NESCO LTD ,MUMBAI vs. DCIT, CIRCLE 13(1)(2), MUMBAI

The grounds of appeal are as under: (1) ADDITTION OF RS. 7,06,936/- OF DUTY DRAW BACK U/S 28(iii)(c) OF THE INCOME TAX ACT, 1961

In this case, the only dispute pertains to the addition of Rs of Rs. 7,06,936/- u/s 28(iii)(c) of the Act. It is claimed that the assessee did not receive the impugned income during the year. The assessee before the lower authorities claimed that it was consistently following cash basis of accounting for export incentives which was also accepted by the Department in the preceding assessment years. Accordingly, under the rules of consistency, no notional income could be brought to taxed. It was also argued that the amount was never credited in the books of account as it was not accrued during the year and therefore, could not form part of the total income. The explanation offered by the assessee was rejected by the ld.CIT(A) who upheld the addition on the ground that the CBEC verified data

Before us, the ld.AR has vehemently argued that the authorities below did not examine the reply of the assessee and brushed it aside despite its repeated contentions as no such amount was received nor was taxable during the year.

We have carefully gone through the orders of the authorities below which reveal that the issue in hand has not been examined by the AO in proper perspective and the contentions raised by the assessee before them were not properly appreciated. Therefore, in the interest of justice and fairplay we proposed for remitting the entire matter to the file of the AO for examining it afresh and pass a de novo assessment order. Neither side had any objection to it. Therefore, we order accordingly. Needless to state, he would allow adequate opportunity to the assessee who would make desired compliance before him. Thus, the grounds of appeal are allowed for statistical purposes.

In the result, the appeal of the assessee is allowed for statistical purposes.