TaxTMI 
TaxTMI 
2026 (8) TMI 41
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.... been offered for taxation in the earlier years, it cannot be added again in this year because same income cannot be taxed twice (c) the reconciliation of income and other documents and submissions filed by the assessee. Thus, the addition so made should be deleted. 2. Without prejudice to the above ground, if it is held that the income of Rs. 35,00,665/- was required to be offered in the year under consideration on the basis of Form 26AS, then directions should be issued to exclude the same from the income of the earlier year as the same income cannot be taxed twice i.e. once in the year of accrual and second in the year when it is reflected in Form 26AS. Necessary directions in this regard may be issued. 3. The learned CIT(Appeals) has erred in law and on facts in confirming the disallowance of transfer expenses of Rs. 8,38,500/- paid to Noida authority for sale of property out of business income but not issuing directions to allow these expenses while computing capital gain though the CIT(A) gave a finding that these expenses incurred on sale of asset are eligible for such deduction. Thus, necessary directions should be issued to allow these expenses as deducti....
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....es u/s. 142(1), assessee filed its submissions online. Further assessee requested for hearing through video conferencing which was granted. 5. During assessment proceedings, the AO observed that there is a substantial variation in income offered to tax in ITR in comparison to income as per Form 26AS. A separate notice u/s. 142(1) was issued to the assessee to submit a comprehensive reconciliation statement with respect to variations. In response, assessee submitted a reconciliation statement. For the sake of brevity, the same is reproduced below :- "Details of the Consultancy Income as in the Balance sheet are Rs. 3,24,14,785.20/- and the details are enclosed herewith. Reconciliation of difference in Consultancy Income of GAIL & BPRL with 26AS, copy of ledger of BPRL Consultancy Income of the month of March 2017- March 2018 is attached as per Annexure-1. There is no difference in consultancy income as in Balance Sheet. Consultancy Income Amount 1 Consultancy Income-BPRL 51,44,000.00 2 Consultancy Income-Gail Cambay(One) 1,60,08,250.00 3 Consultancy Income- Gail Cambay (Two) 81,16,000.00 4 Consultancy Income- Halliburton Project 36,46,536.00....
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....f Rs. 35,00,665/- (Rs. 3,59,15,450/- - Rs. 3,24,14,785/-) and the same was added to the total income of the assessee as undisclosed sources. 7. Further the AO on verification of the other expenses of Schedule 2.7.4 of the Profit & Loss account which includes loss on investment/asset, selling expenses, commission and brokerage and valuation charge to the extent of Rs. 60,21,047/- and this should have been added back in the computation of income. When the same was asked assessee to clarify, in this regard assessee has submitted that loss on investment was already added back to the head 'income from business' in the computation of income as under :- Sale of Property - Advant Rs. 38,72,158/- Sale of Car Rs. 2,02,686/- IIFL National Agenda Fund Rs. 2,70,280/- 8. With regard to selling expenses of Rs. 8,35,800/- and commission and brokerage of Rs. 6,87,422/-, they are claimed as business expenditure and valuation charges of Rs. 1,50,000/- also part of business expenditure. After considering the submissions of the assessee, AO rejected the same with the following observations :- "4.4 The above contentions of the assessee are carefully considered. T....
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....R of the assessee brought to our notice pages 17 and 18 of the paper book wherein assessee has reconciled the consultancy income declared by the assessee in return of income versus income declared in Form 26AS. He brought to our notice that the issue raised by the AO of the income which assessee has failed to bring on record with the relevant documents. He submitted that assessee regularly declares income in its return of income and based on the work performed by it and the invoices raised to the parties, there are certain invoices for which the customers are recording the sale in the subsequent year and accordingly they deducted the TDS. The same amount which was declared in the previous assessment year was not declared in the present assessment year and he prayed that the addition made by the AO is double addition and prayed for deletion of the same. 12. With regard to grounds no. 3 and 4, ld. AR submitted that these expenses are relating to transfer expenses relating to sale of property. He prayed that since these expenses are relating to transfer of property, the AO has disallowed the same under the head business income, however the same should be allowed while computing the....
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....the year under consideration. Therefore, grounds no. 3 and 4 raised by the assessee are accordingly allowed. 18. With regard to ground no. 5, the assessee filed copy of the invoice from the consultancy service on availing working capital loan. The assessee could not substantiate the same and how it is useful in the business. For the sake of justice, we are inclined to disallow 50% of the expenses claimed by the assessee. Accordingly, ground no. 5 raised by the assessee is partly allowed. 19. In the result, the appeal filed by the assessee is partly allowed. Order pronounced in the open court on this 5^th day of June, 2026. ============= Document 1 Reconciliation of Consultancy Income for FY 2017-18 8 Consultancy Income Amount 1 Consultancy Income BPRL 5,144,000.00 2 Consultarcy Income-Gall Cambay (One) 16,008,250,00 3 Consultancy Income Gail Cambay (Two) 8,116,000.00 4 Consultancy Income-Halliburton Project 3,646,536.00 5 Consultancy Income reversed -500,000.80 32,414,785.20 BPRL Consultancy Income Reconciliation BPRE Consulatancy Income FY 17-18 5,144,000.00 Add: Consultancy Incorre -BPRL considered as Work in Progress Income during the FY 201....