AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (8) TMI 1536
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....s to 'the Act') for Assessment Year 2011-12. 2. The assessee company engaged in the business of trading in pharmaceutical products on a whole sale basis in respect of phone projects, filed its return of income on 30.09.2010 declaring total income at Rs. (-) 3,99,18,901, which was processed u/s 143(1) of the Act. Subsequently, under scrutiny notice u/s 143(2) dated 06.08.2012 was served upon the assessee. The said assessment was finalized by the Learned DCIT, Circle - 4, Ahmedabad on 25.03.2014 in the manner as follows: "10. Subject to above, total income of the assessee is determined as under: Total income as per intimation u/s 143(1) of the Act. Dated : 28.01.2012 Rs.(-) 3,99,18,901/- Add: (i) Upward Adjustment as disc....
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....finalizing the scrutiny assessment, the AO disallowed the expenditure of non achievement of targets amounting to Rs. 22,74,380/- as the same were disallowed during the scrutiny assessment finalized for A.Ys.2008-09, 2009-10 and 2010-11. When the full expenditure of non achievement of targets was disallowed, the deduction of Rs. 19,94,560/- claimed by the assessee during A.Y. 2011-12 was also required to be disallowed. This has resulted in under assessment of income of Rs. 19,94,560/- (3) Further scrutiny of records revealed that' the assessee has debited an amount of Rs. 5,50,92,026/- in P&L account under Schedule R operating and administrative expenses which includes profession fees of Rs. 14,52,503/- which was paid to non-res....
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....of the Revenue that income should also be indirect proportion to the amount of TDS is not correct. At times there are some timing difference between Revenue recognition and deduction tax at source. The assessee's case is this that the deductor has effected TDS on account of "service tax" to the tune of Rs. 2,46,96,942/- which is included in the Bill. The service tax collected by the service provider is not the income of the assessee and hence the same is not reflected in his Profit and Loss account. Further that the deductor has also effected TDS on "reimbursement" expenses of Rs. 1,46,78,806/- which is also not income of the assessee and thus is not reflected in the Profit and Loss account. Apart from that the difference on account of timi....
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....e Apex Court in the matter of Malabar Industrial Co. Ltd-vs-CIT (2000) 243 ITR 83 (SC). So far as the provision of Rs. 19,94,560/- for non-achievement of targets is concerned,it was the submission of the Learned AR that the same was examined at the original assessment stage itself by the Learned AO and upon such examination addition to the tune of Rs. 22,74,380/- was made. Further that when two views are possible as regards a particular issue and AO adopts either of the said two views, the Learned CIT is not permitted to invoke jurisdiction u/s 263 of the Act. We find that the observation regarding non-deduction of tax at source u/s 195 on payments of Rs. 14,52,503/- by the assessee as made by the Ld. PCITis not correct since the a....
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.... assessee it is not been reflected in the P&L account. Similarly, TDS effected on "reimbursement" of expenses of Rs. 1,46,78,806/- is neither the income of the assessee, hence not reflected in P&L account.So far as the difference on account of timing difference of Rs. 2,32,16,538/- is concerned we find that reconciliation statement of difference between service income as per P&L account and as worked out on the basis of the TDS was also furnished before the appellate authority but the same was not taken into consideration in its proper prospective. Merely because there was some difference in the service income as per P&L Account and as worked out based on TDS the assessment order cannot be said to be erroneous and prejudicial to the interes....