2016 (10) TMI 1251 - AT - Income Tax

Accrual of income - Additional gross receipts - assessee filed revised computation of income in the course of the assessment proceedings - AO being of the view that it was not reflected in the books of accounts of the assessee added the same to the income of the assessee - DR relying upon the orders of the tax authority submitted that the assessee may need to demonstrate that the return filed could be revised and whether the Revised Computation was accepted by the AO or not - HELD THAT - The record shows that fresh evidence was filed before the CIT(A) and the reliance has been placed on the Remand Report where facts are stated to be accepted however allegation of contradictory statements during the assessment stage are relied upon. As find that the issue needs to decided on the basis of facts and evidences and not necessarily only by an argument advanced before the AO at the assessment stage. As per the record, assessee claims relief on the basis of aforesaid Form 16A stated to be made available to the assessee only on or after 12.10.2012 thus in the original computation these could not be reflected. Since the aspect has not been addressed and examined the impugned order is set aside and the ld.CIT(A) is directed to consider the claim of the assessee addressing the specific document - Appeal of the assessee is allowed for statistical purposes.

Summary

Issues: Assailing correctness of order dated 19.05.2015 of CIT(A)-20, New Delhi regarding 2011-12 assessment year; Addition of ?1,00,835 to returned income on account of additional gross receipts from M/s Sindh Projects Masonary Dam Division; Reconciliation of 26AS with books of accounts; Acceptance of revised computation of income by AO.

Analysis:

1. Assailing correctness of CIT(A) order: The appellant challenged the order of CIT(A)-20, New Delhi for the 2011-12 assessment year. Despite various grounds raised in the appeal, during the hearing, both parties focused on Ground No. 2. This ground pertained to the incorrect addition of ?1,00,835 to the appellant's income, representing TDS on gross receipts from M/s Sindh Projects Masonary Dam Division. The appellant contended that this amount was contested in appeal before CIT(A) as it was duly entered in the books of accounts and turnover.

2. Addition of ?1,00,835 to returned income: The appellant declared an income of ?30,83,170 on 30/09/2011. Due to incomplete information about the deduction made by M/s Sindh Projects Masonry, amounting to ?1,00,835, the appellant filed a revised computation of income during the assessment proceedings. However, the Assessing Officer added this amount to the appellant's income, stating it was not reflected in the books of accounts. The appellant argued that corrections were made in the computation of income and supported this with fresh evidence.

3. Reconciliation of 26AS with books of accounts: The appellant submitted Form No.16A issued by M/s E.E.Sindh Project Masonry Dam Division, indicating the specific amounts deducted. The appellant revised the return based on this information, which was filed before the AO. The appellant contended that the CIT(A) misdirected herself by attempting to reconcile the 26AS with the books of accounts and relying on the original computation of income. The issue required a factual examination based on the evidence presented.

4. Acceptance of revised computation of income by AO: The Senior DR, relying on tax authority orders, raised concerns about the acceptance of the revised computation by the AO. However, she agreed to verify the facts. The Tribunal observed that fresh evidence was submitted before the CIT(A), and the issue needed to be decided based on facts and evidence, not just arguments made during the assessment stage. The order was set aside, directing the CIT(A) to consider the appellant's claim and provide a reasoned conclusion, allowing the appellant a fair opportunity to be heard.

5. Conclusion: The Tribunal allowed the appeal for statistical purposes, emphasizing the need for a detailed consideration of the evidence presented by the appellant. The decision was pronounced on 21st October 2016, setting aside the impugned order and restoring the issue back to the CIT(A) for further examination in accordance with the directions provided.