Vilas Punjaram Desale, Dhule V. Income-tax Officer,

ITA 1323/PUN/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1101 (ITAT-PUNE)
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 07-10-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 69C; 143(3)

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC , PUNE , BEFORE MS. SUSHMA CHOWLA, JM . / ITA NO. 1 323 /PN/201 5 / ASSESSM ENT YEAR : 20 11 - 1 2 SHRI VILAS PUNJARAM DESALE, PLOT NO.36B, PANE NAGAR, A/P NIZAMPUR, TALUKA SAKRI, DISTRICT DHULE - 424305 . / APPELLANT PAN: A JXPD4147M VS. THE INCOME TAX OFFICER , WARD 3 ( 3 ), DHULE . / RESPONDENT / APPELLANT BY : SHRI ABHAY AVCHAT / APPELLANT BY : SHRI ABHAY AVCHAT / RESPONDENT BY : SHRI SUHAS KULKARNI / DATE OF HEARING : 08 . 0 8 .201 6 / DATE OF PRONOUNCEMENT: 12 . 0 8 .201 6 / ORDER PER SUSHMA CHO WLA, J M : TH IS APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT (A) - 1 , NASHIK, DATED 0 3 . 0 8 .20 1 5 RELATING TO ASSESSMENT YEAR 20 11 - 1 2 AGAINST ORDER PASSED UNDER SECTION 1 43(3) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2 . THE ASSESSEE HAS RAIS ED THE FOLLOWING GROUNDS OF APPEAL : - 1. THE LEARNED INCOME TAX OFFICER, WARD 3(3), DHULE HAS ERRED IN MAKING AGGREGATE ADDITION OF RS.7,28,150/ - AND THE COMMISSIONER OF INCOME TAX (APPEALS) 1, NASHIK HAS ERRED IN CONFIRMING THE SAME. ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 2 2. WITHOUT CONSIDER ING FACTS AND CIRCUMSTANCES OF THE CASE AND THE LAW, THE LEARNED INCOME TAX OFFICER, WARD 3(3), DHULE HAS ERRED IN MAKING ADDITION OF RS.4,85,150/ - UNDER THE PRETEXT OF UNDISCLOSED CONTRACT INCOME AND THE COMMISSIONER OF INCOME TAX (APPEALS) - 1, NASHIK HAS ERRED IN CONFIRMING THE SAME. 3. WITHOUT CONSIDERING FACTS AND CIRCUMSTANCES OF THE CASE AND THE LOW, THE LEARNED INCOME TAX OFFICER, WARD 3(3), DHULE HAS ERRED IN MAKING ADDITION OF RS.2,43,000/ - UNDER THE PRETEXT OF SECTION 69C OF THE ACT AND THE COMMIS SIONER OF INCOME TAX (APPEALS) - 1, NASHIK HAS ERRED IN CONFIRMING THE SAME. 3. THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST THE ADDITION MADE OF RS.4,85,150/ - ON ACCOUNT OF UNDISCLOSED CONTRACT INCOME AND FURTHER ADDITION MADE OF RS.2,43,000/ - UNDER SECTION 69C OF THE ACT. 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE WAS CARRYING ON THE BUSINESS OF CIVIL CONTRACTOR UNDER THE NAME AND STYLE OF SAIDH AN CONSTRUCTION AT NIZAMPUR . FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD FURNISHED THE RE TURN OF INCOME DECLARING TOTAL INCOME OF RS. 3,33,284/ - . THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY. DURING THE COURSE OF ASSESSMENT ASSESSEE WAS PICKED UP FOR SCRUTINY. