9911796707
TMI Blog2019 (12) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... issue to the file of the Assessing Officer for fresh consideration. The grounds of appeal of the assessee are partly allowed for statistical purposes. - ITA No.520/Coch/2019 - - - Dated:- 29-11-2019 - S/Shri Chandra Poojari, AM And George George K., JM For the Assessee : Shri Kalpesh Shah, CA For the Revenue : Smt. A.S. Bindhu, Sr. DR ORDER PER CHANDRA POOJARI, AM: This appeal filed by the assessee is directed against the order of the CIT(A), Kochi dated 26/07/2019 and pertains to the assessment year 2012-13. 2. The assessee has raised the following grounds of appeal: 1. Confirming rejecting of the Books of Account by Assessing Officer invoking the provisions of section 145(3) of the Act. 2. Confirming action of Assessing Officer passing the order u/s. 144of the Act, clearly overlooking the fact of documents submitted before the Ld. CIT(A) and various details and documents having been furnished before the Assessing Officer and when called for including: 3. Sustaining the addition of ₹ 28,98,540/- by est ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Other direct Expenses 482550.8 13,69,473 1852023.8 Gross Profit 3617213.7 56,800 56,800 52,01,460.7 It was explained that there were some discrepancy in the audited accounts filed and informed that the actual gross receipt and expenses shown in the P L account was not correct, the actual receipt and expenses was less than the amount shown in the audited P L a/c. The Ld. AR contended that the actual turnover and expense range of 8 crs to 7 Crs. The assessee was asked to identify the area in which discrepancy occurred but they were not able to explain or identify entries in which duplication occurred or to a file a statement showing he same but only produced ledger copy of some account heads stating that the entries are cross verifiable. 3.1 The assessee had not filed a revised P L a/c audited balance sheet and also not able to explain a large part of exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee had earned resultant gross Handling Charges income aggregating to ₹ 47,69,800/-, which had been credited to the Profit and Loss account.. It was submitted that as part of the normal business activities, the assessee had inter alia incurred various expenses like Customs duty, Bonded warehouse charges, Shipping line charges, CFS Port charges, Custodian charges etc. and these were incurred (and paid for) for and on behalf of its clients and they were accordingly subjected to claims of reimbursement from the respective clients, which was done by raising debit notes. The assessee submitted that instead of netting off these two against each other, the expenses so incurred were charged to the Profit Loss account, whereas the corresponding reimbursement claims were credited to the Profit Loss account which was done for the sake of transparency and proper disclosure in the Audited financials. 5.1 According to the Ld. AR, the aggregate reimbursement credits appear on the credit side of the Profit and loss account at ₹ 12,58,39,057/-, while corresponding reimbursement expenses incurred amounting to ₹ 12,54,07,397/- appear on its debit side ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. AR emphasized that the same is tax neutral, as such inadvertent overstatements clearly appear on both the sides of the Profit Loss account thus naturalizing its effect. 5.5 In view of the above, the Ld. AR requested the Tribunal to estimate the income on the basis of the actual gross receipt and handling charges which can have an element of profit embedded therein and after excluding the receipts on account of reimbursements and dispose the matter on merit. The Ld. AR relied on the decision of the ITAT, Delhi in the case of Jaquar Enterprises vs. DCIT 48 taxmann.com 19 where in the Assessing Officer had charged 8% profit on reimbursement of Godown rent, which was deleted by CIT(A) and upheld by the Tribunal. The Ld. AR also relied on the ITAT, Mumbai in the case of M/s. Helios Logistics vs. ITO in ITA No.1032/Mum/2015 wherein it was held that in case of custom house/clearing and forwarding agent, reimbursement was not part of turnover. The Ld. AR also relied on the ITAT, Cochin in the case of ACIT vs. St. Mary s Rubbers Pvt. Ltd. in ITA No. 224/Coch/2016 wherein it was observed that reimbursement of expenses incurred by clearing agencies on behalf of the clie ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
