Case Law Details
DCIT Vs Maa Umiya Agritech Pvt. Ltd. (ITAT Indore)
ITAT Indore held that in the absence of any major discrepancies or defects in the books of accounts, the rejection of the books of account only for want of tax audit report is not justified.
Facts- The assessee company was engaged in the business of food process and cold storage. The assessee filed its return of income on 29.09.2012 declaring total income at loss of Rs.13,43,58,600/-. The AO completed the assessment u/s 144 on 25.03.2015 at the total income of Rs.5,38,80,006/-. Aggrieved by the assessment order, the assessee filed before the Ld. CIT(A). The Ld. CIT(A) after calling remand report twice from the AO has deleted the majority of the additions made by the AO. Therefore, aggrieved by the impugned order of the Ld. CIT(A) the revenue has filed the present appeal.
Conclusion- It is specifically noted that the remedy for non-filing of the tax audit report is to initiate separate proceedings under Income Tax Act but when all other documents and books of account are maintained and statutory audit reports were filed to show that books of account have been audited by the auditor then the AO ought to have examined books of account and supporting evidence.
It is only a case where accounts were not correct or incomplete or the method of accounting employed by the assessee is not such as to enable the AO to determine the income properly then can resort to the provisions of section 145(3) or 144 of the Act. In the absence of any major discrepancies or defects in the books of accounts, the rejection of the books of account only for want of tax audit report is not justified.
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