DCIT NON CORP CIRCLE2 MADURAI, MADURAI vs. BALASUBRAMANIAN CHANDRADEVI, MADURAI

1. 1. 1. 1. 1. Report filed u/s 44AB of the Act for the PAN: ADWPC2363B and it was furnished only during the appellate proceedings by the assessee apportioning the alleged amount of Rs. 4,31,74,678/- as a part of its Total Sales. (3)The Ld.CIT(A) erred by deleting the addition ofRs.4,3,74,678/- without actually verifying with the records as to whether the amount is accounted for and forms part of the Total Sales under PAN: ADWPC2363B for the relevant year' (4) The Ld. CIT(A) erred by not appreciating the fact that as per audit report u/s 44AB of the Act for PAN: ADWPC2363B for the assessment year 2018-19, the assessee has mentioned that she has employed mercantile system of accounting. That being the case' the assessee ought to have admitted the accrued interest of Rs.44,000/-on the deposits for the assessment year 2018- l9 itself but has not done so' (5) The Ld. CIT(A) erred by deleting interest income of Rs.44,000/- without appreciating the fact that the interest has accrued in the financial year 2O17-18 relevant to the assessment year 2018-18. (6)The Ld' CIT(A)failed to verify the fact with regard to deletion of Rs.44,000/- that though the assessee has claimed that she has applied for surrender of PAN: ABKPC77l1R on 26.1.2007 after a period of eight years of such surrender, the assessee has used the PAN: ABK PC7711R to make deposits in Bank, for which specific information was flagged as per Risk Management Strategy formulated by Central Board of Direct Taxes. (7) For these and such other grounds that may be adduced at the time of hearing and it is prayed that the order of the Ld.CIT(A) may be reversed and that of the Assessing Officer be restored'

The Ld. Departmental Representative (DR) submitted that the assessee's claim that the old PAN was surrendered in 2007 cannot be accepted since the assessee has used the old PAN for deposits with bank on which interest is received. With regard to the contention that the export treated as unexplained by the A.O is included in the return of income under the new PAN is not properly substantiated by the assessee and the CIT(A) has given Balasubramanian Chandradevi :- 4 -: relief merely based on the details furnished by the assessee. The Ld. DR also argued that the comments of the A.O in the remand report has not been properly considered by the CIT(A) while giving relief. Accordingly the ld. DR supported the order of the A.O.

The Ld. Authorized Representative (AR) of the assessee on the other hand argued that until 15.07.2017, there was no provision to change the PAN in IE code and therefore the assessee's old PAN could not be changed. The Ld. AR further submitted that the CIT(A) has given a detailed finding after verification of all the documentary evidences furnished by the assessee and therefore there is no infirmity in the order of the CIT(A) in allowing the appeal.

We have heard the parties, and perused the material available on record. The A.O reopened the assessment under the PAN: ABKPC 7711R and proceeded to make an addition towards undisclosed income and interest income on the ground that the assessee did not file the return of income and that the assessee has not responded to the notices issued. Before the CIT(A) the assessee submitted that the re-assessment notices are issued under the old PAN which was surrendered by the assessee and that the export income added by the A.O was due to the fact that the assessee could not change the PAN in IE code. From the perusal of the order of the CIT(A) we notice that the CIT(A) has considered the following details before allowing the appeal: i. Proof of having applied for surrender of PAN(Para 5.5 Page 12 & 13) of CIT(A); Balasubramanian Chandradevi :- 5 -: ii. The ITR filed by the assessee under the new PAN: ADWPC 2363B (Para 5.7 Page 14 & 15 of the CIT(A) order) iii. The export sales details with invoices and the profit and loss account (Para 5.7 Page 15 & 16 of CIT(A) order)

During the course of hearing, The Ld. AR submitted the copies of the financial statements to submit that the impugned addition made by the A.O is already included in the profit and loss account of the assessee. The Ld. AR also drew our attention to the assessment order passed for the earlier assessment years where an identical query has been raised with regard to the export reflected under the old PAN and the A.O accepted the submission made by the assessee by not making any additions. In view of these discussions and the facts considered by the CIT(A), we are of the view that the CIT(A) has factually examined the documentary evidence substantiating the claim of the assessee that the impugned additions are already part of the income declared under the new PAN. With regard to the contention of the Ld. DR that the CIT(A) did not consider the remand report of the A.O, we notice that in the remand report, the A.O did not record any adverse finding on the documentary evidences/merits, but has merely stated that the claim of the assessee with regard to non receipt of notices due to which she could not respond is factually not correct. Accordingly, we are unable to see merit in the argument of the Ld. DR. On perusal of record it is clear that the CIT(A) after considering the remand report has called for verification of documentary evidences and has allowed the claim of the assessee on merits after detailed verification of the documents submitted. With regard to interest also, he CIT(A) has deleted the addition after verifying the fact based on documentary evidences that the income is offered to tax in the subsequent AYs. Therefore, we see no reason to interfere with the order of the CIT(A).

In the result, appeal of the Revenue is dismissed.