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TMI Blog2016 (8) TMI 1354X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the business of trading of Hero Vehicles and spares in the name of proprietary-concern by name Shraddha Motors. Assessee electronically filed her return of income for AY 2010-11 on 24/09/2010 declaring total income of Rs. 94,85,510/-. The case was selected for scrutiny and thereafter assessment was framed u/s. 143(3) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") vide order dated 17/12/2012 and the total income was determined at Rs. 1,30,35,510/-. Aggrieved by the order of the Assessing Officer (AO), assessee carried the matter before the ld.CIT(A), who vide order dated 08/08/2013 (in Appeal No.CIT(A)-VI/134/Cir.3/12-13) granted partial relief to the assessee. Aggrieved by the order of ld.CIT(A), Revenue is now in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see. The submission of the assessee that the deposits were interest-free and refundable deposits received from her sub-dealers and were not income was not found acceptable to the AO. Thereafter, out of the total deposits, the deposit of Rs. 35,50,000/- which was received by the assessee during the year was considered by the AO to the income of the assessee and accordingly added to the total income. Aggrieved by the order of AO assessee carried the matter before the ld.CIT(A) who deleted the addition by holding as under:- "4.3. The Contentions of the Id. A.R. are that the appellant is carrying on the business directly as well as through authorized representative dealers (ARDs) appointed by the appellant and sales service providers (SSPs) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d SSPs at different locations, appellant received ad-hoc amounts by way of security deposits. These amounts have nothing to do with the actual market price of the vehicle. As and when the sale takes place through the ARDs and SSPs, appellant admits the sales proceeds in the books of accounts and refunds the corresponding security deposits to the ARDs and SSPs. This method has been consistently followed over the years. As seen from the assessment order u/s.143(3) passed in the appellant's case for the immediately preceding A.Y. 2009-10, the income returned was accepted and no addition in respect of trade deposits received was made. Treating the security deposits as sale proceeds without the actual sales taking place is against the princi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that as and when the sales take place through ARDs and SSPs, the sale proceeds are accounted as income by the assessee and this method of accounting has been consistently followed by the assessee and has also been accepted by the Revenue in the scrutiny proceedings. He has further noted that during the year under consideration assessee had received trade deposits of Rs. 35.5 lacs and has repaid Rs. 26 lacs out of it and in effect the net trade received by the assessee during the year was only to the tune of Rs. 9.5 lacs. Under these circumstances, ld.CIT(A) had deleted the addition. Before us, Revenue has not placed any material to controvert the findings of ld.CIT(A). In view of the aforesaid facts, we see no reason to interfere with the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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