TaxTMI 
TaxTMI 
TaxTMI 
2016 (4) TMI 661
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....enhancement dt. 13.09.2015 is barred by limitation and is issued in excess of jurisdiction; AND (b) In the set-aside proceedings, there was no fresh Notice of enhancement, as in any circumstances, being time barred, the same could not have been; issued; AND (c) There is no lawful justification for the proposed enhancement, once books/evidence have been produced, that are regularly maintained by the assessee, the Scope for addition, vanishes. 3.1 Because on the facts and in the circumstances of the case, the Ld. CIT (A) erred in not following the ratio of the Apex Court to the effect, that power of enhancement is restricted to only those issues which were considered by Assessing Officer at Assessment stage and no enhancement can be made to tax a new source of income. 3.2 Because the Ld. CIT (A) erred in placing reliance upon the judgment of the Hon'ble Allahabad High Court in the case of Kashi Nath Chandiwala 280 ITR 318, whereas, the same decision is distinguishable on facts and the judgment of the Hon' ble Delhi Court, being applicable to the case, has been ignored. 4. Because the Ld. CIT (A) erred to appreciate that in relation to wage payment, proper evidence ....
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....11.04.2014 in the assessee's appeal No. 54/Lkw/2014. Copy of this Tribunal's order is available on pages 38 to 47 of the paper book. He further submitted that against this Tribunal's order, assessee filed an appeal before the Hon'ble Allahabad High Court and in the judgment dated 10.12.2014 in Income Tax Appeal No. 145 of 2014, Hon'ble Allahabad High Court has set aside the order of the Tribunal as well as the order of the Ld. CIT(A) dated 14.11.2014 and restored the matter back to the file of the Ld. CIT(A) for a fresh decision. He submitted that this Judgment of the Hon'ble Allahabad High Court is available on pages 53 to 55 of the paper book. He raised a contention that Ld. CIT(A) was not justified in making enhancement of income in the facts of the present case and in support of this contention, he placed reliance on the following judicial pronouncements: a) CIT Vs. Kashi Nath Candiwala reported in 144 taxman 840 (All.) b) CIT Vs. Nirbheram Daluram 5 taxman 84 (MP) c) Jute Corpn. of India Ltd. Vs. CIT reported in 53 taxman 85 (SC) d) CIT Vs. S.G. Exports reported in 12 taxman.com 77 (P&H). e) CIT Vs. Mrs. Ratanbai N.K. Dubhash reported in 100 taxman 458 (Bom) f) Sur....
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....la (Supra), it was held by Hon'ble Allahabad High Court that the Tribunal was not justified in holding that the CIT has no power of enhancement in respect of an issue which was not te subject matter of the appeal. Respectfully following this judgment of the Hon'ble Allahabad High Court, we hold that there is no merit in this contention of Ld. AR of the assessee that the enhancement made by Ld. CIT(A) is not proper and valid. This aspect is decided against the assessee. Regarding the merit of the enhancement made by Ld. CIT(A), we find that the decision of Ld. CIT(A) on merit is contained in Para 4.3.1 to 4.5 of his order and these paras are reproduced herein below for the sake of ready reference:- "4.3,1 The appellant has provided comparative chart of gross profit for expenses, but sundry creditors is not reflected therein. Labour charges have gone up from Rs. 22.S2 lakhs to Rs. 23.82 lakhs while job work receipts have gone down from Rs. 1.01 crores to Rs. 90.35 lakhs. Even material purchased has gone down from Rs. 62.93 lakhs to Rs. 49.64 lakhs while there had hardly been any variation in freight & cartage. The appellant has not justified the increase in the labour charges durin....
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....t 50% is found reasonable, during the year and is sustained. 4.4 The appellant was further required to substantiate the identity, capacity & genuineness of sundry creditors. It is pertinent that the Ld. CIT(A)-II, Kanpur vide order dated 14.11.2013 in the appeal for instant year and in absence of bills and vouchers had disallowed Rs. 15.0 lacs out of total claim of payable sundry creditors included in Sundry Creditors liability shown at Rs. 27,76,180/-. In the present proceedings too, the existence, of sundry creditors as per the balance sheet of the appellant as on 31.03.2006/- is not-proved fully and the liability of payable amounts has continued to exist, for apparently long duration. Out of the said total payable sundry creditors, the appellant has submitted only five confirmations alongwith Aadhar Card and stated that two more parties have been contacted to give their confirmations. Till date, no response has been received which casts doubt on the genuineness of the said creditors in appellant's books. Further, out of the five confirmations filed only two have Permanent Account Number, and for the three others, the copy of ledger account is submitted. However, in cas....
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.... as per CIT (A), the labour charges has increased from Rs. 22.92 Lacs in the preceding year to Rs. 23.82 Lacs in the present year although Job Work receipts has gone down to Rs. 90.35 Lacs from Rs. 101 Lacs in the preceding year. Further this is not the case of the assessee that the job work of the present year is more labour oriented as compared to the preceding year. We also find that as per the balance sheet, there is Expenses Payable Rs. 16.64 lacs which include Labour Charges Payable Rs. 16.25 lacs out of total labour charges claimed Rs. 23.82 Lacs. It means that labour charges for more than 8 months is claimed to be outstanding at the year end and it is not a case of the assessee that such labour charges payable is payable to one or more labour contractor who can afford to grant this huge credit of more than 8 months. Regarding this contention that G.P. rate and N. P. rate of the present year are better in the present year as compared to the preceding or succeeding year, we find that this is not a case of the assessee that any assessment of such preceding or succeeding year was completed u/s 143 (3) and in the absence of that, such preceding or succeeding year cannot be a gui....