TaxTMI 
TaxTMI 
2018 (9) TMI 1784
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.... 143(3) of the Income Tax Act, 1961 on 28/03/2213. The total income was assessed as Rs. 27,90,33,030/-. 04-The Assessing Officer has rejected the Books of Accounts of the assessee and additions were made on account of Unaccounted Stock, Unexplained Credit under Section 68, Unaccounted Purchase, Unexplained Credit under Section 68, Estimation of Gross Profit on sale of Gold Bar and Estimation of Gross Profit on sale of Gold Bar again. 05-The assessee being aggrieved by the order passed by the Assessment Officer preferred an appeal before the Commissioner of Income Tax (Appeal) and the appellate authority vide order dated 27/02/2015 has confirmed the addition of Rs. 50,00,000/- on account of Unexplained Credit under Section 68 of the Income Tax Act, 1961. 06-The addition on account of estimation of gross profit of Gold and Silver Bar, the Commissioner of Income Tax (Appeal) has confirmed addition and the assessee was ultimately granted a relief of Rs. 4,98,05,923/-. The Commissioner of Income Tax (Appeal) has partly affirmed the order passed by the Assessing Officer. Against the order passed by the Commissioner of Income Tax (Appeal), the assessee as well as Income Tax Depar....
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....ouped the sales of gold bullion and silver bullion together at Rs. 585,95,67,563/- (i.e. gold bullion Rs. 584,67,73,769/- and silver bullion Rs. 1,27,93,794/-) for A.Y. 2010-11 and by making enhancement of 17.5% on aggregate sales, the learned CIT(A) applied gross profit rate of 1.25%. 14. We further find that the additions in silver bullion account were made by the Assessing Officer at Rs. 9,65,123/- and Rs. 40,69,563/- in A.Y. 2010-11 & 2011-12 by estimating gross profit on sale of silver bullion. It was also contended by the learned counsel for the assessee before us that no incriminating documents regarding purchase/sale of silver bullion were found. Gross profit on sales of silver bullion was disclosed @ 0.63% in A.Y. 2010-11 and @ 1.06% in A.Y. 2011-12. Quantitative records have been maintained and books of accounts are audited. Sale of silver bars during and in A.Y. 2010-11 was Rs. 1,27,93,794/- (522.946 kg) whereas sale in A.Y. 2011-12 was Rs. 5,50,01,943/- (1861.524 kg.). The Assessing Officer did not apply gross profit rate but he conducted market enquiry of silver bullion trade business. The Assessing Officer on the basis of market enquiry found that profit on o....
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....eriod relevant to assessment year 2011-12. We also observe that whenever there is tremendous increase in the price of gold, the margin of profit shrinks. Gold market is well informed marked and guided by international price. There was VAT of 1% on the recorded trading of gold. Thus, the gross profit estimated on unrecorded sales cannot be applied to the recorded sales as the margin of tax also remains with the seller of unaccounted sales while in the recorded sales the prices are increased by VAT which reduces the margin of profit by the similar amount. The cumulative effect of increase in turnover and increase in gold price must have reduced the gross profit for the assessment years 2010-11 and 2011-12. We also find that the Additional Commissioner of the same Range in the case of Shri Nitesh Kumar Doshi for the A.Y. 2010-11 has accepted the G.P. rate at 0.14% on the recorded sales and Shri Doshi was also engaged in similar business. In the case of Baldev Krishna the GP was estimated at Rs. 400/- per 120 gms which comes to around 0.2% of the sales recorded. Similarly in the case of Vonamala Jagdishwaraiah; (2015) 44 CCH 005 GP at 0.1% has been accepted by Hyderabad Bench of ITAT a....
