TaxTMI 
TaxTMI 
2026 (6) TMI 1164
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Department, but, had not informed the assessee of passing of the CIT(A)'s order. The Director of the assessee company, in a duly sworn affidavit filed before us, has stated that the appeal was filed by the Consultant of the assessee company and had given his email ID in form 35 as [email protected] while the assessees registered email ID in the ITBA portal was [email protected] and [email protected]. She stated in the affidavit that the Consultant did not inform of passing of the CIT(A)'s order and it was only while going through the ITBA portal they became aware of the passing of the CIT(A) order resulting in a delay of 176 days in the filing of the present appeal before us. 3. Ld. DR vehemently opposed the condonation of delay. 4. Considering the averments made by the assessee as above, we are of the view that there was reasonable cause for the delay in filing of the appeal before us and in the interest of justice, therefore, we condone the delay of 176 days in the filing of the appeal before us. 5. Taking up the appeal for adjudication, the assessee has raised following grounds before us: "1. The order passed by the Ld. CIT (A) is against l....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., the assessee had reflected income from the said contractual receipts, estimating profits @8% thereon amounting to Rs. 35,03,070/-. Finding the assessee to have not reflected the said income in its P&L account, he rejected the books of accounts of the assessee and further estimated profits on the said contractual receipts by applying rate of 12% thereon resulting in addition of Rs. 17,51,535/- to the income of the assessee. Further, the AO noted the assessee to have claimed losses in the return of income filed to the tune of Rs. 17,59,649/-. The same were noted to be in the nature of finance charges, including bank charges and bank interest. In the absence of any evidence furnished by the assessee demonstrating the said expenses to have been incurred for business purposes, he disallowed the claim of loss of Rs. 17,59,649/-. Thus, the AO assessed the income of the assessee at Rs. 52,54,600/- as against Rs. 17,43,421/- returned by the assessee. 8. The matter was carried in the appeal before the Ld.CIT(A) who confirmed the order of the AO. 9. Before us, the Ld. Counsel for the assessee has challenged the validity of the reopening in the present case on two grounds; i. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ced at page nos. 5 & 6 of the assessment order which revealed that the invoice of Rs. 4.37 Crores had been issued to the assessee on 31.03.2009 i.e. relating to A.Y. 2009-10 i.e. the preceding assessment year. 13. We do not find any merit in the contention of the Ld. Counsel for the assessee for the reason that at the time of recording reasons for reopening of the case of the assessee only fact/information in the possession of the AO was of TDS having been deducted in the impugned year on the Contract Income of Rs. 4.37 Crores of the assessee by Inter Globe Hotels Pvt. Ltd. and no return of income being filed by the assessee reflecting the said receipt of the income. The fact of the bill relating to the Contract Income having been raised on the assessee in the preceding year was brought to the notice of the AO only subsequently during re-assessment proceedings. Therefore, on the date of reopening of the case of the assessee, the information in the possession of the AO, we hold, lead to a reasonable belief of escapement of income. Any information relating to the reopening of the case obtained subsequent to reopening does not in any way effect the reasons forming belief of escapem....
X X X X Extracts X X X X
X X X X Extracts X X X X
....2 raised by the assessee challenging the validity of the reopening in the present case is, accordingly, dismissed. 17. Ground Nos. 3, 4, 5 & 6 relate to the merits of the case and challenging the order of the Ld. CIT(A) in confirming the addition made by the AO of Rs. 52,54,605/- being 12% of the receipts of Rs. 4.37 Crores from Inter Globe Hotels Pvt. Ltd. 18. The facts relevant to the issue are that the assessee initially had filed no return of income for the impugned year in terms of Section 139(1) of the Act. Subsequently, in response to notice u/s. 148 of the Act, the assessee filed return of income declaring net profits from the Contract Income Rs. 4.37 Crores @ 8% i.e. Rs. 35,03,070/-, reflecting/stating the same as income not included in the P&L account. Against the same, the loss declared in the P&L account Rs. 17,59,649/- was set off and net income of Rs. 17,43,421/- was returned to tax by the assessee. The computation of the same is reproduced at page 3 of the assessment order as under: BUSINESS & PROFESSION Ghanshyam Infrastructure Pvt. Ltd. LOSS As per P&L a/ c. (Rs. 17,59,649) Add: Other Income not included in P&L a/c. a. Net Profit from....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... year at all, but, in fact pertained to the preceding year. He contended that it was pleaded to the Ld. CIT(A) that the assessee had returned the said income in the impugned year to buy peace of mind. 21. We agree with the Ld. Counsel for the assessee that the AO noted the fact of the bill of Rs. 4.37 Crores being issued on 31.03.2009, pertaining to A.Y. 2009-10 while the impugned assessment year before us is A.Y. 2010-11. However, at the same time Form 26AS reflects TDS deducted and paid in the impugned year. Which means that the TDS deducting party had acknowledged expense pertaining to the said contract bill in the impugned year. Moreover, the assessee has not demonstrated before us that the impugned amount of contractual income was reflected in its accounts and the return of income of the assessee for the preceding year. On the contrary the assessee itself has disclosed the net profits on the said contractual receipts in the impugned year. The bill may have been issued admittedly in the preceding year, but, unless and until it is demonstrated to have been accounted for in the books of accounts of the assessee also in the preceding year, it does not automatically lead to the ....