2014 (1) TMI 913 - AT - Income Tax

Deletion made on account of suppressed receipts Held that - The addition has been made by the assessing officer by simply holding that assessee - doctor has shown receipts only for five days in a week and not showing receipts on all Saturdays and Sundays of the year - CIT(A) has given relief to the assessee by holding that assessing officer has not been able to bring any evidence on the record to show that assessee-doctor was running his consulting room on Saturdays and Sundays also - the addition has been made by him only on the basis of assumptions and surmises. CIT(A) found that assessee during the assessment proceedings gave several evidences in the form of files of the patients managed by him and the prescriptions issued by him to his patients to show that the assessee-doctor was available for consultation only from Monday to Friday - As far as the medicines prescribed by the assessee-doctor on Saturdays and Sundays it was explained that those medicines were only for the patients who were admitted in his hospital and have nothing to do with his consulting receipts as he was not giving medicines along with prescriptions to his patients - The offer of the doctor to the assessing officer was not accepted by him to depute a person to verify whether his consulting room is open for five days only or for all 7 days of the week - The assessing officer without bringing anything on record to show that assessee was giving consultations to his patients on Saturdays and Sundays also have gone to make the addition was not sustainable in law - CIT(A) has rightly deleted the addition Decided against Revenue.

Summary

Issues:
Appeal against CIT(A) order for assessment years 2006-07 & 2007-08; Addition of Rs. 10,12,859/- for suppressed receipts.

Analysis:
The appeals were filed by the Revenue against the CIT(A) order for the assessment years 2006-07 & 2007-08. The assessing officer observed that the doctor- assessee did not show consulting receipts income on Saturdays and Sundays, suspecting suppression of receipts. The assessing officer made an addition of Rs. 10,12,859/- based on the average professional receipts per day. The CIT(A) considered the doctor's submissions, including evidence of illness and discontinuation of practice, and deleted the addition. The CIT(A) noted that the assessing officer did not reject the books of accounts, making the estimation of gross receipts unsustainable. The CIT(A) found no substance in the assessing officer's contention and held that the addition was based on assumptions and surmises.

The Revenue appealed the CIT(A) decision. During the hearing, the Departmental Representative supported the assessing officer's order, while the doctor filed written submissions. The ITAT found that the assessing officer made the addition merely on the basis that the doctor showed receipts for five days a week, not on all Saturdays and Sundays. The ITAT agreed with the CIT(A) that there was no evidence to show that the doctor was working on weekends. The ITAT upheld the CIT(A)'s decision, noting that the doctor provided evidence during assessment proceedings to demonstrate his availability for consultation only from Monday to Friday. The ITAT also clarified that the medicines prescribed on weekends were for hospitalized patients, not for consulting receipts. The ITAT concluded that the assessing officer's addition was unfounded and not sustainable in law, affirming the CIT(A)'s deletion of the addition.

In conclusion, both appeals filed by the Revenue were dismissed, upholding the CIT(A)'s decision to delete the addition of Rs. 10,12,859/- for suppressed receipts.