The ACIT, Circle-5, Surat V. M/s. Technocrat Consultants, Surat

ITA 990/AHD/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 5996 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-04-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 04-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: S N DIVETIA

Judgement Text

, , , , B, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, B BENCH . .. . . .. . , !' !' !' !', , , , #$ %&'( #$ %&'( #$ %&'( #$ %&'(, , , , )* + ) ' )* + ) ' )* + ) ' )* + ) ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND ANIL CHATURVEDI, ACCOUNTANT MEMBER) ITA NO.990/AHD/2011 [ASSTT.YEAR : 2006-2007] ACIT, CIR.5 SURAT. /VS. M/S.TECHNOCRAT CONSULTANTS 1 ST FLOOR, PANDOL CHAMBERS B-4, GANDHI SMRUTI BHAVAN NANPURA, SURAT. ( (( (-. -. -. -. / APPELLANT) ( (( (/0-. /0-. /0-. /0-. / RESPONDENT) + 1 2 )/ REVENUE BY : SHRI P.L. KUREEL, SR.DR 4& 1 2 )/ ASSESSEE BY : SHRI S.N. DIVETIA 5 1 &(*/ DATE OF HEARING : 2 ND APRIL, 2014 678 1 &(*/ DATE OF PRONOUNCEMENT : 02-05-2014 )9 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2006-2007 IS DIRECTED AGAIN ST THE ORDER OF THE CIT(A). 2. THE ONLY GROUND OF THE APPEAL OF THE REVENUE IS AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD.CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.14,01,447/- MADE ON ACCOUNT OF SUPPRESSION RECEIPT OF THE IT AC T. ITA NO.990/AHD/2011 -2- 3. THE LEARNED DR HAS REFERRED TO PARA 4.1 ONWARDS OF THE ASSESSMENT ORDER IN SUPPORT OF THE CASE OF THE REVENUE. HE SU BMITTED THAT AS PER THE TDS CERTIFICATE, THE ASSESSEES RECEIPT WERE RS.57 LAKHS WHEREAS THE ASSESSEE HAS SHOWN TOTAL RECEIPT OF RS.42,98,553/- FROM M/S.HINDALCO INDUSTRIES LTD. (HIL FOR SHORT), THEREFORE, DIFFE RENCE OF RS.14,01,447/- WAS RIGHTLY TREATED AS UNDISCLOSED INCOME OF THE AS SESSEE. HE RELIED ON THE ORDER OF THE AO. THE LEARNED COUNSEL FOR THE ASSE SSEE HAS OPPOSED THE SUBMISSIONS OF THE LEARNED DR. HE SUBMITTED THAT T HE ASSESSEE WAS FOLLOWING CASH SYSTEM OF ACCOUNTING, AS IS CLEARLY MENTIONED IN ITS TAX AUDIT REPORT AND THE DIFFERENCE AROSE BECAUSE OF H IL MAINTAINS ITS BOOKS OF ACCOUNTS ON MERCANTILE BASIS AND HAVING DEDUCTED TAX AT SOURCE FROM FEES ON TECHNICAL SERVICES PAYABLE TO THE ASSESSEE ON ACCRUAL BASIS. THE ASSESSEE HAS SUBMITTED RECONCILIATION STATEMENT AND DIFFERENCE AMOUNT WAS RETENTION MONEY AND ALSO RECEIPTS AND PAYMENTS WERE PROPERLY RECONCILED. HE HAS RELIED ON THE ORDER OF THE CIT(A). 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND HAVE PE RUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT THE CIT(A) HAS GIVEN A FINDING THAT IT HAS BEEN CERTIFIED BY THE TAX AUDITORS THAT THE ASSESSEE WAS HAVING CASH SYSTEM OF ACCOUNTING. THE RECONCILIATION STAT EMENT WAS FILED WITH REGARD TO THE RECEIPTS AND PAYMENTS WHICH WERE PROP ERLY RECONCILED. THE CIT(A) HAS OBSERVED THAT MONEY HAS BEEN RETAINED BY THE PRINCIPAL I.E. HIL. IN THESE FACTS AND CIRCUMSTANCES, THE CIT(A ) HAS DIRECTED THE AO TO WITHDRAW THE CREDIT OF TDS GRANTED TO THE ASSESS EE TO THE EXTENT IT PERTAINED TO INCOME NOT OFFERED FOR TAX, AND THE AD DITION MADE WAS DELETED. THERE BEING NO MISTAKE IN THE ORDER OF THE CIT(A) O N THIS ISSUE, AS THE DIFFERENCE AMOUNT WAS RETENTION MONEY WITH THE PRIN CIPAL HIL AND THE ASSESSEE WAS FOLLOWING CASH SYSTEM OF ACCOUNTING, A ND THAT THE CIT(A) HAS DIRECTED THE AO TO WITHDRAW THE CREDIT OF TDS GRANT ED TO THE ASSESSEE TO ITA NO.990/AHD/2011 -3- THE EXTENT IT PERTAINS TO THE INCOME NOT OFFERED FO R TAX, AND ACCORDINGLY, THE ORDER OF THE CIT(A) ON THIS ISSUE IS CONFIRMED, AND THE GROUND OF THE APPEAL OF THE REVENUE IS DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( %&'( %&'( %&'( %&'( / ANIL CHATURVEDI) )* + )* + )* + )* + /ACCOUNTANT MEMBER ( .. /G.C. GUPTA ) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD