Enstage Software Private Limited, Bangalore V. Assistant Commissioner of Income Tax, Circle -2(1)(2), Bangalore

ITA 770/BANG/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5634 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 11-09-2019
• Assessment Year: 2014-2015
• Appeal Filed On: 12-04-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R PREMI
• Assessee Lawyers: SUDHEENDRA B R
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NO. 770 /BANG/201 9 ASSESSMENT YEAR : 20 1 4 - 1 5 M/S. ENSTAGE SOFTWARE PVT. LTD., 16/1, WINGS, SECOND FLOOR, CAMBRIDGE ROAD, HALASURU, BANGALORE 560 008. PAN: AAACE9963B VS. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 2 (1) (2), BANGALORE. APPELLANT RESPONDENT ASSESSEE BY : SHRI SUDHEENDRA B.R., ADVOCATE REVENUE BY : SMT. R. PREMI, JCIT (DR) DATE OF HEARING : 11 .0 9 .2019 DATE OF PRONOUNCEMENT : 20 . 0 9 .2019 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE AND THE SAME IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-2, BANGALORE DATED 28.11.2018 FOR ASSESSMENT YEAR 2014-15. 2. THE ASSESSEE HAS RAISED VARIOUS GROUNDS. BUT IN COURSE OF HEARING, IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT ONLY GROUND NO. 2.1 HAS TO BE DECIDED AND THE REMAINING GROUNDS ARE NOT PRESSED AND ACCORDINGLY, WE DISMISS THE REMAINING GROUNDS AND REPRODUCE GROUND NO. 2.1 AND DECIDE THE SAME. 2.1 THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ADDITION OF RS. 27,70,335 ON ACCOUNT OF DIFFERENCE BETWEEN THE GROSS RECEIPTS REPORTED BY THE APPELLANT IN ITS RETURN OF INCOME AND THE GROSS RECEIPTS BEING REFLECTED IN FORM 26AS FOR THE RELEVANT ASSESSMENT YEAR. 3. IT WAS SUBMITTED BY LD. AR OF ASSESSEE THAT AS PER PARA NO. 4.2 OF THE ASSESSMENT ORDER, IT IS NOTED BY THE AO THAT INCOME ACCOUNTED FOR IN THE P&L ACCOUNT IS RS. 6,01,82,878/- AS AGAINST INCOME IN RESPECT OF SIMILAR PARTIES AS REPORTED IN 26AS STATEMENT AT RS. 6,29,53,213/- AND MADE ADDITION ON ACCOUNT ITA NO. 770/BANG/2019 PAGE 2 OF 3 OF DIFFERENCE IN THESE TWO AMOUNTS OF RS. 27,70,335/-. THEREAFTER HE SUBMITTED THAT LD. CIT(A) HAS NOTED ON PAGE NO. 6 OF HIS ORDER THAT THE ASSESSEE HAS FILED A RECONCILIATION STATEMENT IN WHICH IT IS STATED THAT SOME INVOICES OF LAST YEAR WERE TAKEN IN FORM 26AS IN THE PRESENT YEAR TO THE EXTENT OF RS. 63,22,284/- AND SOME INVOICES OF THE PRESENT YEAR WERE NOT REFLECTED IN FORM NO. 26AS AND IT WILL REFLECT IN THE NEXT YEAR AND BECAUSE OF THESE TWO REASONS, THERE IS NET DIFFERENCE OF RS. 27,70,335/-. THEREAFTER IT WAS POINTED OUT THAT THE RECONCILIATION STATEMENT SUBMITTED BY THE ASSESSEE BEFORE THE AO AND LD. CIT(A) WERE NOT ACCEPTED BY THE AUTHORITIES BELOW ON THIS BASIS THAT THE INVOICES RAISED ARE NOT SIGNED BY THE AUTHORIZED SIGNATORIES AND SOME OF THE INVOICES DONT HAVE AN INVOICE NUMBER NOR DETAILS OF BUYERS ORDER NO, SUPPLIERS REFERENCE NUMBER AND DISPATCH DOCUMENT NUMBER. HE SUBMITTED THAT ON THIS BASIS, IT CANNOT BE SAID THAT AN INCOME HAS TO BE TAXED TWICE IN THE PRECEDING YEAR WHEN THE ASSESSEE OFFERED THE SAME IN THE P&L ACCOUNT BUT IT WAS NOT REPORTED BY THE CUSTOMER IN THE FORM NO. 26AS AND IN THE PRESENT YEAR AGAIN, WHEN THE CUSTOMER HAS REPORTED IN FORM NO. 26AS BUT OBVIOUSLY IT WAS NOT ACCOUNTED BY THE ASSESSEE IN THE PRESENT YEAR BECAUSE IT WAS ALREADY ACCOUNTED FOR IN THE PRECEDING YEAR. AT THIS JUNCTURE, THIS PROPOSITION WAS PUT FORWARD BY THE BENCH THAT THE MATTER MAY BE RESTORED BACK TO THE FILE OF LD. CIT(A) FOR FRESH DECISION WITH THE DIRECTION THAT THE ASSESSEE SHOULD ESTABLISH WITH EVIDENCES THAT THIS AMOUNT OF RS. 63,22,284/- FOR WHICH CREDIT IS APPEARING IN FORM 26AS BUT CREDIT IS NOT APPEARING IN THE P&L ACCOUNT OF THE PRESENT YEAR WAS ACTUALLY ACCOUNTED BY THE ASSESSEE IN THE PRECEDING YEAR AND THE AMOUNT OF RS. 35,51,949/- FOR WHICH THERE IS NO CREDIT APPEARING IN THE PRESENT YEAR IN FORM 26AS BUT CREDIT IS APPEARING IN THE BOOKS OF THE ASSESSEE AND SUCH CREDIT IN FORM 26AS IS APPEARING IN THE NEXT YEAR. IF THE ASSESSEE CAN ESTABLISH THESE CLAIMS BY FILING COGENT EVIDENCES, THEN SUCH EVIDENCES CANNOT BE REJECTED MERELY ON THIS BASIS THAT THE INVOICES ARE NOT SIGNED BY THE AUTHORIZED SIGNATORIES AND SOME OF THE INVOICES DONT HAVE AN INVOICE NUMBER NOR DETAILS OF BUYERS ORDER NO, SUPPLIERS REFERENCE NUMBER AND DISPATCH DOCUMENT NUMBER ETC. BECAUSE EVEN IF THERE IS SOME SHORTCOMING IN THE INVOICES, THE AMOUNT CANNOT BE TAXED TWICE. THE LD. CIT(A) SHOULD CONSIDER THIS ASPECT ON THE BASIS OF EVIDENCES TO BE BROUGHT ON RECORD BY THE ASSESSEE AND THEREAFTER, ITA NO. 770/BANG/2019 PAGE 3 OF 3 HE SHOULD DECIDE THE ISSUE AS PER LAW BY WAY OF A SPEAKING AND REASONED ORDER. BOTH SIDES AGREED TO THIS PROPOSITION. HENCE, WE ORDER ACCORDINGLY AND RESTORE THE MATTER TO CIT (A) FOR A FRESH DECISION IN THE LIGHT OF ABOVE DISCUSSION AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING HEARD TO BOTH SIDES. GROUND NO. 2.1 IS ALLOWED FOR STATISTICAL PURPOSES. 4. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE. SD/- SD/- (PAVAN KUMAR GADALE) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 20 TH SEPTEMBER, 2019. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.