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TMI Blog2022 (11) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee filed at the time of original assessment for the amount of actual advances received from customers is as per the audited balance sheet of the assessee. We also find merit in the argument of the Ld. AR that the customers advances carried over year after year and it is the consolidated list of advances as on balance sheet date is done in the liabilities side of the balance sheet. The advances may comprise of earlier advances also. Considering the same, the Ld. CIT(A) has rightly calculated the advances for the current year being the difference between the customer advances of AYs 2010-11 and 2011-12. We therefore find that the Ld. CIT(A) has rightly considered the current year advances and estimated the profit @ 6% based on the declared profits by the assessee, which were not disputed by the Ld. AO in the earlier years. We therefore find no interference is required in the order of the Ld. CIT(A) on this ground and accordingly, this ground raised by the Revenue is dismissed. Taxing of unrecorded incentives - HELD THAT:- We find from the submissions made by the Ld. AR that a reconciliation statement has been provided before the Ld. Revenue Authorities. Howe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvey operation U/s. 133A was carried out on 16/12/2015 in both the business premises. The liabilities claimed by the assessee were examined during the survey operations and the assessee was requested to furnish the complete details of the liabilities appearing in the balance sheet. Consequently, the assessee field a letter on 15/2/2016 claiming the liabilities as customer advances and these advances are shown as sales in the subsequent assessment year. Ld. AO not convinced with the replies of the assessee made addition of unproved liability of Rs. 5,68,36,317/- and unrecorded incentives of Rs. 22,31,200/- to the total income admitted by the assessee. Aggrieved by the order of the Ld. AO, assessee filed an appeal before the Ld. CIT(A), Visakhapatnam. The Ld. CIT(A) after considering the submissions made by the assessee with respect to the advances from customers and with respect to the incentives provided by TVS Motors, partly allowed the appeal. The Ld. CIT(A) considering the difference between the advances from the previous year to the current year as unaccounted sales and computed the income and at 6% on unaccounted sales. Similarly, the Ld. CIT(A) also accepted the reconciliatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ility of AY 2009-10 instead of considering the liability pertaining to the immediately preceding year i.e. AY 2010-11 which is Rs. 3,32,06,534/- while arriving at the above difference. 6. As the assessee did not establish that the unproved liabilities were indeed considered by it while recognizing revenue either during the current year or in other years, the CIT(A) is not correct in deleting the addition relating to such unproved liabilities. 7. As the assessee, during the Assessment proceedings did not reconcile fully the incentives received from TVS motors with those recorded in its books of account, it failed to prove that there is no concealment of income. Thus, on the basis of a reconciliation statement produced by the assessee during the appellate proceedings and hold there is an unreconciled difference of Rs. 1,34,716/- only the Ld. CIT(A) instead of calling for a remand report to verify the correctness of assessee's submissions, erred in allowing the assessee's claim and restricting the addition to Rs. 1,34,716/-. 8. Any other ground or grounds that may arise during the appellate proceedings. 4. The Ld. Departmental Representative [Ld. DR] relied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so. Considering the same, the Ld. CIT(A) has rightly calculated the advances for the current year at Rs. 1,64,21,541/- being the difference between the customer advances of AYs 2010-11 and 2011-12. The Ld. CIT(A) in para 5.4 has recorded his findings which reads as follows: 5.4. I have considered the submissions made by the AR and also gone through the AO's assessment order. The appellant contested the addition of Rs. 5,68,36,317/- by explaining that the amount shown in the customers advances are nothing but sales and only the profit at 6% has to be worked out for levying tax. I have examined the details and explanations filed by the appellant and found that the explanation of the appellant is acceptable and therefore, the addition of Rs. 5,68,36,317/- is hereby deleted. However, the profit at 6% on such advances have to be added to the income declared which worked out to Rs. 9,85,292/-. This estimation of 6% was on the amount of Rs. 1,64,21,541/- representing the difference between B/f customers advances of the AY 2009-10 and customer advances of this year 2011-12 (Rs. 5,68,36,318 - Rs. 4,04,44,776). Hence, this profit of Rs. 9,85,292/- shall be considered in place of unp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismiss the appeal of the Revenue. 10. In the result, appeal filed by the Revenue is dismissed. I.T.A. No. 470/Viz/2018 (Assessment Years: 2012-13) 11. In this appeal the Revenue has raised the identical grounds to that of the grounds raised in its appeal for the AY: 2011-12. Therefore, our decision given on the issues raised in the appeal ITA No. 469/Viz/20218, applies mutatis mutandis to the issues raised in the instant appeal also. Accordingly, the grounds raised by the Revenue are dismissed. 12. In the result, appeal filed by the Revenue is dismissed. C.O. Nos. 26 30/Viz/2020 (In I.T.A. No. 469 470/Viz/2018) (Assessment Years: 2011-12 2012-13) 13. The Cross Objections raised by the assessee are in support of the decision taken by the Ld. CIT(A). While adjudicating the Revenue's appeals on merits, we find no interference is required in the order of the Ld. CIT(A). Accordingly, there is no need to adjudicate the grounds raised by the assessee in its cross objections. Thus, the adjudication of the Cross Objections become infructuous, and they are dismissed as such. 14. In the result, Cross Objections raised by the assessee are dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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