9911796707
TMI Blog2017 (8) TMI 414X X X X Extracts X X X X X X X X Extracts X X X X ..... udication.He is directed to afford a reasonable opportunity of hearing to the assessee.First effective Ground of appeal(GOA- 2&3)is decided in favour of the assessee,in part. Credit notes issued to Reach Global Services Ltd (RGSL),an Associated Enterprise (AE) of the assessee - Held that:- The assessee had filed copy of ledger accounts of RGSL considering credit note and final invoice vide letter dtd. 07/12/2011,copy of invoices,copy of credit note dtd. 6/04/2009 issued for ₹ 2,49,73,220/- and confirmation of accounts from RGSL for year under appeal. From the statement it is clear that RGSL had included the credit note of USD $5,53,232 in its books of account and working of final fees receivable from RGSL (Rs.13, 45, 69,123/-). We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05-06 to FY.2008-09 as per TDS certificate and cumulative income offered to tax.During the assessment proceedings,the AO found that there was difference between cumulative income for the period FY.2005-06 to FY.2008-09 as per TDS certificate and cumulative income offered to tax for FY.2005-06 to 2008-09.He directed it to file reconciliation in that regard. Details of the reconciliation of income as per TDS certificates and that as offered to tax by the appellant were submitted vide letters dated 20.10.2011 and 30.11.2011.It was argued that entire income as per TDS certificate has been offered to tax either during the year; in preceding year or subsequent year,that it had claimed TDS credit during the year ;corresponding income which was off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO,after considering the submissions of the assessee, held that the assessee had not shown the income accrued to it for the year under consideration, while filing the return of income. Finally, he made an addition of ₹ 23.95 lakhs to the total income of the assessee. 2.1. Aggrieved by the order of the AO,the assessee filed an appeal before the First Appellate Authority(FAA)and made elaborate submissions.After considering the assessment order and the submissions of the assessee,he confirmed the order of the AO and dismissed the appeal of the assessee. 2.2. During the course of hearing before us,the AR stated that the AO and the FAA had considered the reconciliation filed by the assessee,that there was no justification for makin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per a formulae viz. (Return on costs + Return on assets)-(External customer revenue + ISP revenue + other income),that during the year under appeal the assessee had raised invoices of ₹ 15.76 crores on AE on provisional basis, that on that basis the assessee estimated that the income receivable as per the agreement would be less than the invoices raised,that it issued a credit note of ₹ 2.49 crores,that subsequently it raised an invoice on RGSL for an amount of ₹ 1.91 crores.However,the AO did not accept the credit notes issued for partial reversal of invoices raised on the ground that these credit notes were issued to reduce/suppress the taxable income. 3.1. In the appellate proceedings,the FAA confirmed the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RGSL had included the credit note of USD $5,53,232 in its books of account and working of final fees receivable from RGSL (Rs.13, 45, 69,123/-).We find that all the above facts were not analysed properly by the AO/ FAA during the assessment/appellate proceedings.Therefore,in the interest of justice,we are restoring back the issue to the file of the AO for fresh adjudication.He is directed to decide the issue after affording reasonable opportunity of hearing to the assessee.Second effective ground of appeal (GOA-3) is partly allowed. 4. Next two grounds of appeal deal with addition on account of credit notes issued to Broadband Pacenet (BP)-,amounting to ₹ 52.50 lakhs (GOA-4) and shortfall on account of difference in income offere ..... X X X X Extracts X X X X X X X X Extracts X X X X
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