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD UNDERTOOK CONTRAC T WORK FROM M/S. SUZLON INFRASTRUCTURE SERVICES PVT. LTD. THE ASSESSEE HAD DECLARED THE CONTRACT RECEIPTS AT RS.54,08,392/ - ONLY, ON WHICH NET PROFIT WAS DECLARED AT RS.4,32,673/ - @ 8%. ON VERIFICATION OF THE AUDIT REPORT, E - FILED RETURN OF INCOME AND CO MPUTATION OF INCOME ALONG WITH ANNEXURE FILED, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD DECLARED TDS AT RS.1,46,494/ - . AS PER TDS CLAIMED BY THE ASSESSEE AND AS PER 26AS STATEMENT, THE ASSESSEE HAD COMP U TED THE CONTRACT WORK OF RS.1,14,72,770/ - , ON WHICH CONTRACTEE COMPANY I.E. M/S. SUZLON INFRASTRUCTURE SERVICES PVT. LTD. HAD DEDUCTED TDS OF RS.1,46,494/ - . HOWEVER, THE ASSESSEE HAD ONLY DISCLOSED CONTRACT RECEIPTS OF RS.54,08,392/ - WHICH WAS INCLUSIVE OF EARLIER YEAR WORK - IN - PROGRESS CONTRACT RE CEIPTS OF RS.12,53,322/ - , HENCE THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD DISCLOSED THE CONTRACT ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 3 RECEIPTS OF RS.41,55,070/ - ONLY. THERE WAS A DIFFERENCE IN DISCLOSING THE CONTRACT RECEIPTS TO THE EXTENT OF RS.60,64,378/ - BY THE ASSESSEE. THE ASSE SSING OFFICER ALSO NOTED THAT IN THE BALANCE SHEET ON THE ASSET SIDE, THE ASSESSEE HAD CLAIMED WORK - IN - PROGRESS OF MINUS FIGURE OF RS. 73,17,700/ - AND SHOWN THE SUNDRY DEBTORS AT RS. 95,32,344/ - RECEIVABLE FROM M/S. SUZLON INFR ASTRUCTURE SERVICES PVT. LTD. THE ASSESSEE WAS THUS, ASKED TO EXPLAIN THE SAME. FURTHER, INFORMATION WAS ALSO SOUGHT FROM M/S. SUZLON INFRASTRUCTURE SERVICES PVT. LTD. TO GIVE DETAILS OF CONTRACT WORK ALLOTTED YEAR - WISE, COMPLETED BY THE ASSESSEE, ADVANCES GIVEN, WORK - IN - PROGRESS AND THE TOTAL CONTRACT AMOUNT PAID DURING THE FINANCIAL YEAR ALONG WITH TDS DEDUCTED. IN RESPONSE, THE ASSESSEE SUBMITTED THAT IN RESPECT OF WORK - IN - PROGRESS, RS. 73,17,700/ - ONLY AMOUNT WAS CREDITED BY THE CONTRACTEE COMPANY AND ACTUAL PAYMENT CHEQUE WAS CLEA RED AFTER COMPLETION OF WORK I.E. IN ASSESSMENT YEAR 2012 - 13 . THE CONTRACTEE COMPANY ON THE OTHER HAND, VIDE LETTER DATED 21.08.2013 STATED THAT AS PER OUR BOOKS OF ACCOUNTS BALANCE OF M/S SAIDHAN CONSTRUCTION IS RS.5,60,974/ - (CREDIT) AS ON 31 ST MARCH 2 011. ONE OF THE INVOICE NO.002 DATED 18/02/2011 OF RS.91,50,488/ - WAS BOOKED ON 06/05/2011 I.E. F.Y. 2011 - 12 AFTER WORK COMPLETED. HOWEVER WE HAVE DEDUCTED TDS OF 82,960/ - AGAINST SAID INVOICE ON PROVISION BASIS IN MARCH 2011 AND BALANCE TDS OF RS.8545/ - . THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THE CONTRACTEE COMPANY HAD AGREED TO THE BILLS SUBMITTED BY THE CONTRACTOR ON 18.02.2011, THAT IS WHY IT HAD CREDITED HIS