TMI Blog2022 (1) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... from. There is no allegation that the books of accounts of the assessee do not comply with the respective accounting standards which has a mandate of law in view of the Provisions of section 211 of the Companies Act. As the complete details were filed before the learned CIT (A) and where the annual accounts for two years filed before him clearly shows the higher income offered by the assessee from the impugned contract, we do not find any reason to set aside this issue back to the file of the learned Assessing Officer. Furthermore, the appeal before the learned CIT (A) is also a continuation of assessment proceedings only. The learned CIT (A) confirmed addition merely harping on non-compliance by assessee before the Assessing Officer and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 5,57,328/-. During the course of assessment proceedings, assessee remained non-compliant and therefore, Assessing Officer passed order under section 144 of the Act on 26th November, 2020 by making addition of ₹ 72,78,238/-. 3. Genesis of the addition shows that Assessing Officer noted that the gross receipts as per Form No. 26AS with respect to the contract work of Billpower Limited is shown of ₹ 9,70,43,181/- whereas, the gross receipts credited in the profit and loss account of the assessee is merely 41,47,577/-. Further, the assessee company has claimed the TDS credit of ₹ 21,96,868/-. In absence of any explanation learned Assessing Officer estimated the profit rate at the rate of 7.5% on the contract valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reconciliation of gross receipts as per Form No. 26AS with the entries in the books of account. He submitted that on completion of the contract the income credited and offered to taxation by the assessee is ₹ 9,94,46,049/- whereas the credit in the Form No. 26AS is only 9,69,49,181/-. Therefore, the assessee has offered higher income on completion of the contract. He also referred to the contract dated 15th January, 2007 with Bill power Limited and stated that according to Para No. 14 (i) of contract, contract was to be completed by 16th June, 2007, however, it got competed in subsequent years without any escalation clause. He further referred to the annual accounts of the assessee for the year ended on 31st, March 2009, where on com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, it is important to see that during the course of the continuation of contract all the receipts received from the Principal are considered by assessee in its books of account or not. It may overflow in more than one accounting period. The Principal is required to be deducted tax at source under section 194C of the Act as and when the payments are made to the contractor. As soon as the tax is deducted by the principal on payment made to the contractor assessee, naturally it would be reflected in the Form No. 26AS of the assessee. The assessee will recognize the revenue, in each case according to the method of accounting followed by it. Therefore, there may be chances that there may be recognition of Revenue in another year where tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contract, vi. Bills and copy of account of principal shows that all sums received are accounted for in the account of principal Thus, we do not find any reason to uphold the orders of the lower authorities. Assessee has submitted details before the lower authorities i.e. Commissioner of Income Tax (Appeals), the statement showing reconciliation was also before the learned CIT (A) and before the learned Assessing Officer during the remand proceedings. The reconciliation submitted by the assessee, which is placed before us at page Nos. 17, and 18 of the paper book is so evident that no further clarification is required there from. There is no allegation that the books of accounts of the assessee do not comply with the respective ..... X X X X Extracts X X X X X X X X Extracts X X X X
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