ACIT, CIRCLE - 42, MURSHIDABAD, MURSHIDABAD vs. SANDIPAN PRAMANIK, MURSHIDABAD

The assessee is an individual and is in the business of civil construction. He filed his return of income for the Assessment Year 2014-15, electronically on 14/11/2014 declaring total income of Rs.98,13,490/-. The Assessing Officer completed the assessment u/s 143(3) of the Act, determining the total income of the assessee at Rs.1,75,05,930/- interalia disallowing depreciation claimed by the assessee @ 30% on tipper given on hire and adding an amount on Rs.68,89,394/- as income being difference in the total contract receipts declared by the assessee during the year and the amount of contract receipts mentioned in Form No. 26AS i.e., tax deducted at source certificate. Aggrieved the assessee carried the matter in appeal. The ld. First Appellate Authority granted relief.

Further aggrieved the revenue is in appeal before us on both these issues.

After hearing rival contentions, we find that the amount of Rs. 68,89,394/-, was accounted by the assessee in the subsequent Assessment Year, which was the Assessment Year: 2014-15 Sandipan Pramanik year of receipt. It was an issue of timing of recognition of income. The ld. CIT(A) has, without deleting the addition in question on the ground that, it had been accounted for in receipt basis took a view, that it would be fair to treat the net profit of 3.66%, on the difference amount of Rs. 68,89,394/- as income. The ld. Counsel for the assessee, submitted that, the difference in question would never be the income of the assessee during the year, but nevertheless the assessee chose not to carry this issue in further appeal. 4.1. In our view, the total amount of Rs. 68,89,394/- cannot be brought to tax as income during the year for the reason that, the various Government agencies have at the end of the year passed certain closing entries but the assessee has not received any of these amounts during this year. This is not the case of non recording of receipts. It is a case of timing of recording of receipts i.e., the year of taxability in question. The ld. CIT(A)’s order, in our view, requires no interference, under the facts and circumstances of the case. Hence, we dismiss this ground of the revenue.

The next issue is the rate of depreciation that has to be allowed on tippers given on hire. 5.1. The ld. CIT(A) has recorded that the Assessing Officer has not controverted the fact that the assessee had given its vehicles on hire to M/s. ABC Constructions. He, thus, allowed the depreciation @ 30%. This factual finding of the ld. CIT(A) could not be controverted by the ld. D/R. Hence, we uphold this finding and dismiss this ground of the revenue. In the result, appeal of the revenue is dismissed.

Kolkata, the 26th day of April, 2019. Sd/- Sd/- [S.S. Godara] [J. Sudhakar Reddy] Judicial Member Accountant Member Dated : 26.04.2019 {SC SPS} Assessment Year: 2014-15 Sandipan Pramanik Copy of the order forwarded to: 1. Sandipan Pramanik 10, Sri Krishna Saha Lane P.O. Berhampore Dist. Murshidabad – 742 101 2. Assistant Commissioner of Income Tax, Circle-42, Murshidabad 3. CIT(A)- 4. CIT- , 5. CIT(DR), Kolkata Benches, Kolkata.