ACCOUNT AND DEDUCTED THE TAX ON SUCH COMPLETION OF CONTRACT WORK. HENCE, THE CON TRACTEE COMPANY UPLOADED THE POSTING IN RESPECT OF THIS BILL OF RS.82,96,000/ - ON ONLINE IN THE QUARTER ENDING 31.03.2011 BY SHOWING THAT THE TDS HAD BEEN MADE ON SUCH PAYMENTS, BUT WHILE REPLYING TO THE LETTER OF ASSESSING OFFICER, THE CONTRACTEE COMPANY HAD STATED THAT IT HAD DE DUCTED TAX ON PROVISIONAL BASIS. IN THIS REGARD, REFERENCE WAS MADE TO THE PROVISIONS OF ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 4 SECTION 194C(1) OF THE ACT AND IT WAS OBSERVED BY THE ASSESSING OFFICER THAT AS PER SECTION, THERE IS NO PROVISION TO DEDUCT TAX ON PROVISION AL BASIS,. HE FURTHER OBSERVED THAT THE ASSESSEE HAD CLAIMED THE TDS DEDUCTED BY THE CONTRACTEE COMPANY IN THE YEAR OF DEDUCTION, BUT AVOIDED TO SHOW THE CONTRACT RECEIPTS IN THE YEAR OF ITS CREDIT. THE ASSESSING OFFICER ACKNOWLEDGED THAT THE PAYMENTS SH IFTED TILL THE DATE OF 06.05.2011 . THE PLEA OF THE ASSESSEE THAT HE HAD RECEIVED CHEQUE IN THE MONTH OF MAY, 2011 AND THEREFORE HAD ACCOUNTED FOR RECEIPTS IN THE NEXT YEAR WAS NOT ACCEPTED BY THE ASSESSING OFFICER BECAUSE THE ASSESSEE WAS MAINTAINING HIS BOOKS OF ACCOUNT ON MERCANTILE SYSTEM OF ACCOUNTING AND SINCE THE SAME PRINCIPLE WAS APPLIED BY THE ASSESSEE ON ACCOUNTING THE BILLS PAYABLE, RECEIVABLES, DEBTORS AND CREDITORS, ETC. THE DIFFERENT TREATMENT GIVEN TO THE CONTRACT RECEIPTS OF RS.60,64,378/ - WAS FOUND TO BE NOT ACCEPTABLE. THE EXPLANATION OF THE CONTRACTEE COMPANY ALSO IN THIS REGARD WAS NOT ACCEPTED AND THE ASSESSING OFFICER HELD THAT THE ASSESSEE SHOULD HAVE DISCLOSED THE CONTRACT RECEIPTS OF RS.60,64,378/ - IN THE ACCOUNTING YEAR 2010 - 11. IN VIEW THEREOF, THE ADDITION OF RS.60,64,378/ - WAS ACCOUNTED FOR IN THE ACCOUNTING YEAR 2010 - 11 AND THE PROFIT ON SUCH RECEIPTS WAS ADOPTED @ 8% WHICH WORKED OUT TO RS.4,85,150/ - AND SAME WAS ADDED IN THE HANDS OF ASSESSEE. 5. ANOTHER ISSUE CONSIDERED BY THE ASSESSING OFFICER WAS THE PAYMENT OF LABOUR CHARGES. THE ASSESSING OFFICER FROM THE PERUSAL OF BOOKS OF ACCOUNT PRODUCED BY THE ASSESSEE NOTED THAT THE ACCOUNTING ENTRY HAD BEEN PASSED SHOWING THAT THE LABOUR PAYMENTS TOTALING RS.2,74,800/ - WAS CLA IMED TO HAVE MADE THROUGH PUSHPA DESALE. ON BEING ENQUIRED, IT WAS POINTED OUT THAT SHE WAS THE WIFE OF ASSESSEE AND HAD MADE PAYMENTS FOR LABOUR . THE DETAILS OF LABOUR CHARGES PAID ARE REPRODUCED UNDER PARA 7 OF THE ASSESSMENT ORDER. THE ASSESSEE EXPLA INED THAT HIS WIFE OWED SUM OF RS. 2,43,000/ - TO THE ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 5 ASSESSEE IN EARLIER ASSESSMENT YEAR AND THE SAME WAS RECEIVABLE FROM HER AND HENCE, SHE MADE THE PAYMENT ON ACCOUNT OF LABOUR CHARGES. