Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2024 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (2) TMI 1332 - ITAT DELHIScope of Limited Scrutiny - Accrual of income - Addition towards advance fees and deposits from old students - AO attempt to convert limited scrutiny into complete scrutiny - HELD THAT:- AR before us made a statement from the Bar that similar accounting treatment of advance fees and deposits from old students done by the assessee was duly accepted by the revenue in the earlier years even in scrutiny assessment proceedings and that there was no change in factual matrix during the year when compared to earlier years. Even in AY 2015-16, the treatment of the same in the books of accounts was accepted by the ld. AO u/s 143(3) proceedings dated 18.12.2017. In any event, he also stated that the entire issue is revenue neutral as assessee has been consistently following the practice of offering the earlier advance fees to income and whatever fee that is received for the period beyond the financial year is treated as advance fees, which would become income in the succeeding year. DR could not bring any contrary material to this argument. We find that CIT(A) had elaborately dealt with the issues in dispute and had granted relief to the assessee both on legal issue as well as on merits. As per the scheme of the Act, AO if he desires to convert limited scrutiny into complete scrutiny, he has to obtain prior permission from the competent authority to do so and only then could assume jurisdiction to examine other issues. In the instant case, the same was admittedly not done by the AO. CIT(A) was duly justified in quashing the additions made by the ld. AO on this ground. CIT(A) had elaborately given a categorical finding that the income had been properly accounted and offered by the assessee in accordance with the provisions of the Act and there is no scope for making any addition even on merits. Appeal of the revenue is dismissed.
|