Sri Balaji Promoters, Bangalore Vs Income Tax Officer, Ward- 7(2)(4), Bangalore

Last updated: 17 December 2020

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This Income Tax Appellate Tribunal case concerns Sri Balaji Promoters and the Income Tax Officer for the assessment year 2016-17. The appeal challenges an addition of Rs. 1,56,35,302/-, representing the difference between income disclosed in the company's books and Form 26AS. The assessee, a partnership firm providing market support services, explained that the discrepancy arose from including service tax in the gross commission receipts reported in Form 26AS, a clarification accepted by the Assessing Officer.

Court :
ITAT Bangalore

Brief :
The assessee has filed this appeal challenging the order dated22.11.2019 passed by Ld CIT(A)-7, Bengaluru and it relates to the assessment year 2016-17. The assessee is aggrieved by the decision of Ld CIT(A) in confirming the addition of Rs.1,56,35,302/-, being the difference in the income disclosed in the books of account and Form 26AS.

Citation :
ITA No.122/Bang/2020

IN THE INCOME TAX APPELLATE TRIBUNAL
BANGALORE BENCHES “C”, BANGALORE

Before Shri George George K, JM & Shri B.R.Baskaran, AM
ITA No.122/Bang/2020 : Asst.Year 2016-2017

Sri.Balaji Promoters
No.216, 1st Floor, 3rd Main
Jayanagar VI Block
Bangalore – 560 082
PAN : ACRFS9100L
(Appellant)

vs.

The Income Tax Officer
Ward 7(2)(4)
Bangalore.
(Respondent)

Appellant by : Sri.Prashanth.G.S., CA
Respondent by : Smt.R.Premi, JCIT-DR
Date of Hearing : 15.12.2020
Date of
Pronouncement : 15.12.2020

O R D E R

Per B.R.Baskaran, AM :

The assessee has filed this appeal challenging the order dated22.11.2019 passed by Ld CIT(A)-7, Bengaluru and it relates to the assessment year 2016-17. The assessee is aggrieved by the decision of Ld CIT(A) in confirming the addition of Rs.1,56,35,302/-, being the difference in the income disclosed in the books of account and Form 26AS.

2. The assessee is a partnership firm. It is engaged in the business of providing market support services to a company named M/s Bacardi India P Ltd.

3. During the scrutiny proceedings, the AO noticed from Form 26AS that the assessee has received a sum of Rs.1,82,82,161/- as Commission and Contract receipts. However, it was seen that the assessee has disclosed asum of RS.23,37,309/- in its return of income as Commission income. The assessee explained that the Commission amount received wasRs.26,62,513/-, which included Service tax component of Rs.3,25,204/-.Accordingly net commission income of Rs.23,37,309/- was disclosed in the return of income. The AO accepted this explanation.

To know more in details find the attachment file

FAQ :

The main issue is the Income Tax Officer's addition of Rs. 1,56,35,302/- to Sri Balaji Promoters' income for the assessment year 2016-17, which represented the difference between income disclosed in their books and Form 26AS.

Sri Balaji Promoters is a partnership firm engaged in providing market support services to M/s Bacardi India P Ltd.

The difference arose because Form 26AS included service tax in the gross commission receipts, whereas Sri Balaji Promoters disclosed only the net commission income after deducting the service tax component in their return.

Yes, the Assessing Officer accepted the assessee's explanation that the disclosed income of Rs. 23,37,309/- was the net commission after deducting the service tax component of Rs. 3,25,204/-.