TaxTMI 
TaxTMI 
2022 (3) TMI 30
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....me tax return by the appellant does not vitiate the genuineness of the expenditure claimed as the payment were routed only through banking channels. 4. The A.O has adopted the statement of profit and loss account as reported by the chartered Account vide section 44AB of the Act instead of the profit and loss account as per books of account maintained. 5. The Audit report u/s 44AB is only a audit report and not a certificate. It helps the A.O to assess the income. Hence the profit arrived as per report is not conclusive. 6. Section 145 is machinery section and the derivation of profit by applying the machinery section alone constitute profit and gains under section 28 of the Act." 3. Brief facts of the case are that the assessee is a partnership firm, engaged in the business of running hospital, filed its return of income for the assessment year 2016-17 on 19.10.2016 admitting total income of Rs. 2,86,33,480/-. During the course of assessment proceedings, the Assessing Officer noticed that there is a difference in net profit reported in ITR filed for relevant assessment year and net profit reported in tax audit report. As per return, net profit reported....
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....led for relevant assessment year and tax audit report issued in Form 3CD and argued that the auditor has committed an error in uploading figures for which the assessee cannot be penalized. The learned CIT(A), after considering relevant facts and also taken note of various reasons given by the Assessing Officer came to the conclusion that contention of the appellant that the tax auditor has erred in uploading figure in Form 3CD lacks basis, more particularly, when the statutory auditor filed revised audit report, subsequent to filing of return, has reported same profit as that of original audit report. Therefore, the learned CIT(A) opined that there is no error in the findings of the Assessing Officer that revised audit report which has been filed after filing of return did not reflect claim of provisions made for expenses and thus, there is no case for the assessee to claim that difference has been reconciled, hence, rejected arguments of the assessee and sustained additions made by the Assessing Officer towards difference in net profit. Aggrieved by the learned CIT(A) order, the assessee is in appeal before us. 6. The learned A.R for the assessee submitted that the learned CIT(....
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....r in the reasons given by the Assessing Officer as well as learned CIT(A) to sustain additions made by the Assessing Officer and their orders should be upheld. 8. We have heard both the parties, perused material available on record and gone through orders of the authorities below. The facts with regard to difference in net profit as reported in ITR filed for the relevant assessment year by the assessee and tax audit report filed by the auditor u/s.44AB of the Act, in Form 3CD. In fact, the assessee had admitted that there is difference in net profit as shown in two forms, but the assessee claims to have reconciled difference between net profit shown in Form 3CD and ITR filed for the relevant assessment year and argued that certain year end provision was not considered by the tax auditor, while uploading financial figures for the relevant assessment year in Form 3CD and same has been reconciled after finalization of accounts and reported to the income tax department in ITR form. We have gone through reasons given by the assessee to justify difference in net profit shown in ITR filed for the relevant assessment year and tax audit report issued in Form 3CD and we do not ourselves s....
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....as been subsequently clarified by stating that there is a typing error. Under those facts, the Tribunal came to the conclusion that there was an inadvertent error committed by the auditor, who wrongly mentioned net profit figure in tax audit report, however, there is no difference in either income or expenses reported by the assessee. In this case, there is difference between expenses reported by the assessee and the assessee claims to have made certain provisions to reconcile difference in net profit. As we have already noted in earlier part of this order, claim of the assessee goes unproved in absence of any evidences. Hence, case laws relied upon by the assessee has no application to the facts of the present case. 10. Insofar as the decision of the Hon'ble Supreme Court in the case of Price Waterhouse Coopers Pvt.Ltd Vs. CIT (supra), we find that the Hon'ble Supreme Court had considered facts in light of penalty levied u/s.271(1)(c) of the Act, on the ground of furnishing inaccurate particulars of income, after considering relevant facts held that the assessee has claimed deduction for certain expenses towards provisions u/s.40A(3) of the Act, whereas the tax auditor ....