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Income Tax Appellate Tribunal, CUTTACK ‘SMC’ BENCH,
Before: SHRI N.S SAINI
This is an appeal filed by the assessee against the order of CIT(A)-1,
Bhubaneswar, dated 26.5.2015 for the assessment year 2010-2011.
The sole issue involved in this appeal is that the ld CIT (A) erred in
confirming the addition of Rs.9,72,000/- made by the Assessing Officer as
unexplained sundry creditors.
I have heard the rival submissions and perused the orders of lower
authorities and materials available on record. In the instant case, the
2 IT A No. 360 /CT K/20 15 Asse ss ment Y ear :20 10- 201 1 assessee is engaged in the business of trading in books under the name &
style of Ambica Book Centre. The Assessing Officer observed that in the total
of sundry creditors in the balance sheet of Rs.25,93,670.81, the assessee has
shown Rs.9,72,000/- as amounts receivable from District Inspector of School,
Koraput for supply of books. The Assessing Officer observed that the assessee
has issued following bills for Rs.9,72,000/- on 30.12.2009:
Sl.No. Bill No. Date Amount (Rs.) 1. 574 30.12.2009 87,578/- 2. 575 30.12.2009 77,800/- 3. 576 30.12.2009 89,735/- 4. 577 30.12.2009 95,564/- 5. 578 30.12.2009 88,587/- 6. 579 30.12.2009 76,010/- 7. 580 30.12.2009 68,491/- 8. 581 30.12.2009 80,968/- 9. 582 30.12.2009 73,807/- 10. 583 30.12.2009 83,171 11. 584 30.12.2009 77,224/- 12. 585 30.12.2009 73,165 Total 9,72,000
Therefore, the Assessing Officer was of the view that the assessee has
received Rs.9,72,000/- on 4.3.2010 from the District Inspector of School,
Koraput against the sale of books made on 30.12.2009. The contention of
the assessee before the Assessing Officer was that the above bills were
proforma bills submitted to the District Inspector of School, Koraput on
30.12.2009 for supply of library books based on which the District Inspector
of School, Koraput issued a cheque for Rs.9,72,000/- on 4.3.2010 to the
assessee. The books were supplied in the next financial year. Hence, the
3 IT A No. 360 /CT K/20 15 Asse ss ment Y ear :20 10- 201 1 District Inspector of School, Koraput has been reflected as creditors in the
balance sheet as on 31.3.2010 by the assessee. However, the Assessing
Officer was not satisfied and added Rs.9,72,000/- u/s.69 of the Act as bogus
credit.
On appeal, ld CIT(A) confirmed the action of the Assessing Officer.
Before me, ld A.R. of the assessee pointed out from annexure-4 that a
cheque for Rs.9,72,000/- dated 4.3.2010 was received from the District
Inspector of School, Koraput, which was credited in the bank account of the
assessee on 4.3.2010. He further pointed out from same annexure-4 that the
assessee has made payment through cheque No.162235 dated 20.2.2010 for
Rs.5,50,000/- to Grantha Mandir, Cuttack and another cheque was also given
to same party being cheque No.162236 dt.24.2.2010 for Rs.1,50,000/- as
advance for supply of books. Further, ld A.R. pointed out from annexure -6
that on 27.3.2010, the assessee issued a cheque for Rs.1,19,235/- being
Cheque No.162249 to Maa Sarada Publication, which was also for supply of
books. He pointed out that as the supply of books were received in the
subsequent financial year, therefore, in the balance sheet prepared on
31.3.2010, Rs.8,19,235/- was shown as amount receivable from the suppliers
namely, Maa Sarada Publication and Grantha Mandir. He further pointed from
annexures -11,12 & 13 that the Head Master, New U.P.School, Lankaput,
4 IT A No. 360 /CT K/20 15 Asse ss ment Y ear :20 10- 201 1 Koraput has issued acknowledgement on 7.4.2010 for receipt of 378 numbers
of books. Further, the Head Master, Upper Primary School, Lendrimaliguda
has issued acknowledgement on 9.4.2010 for receipt of 378 numbers of books
from the D.I. of Schools, Koraput and similarly, the Head Master, Upper
Primary School, Ganipadar has also issued a certificate dated 6.4.2010 for
receipt of 378 numbers of books from the District Inspector of School,
Koraput. By pointing out these evidences, it was submitted that the supply of
books to schools were made in the succeeding financial year and, therefore,
the assessee accounted for the sale of Rs.9,72,000/- by raising invoices on
DI, Koraput being Invoice No.1 dated 31.8.2010. The same was duly shown
as sale in the immediately succeeding assessment year 2011-12 and the
income therefrom was shown in the return of income filed by the assessee.
