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TMI Blog2016 (5) TMI 1604X X X X Extracts X X X X X X X X Extracts X X X X ..... dents. In the process the Ld. CIT(A) has confirmed the addition of Rs. 15,28,270/- which was never reached to the assessee as income as it was diverted at source only. The Ld. CIT(A)'s finding be quashed allowing the claim of the assessee. 3. On the facts and circumstances of the case and in law the Ld. CIT(A) was not justified in confirming the addition made by the A.O. of Rs. 1,78,77,487/- on the parity of reasoning that the assessee-company failed to account for the income comprised in TDS certificates which reasoning was upheld by Ld. CIT(A) observing "Though TDS credit is appearing in F. No. 26AS statement corresponding income is not shown by the appellant." The Ld. CIT(A) observed contrary to the provisions of law and judicial precedents placed before him. The addition confirmed by him be quashed. 4. On the facts and circumstances of the case and in law in the process the income which was not 'real income' got taxed because of order of the Ld.CIT(A). It be held accordingly. 5. On the facts and circumstances of the case and in law the levy of interest u/s. 234A, 234B and 234C is not justified. 6. The appellant craves/leave to add, amend or alter any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant company vide letter dated 02.09.2009 which was received by the Police Authorities on 03.09.2009 as per notings made in Kannada language at Hebbagodi Police Station at Bangalore. In this complaint, it has been claimed that ex-employee Shri E. Srinivas has cheated the company to an extent of Rs. 25 lacs during the F.Y. 2003-2006. Thereafter, deed of settlement was arrived at on 08.09.2009 as per which Rs. 25 lacs was paid by Shri. E. Srinivas to the company as stated in the reply of the appellant. The appellant claims that embezzlement was to the tune of Rs. 40,28,270/- out of which Rs. 25,00,000/- was received and therefore balance amount of Rs. 15,28,270/- was business loss which should be allowed. The appellant claims that the matter came into notice of the appellant company in A.Y. 2009-10 i.e. F.Y. 2008-09 is also not supported by the fact as the reconciliation shows receipt of Rs. 25,00,000/- which was received by the appellant in A.Y. 2010-11 i.e by deed of settlement dated 08.09.2009. Accordingly, from the analysis of fact it emerges that-- (i) Claim of embezzlement of Rs. 40,28,270/- is not substantiated as Police Complaint was made only for Rs. 25 lacs which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceived as per Form 26AS has been reflected in the books of account and if not the reason for the same. From the various details furnished by the assessee the AO noted that the income of the assessee is short to the extent of Rs. 1,78,77,487/- in comparison to the figures in Form 26AS. He, therefore, asked the assessee to give the reasons for the huge difference in the income credited as per Form 26AS supplied to the assessee and entries in the books of account. The assessee gave only the comparison but no explanation was given as to why the amount offered was less than the amount stated in Form 26AS. The AO, therefore, again asked the assessee to give proper reasons explaining the difference with documentary evidence. 10. It was submitted that some of the customers have verbally informed the assessee that there might be mistake from their side in feeding sales value against PAN Numbers of customers and same might have been uploaded for which the TDS return might have gone wrong. It was submitted that the accounts of the company are audited under the Companies Act and under the Income Tax Act with confirmation from customers on test check basis every year. It was submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the extent of TDS credit shown in 26AS statement meaning thereby that TDS credit has been claimed without showing corresponding income. This is not permissible as credit of TDS can be claimed only in the year, income is offered. The AO has accepted the credit for TDS but added the corresponding income in absence of proper reconciliation. The general explanation for such discrepancy filed by the appellant can be appreciated in respect of minor discrepancies but not in respect of amount of Rs. 1,78,77,487/- which is quite a substantial amount. Therefore, I do not find any merit in the submissions of the appellant. The appellant has relied upon certain case laws. The same are distinguishable in the sense that the same pertains to allowing credit of TDS on the basis of TDS certificates in case of mismatch. In this case the issue is different. Though TDS credit is appearing in Form 26AS statement, corresponding income is not shown by the appellant. Therefore, reliance on the above case laws is misplaced and the ground is dismissed." 13. Aggrieved with such order of the CIT(A) the assessee is in appeal before us. 14. The Ld. Counsel for the assessee submitted that there are more than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as reflected in Form 26AS on which TDS has been made and that the same has been offered to tax. Merely by stating that the number of accounts are more than 2500 and it will take substantial time for reconciliation cannot be the basis for deleting the addition. The assessee has to conclusively prove that the amounts reflected in Form 26AS has been recorded in the books of account of the assessee either during the current year or in the preceding or succeeding year. He could have also filed confirmation from the concerned parties that the amount entered by them in Form 26AS is incorrect and the correct amount is something else. Only when proper reconciliation is made then only the revenue authorities can consider the same and take proper decision. Since in the instant case the assessee failed to discharge the onus cast on it despite sufficient opportunities granted at various levels, therefore, the addition made by the AO and sustained by the CIT(A) has to be upheld. 17. The decision of Mumbai Bench of the Tribunal relied on by the Ld. Counsel for the assessee in the case of Varsha G. Salunke (Supra) is not applicable to the facts of the present case. In that case the assessee has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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