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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. N. K. Saini
ORDER This is an appeal by the assessee against the order dated 29.09.2017 of ld. CIT(A)-1, Noida. 2. Following grounds have been raised in this appeal: “1. That the Ld. A.O. as well as Ld. C.I.T.(A)-1, Noida, have erred in law and on facts in making/sustaining addition of Rs.10,77,380/- erroneously made on account of commission receivable from M/s. Om Radianz Infra Ltd. on the basis of Form-26AS., without considering and appreciating that the appellant has been following Cash System of Accounting and did not receive such commission in F.Y. 2009-10, therefore, the addition was liable to be deleted.
2. That the order of the Ld. C.I.T.(A)-1, Noida is bad in law and on facts and is also contrary to the principles of natural justice and equity, therefore, was liable to be cancelled.
3. That the authorities below erred in law and on facts in not considering and allowing deduction claimed by the Neelima Raizada appellant under section 80C of the Income Tax Act, 1961 in respect of payment of Premium of Life Insurance Policy Rs. 51,500/- and repayment of principal amount of Housing Loan Rs. 85,230/-.
4. That the addition made by the Ld. A.O. and sustained by the Ld. C.I.T.(A)-1, Noida is insupportable in law and in any case much too high and excessive.
5. That any other relief or reliefs as your honour may deem fit in the facts and circumstances of the case, be granted.
6. Your humble appellant craves leave to add, amend or withdraw any ground(s) before the hearing.”
3. From the above grounds, it would be clear that the grievance of the assessee relates to the sustenance of addition of Rs.10,77,380/- made by the AO on account of commission receivable on the basis of Form No. 26AS and deduction claimed u/s 80C of the Income Tax Act, 1961 (hereinafter referred to as the Act), not allowed by the AO.
Facts of the case in brief are that the assessee filed the return of income on 01.03.2011 declaring an income of Rs.35,700/-. The AO gathered information that the assessee had received Rs.10,77,380/- by way of commission from M/s Om Radianz Infra Pvt. Ltd. on which the tax was deducted which was also disclosed in Form No. 26AS and uploaded on the system. The AO made the addition of the said amount. He also did not allow the claim of deduction u/s 80C of the Act since the evidence in support of the same was not furnished.
Neelima Raizada 5. Being aggrieved the assessee carried the matter to the ld. CIT(A) and submitted that the assessee maintained her books of accounts on receipt basis and that the commission disclosed by the payer was not actually received by the assessee who received only Rs.1,67,476/-. The ld. CIT(A), however, did not find merit in the submissions of the assessee and confirmed the action of the AO by observing in paras 8 & 9 of the impugned order as under: “8. In any case, the Appellant has claimed the entire amount of TDS of Rs. 1,07,738/- and therefore, as per the provisions of section 199 of I.T. Act, 1961, the entire amount corresponding to that amount of TDS became the income of the appellant in the year in which the appellant had claimed the credit of the TDS. As the appellant has claimed the credit for the TDS of Rs. 1.07,738/- in the AY 2010-2011 to which the impugned assessment order pertains, the corresponding amount is the income of the AY 2010-11.
9. In view of the failure of the appellant to sustain her claim of maintaining the cash system of accounting either before the Ld. A.O. or in the present proceedings and the refusal of the appellant to produce the Books of Accounts as claimed to have been maintained by her all through and the claim of entire TDS of Rs, 1,07,738/- in the AY 2010-11, the entire receipt of commission of Rs.10,77,380/- is the income of the appellant for AY 2010-11 and there is no infirmity in the impugned assessment order. As the appellant has not produced any evidence to corroborate her claims of deductions u/s 80C to the extent of Rs.1,00,000/-. There is no infirmity in the impugned assessment order on this issue also.”
Now the assessee is in appeal. The ld. Counsel for the assessee submitted that the commission of Rs.1,67,476/- was only received during this year and the remaining amount was received in Neelima Raizada the subsequent year on which tax had also been paid in succeeding year and even the TDS deducted was claimed against the said commission in the said year. It was further submitted that the ld. CIT(A) was not justified in confirming the action of the AO for denying the claim of deduction u/s 80C of the Act for which the assessee is eligible.
In her rival submissions, the ld. Sr. DR supported the orders of the authorities below and further submitted that the assessee did not produce the books of accounts either before the AO or before the ld. CIT(A) in support of her claim that the commission was shown on receipt basis and not on accrual basis. Therefore, the addition was rightly made by the AO and sustained by the ld. CIT(A).
I have considered the submissions of both the parties and perused the material available on the record. In the present case, the claim of the assessee is that the commission was received on receipt basis amounting to Rs.1,67,476/- and the remaining amount of commission was shown in the succeeding year which was accepted by the department and even the TDS deducted on the commission was also adjusted in the said year, these facts need verification at the level of the AO, particularly when, it is well settled that the same income cannot be taxed twice. I, therefore, deem it appropriate to set aside this issue back to the file of the AO to be adjudicated afresh in accordance with law after verifying from the record as to whether the claim of the assessee is right in respect of remaining commission has been shown in the succeeding year and taxed by the department. The AO is also Neelima Raizada directed to verify the claim of the deduction u/s 80C of the Act and if the assessee is found to be eligible after proper verification then the claim shall be allowed.
In the result, appeal of the assessee is allowed for statistical purposes. (Order Pronounced in the Open Court on 12/06/2018)