TaxTMI 
TaxTMI 
2009 (10) TMI 942
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....is appeal of the assessee is against the order of CIT(A) in confirming the addition made by the Assessing Officer on account of alleged unaccounted cash sales amounting to Rs. 40,200/-. 3. We have heard the rival contentions and gone through the facts and circumstances of the case. We have also perused the case records including the assessment order as well as the order of CIT(A). The brief facts are that the Assessing Officer during the course of assessment proceedings noticed that the assessee has effected cash sales to M/s. Techno Rub Industries on 05-03-2001, 07- 03-2001 and on 10-03-2001 amounting to Rs. 18,500/-, 13,500/- and Rs. 8,100/- respectively for which the Director of the company has issued stamped receipt to the above mentioned party i.e. M/s. Techno Rubb Industries and copies of these stamped receipts issued to the above mentioned party had been obtained and kept on record. On verification of the cash book, the Assessing Officer noticed that no entry has been made in cash book in respective dates, a specific notice on this point was issued to the assessee asking to show cause as to why the cash sales as mentioned above should not be added to income of assessee. T....
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....d in rejecting he vague explanation furnished by the assessee in the matter. It is quite clear that the documents on which the AO lay hands clearly indicate cash sales totaling to Rs. 40,200/- in the month of March, 2001 to M/s. Techno Rubb Inds. which were not reflected in the books of account and as a consequence, the AO was fully justified in bringing to tax such unaccounted sales as income of the assessee. The consequential addition of Rs. 40,200/- made by the AO is accordingly, confirmed and this ground of assessee's appeal is therefore rejected. In view of the above, we dismiss this issue of the assessee's appeal. 4. The next issue in this appeal of the assessee is against the order of CIT(A) in confirming the disallowance made by the AO on account of rate and confirmed the expenses of Rs. 82,881/-. ITA No.160 & 1089/Ahd/2006 A.Y. 2001-02 Zeo Chem Pvt. Ltd. v. ITO Central Ward-2(1) & ACIT Cir-1, Bng. Page 4 5. We have heard the rival contentions and gone through the facts and circumstances of the case. The brief facts are that during the course of assessment proceedings the AO noticed that the assessee made a claim of deduction of Rs. 82,881/- under the he....
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....unts credited to the account of various parties and that too through journal entries on the last day of the financial year, the claim of the appellant was rightly rejected. It is so, because in the normal course, the entries for rate difference would be passed on various dates and when the accounts of various customers are finalized and not through journal entries at the year end just to reduce the taxable profits. For the reasons above, I hold that the consequential addition of Rs. 82,881/- made by the A O did not call for any interference. The same is, accordingly confirmed. This ground of appeal is, therefore, rejected." Aggrieved, now assessee came in appeal before us. We find that even now before us the assessee could not adduce anything in support of the claim of the assessee and even no confirmation of the respective parties were filed before either of the lower authorities in regard to the claim of deduction of tanvar vata as claimed by the assessee. As the assessee could not furnish any confirmation of the amounts claimed on account of various parties, the lower authorities rightly disallowed these expenses and we confirm the same. 6. The next issue in this appeal of....
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....nt at the year end will not obviously entitle the appellant to claim the deduction, unless and until such transaction is confirmed by the respective party and such commission receipt is shown as income by the respective party and such commission receipt is shown as income by the respective party. I, therefore, hold that with the given facts, the AO was justified in disallowing the claim. Consequently, the addition of Rs. 91,000/- made by the AO on this ground is, therefore, confirmed. This ground of appeal is, therefore, rejected." We find that even now before us Ld. Counsel for the assessee has not filed any evidence which suggest that the assessee has paid commission on account of any specific services rendered by that party i.e M/s. R.N. Sahni & Sons Delhi. In the absence of any confirmation or details of service rendered, we are unable to allow the claim of the assessee. Accordingly, we are of the view that the lower authorities have rightly disallowed the claim and we confirm the same. This issue of the assessee's appeal is dismissed. 10. The next issue in this appeal of the assessee is against the order of CIT(A) in confirming the action of the Assessing Officer in ....
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....semi-finished materials were available which were converted into finished goods. Relevant extracts from the accounts of the preceding year are enclosed, which show that there was 18,660 MTs of materials in the form ITA No.160 & 1089/Ahd/2006 A.Y. 2001-02 Zeo Chem Pvt. Ltd. v. ITO Central Ward-2(1) & ACIT Cir-1, Bng. Page 8 of semi-finished goods. Thus, the production in the earlier years was partly out of the opening stock of semi-finished goods." The CIT(A) referred the objections of the assessee to the Assessing Officer and the AO submitted his remand report as under:- 7.3 The AO vide remand report dated 14.9.2005 submitted as under in the matter. "The assessing officer has verified the low yield Zeolite Powder as against higher consumption of raw material, in last quarter of this year. The purchases are verified and a finding is recorded that there is no delivery challan. Material defects in the bills and also other reasons for holding the purchases as bogus. This is elaborated in para 7 of the assessment order. Considering the overall facts, the assessing officer has rightly considered production loss at 10% and the assessee could not controvert the observations commun....
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....t on the purchase bills were belonging to another concern, Mukhi Agency. During the course of appellate proceedings, there is an admitted position by the appellant that no payment was made to any of these parties and that all payments were still outstanding. The evidences clearly indicate that these parties were non- existence and therefore, there was a clear attempt on the part of the appellant to introduce fictitious purchases in the name of such non-existent parties to artificially reduce taxable profit and defraud the revenue. With evidences on record, therefore, I find that the AO was fully justified in treating the purchases from these parties as bogus and in making the consequential disallowance of Rs. 13,80,636/-. The disallowance made by the AO is accordingly confirmed. This ground of appeal is, therefore, rejected." We find that the CIT(A) has rightly held on the basis of evidences that no payment was made to these parties and all payments were outstanding and even now before us the assessee could not adduce anything which shows that the payments are made. It means that till date these payments are outstanding. Accordingly, this is not a fit case to be interfered in th....
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....n account of unexpected investment in the closing stock of finished product has already been considered by the Assessing Officer. Subsequently, the Ld. Counsel for the assessee taken us to the relevant finding of the AO at page-8 of assessment order last para has already been considered. The Ld. Counsel for the assessee as regards to second issue in the show cause about the non-genuine parties as mentioned above has already been considered at page-7 para 7.3 of the assessment order as under:- "7.3 As stated by the assessee itself, the assessee company has shown huge purchases of raw-materials in the last quarter of the year. On scrutiny of the purchase of raw-materials made during the year, it is noticed that not a single purchase is supported by the delivery challan or L.R. For example, the assessee has shown purchase of S.S. Liquid of 43400 Kgs. as per bill No.185 dt. 31.1.2001 issued by M/s. Ram Acis Chem Agenc, Mehsana. In this bill the party has shown supply of S.S/ liquid on various dates such as on 8.1.01 - ITA No.160 & 1089/Ahd/2006 A.Y. 2001-02 Zeo Chem Pvt. Ltd. v. ITO Central Ward-2(1) & ACIT Cir-1, Bng. Page 11 14500 Kgs. 16.1.01 - 14600 Kgs., and on 22.1.01....