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FILE THE BANK ACCOUNT OF HIS WIFE, WHICH WAS PLACED ON RECORD. THE ASSESSEE ALSO REPLIED THAT HIS WIFE WAS HAVING NO SOURCE OF INCOME, HENCE, THE ASSESSING OFFICER QUESTIONED AS TO HOW SHE SOURCED THE PAYMENT OF LABOUR CHARGES OF RS. 2,43,000/ - . THE ASSESSING OFFICER ON VERIFICA TION OF SBI ACCOUNT ALSO FOUND THAT DURING THE DATES OF PAYMENT I.E. FROM 26.04.2010 TO 05.07.2010 , SHE WAS HAVING NEGLIGIBLE AMOUNT TO HER CREDIT AND IN THE ABSENCE OF THE ASSESSEE HAVING REBUTTED THE SAME OR BRINGING ON RECORD THE EVIDENCE FROM WHICH SOU RCE HIS WIFE HAD MADE THE PAYMENT, EXCEPT FOR SAYING IT WAS MADE OUT OF CASH IN HAND, FOR WHICH NO PROOF WAS SUBMITTED. THE EXPLANATION OF THE ASSESSEE WAS REJECTED. IN VIEW THEREOF, THE EXPENDITURE OF RS.2,43,000/ - WAS TREATED AS UNEXPLAINED AND WAS ADD ED UNDER SECTION 69C OF THE ACT. 6. BEFORE THE CIT(A), THE ASSESSEE CLAIMED THAT SINCE THE CONTRACTEE COMPANY HAD MADE THE PAYMENT AGAINST THE SAID BILL IN SUCCEEDING YEAR, THE CONTRACT RECEIPTS OF RS. 60,64,378/ - WERE NOT SHOWN IN THE YEAR UNDER CONSIDERA TION. THE CIT(A) OBSERVED THAT WHERE THE ASSESSEE WAS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING AND HE HAD TAKEN THE BENEFIT OF TAX DEDUCTION CERTIFICATE IN THE CURRENT YEAR, THEN THE CORRESPONDING RECEIPTS WERE TO BE ACCOUNTED FOR. THE ASSESSEE HAD RAIS ED THE BILL ON 18.02.2011 I.E. DURING THE CURRENT YEAR AND AS PER MERCANTILE SYSTEM OF ACCOUNTING , T HE SAID RECEIPT HAD TO BE ACCOUNTED FOR ON ACCRUAL BASIS. MERELY BECAUSE THE PAYMENT WAS MADE IN THE NEXT YEAR DOES NOT ABSOLVE THE ASSESSEE FROM HIS DUTY. FURTHER, THE CIT(A) HELD THAT IN CREDITING THE INCOME IN ACCOUNTS WHILE CLAIMING TDS ON THE SAME WAS ALSO IN CONTRAVENTION OF PROVISIONS OF SECTION 198 OF THE ACT. IN VIEW THEREOF, THE ADDITION MADE BY THE ASSESSING OFFICER IN THIS REGARD WAS UPHELD. ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 6 S IMILARLY, THE ADDITION MADE ON ACCOUNT OF LABOUR CHARGES OF RS.2,43,300/ - WAS ALSO HELD TO BE JUSTIFIED. 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 8. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ASSESSEE WAS ENGAGED IN WORKS CONTRACT AND WAS FOLLOWING PROJECT COMPLETION METHOD, WHEREIN THE INCOME FROM ANY CONTRACT WAS RECOGNIZED ON ITS COMPLETION. ATTENTION WAS DRAWN TO THE ASSESSMENT ORDER FOR ASSESSMENT YEAR 2008 - 09, WHEREIN THE SAID SYSTEM OF ACCOUNTING B EING FOLLOWED WAS ACCEPTED BY THE ASSESSING OFFICER. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED OUT THAT THE SAID RECEIPT HAS BEEN OFFERED TO TAX IN ASSESSMENT YEAR 2012 - 13. