Ad Circle (P) Ltd., Kolkata V. CIT-III, KOLKTA, Kolkata

ITA 701/KOL/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83161 (ITAT-KOLKATA)
• Duration Of Justice: 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-11-2014
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 21-04-2014
• Court: TRIBUNAL
• Department Lawyers: P K HIMMATSINGKA
• Assessee Lawyers: VEERINDER MEHTA
• Keywords: Assessment record
• Section: 143(3); 147; 263; 63

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A , KOLKATA [BEFORE HONBLE SRI MAHAVIR SINGH, JM& HONBLE S RI SHAMIM YAHYA, AM ] ITA NO.701/KOL/2014 ASSESSMENT YEAR : 2009-10 ( APPELLANT ) (RESPONDENT) AD CIRCLE(P)LTD. ..-VS- C.I.T., KOL-III, KOLKATA KOLKATA (PAN: AACCA 1705 D) FOR THE APPELLANT SHRI VEERINDER MEHTA, CIT FOR THE RESPONDENT SHRI P.K.HIMMATSINGKA, FCA DATE OF HEARING : 03.11.2014 DATE OF PRONOUNCEMENT : 03. 11.2014. ORDER PER SHRI SHAMIM YAHYA, AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. C.I.T-III, KOLKATA DT. 25.03.2014 AND PERTAINS TO ASSESSMENT Y EAR 2009-10. 2. IN THIS CASE THE LD. CIT OBSERVED THAT ON PERUSA L OF THE ASSESSMENT RECORDS, NOTE SHEETS, COMPLIANCES ETC. IT WAS OBSERVED THAT RS.2, 26,75,346/- AND RS.19,86,886/- AGGREGATING TO RS.2,46,62,232/- WAS CREDITED TO THE P/L A/C ON ACCOUNT OF ADVERTISING RECEIPT AND SALE AND SERVICE RESPECTIVELY. FURTHER, THE ASSESSEE FURNISHED DETAILS OF CLIENT-WISE BILLING AND DETAILS OF TDS ON NON-SALAR Y RECEIPT. LD.CIT NOTED THAT ON COMPARISON OF THE TWO STATEMENTS IT WAS FOUND THAT AN INCOME OF RS.11,89,158/- WAS NOT REFLECTED IN THE P/L A/C THOUGH THE CREDIT OF T DS WAS CLAIMED ON THE SAID INCOME. TDS SO CLAIMED WAS ALLOWED IN THE ASSESSMENT ORDER IGNORING THE FACT THAT THE CORRESPONDING INCOME WAS NOT TAKEN INTO ACCOUNT IN COMPUTING THE TOTAL INCOME. LD.CIT OBSERVED THAT FAILURE ON THE PART OF THE A.O . TO DO SO HAS RENDERED THE ASSESSMENT ORDER ERRONEOUS AND THEREBY CAUSED PREJU DICE TO THE INTEREST OF REVENUE. ITA.NO.701/KOL/2014 AD CIRCLE (P) LTD. A.YR .2009-10 2 2.1. ON THE BASIS OF ABOVE THE LD. CIT OBSERVED THA T ASSESSMENT PASSED U/S 147 INSTEAD OF 143(3) OF THE ACT IN THIS CASE APPEARS T O BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE ON THE ABOVE DISCUSSED SUPRA. A SSESSEE IN RESPONSE SUBMITTED THAT TDS WAS NOT CLAIMED ON ANY INCOME WHICH IS NOT INCL UDED IN THE AUDITED P/L A/C. THE LD. CIT OBSERVED THAT ASSESSEES COUNSEL SUBMITTED HIS EXPLANATION REGARDING CREDIT OF RS.2,46,62,232/- AND TDS THERETO BUT WAS SILENT ON THE DISCREPANCY OF RS.11,89,158/- BETWEEN THE CLIENT WISE BILLING VIS--VIS TDS ON NO N SALARY RECEIPT. HENCE THE LD. CIT CONCLUDED THAT AO FAILED TO NOTICE AND RECONCILE TH IS APPARENT NON-REPORTING OF INCOME. THE LD. CIT CONCLUDED AS UNDER :- IN THE ASSESSMENT ORDER PASSED U/S 147/143(3) OF T HE I.T.ACT DATED 12-12-2011 THE AO DID NOT LOOK INTO THE MATTER WHICH ENTAILS LOSS OF REVENUE AS DETAILED IN THE PRECEDING PARAS AND THEREFORE, THE SAID ASSESSMENT ORDER IS H ELD TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND IS SET ASIDE TO FRAME D E NOVO AS PER LAW AFTER GIVING THE ASSESSEE ADEQUATE OPPORTUNITY. AGAINST THE ABOVE ORDER ASSESSEE IS IN APPEAL BEFOR E US. 3. