Re: Form 3 received with different calculation by Department
Hello Sir
Assessee received Form 3 for AY 2009-10 (assessees appeal pending before CIT(A)) without considering a judgment in his favour on similar issue in AY 2010-11 (Where Tribunal has reduced the disallowance from 12.5% to 5% of total allied bogus purchase).
We had calculated 50% of total Disputed tax …. but Department has calculated 100% of the disputed tax with the remark “the assessee has calculated the disputed tax under DTVSV scheme at Rs. 315340/-. the disputed tax as per the ssytem is calculated at Rs . 634157/-. the difference in the disputed tax is because the assessee has wrongly calculated disputed tax.
What should be done?
Fresh Form can always be filled. Further 50 percent would be to the extent of favourable order in the case of the assessee. Since the disallowance is reduced from 12.5% to 5%, the favourable order is to the extent of 7.5 per cent. 5 percent disallowance is still upheld. Therefore, in our opinion, the assessee will have to pay 5 + 3.25 (50% of 7.5%) i.e. 8.25 per cent of total alleged bogus purchases.
In the alternative, if the assessee approaches the Tribunal, the issue being a covered matter, the Tribunal is likely to uphold 5 percent. However, interest & penalty might be attracted.
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