Vikatan.Com Pvt Ltd., CHENNAI V. DCIT, CHENNAI

ITA 2116/CHNY/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8431 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 08-08-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 02-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V NANDA KUMAR
• Assessee Lawyers: T BANUSEKAR
• Keywords: Additional evidence

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !'# ! ,% !& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ ITA NO. 2116/MDS/2015 ( )( / ASSESSMENT YEAR : 2012-13 VIKATAN.COM PVT. LTD., 757, ANNA SALAI, CHENNAI 600 002. PAN : AABCV5242P V. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE - 3(2), CHENNAI. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SHRI T.BANUSEKAR, C.A. -.+,/0 / RESPONDENT BY : SHRI V.NANDAKUMAR, JCIT 1 /2% / DATE OF HEARING : 17.08.2016 3') /2% / DATE OF PRONOUNCEMENT : 23.09.2016 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE CIT(A) -11, CHENNAI DATED 10.09.2015 AND PERTAINS T O ASSESSMENT YEAR 2012-13. 2 I.T.A. NO.2116/MDS/2015 2. SHRI T.BANUSEKAR, THE LEARNED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE COLLECTED SUBSCRIPTION FOR VARIOUS MAGAZINES. THE PERIOD OF SUBSCRIPTION VARIES FROM O NE YEAR, TWO YEARS, THREE YEARS AND TEN YEARS RESPECTIVELY. THE SUBSCRI BER ON PAYING THE SPECIFIED AMOUNT CAN BECOME THE SUBSCRIBER FOR THE PERIOD TO WHICH HE PAID THE AMOUNT. THE ASSESSEE IS FOLLOWING MERCANTI LE METHOD OF ACCOUNTING IN RESPECT OF SUBSCRIPTION ARE CONCERNED . THEREFORE, THE AMOUNT RECEIVED BY THE ASSESSEE FROM SUBSCRIBERS AR E TREATED AS ADVANCE TOWARDS SUBSCRIPTION AND THE PROPORTIONATE AMOUNT WAS CREDITED TO SALES BY DEBITING THE SUBSCRIPTION ADVANCE AMOUN T. THE SUBSCRIPTION RECEIVED FOR THE UNEXPIRED PORTION OF THE PERIOD RE FLECTED UNDER THE HEAD INCOME RECEIVED IN ADVANCE AND IT WILL BE TAKEN A S INCOME OF THE ASSESSEE IN THE FINANCIAL YEAR IN WHICH IT EXPIRES. THIS EXPLANATION OF THE ASSESSEE WAS REJECTED BY THE CIT(A) ON THE GROUND T HAT THE ASSESSEE HAS NOT SUBMITTED THE WORKING OF INCOME RECOGNITION OUT OF THE AMOUNT RECEIVED EITHER BEFORE THE ASSESSING OFFICER OR BEF ORE THE CIT(A). NOW, THE ASSESSEE HAS FILED AN APPLICATION UNDER RULE 29 OF THE INCOME TAX APPELLATE TRIBUNAL RULES. THE PRAYER FOR ADMISSION OF ADDITIONAL EVIDENCE WHICH CONTAINS WORKING FOR RECOGNITION OF INCOME FR OM THE SUBSCRIPTION. THEREFORE, THE LEARNED REPRESENTATIVE FOR THE ASSES SEE SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO THE FILE OF THE ASSE SSING OFFICER FOR 3 I.T.A. NO.2116/MDS/2015 RECONSIDERATION IN THE LIGHT OF THE TERMS AND CONDI TIONS BETWEEN THE ASSESSEE AND THE SUBSCRIBERS. 3. ON THE CONTRARY, SHRI V.NANDAKUMAR, THE LEARNED REPRESENTATIVE FOR THE DEPARTMENT SUBMITTED THAT THE SUBSCRIPTION OF THE ASSESSEE FOR VARIOUS MAGAZINES VARIES FROM ONE MONTH TO TEN YEAR S. THE ASSESSEE HAS NOT TAKEN THE ENTIRE AMOUNT AS INCOME OF THE AS SESSEE. SINCE THE ASSESSEE CLAIMS THAT ONLY PROPORTIONATE AMOUNT HAS TO BE TAKEN AS INCOME, IT IS FOR THE ASSESSEE TO FILE THE NECESSAR Y DETAILS WITH REGARD TO INCOME RECOGNITION FROM THE ADVANCE SAID TO BE RECE IVED BY THE ASSESSEE. IN THE ABSENCE OF ANY DETAILS, THE ASSESS ING OFFICER HAS RIGHTLY REJECTED THE CLAIM OF THE ASSSSEE AND TREATED THE E NTIRE AMOUNT RECEIVED BY THE ASSESSEE AS INCOME FOR THE YEAR UNDER CONSID ERATION. THE CIT(A) ALSO HAS RIGHTLY CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. AS RIGHTL Y SUBMITTED BY THE LEARNED REPRESENTATIVE FOR THE ASSESSEE AND THE LEA RNED REPRESENTATIVE FOR THE DEPARTMENT, THE CIT(A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSEE HAS NOT SUB MITTED THE WORKINGS OF INCOME RECOGNITION OUT OF THE SO CALLED ADVANCE SUB SCRIPTION FOR THE MAGAZINE. NOW THE ASSESSEE HAS FILED THE WORKING FO R INCOME RECOGNITION BEFORE THIS TRIBUNAL. THE ASSESSEE HAS ALSO FILED THE TERMS AND CONDITIONS BETWEEN THE ASSESSEE AND THE SUBSCRI BERS. THEREFORE, 4 I.T.A. NO.2116/MDS/2015 THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OFFICER. THE ASSESSIN G OFFICER SHALL EXAMINE THE TERMS AND CONDITIONS / AGREEMENT BETWEE N THE ASSESSEE AND THE SUBSCRIBERS AND THE WORKING OF INCOME RECOG NITION FROM THE SO CALLED SUBSCRIPTION RECEIVED FROM THE SUBSCRIBER AN D THEREAFTER, HE HAS TO DECIDE THE MATTER. 5. ACCORDINGLY, THE ORDERS OF THE BOTH THE LOWER AU THORITIES ARE SET ASIDE AND THE ENTIRE ISSUE RAISED BY THE ASSESSEE I S REMITTED BACK TO THE FILE OF THE AO. THE AO SHALL RE-EXAMINE THE MATTER AS INDICATED ABOVE AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH L AW AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 23 RD SEPTEMBER, 2016 AT CHENNAI. SD/- SD/- (. !'# ! ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 23 RD SEPTEMBER, 2016. SP. 5 I.T.A. NO.2116/MDS/2015 / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A) 4. 1 92 /CIT, 5. 7: -2 /DR 6. ;( < /GF.