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..../Ind/2015 (revenue's appeal) is regarding the addition sustained of Rs. 2,02,47,590/ - on account of unaccounted investment in A.Y. 2009-10. 18. The facts, in brief, are that on 26.1.2010 the police intercepted two persons with 30 silver bars weighing 919.276 kgs valued at Rs. 2,02,47,590/-. They were transferring the bullion from the residence of the assessee at Gumasta Nagar to his office at Chhota Sarafa, Indore. The police seized the silver which was requisitioned by DDIT (Inv.) by invoking provisions of section 152A of the Act. The assessee claimed that these silver bars were purchased on 25.8.2008 by the assessee at Ahmedabad from Riddhi Siddhi Jewellers 609.456 kgs and M/s M.D. Overseas 309.211 kgs and then transported from branch office at Ahmedabad to Indore office by Rajesh Driver of the assessee who carried the same by Vehicle No. MP 41, D-0175. The original bills were handed over to the police. The Assessing Officer did not believe the assessee's explanation and made the addition. The learned CIT(A) also relied upon the findings of the Assessing Officer and noted that there are substantial evidences and many holes in the story of the assessee regarding purchase....
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.... a detailed fact finding in favour of the assessee after scrutinizing the facts and as such no substantial question of law is involved in this case. The findings arrived at by the Income Tax Tribunal are after considering the facts on record. The Tribunal endorsed the following reasoning in respect of the aforesaid question, as reproduced below, while deleting the addition of Rs. 17,85,88,277/- on account of purchase made from M/s. Hyundai Exporters. Paragraphs No.23 to 28 of the ITAT's order reads as under:- "23. During the financial year 2008-09 relevant to A.Y. 2009-10 the assessee has shown purchases from M/s Hyundai Exports of Rs. 17,85,88,277/-. As per the Assessing Officer, the assessee could produce the original bills to the tune of Rs. 12,56,94,400/- and the remaining bills were not produced. The Assessing Officer observed that bill/tax invoice does not bear the official seal of the seller. In place of seller, the space was found blank. The bill issued on 17.9.2008 was not found to have been signed by the seller and the order number, date of order, delivery memo, etc. were found blank. He observed that the bills produced cannot be relied upon and accordingly a....
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....hey have confirmed the purchases made by the assessee. For all these purchases, the assessee has made advance payments through banking channels, which is evident from page 168 of the paper book and copies of all the bank statements were filed during the assessment proceedings and all the entries in connection with the payment for these purchases were recorded in the books of accounts. He also pleaded that before the learned CIT(A) all the bills including the bills which could not be filed before the Assessing Officer, were filed, which were verified by him. The learned CIT(A) observed that the assessee has entered in the stock register different purchases. He further submitted that the confirmation from the seller has been filed, bills were produced, purchases are entered in the regular books of accounts and also in the stock register, payments for all these purchases were made through banking channels, all these payments are verified from books of accounts and bank statements. He, therefore, pleaded that such additions are unjustified. 27. On the other hand, the learned DR relied upon the assessment order. 28. We have heard both the sides. We find that the assess....
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....6 is also a question of fact and the ITAT has given detailed finding in favour of the assessee after scrutinizing the facts and as such no substantial question of law is involved in this case. The findings arrived at by the Income Tax Tribunal in respect of the aforesaid question in paragraphs No.29 to 32 reads as under:- "29. Ground no. 7 in IT(SS) A No. 241/Ind/2015 is regarding sustenance of addition of Rs. 50 lacs made u/s 68 of the Act which was received from M/s Pramila Investors & Finance Limited. The Assessing Officer made the addition of Rs. 50 lacs being sundry credit balance in the name of M/s Pramila Investors & Finance Limited by holding that identity, income tax return and bank statement of the party have not been filed. This action of the Assessing Officer was sustained by the learned CIT(A). Now the assessee is in appeal before the Tribunal. 30. The learned counsel for the assessee submitted that the assessee has filed confirmation with PAN along with income tax return of M/s Pramila Investment & Finance Ltd. This transaction was through banking channels. He submitted that this amount was not received as loan but it was received for future trading ....
