2013 (10) TMI 779 - AT - Income Tax

Addition on account of In-Patient Credit Held that - Assessee has generated two bills, one at the time of admission of the patient for utilities and another at the time of discharge of the patient. The claim of the assessee that the bills generated at the time of admission for utilities was also included in the discharge bill of the patient. This contention of the assessee needs to be examined after verifying the bills generated at the time of admission of the patient and the bill generated at the time of discharge from the hospital and the total receipt claimed by the assessee - Assessing officer is also an officer empowered to verify the bills and complete the assessment under the Income-tax Act. Therefore, if there is any specific allegation against the assessing officer it is open to the assessee to bring the same to the notice of the higher authorities in the Income-tax department. In the assessment proceedings, the services of the assessing officer can not be excluded. The assessing officer is also an authority established under the provisions of Income-tax Act. This Tribunal being a second appellate authority cannot verify each and every bill, unless the same is verified by the original authority, i.e. the assessing officer. Since the assessee has not filed any reconciliation statement with regard to in-patient credit either before the assessing officer or before the CIT(A), this Tribunal is of the considered opinion that the matter needs to be verified by the assessing officer - Assessing officer is directed to verify the entire bills and vouchers, that may be produced by the assessee in a fair manner, without any bias and undue influence.

Summary

Issues:
Addition of I.P. credit for assessment years 2007-08 to 2009-10.

Analysis:
The judgment by the Appellate Tribunal ITAT COCHIN, delivered by N. R. S. Ganesan (JM), addressed the appeals by both the revenue and the assessee against the CIT(A)'s order for the assessment years 2007-08 to 2009-10. The primary issue under consideration was the addition of specific amounts towards I.P. credit for each assessment year. The assessee contended that there was a duplication of utility bills in the patient's individual bills, as the bills generated at admission were also accounted for at discharge. The senior counsel for the assessee argued that the assessing officer had erroneously included the same amount twice, leading to a double addition. The counsel provided detailed examples from the bills to support this claim. However, the Departmental Representative (DR) highlighted the absence of a reconciliation statement by the assessee before the assessing officer, emphasizing the need for verification to rectify any potential double addition. The DR stressed that the assessing officer should examine the explanation provided by the assessee regarding the alleged double addition.

The Tribunal carefully considered both parties' submissions and examined the available evidence. It acknowledged the possibility of the utility bills being included twice in the patient's bills and deemed it necessary to verify the bills generated at admission and discharge, along with the total receipts claimed by the assessee. Despite the assessee's concerns about receiving justice from the assessing officer, the Tribunal emphasized the assessing officer's authority to verify bills and conduct assessments under the Income-tax Act. As the assessee had not submitted a reconciliation statement regarding the in-patient credit, the Tribunal concluded that the matter should be verified by the assessing officer to ensure a fair assessment process. The Tribunal directed the assessing officer to examine all bills and vouchers provided by the assessee impartially, warning against any bias or undue influence. Consequently, the Tribunal set aside the lower authorities' orders on in-patient credit and remanded the issue back to the assessing officer for thorough verification and a lawful decision after granting the assessee a reasonable opportunity.

In the final decision, both the appeals of the assessee and the revenue were allowed for statistical purposes, while the cross objections of the assessee were dismissed. The judgment emphasized the importance of fair verification by the assessing officer to ensure a just resolution regarding the addition of I.P. credit for the relevant assessment years.