2018 (6) TMI 58

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....deleting the addition of Rs. 73,70,000/- & Rs. 1,85,42,100/- on account of disallowance of expenses u/s.40A(3) and unexplained expenditure. 2. Under the facts and circumstances of the case the Ld.CIT(A) has erred in ruling-out the seized materials marked VRS-16, VRS-23, VRS-25, VRS-26 & VRS-32-35 which clearly indicate that expenses of Rs. 73,70,000/- have been incurred in cash. From the seized documents, it is clearly seen that the violation of Section 40A(3) of the I.T.Act, 1961 has occurred. 3. Under the facts and circumstances of case, the Ld. CIT(A) has erred in ruling-out the seized materials marked BKBT/2 containing loose sheets/cash panna/vouchers etc., which clearly indicate that amount in the left hand side of th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....appeal 6. On the other hand, ld. AR supported the order of CIT(A). 7. We heard the rival submissions and perused the material on record. Prima facie, the sole matrix of the disputed issue is with respect to the deleting the additions on account of disallowance of expenses u/s.40A(3) and unexplained expenditure. We find that the CIT(A) while dealing with the disputed issue of disallowance u/s.40A(3), observed that the disallowance by the AO u/s.40A(3) of the Act pertaining to the same expenses already disallowed by the tax auditor will lead to double taxation. The observations of the CIT(A) on this issue are as under :- "After considering the AO's finding and submission of the appellant, I find that the appellant has submitted....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... "After considering the AO's finding and submission of the appellant, I find that during the course of search and seizure action, the seized document included cash panna of the appellant company at Kolkata office wherein the left hand side indicates the source of fund and the right hand side indicates various expenses. The AO picked up cash amounts mentioned under names of different persons on various dates on the right hand side of cash panna and treated the same as expenses incurred in violation of sec. 40A(3) or expenses not allowable u/s 37 of the Act or unexplained expenses u/s 69C of the Act. On the other hand, the appellant has shown from his regular cash book that all the transactions noted on the seized cash panna was nothing but p....