TaxTMI 
TaxTMI 
2015 (5) TMI 469
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....nd the department also has accepted it as income in assessment in AY 2011-12. 3. The finding of the Commissioner of Income Tax (Appeal) in Para 5.1 at Page 9 of his order that 'the Principles of Res Judicata are not applicable to Income Tax Proceedings and moreover, this issue is yet to attain its stage of finality in the judicial forum' is contrary to facts and law as far as (a) that the Judicial Ruling of the Hon'ble Supreme Court in case of Radhasoami Satsag vs CIT 193 ITR 321 has not been considered, wherein it has been held that the department cannot take a u turn on a consistent policy followed by the assessee for number of years and accepted by the department in spite of the fact that the principle of Res Judicata is not applicable to income tax proceedings. Appellant has been following this consistent policy of offering the revenue for taxation, in the year in which services are rendered by him to the customers, since 1995. (b) That the following preceding judicial rulings, in the case of the appellant itself, have not been considered to judge the finality of the issue in the judicial forum (i) Orders of the Hon'ble ITAT in AY 2006-07, wherein....
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....rin Alkalis Chemicals & Fertilizers Ltd. vs CIT (SC) 227 1TR 172. iii) The assessee has stated that the advance fee received during the year has been offered for taxation in the next year. Each asstt. year is a separate unit and, therefore, the income of the one asstt. Year cannot be deferred to the subsequent year. The taxability normally depends on the method of the accounting policy employed by the assessee. Now in the instant case of the assessee, the assessee has been regularly following mercantile system of accounting and, therefore, the taxability of the assessee is to be ascertained on accrual basis. The total income of the previous year of the assessee will include all income, which accrues or arises or the assessee acquired the right to receive income. As per the terms and conditions of the admission and the refund policy, the said amount of Rs. 16,16,61.424/- is the non-refundable portion of the fee and, therefore, the income has accrued during the year. iv) The assessee has stated that following the matching principles of accrual system of accounting, the revenue is considered in the next year as the cost of imparting such education will be borne in next year. In ....
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....artmental's appeal on identical facts in 2007-08, 2008-09 & 2009-10 assessment years dismissed the appeal while discussing Ground No.-4 raised by the department as would be evident from page 57 of the paper Book para 9 wherein following the view taken in 2006-07 assessment year the departmental appeal was dismissed. The specific finding of the Co-ordinate Bench is reproduced hereunder for ready-reference:- 9. "Ground No. 4 relates to the deletion of the addition of Rs. 13,14,00,000/- . The facts relates to this issue are that the assessee is engaged in the business of imparting coaching for various entrance examination. Some of the courses offered by the assessee are spread over two accounting periods. Thus, part of the fees when received is booked as advance fee in the accounting year in which the student is enrolled. The advance fee presents the fee pertaining to the period falling in the next accounting year when the education/coaching was actually imparted to the students. The assessing officer, however, added the aforesaid amount of fee booked as advance fee as income for the relevant assessment year. CIT(A) deleted the addition following the decision of the assessee's own ....
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.... been offered in the specific year as would be evident from the amount mentioned in Column No.-2 of the paper book and he would have no objection if this fact is verified. For ready-reference, we extract the following table from page 65:- CL EDUCATE LIMITED Financial Year Fee Billing Advance Fee Revenue as per P&L a/c Addition made in Assessment Remarks 1st April 31st March (1) (2) (3) (4)=(1)+(2)-(3) (5)=(3) 2008-09 65,52,19,856 14,28,89,909 18,59,18,030 61,21,91,735 2009-10 57,97,23,970 18,59,18,030 16,16,61,424 60,39,80,576 16,16,61,424 Assessee has taken this amount as his income and has paid tax thereon in succeeding FY (2010-11) as shown in (2). 2010-11 60,18,24,076 16,16,61,424 15,00,32,898 61,34,52,602 15,00,32,898 Assessee has taken this amount as his income and has paid tax thereon in succeeding FY (2011-12) as shown in (2). 2011-12 67,41,10,776 15,00,32,898 17,74,81,162 64,66,62,512 2012-13 73,04,06,242 17,74,81,162 12,56,77,943 78,22,09,461 2013-14 ....
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....available on record. On a consideration of the arguments advanced by the ld. CIT DR and the findings of the AO upheld by the Ld. CIT(A), it is seen that the issue has been fully considered on similarity facts in 2006-07 assessment year wherein the ITAT considering the same Revenue recognition policy of the assessee allowed the claim of the assessee. The said view on facts has consistently been followed by the ITAT in 2007-08; 2008-09; and 2009-10 assessment years wherein either assessee's appeal has been allowed and where the CIT(A) allowed the relief following the view taken by the ITAT and the department has come in appeal, the departmental appeal has been dismissed. It is also seen that the Revenue agitated the issue before the Hon'ble High Court u/s 260A for 2006-07 assessment year wherein assailing the correctness of the order dated 27.12.2010 in ITA no.-4924 & 4925/Del/2009 for 2005-06 & 2006-07 assessment years, the following questions of law canvassed as containing substantial legal issues for admission were raised by the Revenue:- 1. "Whether the respondent was not liable to deduct the tax at source for the relevant year on account of the payment made by it to its franc....