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Income Tax Appellate Tribunal, DELHI BENCH, ‘E’: NEW DELHI
Before: SHRI SHAMIM YAHYA & Ms. ASTHA CHANDRA
ORDER PER SHAMIM YAHYA, AM,
This appeal by the assessee is directed against the order of the Ld.
CIT(A)/National Faceless Appeal Centre (NFAC), New Delhi, dated 20.05.2022 pertaining to Assessment Year 2016-17.
2. The grounds of appeal reads as under:-
“1. That the Assessing Officer ought not to have completed the assessment at a higher figure based on the incomplete and inadequate enquiries merely relying on the unverified material supplied by M/s AON Services India Pvt. Ltd. and consequently the assessment so framed by the Assessing Officer is arbitrary, unjust and in violation of natural justice.
2. That in the absence of cross-examination allowed to the assessee, the Assessing Officer ought not have made the addition based on the frauds committed by the third person in connivance with alleged payer companies on account of misuse of PA number of the appellant.
3. That the Assessing Officer ought not to have made the addition in the hands of the appellant-assessee in respect of the amounts which have not been received by the appellant at all merely relying on the alleged confirmation of payee company and accordingly the assessment so framed by the Assessing Officer at a huge figure is against the principle of real income accrued to the assessee.
That without prejudice to grounds No. 1 to 3 above, the addition of alleged transport receipts of Rs.4,85,76,223 / - alleged to have been paid by the company M/s AON Services India Pvt. Ltd. to the appellant on gross basis, is arbitrary, unjust and at any rate very excessive and should be confined to income component only.
That the appellant denies its liability to pay interest u/s234B and 234C of the Income Tax Act, 1961.”
Brief facts of the case are that the assessee company is a service provider of cab facilities to various multinational companies and earns income as cab hire charges. The assessee filed its return of income for the relevant assessment year on 31.03.2017 declaring an income of Rs. 22,01,779/-. The case was selected for scrutiny under CASS. Accordingly, notice u/s 143(2) and 142(1) were issued to the assessee. As per the information available with the Ld. AO, the assessee company had received payment of contractual receipts of Rs. 4,85,76,223/- from M/s ON Services Private Limited (then MS AOC Services India Pvt. Ltd.) during the relevant AY on which TDS amounted to Rs. 9,71,532/- u/s 194C of the Act. On perusal of records during the course of the assessment proceedings, the Ld. AO found that though the assessee had claimed the said TDS of Rs. 9,71,532/- but failed to book the corresponding contractual receipts in its book of accounts. Accordingly, the Ld. AO concluded the assessment proceedings us 143(3) of the IT Act, 1961 on 18.12.2018 by adding back the contractual receipts of Rs.4,85,76,223/- to the income of the assessee as undisclosed business income earned during the relevant assessment year.
4. Against the above order, the assessee appealed before the Ld. CIT(A). The Ld. CIT(A) noted that the fundamental issue in the case is the contractual payments of Rs.4,85,76,223/- received by the assessee from M/s AOC Services India Pvt. Ltd. He noted that the assessee has denied having received any such income. In support of this contention, the assessee has submitted following documents as evidence:-
Copy of audited financials of assessee for the AY 2016-17.
Copy of bank statement of assessee for the AY 2016-17. 3. Copy of affidavit by the assessed regarding non receipt of any contractual payment from Ms. AOC Services Private Limited (now merged with AON Consulting Private Limited).
4. Copy of replies submitted to the learned AO during the course of assessment proceedings.
5. However, the Ld. CIT(A) was not convinced. He held that the assessee has claimed TDS in original return. The assessee has also filed a revised return of income. In the subsequent revised return he has withdraw a claim of this TDS amount, but the Ld. CIT(A) found that this was after the start of scrutiny proceedings. Mere denial is not enough and he upheld the order of the Assessing Officer.
Against this order, the assessee is in appeal before the Tribunal. We have heard both the parties and perused the records. The Ld. Counsel for the assessee submitted that the assessee has actually not received any payment. The assessee has submitted details of bank account and the payment are not found therein. He submitted that originally Chartered Accountant inadvertently claimed the TDS but later on the same was given up by way of filing of revised return of income. The ld. Counsel for the assessee submitted that somebody has utilized the PAN of the assessee. The Ld. Counsel for the assessee also submitted that the Assessing Officer has not done proper enquiry and also submitted that the assessee has no objection if the matter is set-aside for proper verification.
Per Contra, the Ld. DR submitted that the AO has issued notice u/s 133(6) to the contracting party and they have confirmed the same but he didn’t have any objection in remanding the matter to the file of the AO for proper verification.
After hearing both the parties and perused the records, we note that the assessee has submitted that it has not actually received any amount.
It has also submitted bank statement in which the payments have not been found received. The Ld. CIT(A) opined that the assessee probably has other bank account. This is observation in the realm of suspicion without any cogent basis. Hence, in the interest of justice, we remit the issue to the file of the Assessing Officer. The Assessing Officer is directed to consider the assessee’s submissions properly and decide the issue as per law after proper verification.
In the result, this appeal of the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 16th August, 2023.