The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that no additions under Section 68 of the Income Tax Act, 1961 shall be imposed if the amount doesn’t appear in the book of account.
The Authorized Representative submitted that the Assessing Officer and Commissioner of Income Tax (Appeal) [CIT-A] both erred in the assessment of income of Rs. 17,90,671/- as if earned and received when the appellant had neither earned nor received such interest income during the year as per copy of audited financial statements filed.
He contended that the Assessing Officer and Commissioner of Income Tax (Appeal) have both erred in confirming the addition of Rs. 17,90,671/- under Section 68 of The Income Tax Act when no such amount was found credited in the books of account maintained by the appellant for the previous year, the illegal addition be deleted.
It was further submitted that the copy of the return of income filed by the assessee clearly reveals that the assessee has neither earned nor received impugned interest income during the year and no such amount was credited to the books of accounts of the assessee maintained and audited by the competent auditor therefore no addition, under Section 68 of the Income Tax Act was required to be made.
The Senior Departmental Representative supported the orders of the authorities below and submitted that the AIR Information available through the system reveals that the assessee had received payment of Rs. 17,90,671/- on which TDS of Rs. 1,79,067/- under Section 194A of the Income Tax Act was deducted by the payee M/s. Ecos India Mobility and Hospitality Pvt. Ltd.
The Authorized Representative submitted that the assessee did not recognize any interest income and no TDS has been claimed by the assessee. On being asked by the bench the Senior Departmental Representative, in all fairness did not controvert a factual position that neither the assessee has shown any amount as interest income nor has claimed TDS thereon.
The Two-member bench comprising of Chandra Mohan Garg (Judicial member) and Pradip Kumar Kedia (Accountant member) held that there is no hesitation to hold that the addition made by the Assessing Officer and upheld by the CIT(A) under Section 68 of the Income Tax Act is not sustainable.
Thus, the appeal of the assessee was partly allowed.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
