Reddy, AM And Shri A. T. Varkey, JM For the Appellant : Shri Supriyo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by them for rendering services as aircraft handling and cleaning charges. The Ld. A.R further stated that they have not claimed any credit for TDS of the bills which are shown in Form 26AS which are not part of their turnover. The AO acknowledges that the assessee also furnished some copies of the communications it had with the Airlines showing transfer of business and other related matters. However, according to AO the assessee delayed in submitting details during the assessment proceedings and only started appearing before him on 29.11.2011 and therefore he did not get any opportunity to cross-verify the veracity of the claim. Therefore, the AO concluded that in the circumstances, as extremely evident from an authentic source such as Form No. 26AS the amount of ₹ 2,14,35,593/- is considered to have been kept concealed by the assessee thus added to the total income and thereafter he made an addition of ₹ 2,14,35,593/-. 4. Aggrieved the assessee preferred an appeal before the Ld. CIT(A) who was pleased to delete the addition. However sustained Net Profit (NP) at 11.17% of ₹ 2,14,35,593/-. The revenue is in appeal against the deletion of ₹ 2,14,35,593/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was of the opinion that there was no time/opportunity for him to cross-verify these facts due to paucity of time and therefore he made an addition of ₹ 2,14,35,593/-. On appeal, the Ld. CIT(A) has deleted the addition, after taking note that AO has first raised the mismatch between the turnover shown in the profit and loss account and Form 26AS only on 07.12.2011 and the assessee pursuant to the same duly responded on 13.12.2011 in respect of mismatch. Therefore, the Ld. CIT(A) was of the opinion that the AO s contention that he could not cross-verify the veracity of the facts brought to his notice since the assessee had delayed in giving reply does not have merits because the AO has passed the assessment order on 14.12.2011 when the fact remains that the SCN in respect of mismatch at the first instance was raised by the AO only on 07.12.2011 and since the assessee replied to it vide letter dated 13.12.2011, it does not lie in the mouth of the AO to say that the assessee delayed in giving reply in respect of mismatch. And we agree with the said findings of the Ld. CIT(A) because the AO raised the question of difference of turnover from the P L account filed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Having brought these information to the notice of the AO and since the assessee was able to prove that the business of ground handling services was transferred to M/s Star consortium Aviation Services Pvt. Ltd. from 01.06.2008 onwards; and there was a goof up in the office of TDS deductor (Kingfisher Airlines) while they were filling up 26AS by wrongly entering the PAN, according to Ld. CIT(A) the AO was duty bound to verify the veracity of the claim since the assessee has placed enough material before the AO to support its contention/explanation in respect of mismatch of ₹ 2.14 crores which assessee firm denied to have been received by it. Taking note of all these facts, the Ld. CIT(A) had even issued a letter to Kingfisher Airlines on 04.09.2019 seeking clarification about the Form 26AS/TDS credit against the assessee s PAN. However the Ld. CIT(A) notes that the said letter was returned back with postal remark Left . So the Ld. CIT(A) notes that it is difficult to conclude the information in respect of TDS amount shown in Form 26AS from the TDS deductor as conclusive against the assessee. Therefore, the Ld. CIT(A) observed as under: 4.16. Since the income has been ad ..... 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