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESS EE FURTHER POINTED OUT THAT THE ASSESSING OFFICER MAY VERIFY THE STAND OF ASSESSEE AND ALLOW THE CREDIT FOR TDS. ASSESSEE AND ALLOW THE CREDIT FOR TDS. 9. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, POINTED OUT THAT IN VIEW OF PROVISIONS OF SECTION 198 OF THE A CT, THE AMOUNT OF TDS DEDUCTED DURING THE YEAR WAS TO BE ADDED AS INCOME OF THE ASSESSEE. 10. WITH REGARD TO SECOND ADDITION MADE BY THE ASSESSING OFFICER, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE PAYMENT ON ACCOUNT OF L ABOUR CHARGES WAS THROUGH THE WIFE OF ASSESSEE AND THE SOURCE OF SAID PAYMENT WAS THE AGRICULTURAL INCOME EARNED BY HER. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE IN THIS REGARD, PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 7 11. ON PE RUSAL OF RECORD AND AFTER HEARING BOTH THE LEARNED AUTHORIZED REPRESENTATIVES, THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAS DECLARED INCOME FROM CIVIL CONTRACTS, WHEREIN THE ASSESSEE WAS ENGAGED IN COMPLETING THE WORKS CONTRACT. THE ASSESSEE CLAIMS T HAT IT WAS FOLLOWING PROJECT COMPLETION METHOD AND FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SHOWN WORK - IN - PROGRESS AND THE CONTRACT RECEIPTS WERE SHOWN AS ARISING TO THE ASSESSEE IN THE SUCCEEDING YEAR I.E. ASSESSMENT YEAR 2012 - 13 WHEN THE SAID C ONTRACT WAS COMPLETED. THE ASSESSEE HAD ADMITTEDLY, RAISED A BILL ON 18.02.2011 AND THE CONTRACTEE COMPANY M/S. SUZLON INFRASTRUCTURE SERVICES PVT. LTD. HAD DEDUCTED THE TAX AT SOURCE AND DEPOSITED THE SAME. HOWEVER, THE PAYMENT AGAINST THE SAID CONTRACT AMOUNT WAS RECEIVED BY THE ASSESSEE IN SUCCEEDING YEAR. THE CONFIRMATION FILED BY M/S. SUZLON INFRASTRUCTURE SERVICES PVT. LTD. ALSO REFLECTS THAT THE PAYMENT WAS MADE ON COMPLETION OF THE PROJECT IN SUCCEEDING YEAR. THE ASSESSEE CLAIMED THAT FOR THE YE AR UNDER CONSIDERATION, IT HAD SHOWN WORK - IN - PROGRESS AT RS. 73,17,700/ - , WHICH WAS TRANSFERRED TO THE CONTRACT ACCOUNT IN THE SUCCEEDING YEAR AND TOTAL CONTRACT RECEIPTS WERE SHOWN AT RS. 1,26,49,295/ - . THE PLEA OF THE ASSESSEE WAS THAT IT WAS FOLLOWING TH IS METHOD OF ACCOUNTING PERSISTENTLY FROM YEAR TO YEAR AND THE SYSTEM OF ACCOUNTING HAS BEEN ACCEPTED BY THE REVENUE DEPARTMENT. THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT FOR ASSESSMENT YEAR 2008 - 09 UNDER SECTION 143(3) OF THE ACT HAD ALSO CON SIDERED THE SIMILAR ISSUE OF RECONCILIATION OF CONTRACT RECEIPTS SHOWN IN THE TDS CERTIFICATE AND AS REFLECTED IN THE PROFIT & LOSS ACCOUNT. THE ASSESSEE HAD DECLARED THE CONTRACT RECEIPTS IN ASSESSMENT YEAR 2008 - 09 AT RS. 51 , 04 , 77 7 / - THOUGH THE TDS CERTIF ICATE REFLECTED