TaxTMI 
TaxTMI 
TaxTMI 
2019 (9) TMI 632
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....(A) grossly erred both in law and on facts in relying upon the various judicial pronouncement which are contrary to the facts of the case. In the absence of any concealment of facts or furnishing inaccurate particulars, the penalty sustained is wholly illegal. 3. Because Ld. CIT(A) having failed to adjudicate the ground of appellant claiming lack of sufficient opportunity by the Assessing Officer before passing of order u/s 271(1)(c), the order of Ld. CIT(A) suffers from fatal error in law. 4. Because the order is against the law & facts. 5. Because the appellant craves leave to alter/ modify grounds before or at the time of hearing of the appeal." 2. In this case, return of income for the A.Y. 2009-10 was filed on 29.09.2009 declaring total income of Rs. 4,86,270/-. Subsequently, the case was taken up for scrutiny under CASS and the assessment was completed at a total income of Rs. 1,01,55,498/-. In the process of making additions, the AO disallowed a sum of Rs. 92,00,000/- introduced as capital of the partners of the firm and stated that in the assessment order the appellant conceded for the addition. The AO also disallowed interest of Rs. 2,85,984/- and Rs. 1,83,248/- for....
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....were filed by the assessee. 5.4 During the course of appellate proceedings assessee was again asked that the partner should be produced with all these documentary proofs for receipt of cash against advance for sale of land. However, during the appellate proceedings also could not file any evidence regarding cash received against advance as also the partners were not produced to give their statement. In this connection, emphasis on production of the partners during appellate proceedings was made as before the ITAT, the counsel of the assessee has accepted that these are unaccounted income in the hands of the assessee but it was held that the confession of the counsel of the assessee is not valid in law and the case has been set aside to the file of the Assessing Officer.In the renewed opportunities provided to the assessee, assessee did not file any details of land sold or agreement to sale etc., and hence the acceptance of the counsel of the assessee was correct, though not accepted by assessee. 5.4.1 To verify the nature and source of these transactions AO has again allowed opportunity to the assessee. The nature of these deposits were that Rs. 1,00,000/- was deposited in cash....
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....tion in the firm, ld. CIT(A) has upheld the order of A.O. The addition in firm is contrary to judgment of jurisdictional High Court. He has filed affidavits balance sheets etc. documents of partners of the firms as additional evidence in Rule 29 of ITAT Rules, is admitted. (APB-pg.1-20). 7. The ld. DR has supported the order of penalty confirmed by the ld. CIT(A). He has no objection to the additional evidence filed by the assessee under Rule 29 of ITAT Rules. He contended that the partners have to explain the source of deposits since they have failed to discharge the ONUS, then such deposit could not be added in the hands of the partners only. Hon'ble Allahabad High Court in the case of Jagmohan Ram Chandra vs. CIT 1993 CTR All 153, has following Hon'ble Supreme Court in Jain Brothers has overturn such a proposition vide para 21 as under: Para-21 "Thus, from the aforesaid decisions, it is settled that if an entry of cash credits is found in the books of account of a firm, it is for the firm to give explanation regarding identity and source of such deposits and if the explanation is disbelieved then it is to be added as an income under section 68 of the Act in the hands of th....
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.... evidence, APB page no. 4, 7, and 9 the return of income, balance sheet and ledger account of M/s Verma service station in the books of Sh. Naveen Chandra Verma partner of the firm and vice versa we find that though he has meagre income of Rs. 4,21,280/- with opening balance of Rs. 1,00,000/- to deposit in the firm as on 01.04.2008 and further payment of Rs. 50,00,000/- to the credit of following accounts as on 06.05.2008 make it clear that the financial status of the creditor doesn't warrant such deposits, detailed as under: Debit Credit Verma Service Station Rs. 50,00,000/- 06.05.2008 Ch. No. 258042, From Rama Rama Rs. 8 lacs Hara Hara Rs. 12, lacs Krashna Krashna Rs. 10 lacs Venus Automative Services Pvt. Ltd. Rs. 10 lacs Verma Service Station Pvt. Rs. 10 lacs 11. From the balance sheet (APB page no. 7), it can be seen that assessee has shown an agricultural land for Rs. 10,07,560/- as shown on the asset side of the balance sheet whereas he has shown advances against the sale of land at Rs. 68,50,000/-. Thus, there was a discrepancy in the amount of consideration shown against the sale of agricultural land which cannot be more than Rs. 10,07,560/- and thereby the diff....
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.... Krishna Bulk Movers (P) Ltd. has transferred this amount to M/s Verma Service Station (P) Ltd. Copy of all these accounts were available in the case of Venus Auto and hence, assessee's contention that this amount has now come from some advance for land sold held to be after thought were being not supported by any documentary evidence and these concerns were having zero sales turnover. Again, the value of the land has been shown to be sold as Rs. 10 lacs as evident from the balance sheet of the firm M/s Verma Service Station as above. Under these circumstances, AO was correct in holding these credits as unexplained in the hands of the assessee and the ld. CIT(A)was justified in confirming the addition as unexplained capital of the assessee firm u/s 68 of the Act and so the Tribunal confirmed the addition of Rs. 92,00,000/- is confirmed as unexplained capital u/s 68 of the Act in the hands of the firm. 15. The Assessing Officer has to satisfy whether the penalty proceedings be initiated or not during the course of the assessment proceedings and the Assessing Officer is not required to record his satisfaction in a particular manner or reduce it into writing. The scope of section....