TaxTMI 
TaxTMI 
TaxTMI 
2007 (6) TMI 239
X X X X Extracts X X X X
X X X X Extracts X X X X
....nt under section 132 of the Income-tax Act, 1961 [hereinafter referred to as 'the Act'] on 27-2-2004 at the residential premises of the assessee. Consequent to the search so conducted, notice under section 153A of the Act was issued on 4-8-2005. The provisions of section 153A of the Act had been introduced by the Finance Act, 2003 with effect from 1-6-2003. In respect of searches carried out under section 132 of the Act or requisition of books and other documents made under section 132A of the Act after 31-5-2003 the Assessing Officer was competent to issue a notice calling upon assessee to furnish return of income in respect of six assessment years immediately preceding assessment year relevant to the assessment year in which search is conducted or requisition is made. The Assessing Officer is empowered to re-assess the total income in respect of each assessment year falling with such six assessment years under the second proviso to section 153A of the Act. If in respect of any assessment year falling within the six assessment years referred to earlier, any assessment or re-assessment is pending on the date of initiation of the search under section 132 of the Act or making....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e by the Assessing Officer on account of estimating the sale of scrap of the appellant at Rs. 23,500 as against Rs. 3,510 shown by the appellant." 3.2 In response to the notice under section 153A of the Act, the assessee filed return of income disclosing income of Rs. 3,23,000. The income so declared included income from business and income from house property at Rs. 1,92,000. The Assessing Officer called upon the assessee to furnish the books of account of the business of buffing and polishing carried on under the name of M/s. B.M. Associates. The assessee failed to produce the books of account on the ground that the same were not available. Since the books of account were not produced, the Assessing Officer rejected the income declared from business and held that the income from business will be estimated as laid down in the provisions of section 145 sub-section (3) and in the manner laid down in section 144 of the Act. This was confirmed by the CIT (Appeals). We are of the view that in the given circumstances, rejection of books of account was proper and calls for no interference. 3.3 After rejecting the books of account the Assessing Officer noticed that the assessee declared....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y the assessee was very low in the type of business in which the assessee is engaged would not be sufficient for making the addition. The addition made is, therefore, directed to be deleted and the 7th ground of appeal of the assessee is also allowed. 5.1 The third ground of appeal of the assessee, reads as follows:- "3. It is contended that the ld. CIT (Appeals) has erred in upholding an addition of Rs. 40,000 being deposit in M/s. B.M. Associates made by the appellant by treating the same as emanating out of her undisclosed concealed income." 5.2 Along with the return of income filed for the assessment year 1998-99, the assessee had also filed a balance sheet. The Assessing Officer noticed that in the capital account of the assessee there was an addition of Rs. 1,20,000. The assessee explained the source with regard to the deposit of Rs. 80,000 in the capital account, which was accepted by the Assessing Officer. With regard to the remaining sum of Rs. 40,000 the assessee explained that she had an account with State Bank of India at Sarai Khawaja, where from a sum of Rs. 40,000 was withdrawn and deposited as capital, in the account of M/s. B.M. Associates. The assessee did not....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fication for disallowing the claim for deduction of these expenses. Consequently, the 4th ground of appeal of the assessee, is dismissed. 7.1 The 5th ground of appeal of the assessee, reads as follows:- "5. It is contended that the ld. CIT (Appeals) has erred in upholding an addition of Rs. 24,000 made by the Assessing Officer on account of low household expenses." 7.2 The Assessing Officer on examination of the capital account of the assessee noticed that there were no withdrawals for meeting personal expenses and other house-hold expenses. The family of the assessee consisted of her husband, two sons and two daughters. When asked about the details in this regard, the assessee submitted that the total family expenses during the year were of Rs. 99,800 and that her husband, Shri C.P. Kaushik had withdrawn a sum of Rs. 60,000 from his books of account and had further surrendered a sum of Rs. 39,800 before the Settlement Commission on account of low withdrawal for meeting house-hold expenses. An undertaking was also filed by Shri C.P. Kaushik before the Assessing Officer in this regard. The Assessing Officer, however, made an addition of Rs. 24,000 towards low withdrawals for mee....
X X X X Extracts X X X X
X X X X Extracts X X X X
....42 were not available. The Assessing Officer called upon the assessee to produce the bills, which were not available. The assessee filed a reply stating that the same are already included in the bills, which have already been furnished. Finding this explanation not satisfactory, the Assessing Officer made an addition of Rs. 1,11,542. The action of the Assessing Officer was confirmed by the CIT (Appeals). 10.3 Even before us the assessee has not been in a position to offer any valid explanation. The plea of the assessee that the bills, which were not produced were already included in the bills produced before the Assessing Officer remains un-substantiated. In the circumstances, the orders of the revenue authorities are confirmed and the second ground of appeal of the assessee, is dismissed. 11.1 The third ground of appeal is with regard to the addition on account of low house-hold expenses. This addition has been made by the Assessing Officer on identical circumstances under which a similar addition was made in the assessment year 1998-99. In this assessment year, however, the Assessing Officer did not make separate addition and he held that the addition of Rs. 1,11,542 made on ac....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... to have summoned them for examination and without doing so, should not have drawn adverse inference against the assessee. The CIT (Appeals), however, rejected the plea of the assessee on the ground that the address of Shri Salender Vashist was not furnished and that the address of Shri P.K. Sharma and Shri Mohan Lal given in the confirmation does not appear to be correct postal address. The addition made by the Assessing Officer was thus confirmed by the CIT (Appeals). 13.5 We have heard the rival submissions. As far as the cash credit in the name of Shri Salender Vashist is concerned, since the address of Shri Salender was admittedly not furnished by the assessee, the addition made by the revenue authorities deserves to be confirmed. The identity of the creditor has not been established in this case. As far as the credits in the names of Shri P.K. Sharma and Shri Mohan Lal are concerned, the addresses were given by the assessee in the confirmation. Without making any attempts to serve summons at the address given in the confirmation, it was not proper to draw an inference that these addresses were not correct postal addresses. In our view, the assessee had established the identi....