THE CONTRACT RECEIPTS AT RS. 70,95,430/ - . THE ASSESSEE WAS ASKED TO EXPLAIN THE DIFFERENCE OF RS. 19,90,653/ - . THE ASSESSEE IN THIS REGARD EXPLAINED THAT THE SAID RECEIPTS WERE OFFERED FOR TAXATION IN ASSESSMENT YEAR 2009 - 10 AS ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 8 THE CHEQUE F OR THE SAID AMOUNT WAS RECEIVED AND REALIZED IN SUCCEEDING YEAR. BESIDES, IT WAS POINTED OUT THAT CHEQUE WAS RECEIVED ON 31.03.2008 AS AN ADVANCE FOR THE WORK WHICH WAS TO BE DONE IN FUTURE. THE ASSESSING OFFICER NOTED THAT WHERE THE ASSESSEE HAD OFFERED THE RECEIPTS IN QUESTION FOR ASSESSMENT YEAR 2009 - 10, THEN EVEN THE TDS EQUAL TO THE SAID RECEIPTS WAS TO BE CONSIDERED IN SUCCEEDING YEAR, WHERE CORRESPONDING CONTRACT RECEIPTS HAD ALREADY BEEN OFFERED BY THE ASSESSEE. 12. NOW, COMING TO THE FACTS OF THE PRESENT CASE. THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD CLAIMED THE TDS OF RS. 82,960/ - DURING THE YEAR. HOWEVER, THE CONTRACT RECEIPTS RELATING TO THE SAID AMOUNT WERE NOT OFFERED TO TAX IN THE CAPTIONED ASSESSMENT YEAR. THE ISSUE WHICH ARIS ES IN THE PRESENT APPEAL IS IN RELATION TO THE TAXABILITY OF CONTRACT RECEIPTS RELATABLE TO THE TAX DEDUCTED AT SOURCE. SINCE THE ASSESSEE IS FOLLOWING PROJECT COMPLETION METHOD, THEN THE CONTRACT RECEIPTS ARE TO BE RECOGNIZED AS INCOME OF THE ASSESSEE IN THE YEAR OF COMPLETION OF PROJECT, WHICH IN THE FACTS OF THE PRESENT CASE IS THE SUCCEEDING YEAR I.E. ASSESSMENT YEAR 2012 - 13 . THE ASSESSEE HAS ALREADY OFFERED THE INCOME RELATABLE TO THE SAID CONTRACT RECEIPTS TO TAX IN ASSESSMENT YEAR 2012 - 13. NOW, TH E BALANCE IS THE TREATMENT OF TAX DEDUCTED AT SOURCE AT RS. 82,960/ - . THOUGH WHILE COMPLETING THE ASSESSMENT FOR ASSESSMENT YEAR 2008 - 09, THE ASSESSING OFFICER HAD HELD THA T THE SAID BENEFIT OF TDS IS TO BE ALLOWED IN ASSESSMENT YEAR 2009 - 10 I.E. THE YEAR IN WHICH THE ASSESSEE HAD SHOWN CONTRACT RECEIPTS. HOWEVER, THE PROVISIONS OF SECTION 199 OF THE ACT HAVE UNDERGONE AMENDMENT W.E.F. 01.04.2008 . PRIOR TO THE AMENDMENT, THE SECTION PROVIDED THAT THE CREDIT FOR TAX DEDUCTED AT SOURCE WOULD BE ALLOWED IN T HE ASSESSMENT YEAR FOR WHICH SUCH INCOME IS ASSESSABLE. HOWEVER, AFTER THE AMENDMENT, IT HAS BEEN PROVIDED THAT ANY DEDUCTION MADE IN ACCORDANCE WITH PROVISIONS OF THE CHAPTER AND PAID TO THE CENTRAL ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 9 GOVERNMENT SHALL BE TREATED AS PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOM THE INCOME DEDUCTION WAS MADE OR THE OWNER OF SECURITY OR THE DEPOSITOR O R ANY OWNER OF PROPERTY OF UNIT HOLDER OR SHAREHOLDER AS THE CASE MAY BE. HENCE, THE CREDIT FOR TAX DEDUCTED AT SOURCE IS TO BE ALLOWED