Hence, it was his submission that the addition made by the Assessing Officer
and confirmed by ld CIT(A) in the presence ofoverwhelming evidences, was
not justified.
On the other hand, ld D.R. supported the orders of lower authorities.
`I find that it is not in dispute that the assessee received Rs.9,72,000/-
on 4.3.2010 by cheque from the District Inspector of School, Koraput for
supply of books to the schools as directed by the District Inspector of School,
Koraput. It is also not in dispute that in order to procure the said books, the
5 IT A No. 360 /CT K/20 15 Asse ss ment Y ear :20 10- 201 1 assessee paid advance to the suppliers on 22.3.2010 also by cheque. It is
also not in dispute from the certificates of the Head Masters of Schools, filed
in Annexures-11,12 & 13 that the books were actually supplied by the
assessee in the subsequent financial year relevant to assessment year 2011-
It is also not in dispute that the assessee accounted for the sale of
Rs.9,72,000/- by raising invoices on DI of Schools on 30.8.2010. It is also
not disputed by the revenue that the assessee has disclosed the sale of
Rs.9,72,000/- in the return of income filed by the assessee for assessment
year 2011-12. The assessee has also filed copy of its balance sheet evidencing
the fact of showing the District Inspector of School, Koraput as the creditor in
the year ended on 31.3.2010 and showing the advance made to supplier of
Rs.8,19,235/- as debtors in the balance sheet. The explanation of the
assessee is that on 30.12.2009, the assessee has raised proforma invoices,
which were submitted to the District Inspector of School, Koraput so as to
enable him to make advance payment of Rs.9,72,000/- to the assessee for
supply of books to Schools nominated by the District Inspector of School,
Koraput has been brushed aside by the Assessing Officer without giving any
reasons. I find that the explanation of the assessee is a plausible one and can
be accepted in the given facts and circumstances of the case. I also observe
from the bills dated 30.12.2009 that the assessee has stated in the heading
“these bills as credit bills”. The same were to be given to the District Inspector
of School, Koraput as an estimated price for supply of books to the designated
6 IT A No. 360 /CT K/20 15 Asse ss ment Y ear :20 10- 201 1 schools by the District Inspector of School, Koraput based on which advance
payments were made to the assessee. I am of the considered view that the
income can be taxed once and the same income cannot be taxed twice. It is
not disputed by the revenue that the assessee has disclosed sales of
Rs.9,72,000/- in its return of income for assessment year 2011-12.
Therefore, same amount cannot be treated as unexplained credit of the
assessee and brought to tax in the year under appeal. Hence, I set aside the
orders of lower authorities and delete the addition of Rs.9,72,000/- and allow
the ground of appeal of the assessee.
In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on 03/01/2017 in the presence of parties. Sd/- (N.S Saini) ACCOUNTANT MEMBER
Cuttack; Dated 03/01 /2017 B.K.Parida, SPS Copy of the Order forwarded to : 1. The Appellant : Smt. Alladina Patra, Prop. M/s. Ambika Book Centre, Main Road, Koraput 2. The Respondent. ITO, Ward-2, Jeypore 3. The CIT(A)-1, Bhubaneswar 4. CIT, Bhubaneswar. 5. DR, ITAT, Cuttack 6. Guard file. BY ORDER, //True Copy//
ASST.REGISTRAR, ITAT, Cuttack
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