TMI Blog2023 (3) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... clients towards rendering various services as their income and reimbursement of expenses is squared off in the parties account. The assessee has filed a party wise reconciliation along with ledger account explaining the difference. As per chart filed by the assessee, the gross receipts towards C F service charges and other income, exactly matches with gross receipts booked by the assessee in their books of accounts. Assessee had also reconciled difference between reimbursement of expenses and as per bills filed by the assessee, amount received from clients towards reimbursement of expenses is more than the amount of difference noticed by the AO from the Form no. 26AS. AO has erred in making additions towards difference in gross receipts as per Form no. 26AS and as per books of accounts of the assessee. Appeal filed by the Revenue is dismissed. - ITA No.: 3316/Chny/2019 - - - Dated:- 16-11-2022 - SHRI MAHAVIR SINGH, VICE PRESIDENT AND SHRI G. MANJUNATHA, ACCOUNTANT MEMBER For the Appellant : Shri. P. Sajit Kumar, JCIT For the Respondent : Shri. T.N. Seetharaman, Advocate ORDER PER G. MANJUNATHA, ACCOUNTANT MEMBER: This appeal filed by the Rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings, the Assessing Officer noticed that as per Form no. 26AS, total receipts of the assessee was at Rs. 8,34,92,458/-, whereas the assessee had declared gross receipts of Rs. 3,12,11,975/- in the books of accounts. Therefore, called upon the assessee to explain the difference of Rs. 5,22,80,480/-. In response, the assessee submitted that difference is due to reimbursement of expenses incurred on behalf of the clients. The assessee being in the business of C F agent for various companies had incurred certain expenses on behalf of their clients, and subsequently, got reimbursed from them. The clients have deducted TDS on total amount billed by us including reimbursement of expenses. But, the assessee has accounted its service charges and other income in the profit and loss account and excluded reimbursement of expenses. The AO did not accept explanation furnished by the assessee and according to him, the assessee could not prove with sufficient documents that reimbursement of expenses was accounted in the books of clients. Although, assessee has produced ledger account of some of the clients in its books, but does not produce financial and other documents of the clients to pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... min Expenses Receipt 920200.00 1334300.00 1332300.00 1756600.00 5343400.00 Interest Receipt 9816.33 1014871.10 1024687.43 Investment Subsidy Receipt 101614.00 151421.00 149421.00 199228.00 601684.00 Profit on sale of Fixed Assets 5302.00 5302.00 Rebate Charges Receipt 482577.40 668831.70 648168.70 828818.70 2628396.50 Expenses claim alc - Surplus 7483565.12 7483565.12 Total Amount in P L A/c 3600239.48 5915199.42 6306913.35 17021296.00 328436482.5 Amount as per Service Tax Return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt accordingly. 5. The Ld. DR submitted that the Ld. CIT(A) has erred in deleting additions made towards difference in gross receipts as per Form no. 26AS and books of accounts of the assessee, on the basis of certain additional evidence, without confronting those evidences to the Assessing Officer for its comments and rebuttal. The Ld. DR further submitted that, although the assessee claims to have reconciled difference between gross receipts as per books of accounts and gross receipts as per Form no. 26AS, but the assessee could not file necessary evidences including bills/vouchers in support of various expenses incurred by the assessee for their clients and also proof of accounting said expenses by the clients in their books of accounts. The CIT(A) without considering such facts, simple deleted additions made by the AO. 6. The Ld. Counsel for the assessee, on the other hand submitted that the assessee has filed a reconciliation and explained difference between gross receipts as per books of accounts and gross receipts as per Form no. 26AS. The assessee had filed sample copies of invoices for their charges and invoices/debit notes issued to clients for reimbursement of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otal payments made to the assessee including reimbursement of expenses. Thus, obviously there will be a difference between total payments made by the clients and TDS deducted thereon as per Form no. 26AS and gross receipts booked by the assessee in their books of accounts. The AO has noted difference of Rs. 5,22,80,480/- in gross receipts as per books of accounts of the assessee and gross receipts as per Form no. 26AS. The assessee has explained difference between gross receipts and claimed that said difference is on account of reimbursement of expenses. The assessee had filed reconciliation explaining difference with party wise service charges received and reimbursement of amount received towards reimbursement of expenses. The AO never disputed these facts, however rejected reconciliation filed by the assessee only for the reason that the assessee could not prove with sufficient documents that reimbursement of expenses were not accounted in the books of clients. 8. In our considered view, the reasons given by the AO to make additions towards difference in gross receipts appears to be baseless and incorrect, because the assessee can file whatever evidence the Assessing Officer w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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