TaxTMI 
TaxTMI 
2018 (10) TMI 1973
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....s. 143(3) of the Act. 2. The assessee has raised several grounds in its appeal however the cruxes of the issues are that (i) The Ld.CIT(A) has erred by holding that reopening of assessment U/s.147 of the Act is valid. (ii) The Ld.CIT(A) has erred in confirming the order of the Ld.AO who had treated the subscription fees received in advance during the relevant assessment year as the income of the relevant assessment year without considering the fact that the income did not accrue to the assessee during the relevant assessment year. 3. The brief facts of the case are that the assessee is a private limited company formerly known as M/s. Consim Info Pvt. Ltd., is engaged in the business of rendering matrimonial & other online services, fi....
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....oncept of deferred income. Hence the Ld.AO treated the entire amount of profile registration fee, up-gradation fees and subscription fees received during the relevant assessment year as the income of the assessee for the relevant assessment year. The Ld.AO while holding so, relied in the decisions of Sterling Holiday Resorts India Ltd., vs. ACIT reported in 111 ITD 116 and the decision of EID Parry (India) Ltd., vs. CIT reported in 126 taxmann 174. 5. On appeal, the Ld.CIT(A) confirmed the order of the Ld.AO by observing as follows relying in the decision cited by the Ld.AO in his order:- "9. The assessee has quoted various decisions to claim that the matching principle of revenue and expenditure should apply. In this regard, it is noted....
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....ts income in the subsequent assessment year. Hence it was pleaded that the addition made by the Ld.AO for Rs. 2,68,12,597/- which was further confirmed by the Ld.CIT(A) may be deleted. The Ld.DR on the other hand relied on the orders of the Ld.Revenue Authorities. 7. We have heard the rival submissions and carefully perused the materials on record. It is not disputed that the amount of Rs.2,68,12,597/- was received in advance for the services to be rendered in the immediate succeeding assessment year. Accordingly the assessee had treated the same as the income in the succeeding assessment year. However the Ld,Revenue Authorities was of the view that there is no concept of deferred income as per the provisions of the Act and therefore treat....
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....ant assessment year though certain benefit arising out of the same can be attributable to subsequent years. However, as per Mercantile System of Accounting, only the accrued income for the relevant assessment year can be treated as the income for the relevant assessment year. In the case of the assessee, there is no dispute that the amount of Rs.2,68,12,597/- received by the assessee pertains to the services to be rendered in the immediate succeeding assessment year. Hence the assessee has rightly recognized its revenue of Rs.2,68,12,597/- in the succeeding assessment year. Therefore the addition made by the Ld.AO which is further sustained by the Ld.CIT(A) by treating the fees received in advance for the succeeding assessment year as the i....