Avdhut Vasant Ghodgaonkar, Jalgaon V. ACIT, Circle -1, Jalgaon

ITA 954/PUN/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9865 (ITAT-PUNE)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-12-2019
• Assessment Year: 2015-2016
• Appeal Filed On: 01-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V.K. SINGH
• Assessee Lawyers: SANJAY TUPE
• Keywords: TDS

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI R.S. SYAL, VICE PRESIDENT . / ITA NO.954/PUN/2019 / ASSESSMENT YEAR : 2015-16 AVDHUT VASANT GHODGAONKAR, PLOT NO.4, SANSKRUTI BUNGLOW, SURVEY NO.478 1B2, TELEPHONE NAGAR, JALGAON 425 002 PAN : ABCPG6485C VS. ACIT, CIRCLE-2, JALGAON (APPELLANT) (RESPONDENT) / ORDER PER R.S.SYAL, VP : THIS APPEAL BY THE ASSESSEE ARISES OUT OF THE ORDER PASSE D BY THE CIT(A)-2, NASHIK ON 22-04-2019 IN RELATION TO THE ASSESSMENT YEAR 2015-16. 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAINST THE CONFIRMATION OF THE ADDITION OF RS.10,03,332/-, WHICH WAS TH E AMOUNT OF PROVISION OF INCOME-TAX WRITTEN BACK BY THE ASSESSEE TO HIS CAPITAL ACCOUNT. APPELLANT BY SHRI SANJAY TUPE RESPONDENT BY SHRI V.K. SINGH DATE OF HEARING 03-01-2020 DATE OF PRONOUNCEMENT 03-01-2020 ITA NO. 954/PUN/2019 AVDHUT V. GHODGAONKAR 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSE E CREDITED HIS CAPITAL ACCOUNT WITH A SUM OF RS.10,03,332/- ON ACCOUNT OF REVERSAL OF PROVISION FOR TAX. ON BEING CALLED UPON TO EXPLAIN THE REASONS FOR CREDITING THE CAPITAL ACCOUNT, THE ASSESSEE SUBMITTED THAT THE PROVISION CREATED FOR THE EARLIER ASSESSMENT YEARS WAS WRITTEN BACK. NOT SATISFIED, THE ASSESSING OFFICER TREATED THIS SUM AS CASH CREDIT U/S.68 OF THE ACT. HE, THEREFORE, MADE ADDITION FOR THIS SUM, WHICH CAME TO BE SUSTAINED IN THE FIRST APPEAL. 4. HAVING HEARD BOTH THE SIDES AND PERUSED THE RELEVANT MATERIAL ON RECORD, IT IS SEEN FROM THE ASSESSEES ANNUAL ACCOUNTS THAT PROVISION FOR TAX IN THE BALANCE SHEET AS ON 31-03-2014 STOOD AT RS.8,49,832/-. FOR THE YEAR UNDER CONSIDERATION, THE ASSESSEE CREATED A FURTHER PROVISION FOR RS.1,53,506/-. AT THE END OF THE YEAR, THE ASSESSEE R EVERSED THE AMOUNT OF PROVISION FOR TAXATION AND CREDITED THE AMOUNT TO THE CAPITAL ACCOUNT. APART FROM THAT, THERE WAS AN AMOUN T OF ADVANCE TAX/TDS APPEARING IN THE ASSESSEES BALANCE SH EET, WHICH OUGHT TO HAVE BEEN ADJUSTED AGAINST THE AMOUNT OF PROVISION FOR TAXATION. INSTEAD OF ADJUSTING THE AMOUNT OF ITA NO. 954/PUN/2019 AVDHUT V. GHODGAONKAR 3 PROVISION WITH THE AMOUNT OF TDS/ADVANCE TAX, THE ASSESSEE STRAIGHT AWAY CARRIED THE AMOUNT OF PROVISION FOR TAXATION TO HIS CAPITAL ACCOUNT. THE LD. AR SUBMITTED THAT THE ACCOUNTS HAVE BEEN REVISED AND THE AMOUNT OF ADVANCE TAX/TDS FOR TH E EARLIER YEARS HAS NOW BEEN DEBITED TO THE CAPITAL ACCOUNT OF THE ASSESSEE. SINCE THE AMOUNT OF PROVISION HAS BEEN CREDITED TO THE CAPITAL ACCOUNT BY MEANS OF DEBIT TO THE PROVISION FOR TAXATION ACCOUNT, THERE CAN BE NO QUESTION OF MAKING ADDITION FOR THIS SUM U/S.68 OF THE ACT. IN VIEW OF THE FOREGOING DISCUSSION, I AM SATISFIED THAT THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN TREATING THE CREDIT TO THE CAPITAL ACCOUNT, ARISING FROM THE REVERSAL OF PROVISION OF TAXATION, AS CASH CRED IT U/S.68 OF THE ACT. I, THEREFORE, DELETE THE ADDITION. 5. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 03 RD JANUARY, 2020. SD/- (R.S.SYAL) / VICE PRESIDENT PUNE; DATED : 03 RD JANUARY, 2020 ITA NO. 954/PUN/2019 AVDHUT V. GHODGAONKAR 4 / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. ( ) / THE CIT (APPEALS)-2, NASHIK 4. THE PR. CIT-2, NASHIK 5. , , SMC / DR SMC, ITAT, PUNE; 6. / GUARD FILE. // TRUE COPY // / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE DATE 1. DRAFT DICTATED ON 03-01-2020 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 03-01-2020 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER -- JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. -- JM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. DATE OF UPLOADING ORDER SR.PS 8. FILE SENT TO THE BENCH CLERK SR.PS 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK 10. DATE ON WHICH FILE GOES TO THE A.R. 11. DATE OF DISPATCH OF ORDER. *