INCOME TAX ACT, 1961

Section 28

Business income - Chargeability - Suppression of income - Difference between figures reported in service tax return and financial statement

Assessee filed return of income declaring income of Rs. 3,40,45,410. An assessment order came to be passed under section 143(3) by making an addition of Rs. 10,52,645 under section 28. On the ground of difference between figures reported in service tax to return and financial statements. Held: It was case of assessee that since audit was initiated at end of 2014, service tax return could not be revised online as 90 days period was over. By going through paper book produced by assessee, it was found that assessee had also tried to file revised return by manually to service tax department which was not accepted. There was no system of manual return filing/revised return by online due to expiry of limitation period. Assessee had tried to revise service tax return, but assessee was not successful in revising service tax return. Difference between service tax return and revenue had occurred due to wrong exchange rate applied to export income transaction while filing service tax return, which being a genuine mistake and Department had not alleged or proved any mens rea on part of assessee who had also tried to revise service tax return. Thus, mere mistake in service tax return did not mean that income of assessee was suppressed.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2014-15

SUBSCRIBE FOR FULL CONTENT