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE R ECORDS. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS DULY SUBMI TTED THE DETAILS OF TDS AND INCOME DISCLOSED IN P&L A/C. HE REITERATED THAT THE ASSESS EE HAS SUBMITTED RECONCILIATION STATEMENT TO THE LD. CIT AND CLARIFIED THAT THE DED UCTOR HAD DEDUCTED TDS ON GROSS AMOUNT OF BILLS INCLUSIVE OF SERVICE TAX AT RS.5,98 ,794/- AND TRADING DISCOUNT ALLOWED TO PARTIES RS.6,59,159/- BOTH AGGREGATE RS.12,57,95 3/-. THE LD. COUNSEL REITERATED THAT THE SAID SERVICE TAX AND TRADE DISCOUNT ALLOWED TO PARTY CANNOT BE INCLUDED AS INCOME IN AUDITED P&L A/C. HE FURTHER SUBMITTED THAT THE L D. CIT HAS FAILED TO SPECIFY HOW ALLEGED FIGURE OF RS.11,89,158/- WAS ARRIVED AT BY HIM REGARDING THE SO CALLED DIFFERENCE. THE LD. COUNSEL OF THE ASSESSEE ALSO SU BMITTED THAT WITHOUT PREJUDICE TO THE ABOVE SUBMISSIONS THE LD. CIT ERRED IN DIRECTING TH E AO TO DO NE NOVO ASSESSMENT DESPITE LIMITED ISSUES INVOLVED IN PROCEEDING U/S 2 63 OF THE ACT. THE LD. DR, ON THE OTHER HAND, RELIED UPON THE ORDER OF THE LD. CIT. 3.1. WE HAVE CAREFULLY HEARD THE SUBMISSIONS AND PE RUSED THE RECORDS. WE FIND THAT ASSESSEES COUNSEL HAS HIMSELF ADMITTED THAT IN FAC T THERE IS A DIFFERENCE BETWEEN ITA.NO.701/KOL/2014 AD CIRCLE (P) LTD. A.YR .2009-10 3 INCOME SHOWN IN THE P&L A/C AND THAT AS PER TDS CER TIFICATE IN AS MUCH AS TDS HAS BEEN DEDUCTED ON GROSS AMOUNT OF BILLS INCLUSIVE OF SERVICE TAX AND TRADING DISCOUNT ALLOWED TO PARTIES AGGREGATE RS.12,57,953/-. WE AL SO FIND THAT THERE IS NO QUERY FROM THE AO ON THIS ASPECT. HENCE THE LD. CITS INVOKING THE PROVISION OF SECTION 263 CANNOT BE FAULTED WITH. HOWEVER, ASSESSEES SUBMISS IONS THAT ASSESSEE HAS DULY SUBMITTED THE RECONCILIATION STATEMENT IS ALSO TO B E TAKEN INTO ACCOUNT. IN THIS VIEW OF THE MATTER WE AGREE WITH THE LD. COUNSEL OF THE ASS ESSEE THAT THE LD. CIT SHOULD HAVE DIRECTED THE AO TO ENQUIRE THE LIMITED ISSUE OF DIF FERENCE AS PER TDS CERTIFICATE AND AS DISCLOSED IN THE P&L A/C. THIS IS MORE SO IN VIEW O F THE FACT THE ASSESSEE HAS CLAIMED THAT THERE IS NO ACTUAL DIFFERENCE AND NECESSARY RE CONCILIATION HAS BEEN SUBMITTED TO THE LD. CIT WHO HAS FAILED TO APPRECIATE THE SAME. IN THIS VIEW OF THE MATTER WE CONSIDER IT APPROPRIATE TO UPHOLD THE ORDER OF THE LD. CIT TO THE EXTENT THAT AO SHOULD ENQUIRE INTO THE DIFFERENCE BETWEEN THE INCOME AS R EPORTED IN TDS CERTIFICATE AND AS PER P&L A/C. 4. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE S TANDS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 03.11.2014. SD/- SD/- [ MAHAVIR SINGH ] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 03.11.2014. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. AD CIRCLE (P) LTD., P.K.HIMMATSINGKA, AA-4, SALT LA KE, KOLKATA-700064. 2 CIT-III, KOLKATA 3 . CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY, BY ORDER, ASST. REGISTRAR , ITAT, KOLKATA BENCHES ITA.NO.701/KOL/2014 AD CIRCLE (P) LTD. A.YR .2009-10 4