Income Mismatch in ITR & 26AS: Tax additions cannot be made just on the basis of From 26AS, says ITAT

Income Mismatch in ITR & 26AS: Tax additions cannot be made just on the basis of From 26AS, says ITAT The Tribunal Bench of Shri Waseem Ahmed, Accountant Member and Shri T. R. Senthil Kumar, Judicial Member has said that incase of making addition where there is mismatch in the gross income reported by the assessee viz a viz the income reflecting in form 26AS, AO should check other considerations as well. Facts of the Case: The AO during the assessment proceedings found that the assessee has shown contract receipt of Rs. 7,43,07,700/- in the books of accounts whereas receipt as per from 26AS was of Rs. 7,47,20,781/-. Thus, the AO made addition of difference amount of Rs.4,13,081/- only to the total income of the assessee. The assessee carried the matter before the learned CIT(A)and submitted that it has shown contract income considering the amount received before filing the return of income. The amount of difference i.e. Rs. 4,13,081.00 represents the amount received after filing of return of income. Therefore, no addition should be made on the basis impugned difference. ITAT Order: 8. We have heard the learned DR and perused the materials available on record. From the preceding discussion, we note that there was mismatch in the gross income reported by the assessee viz a viz the income reflecting in form 26AS for an amount of Rs. 4,13,081.00 only. As such, the assessee has shown less income by the impugned amount, therefore concurrent view was taken by the lower authorities that the assessee has suppressed the income in the books of accounts. However, we find that the assessee before the learned CIT (A) has contended that the impugned income was received after filing of return of income. Thus a doubt arises whether the impugned amount was shown by the assessee in the income tax return in the later year, if that be so, then if any addition is made in the year under consideration, it shall certain lead to the double addition which is undesirable under the provisions of law. However, it is equally important to note that the assessee under a mercantile system of accounting has to declare income based on the concept of accrual. Be that as it may be, in the interest of justice and fair play we are inclined to give one opportunity to the assessee to make the properly presentation of the facts so that the AO could adjudicate the issue of afresh as per the provisions of law. Hence, the ground of appeal is allowed for the statistical purposes. For Official Judgment Download PDF Given Below: