TaxTMI 
TaxTMI 
2013 (11) TMI 960
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....2.2006. 2. The appeal raises a single issue, i.e., the maintainability of the deletion of the addition in the sum of Rs.16,18,150/- u/s.68 of the Act by the ld. CIT(A) in appeal. 3.1 The background facts of the case are that the assessee, a company, which filed its return of income for the year on 01.11.2004 at a loss of Rs.31.95 crores, was extremely uncooperative during the assessment proceedings, with even its return being not accompanied by either the audited accounts or the audit report u/s.44AB of the Act, so that there was non compliance of the said provision. Further, a financial statement filed at the fag end of the assessment proceedings, i.e., on 19.12.2006, was also found to be at variance with that per the return of income, a....
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....tive (DR) was before us at pains to emphasize, not produced before the ld. A.O. Continuing further, however, though the books may not have been found reliable for the purpose of assessment of income, but that would not imply that each and every entry therein is incorrect or false. In fact, the assessee had claimed a loss with reference to its books of account, the disallowance of which by the A.O. stands since confirmed by the first appellate authority. The said loss would only imply that the book or the assessee's accounted assets stand depleted to that extent. As such, we find no conflict between the rejection of its accounts by the Revenue and reliance thereon by the assessee for the purpose of explaining the nature and source of the im....
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....r Mohamed Haji Hasan vs. CIT [2001] 247 ITR 290 (Guj)). The decision in the case of Aggarwal Engg. Co. (Jal.) (supra) does not consider the said decision by the apex court, which is squarely on the point, settling the law in the matter. In fact, the hon'ble high court relied on the decision in the case of CIT vs. Banwarilal Banshidhar [1998] 229 ITR 229 (All), which is in the context of disallowance u/s.40A(3) and, thus, qua a different provision, toward computing business income under Chapter IV-D. The matter is, as also explained by the apex court, factual, so that there could be a case for telescoping, and it would all depend on the facts of the case. In fact, in the instant case there is no question of estimating income upon rejection o....