2018 (2) TMI 1283

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....income for the year under consideration was filed by it on 27.09.2010 declaring a total income of Rs. 48,100/-. As noted by the A.O. during the course of assessment proceedings, there were credits of Rs. 9,79,323/- in the bank account maintained by the assessee with State Bank of India, Arambagh Branch. The explanation offered by the assessee in this regard before the A.O. was that the said amounts were received by it from the Government as mileage rebate. It was explained that the dealers situated above 8 k.m. distance from the godown of the distributor were eligible to get extra allowance on transport charges called as rebate mileage and such rebate mileage amounting to Rs. 9,79,323/- received during the year under consideration was distr....

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....nd accounted for. The explanation given by the appellant was that the appellant had to give mileage rebate to M.R. Distributors whose piece of business is situated at a distance more than 8 Kms. from the distributor's godown. Such rebate is reimbursed to the appellant by the Office of Sub-divisional Controller (F & S), Government of West Bengal. However, the year in which the rebate is paid to the M.R. Distributors may not match with the year in which the reimbursed by the Government is received. Thus, the receipts of Rs. 9,79,323/- could not be treated as income. The AO examined the P&L Accounts for the financial years relevant to A.Ys. 2008-09, 2009- 10 and 2010-11 and found that only Rs. 1.49 lakhs was paid as rebate by the appellant....

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....of the rebates paid, if any, as the M.R. dealers were paying for their purchases as per amounts determined after deducting rebate in the sale memos. The main finding in the assessment order is that the receipts aggregating to Rs. 979,323/- were not accounted for. The appellant has not disputed this finding. Hence, even if the receipts represented reimbursement of rebates distributed by the appellant in earlier years, it has not been explained with sufficient details or evidence as to why the receipts were not accounted for when the rebates paid had already been deducted from the sales. Thus, while expenses have been claimed as deduction, the corresponding reimbursement has not been offered for taxation. Hence, the addition of Rs. 9,79,323/-....