SPJ INFRASTRUCTURE PRIVATE LIMITED , MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX 15(3)(2), MUMBAI

ITA 5193/MUM/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1514 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2014-2015
• Appeal Filed On: 08-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SRINIVAS VENKATARAMAN
• Keywords: Opportunity of being heard; TDS
• Section: 143(3); 145

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUM BAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI AMARJIT SINGH , JM ITA NO.5193/MUM/2017 (ASSESSMENT YEAR: 2014-15) SPJ INFRASTRUCTURE PVT.LTD. 306, JK CHAMBERS PLOT NO.76, VASHI NAVI MUMBAI-400 703 VS. DCIT - 15(3)(2) MUMBAI PAN/GIR NO. AA LCS5456Q ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : SHRI SRINIVAS VENKATARAMAN RESPONDENT BY : SHRI ASHISH KUMAR DATE OF HEARING : 01.01.2019 DATE OF PRONOUNCEMENT : 14. 03.2019 O R D E R PER SHAMIM YAHYA, A. M.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-24, MU MBAI (LD. CIT(A) FOR SHORT) DATED 27.04.2017 AND PERTAINS TO THE ASS ESSMENT YEAR (A.Y.) 2014-15. 2. THE GROUNDS OF APPEAL READ AS UNDER: 1. THE LD.CIT(A) HAS ERRED IN RELYING MERELY ON THE TU RNOVER REFLECTED IN FORM 26AS/ITS WHILE CONFIRMING THE ADDITIONS OF RS. 7,86,995/- MADE BY ASSESSING OFFICER WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LD. CIT(A) HAS GROSSLY ERRED IN LAW IN UNDERSTA NDING THE PRINCIPLES OF RECOGNITION OF REVENUE OR ACCOUNTING OF REVENUE PROVIDED IN THE ACCOUNTING STANDARDS (AS) OF THE INSTITUTE O F CHARTERED ACCOUNTANTS OF INDIA (ICAI) AND PRINCIPLES OF METHO D OF ACCOUNTING SPECIFIED IN SECTION 145 OF THE INCOME TAX ACT, 196 1(HEREAFTER CALLED THE ACT) 3. THE LD. CIT(A) HAS ERRED IN TREATING CLAIM OF TDS A S PER FORM 26AS/ITS AS A BASE FOR ACCOUNTING OF TURNOVER IN TH E BOOKS OF 2 ITA NO. 5193/MUM/2007 SPJ INFRASTRUCTURE PVT.LTD. ACCOUNTS OF THE ASSESSEE WITHOUT VERIFYING OTHER AV AILABLE MATERIAL ON RECORD. 3. BRIEF FACTS OF THE CASE ARE AS UNDER: THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS O F INFRASTRUCTURE DEVELOPMENT AND UNDERTAKING CIVIL CONTRACTS AND ROA D BUILDING CONTRACTS. THE RETURN OF INCOME FOR THE YEAR UNDER APPEAL WAS E-FILED ON 26.11.2014 DECLARING TOTAL INCOME OF RS.3,36,30,400/-. ASSESSM ENT U/S. 143(3) WAS COMPLETED BY THE LD. AO ON 30.09.2016 DETERMINING T OTAL INCOME AT RS.3,44,17,390/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE LD . AO FOUND THAT THE ASSESSEE COMPANY HAS NOT ADMITTED IN THE P&L AC COUNT, THE TOTAL RECEIPTS AS PER THE TDS CLAIMED. HE HAS OBSERVED TH AT THERE WAS A DIFFERENCE OF RS.7,86,995/- ON ACCOUNT OF PLUS MKSP TOLL LTD. THE ASSESSEES SUBMISSION WAS NOT ACCEPTED BY THE LD. A O. ON RECONCILIATION OF ITS DETAILS WITH THE ASSESSEES DETAILS, IT WAS FOUND THAT AMOUNTING TO RS.60,60,938/- AND TDS OF RS.1,21,218/- WAS REFLECT ED IN 26AS/ITS STATEMENT AND AS PER THE BOOKS OF ACCOUNT /ITR OF T HE ASSESSEE WAS RS.52,73,943/- AND TDS OF RS.1,21,220/-. THE ASSESS EE COMPANY HAD BOOKED INCOME IN ITS BOOKS OF ACCOUNT LESS BY RS.7, 96,995/-. HOWEVER, THE ASSESSEE HAD CLAIMED THE FULL CREDIT OF TDS DEDUCTE D ON THIS INCOME. THE DIFFERENCE OF RS.7,86,995/- WHICH HAD NOT BEEN OFFE RED AS INCOME IN ITS BOOKS OF ACCOUNT WAS ADDED TO THE TOTAL INCOME OF T HE ASSESSEE. 