ON PAYMENT OF TAX ON BEHALF OF THE PERSON FROM WHOSE ACCOUNT THE SAID TAX HAS BEEN DEDUCTED AT SOURCE. S ECTION 198 OF THE ACT PROVIDES THAT ALL SUMS DEDUCTED IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER SHALL FOR THE PURPOSE OF COMPUTING THE INCOME OF ASSESSEE BE DEEMED TO BE INCOME RECEIVED. ACCORDINGLY, WHERE ANY DEDUCTION OF TAX HAS BEEN MADE OUT OF ACCOUNT DUE TO ANY PERSON, THEN SUCH TAX DEDUCTED AT SOURCE IS TO BE TREATED AS INCOME OF THE SAID PERSON IN THE YEAR OF ITS DEDUCTION. CONSEQUENTLY, THE TAX DEDUCTED AT SOURC E IS TO BE ADDED AS INCOME IN THE HANDS OF ASSESSEE IN THE YEAR OF ITS DEDUCTION AND CREDIT FOR THE SAME IS TO BE ALLOWED TO THE ASSESSEE. HOWEVER, THE CONTRACT RECEIPTS WHICH ARE SUBJECTED TO SUCH DEDUCTION OF TAX AT SOURCE ARE TO BE TAXED IN THE SUCCEED ING YEAR, EXCLUDING THE AMOUNT OF TAX DEDUCTED AT SOURCE, SINCE THE ASSESSEE IS FOLLOWING PROJECT COMPLETION METHOD IN RESPECT OF ITS CONTRACT WORK . THE GROUND OF APPEAL NO.2 RAISED BY THE ASSESSEE IS THUS, PARTLY ALLOWED. 13. NOW, COMING TO THE ISSUE RA ISED WITH REGARD TO LABOUR PAYMENT OF RS.2,43,000/ - . THE ONUS IS UPON THE ASSESSEE TO ESTABLISH THE SOURCE OF PAYMENT OF RS.2,43,000/ - . UNDOUBTEDLY, THE WIFE OF ASSESSEE OWED THE SAID SUM TO THE ASSESSEE, AGAINST WHICH, THE CLAIM OF ASSESSEE IS THAT THE SAID LABOUR PAYMENT HAS BEEN MADE BY HIS WIFE. HOWEVER, THE PERUSAL OF BANK STATEMENT DID NOT REFLECT THE SAID PERSON TO HAVE SUFFICIENT FUNDS TO MEET THE SAID EXPENDITURE. THE ASSESSEE HAD NOT FURNISHED ANY EVIDENCE IN RESPECT OF SOURCE OF SUCH PAYMENT BY WIFE OF THE ASSESSEE. HOWEVER, BEFORE THE TRIBUNAL, THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE IN THE PAPER BOOK HAS FURNISHED THE DOCUMENTS IN RELATION TO HIS WIFE I.E. ACKNOWLEDGEMENT ITA NO. 1 323 /PN/20 1 5 SHRI VILAS PUNJARAM DESALE 10 OF FILING THE RETURN OF INCOME ALONG WITH CASH FLOW ST ATEMENT . SINCE ALL THESE DOCUMENTS WERE NOT PRODUCED BEFORE LOWER AUTHORITIES NOR ANY MENTION ABOUT THE SAME, I FIND THERE IS NO MERIT IN THE CLAIM OF ASSESSEE IN THIS REGARD AND THE SAME ARE REJECTED. THE GROUND OF APPEAL NO.3 RAISED BY THE ASSESSEE IS THUS, DISMISSED. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE THUS, PARTLY ALLOWED. 14 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED ON THIS 12 TH DAY OF AUGUST , 201 6 . SD/ - (SUSHMA CHOWLA) / JUDICIAL MEMBER / PUNE ; DATED : 12 TH AUGUST , 201 6 . / PUNE ; DATED : 12 AUGUST , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPO NDENT; 3. ( ) / THE CIT(A) - 1 , NASHIK ; 4. / THE PR. CIT - 1 , NASHIK ; 5. 6. , , , - / DR SMC , ITAT, PUNE; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE