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of <h1>Tribunal sets aside assessment order on suppressed contract receipts due to inadequate hearing opportunity</h1> <h3>Dutta Engineering Works Versus The Deputy Commissioner of Income Tax-1 (1), Bhilai</h3> Dutta Engineering Works Versus The Deputy Commissioner of Income Tax-1 (1), Bhilai - TMI Issues involved:The appeal challenges the addition of Rs. 10,08,710 based on the alleged difference in receipts as per books of accounts and Form No.26AS for the assessment year 2014-15.Details of the Judgment:Issue 1: Discrepancy in receiptsThe assessee firm, engaged in business activities, filed its return for A.Y.2014-15, declaring income. Discrepancy arose when the AO noted a variance in receipts from M/s. Thermax Ltd. as per Form 26AS and books of accounts. Assessee claimed part of the receipts were accounted for in the preceding year. However, AO disregarded the explanation due to mismatch in amounts, absence of external evidence, and timing of income booking. Consequently, AO added Rs. 10,08,710 as income for the current year. The CIT(A) upheld this decision despite the assessee's contentions.Issue 2: Appeal before ITATThe assessee appealed before the ITAT challenging the addition of Rs. 10,08,710. The ITAT considered arguments from both parties, reviewed lower authorities' orders, and examined relevant judicial pronouncements. The core dispute revolved around the sustainability of the addition made by the AO regarding the alleged suppressed contract receipts. The AR of the assessee presented a reconciliation of the discrepancy, asserting that the entire amount had been offered for tax. Notably, the assessee maintained accounts under the mercantile system.Conclusion:The ITAT observed that the AO did not adequately consider the reconciliation provided by the assessee due to time constraints. Thus, the matter was remanded to the AO for further examination, allowing the assessee to present additional evidence. The ITAT directed the AO to provide a reasonable opportunity for the assessee to substantiate their claim. Additionally, if the amount had indeed been taxed in the preceding year, the AO was instructed to make necessary adjustments. The ITAT allowed the appeal for statistical purposes, citing the judgment in the case of Income-tax Officer V/s. Bachu Lal Kapoor. A general ground of appeal was dismissed as not pressed.
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