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....e direct the Assessing Officer to delete the addition. This ground of the assessee is, therefore, allowed." 13-Thus, it is evident that the the aforesaid question is purely a question of fact. The respondent assessee has further submitted that the question No.6 raised in this appeal is not question of law but it is a pure question of facts which have been decided by the Tribunal as a last authority on facts by analyzing the relevant documents placed before it by the appellant. 14-Not only this, in the case of Commissioner of Income Tax Vs. Pithampur Conzima (P) Ltd. reported in ITR 244 442 (MP), the coordinate Bench of this Court has held that it become clear that the Tribunal has accepted the explanation of the assessee which showed that the credit given was duly declared by the creditors in the new return and therefore, deletion of the addition was on the basic on the satisfaction reached by the Tribunal and on the appreciation of material before it and therefore, the matter accordingly does not give rise to any question of law warranting dismissal of this application which is accordingly dismissed. 15-Learned counsel for the respondent has placed reliance upon another j....
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....CIT (A) reads as under:- "17. Gr. no. 9 of appeal is against addition of Rs. 45 lakh u/s 68 of the I.T. Act on the ground of repayment of amount from M/s MP real Estate. The said sum of Rs. 45 lakh was invested by appellant in that firm M/s MP Real Estate & Developers, in earlier years and in this year, such amount of partner's contribution was merely returned back by that firm & hence it cannot be added as cash credit u/s 68 of I.T., as it is merely refund of partner's contribution repaid through cheques. Hence addition of Rs. 45 lakh is hereby deleted. Gr. no.9 of appeal is allowed." 18-The Tribunal has also upheld the findings of the CIT (A) and has held as under:- "36. After hearing the parties, we find that the learned CIT(A) has deleted the addition by holding that the amount of Rs. 45 lacs was invested by the assessee in the firm, M.P. Real Estate & Developers in earlier years and in this year this amount was received as partners' contribution by that firm. Hence, the addition u/s 68 could not be sustained and it was merely refund of partners' contribution repaid through cheque. The learned DR failed to controvert the findings of the learned CIT(A). We, ....
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....-In the case of Mangalore Ganesh Beedi Works Vs. Commissioner of Income Tax, Mysore reported the (2015) 378 ITR 640 (SC), the apex Court has held as under:- "19. We are not at all impressed with the submission of learned counsel for the Revenue. There is a clear finding of fact by the Tribunal that the legal expenses incurred by the Assessee were for protecting its business and that the expenses were incurred after 18th November, 1994. There is no reason to reverse this finding of fact particularly since nothing has been shown to us to conclude that the finding of fact was perverse in any manner whatsoever. That apart, if the finding of fact arrived at by the Tribunal were to be set aside, a specific question regarding a perverse finding of fact ought to have been framed by the High Court. The Revenue did not seek the framing of any such question. In this regard, reference may be made to K. Ravindranathan Nair v. Commissioner of Income Tax [2001] 247 ITR 178 / 114 taxman 53 (SC) wherein it was observed: "The High Court overlooked the cardinal principle that it is the Tribunal which is the final fact-finding authority. A decision on fact of the Tribunal can be gone....
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....rds "of general importance" as has been done in many other provisions such as Section 109 of the Code or Article 133(1)(a) of the Constitution. The substantial question of law on which a second appeal shall be heard need not necessarily be a substantial question of law of general importance. In Guran Ditta v. T. Ram Ditta (AIR 1928 PC 172) , the phrase 'substantial question of law' as it was employed in the last clause of the then existing Section 100 CPC (since omitted by the Amendment Act. 1973) came up for consideration and their Lordships held that it did not mean a substantial question of general importance but a substantial question of law which was involved in the case. In Sri Chunilal's case [1962 Supp (3) SCR 549 : AIR 1962 SC 1314], the Constitution Bench expressed agreement with the following view taken by a full Bench of the Madras High Court in Rimmalapudi Subba Rao v. Noony Veeraju [AIR 1951 Mad. 969 : (1951) 2 MLJ 222 (FB)] : (Sir Chunilal case [1962 Supp (3) SCR 549 : AIR 1962 SC 1314], SCR P.557) When a question of law is fairly arguable, where there is room for difference of opinion on it or where the Court thought it necessary to deal with that questi....