3 ITA NO. 5193/MUM/2007 SPJ INFRASTRUCTURE PVT.LTD. 4. UPON ASSESSEES APPEAL LD. CIT(A) CONFIRMED THE ACTION OF THE AO. AGAINST THE ABOVE ORDER ASSESSEE IS IN APPEAL BEFOR E US. 5. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT ASSESSEE HAS DULY GIVEN THE RECONCILIATION OF THE DIFFERENCE, BUT THE SAME HAS NOT BEEN EXAMINED BY THE AUTHORITIES BELOW. THE SUBMISSION OF THE ASSESS EE IS AS UNDER: THE RETURN OF INCOME FOR AY 2014-15 WAS FILED BY TH E ASSESSEE ON 26 TH NOVEMBER, 2014 DECLARING A TOTAL INCOME OF RS.3,36, 30,400/-. THE LD. ASSESSING OFFICER (AO) HAS COMPLETED ASSESSMENT U /S 143(3) MAKING AN ADDITION OF RS.7,86,995/- ON ACCOUNT OF MISMATCH IN TURNOVER REFLECTING INFORM 26AS AND TURNOVER SHOWN IN BOOKS OF ACCOUNTS . THE TURNOVER PERTAINING TO M/S PLUS BKSP TOLL LTD ( HEREAFTER CALLED THE CUSTOMER) REFLECTING IN FORM 26AS IS RS.60,60,938/ - AND THE RESPECTIVE TURNOVER IN BOOKS OF ACCOUNTS OF THE ASSESSEE IS RS .52,73,943/-. THE DIFFERENCE IN TURNOVER IS ON ACCOUNT OF CANCELLATIO N OF BILLS TO THE EXTENT OF RS.2,46,300/- AND REDUCTION IN BILLS TO THE EXTENT OF RS.5,40,700/-(FOR WHICH A DEBIT NOTE WAS ISSUED BY THE CUSTOMER) COPIES OF THE DEBIT NOTE AND LEDGER CONFIRMATION OF THE CUSTOMER WERE PRODUCED BEFORE THE LEARNED AO DURING THE ASSESSMEN T STAGE AND BEFORE THE CIT(A) FOR VERIFICATION OF FACTS AT THE FIRST STAGE OF APPEAL. HOWEVER, THE LD. CIT(A) HAS IGNORED ALL THESE FACTS AND TREATED TURNOVER APPEARING AS PER FORM 26AS AS FINAL TURNOVER AND PR OCEEDED IN MAKING ADDITIONS OF RS.7,86,995/- TO INCOME MERELY ON THE BASIS THAT THE ASSESSEE HAS CLAIMED THE BENEFIT OF TDS DEDUCTED. THE CIT(A) ALSO FAILED TO APPRECIATE THAT THERE WAS AN ACTUAL REDUCTION IN THE REVENUE DUE TO CANCELLATION OF BILLS AND REDUCTION IN BILLS DUE TO VARIOUS TECHNICAL REASONS, THE DOCUMENTARY EVIDENCES OF WHI CH WERE ALREADY PRODUCED. INSOFAR AS THE ORDER PASSED BY THE CIT(A) IS WITHOU T VERIFICATION OF FACTS OF THE CASE, THE ORDER SHALL BE DEEMED TO BE NOT JUSTI FIED AND IS BAD IN LAW. 5. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE RELIE D UPON ORDER OF AUTHORITIES BELOW 4 ITA NO. 5193/MUM/2007 SPJ INFRASTRUCTURE PVT.LTD. 6. UPON CAREFUL CONSIDERATION, WE FIND THAT THERE I S CONSIDERABLE COGENCY IN THE SUBMISSION OF THE LD. COUNSEL OF THE ASSESSEE. THE REASON FOR THE DIFFERENCE BETWEEN THE FIGURES GIVEN IN THE INCOME TAX RETURN AND THAT FOUND IN THE 26AS STATEMENT WAS DULY SUBMITTED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW. THIS EXPLANATION WAS DISMISSED WITHOUT ANY VERIFICATION AS IT IS EVIDENT IN THE ORDERS OF THE AUTHORITIES BELOW AS THERE IS NO DISCUSSION ABOUT THE EXAMINATION/VERACITY OF ASSESSEE SUBMISSION. HENCE IN THE INTEREST OF JUSTICE WE REMIT THE ISSUE TO THE FILE OF AO. THE AO DIRECTED TO EXAMINE THE VERACITY OF THE SUBMISSION OF THE ASSESSEE REGARDING THE REASONS FOR THE DIFFERENCE AND THE CO NSIDERATION THEREOF. IF THE NEED ARISES THE AO MAY EXAMINE THE CONCERNED CU STOMER WITH RESPECT TO WHOM THE DIFFERENCE HAS ARISEN. 7. NEEDLESS TO ADD ASSESSEE SHOULD BE GRANTED ADEQU ATE OPPORTUNITY OF BEING HEARD. 8. IN THE RESULT, THIS APPEAL BY THE ASSESSEE STAN DS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH MARCH, 2019. SD/- SD/- (AMARJIT SINGH) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED : 14.03.2019 THIRUMALESH , SR. PS 5 ITA NO. 5193/MUM/2007 SPJ INFRASTRUCTURE PVT.LTD. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI