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of <h1>Tribunal upholds Assessing Officer's additions, treats commodity loss as speculation loss, and dismisses appeal.</h1> <h3>Shri Nandkishor Laxminarayan Agarwal Versus The Income Tax Officer, Ward-1 (3), Jalna</h3> Shri Nandkishor Laxminarayan Agarwal Versus The Income Tax Officer, Ward-1 (3), Jalna - TMI Issues Involved:1. Addition of Rs. 49,29,010 as unexplained cash deposits.2. Addition of Rs. 16,25,942 treating commodity loss as speculation loss.3. Addition of Rs. 2,50,000 out of disallowance of Rs. 40,61,348 for purchases of scrap.4. Disallowance of interest of Rs. 17,54,623.5. Request for just and equitable relief.6. Cancellation of interest charges under Section 234B.Issue-wise Detailed Analysis:1. Addition of Rs. 49,29,010 as Unexplained Cash Deposits:The assessee claimed that the cash deposits were from cash sales of Rs. 69,02,253. However, the Assessing Officer (AO) added Rs. 49,29,010 as income from undisclosed sources under Section 69 of the Income Tax Act due to the assessee's failure to provide satisfactory evidence. The CIT(A) confirmed the addition, noting the non-cooperation of the assessee and the lack of credible evidence to support the cash sales. The Tribunal upheld the CIT(A)'s decision, emphasizing the assessee's failure to controvert the findings and the lack of cooperation during the assessment proceedings.2. Addition of Rs. 16,25,942 Treating Commodity Loss as Speculation Loss:The AO treated the commodity transactions in metals as speculative under Section 43(5) of the Act, as they were settled otherwise than by actual delivery. The CIT(A) confirmed this, referencing the Tribunal's decision in M/s. Varsha Corporation Ltd. Vs. DCIT, which held similar losses as speculative. The Tribunal found no infirmity in the CIT(A)'s order, noting the assessee's lack of interest in pursuing the appeal and the absence of any evidence to counter the CIT(A)'s findings.3. Addition of Rs. 2,50,000 out of Disallowance of Rs. 40,61,348 for Purchases of Scrap:The AO disallowed Rs. 40,61,348 due to unexplained purchases, which the CIT(A) reduced to Rs. 2,50,000. The CIT(A) noted that the total purchases were Rs. 54,78,795, and all payments were made through banking channels. However, due to incomplete documentation, a token disallowance of Rs. 2,50,000 was sustained. The Tribunal upheld this decision, finding the CIT(A)'s approach reasonable and justified.4. Disallowance of Interest of Rs. 17,54,623:The AO disallowed Rs. 17,54,623 as interest, concluding that funds were not used for business purposes. The CIT(A) did not adjudicate this issue due to the lack of a specific ground of appeal in Form-35. The Tribunal found no merit in the assessee's appeal, noting the consistent non-cooperation and failure to provide necessary details during the assessment proceedings. The order of the CIT(A) was deemed just and proper.5. Request for Just and Equitable Relief:The Tribunal did not specifically address this ground, as it was general in nature.6. Cancellation of Interest Charges under Section 234B:The Tribunal also did not specifically address this ground, as it was consequential in nature.Conclusion:The appeal of the assessee was dismissed in its entirety, with the Tribunal upholding the findings and decisions of the CIT(A) on all grounds. The order was pronounced on 04th February 2019.
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