2014 (2) TMI 80

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..... pt and those advances are offered as income in the year of distribution of film rights - The film was not released in the previous year, therefore, the assessee could not give rights to Shri.O.G. Krishnam Raju during the previous year and no income arose to the assessee during the previous year - This film was released in the succeeding previous year and the exhibition rights were given in favour .....

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..... ess and genuineness of the transaction?" 2. The respondent/assessee filed return of income admitting a total income of Rs.1,78,132/- for the assessment year 2006-07. During the course of the assessment proceedings, the Assessing Officer found certain cash and credit entries in the cash book. The assessee filed a confirmation letter from M/s.Sri Venkateswara Pictures owned by one Sri.O.G.Krishnam .....

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..... e the Tribunal and submitted that the Tribunal failed to see that the confirmation letter filed by the assessee did not contain even the pan number and therefore, it cannot be considered as a sufficient proof of the credit. 4. The first Appellate Authority pointed out that the assessee was an individual in the business of production and distribution of films. The assessee contended before the fi .....

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..... n its cash book had been offered as income in the subsequent year and the assessee had also provided confirmation letter in this regard. The first Appellate Authority after taking note of these facts pointed out that the assessee was consistently following the mercantile system of accounting, wherein advances received for distribution are treated as liabilities in the balance sheet in the year of .....

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..... reason to disbelieve the confirmation letter given by the said O.G.Krishnam Raju and as pointed out by the first Appellate Authority, the assessee was consistently following mercantile system of accounting, wherein advances received for distribution are treated as liabilities in the balance sheet in the year of receipt and those advances are offered as income in the year of distribution of film r .....

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