TaxTMI 
TaxTMI 
2020 (5) TMI 330
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....n that assessee achieved sales of Rs. 9,37,98,738/- against which purchases have been made at Rs. 9,37,50,576/-. The fixed assets schedule of the assessee shows value of the fixed assets at Rs. 1.41 crores as on 31-03-2012 which includes plant and machinery added during the year at Rs. 12,94,658/-. The fixed assets include furniture & Fixtures, computer, vehicles, Copier machine, Plant & Machinery and Air Conditioners etc. But the assessee in P & L a/c of M/s. Rhea Distribution Co. has claimed expenses of Rs. 22,472/- on audit fee only and no other expense have been claimed in P & L A/c. The A.O. noted that it is not understood as to how the assessee running a business without incurring expenses which are necessary in a normal course of business. The assessee is showing huge list of fixed assets, but, no electricity charges have been claimed by the assessee Several vehicles are in the business, but no fuel/maintenance expenses have been claimed. No staff expenses have been paid. In the absence of any explanation and non-production of books of account, A.O. made addition of Rs. 10 lakhs on account of unexplained expenditure u/s 69C of I T Act. The Ld. CIT(A) confirmed the addition. ....
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.... addition to assessee's capital account in the proprietary of M/s. Rhea Distribution Co. 8. As per AIR information, the assessee is found to have deposited cash amounting to Rs. 19,28,19,000/- in his bank accounts during the period under consideration. The assessee was also found to have paid Rs. 4,49,65,022/- towards various credit cards bills and also has deposited Rs. 1.85 crores in cash in his saving bank account during the year under consideration The assessee was asked to explain the source of the cash deposited in various Bank accounts and credit card payment. The assessee explained that cash deposited by the assessee in various bank accounts were to the tune of Rs. 9,72,59,500/- and not Rs. 19,28,19,000/- as shown in the AIR statement for the reason that 21 entries of cash deposits have been repeated twice/thrice in the AIR statement. The A.O. sought confirmation from the bankers of the assessee under section 133(6) of the I T Act and the explanation of the assessee found in order, but, the source of the cash deposits were still required to be explained. It was further found from the balance sheet that assessee has made addition to his capital account to the extent of Rs. ....
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.... 2012-2013 under appeal. 9.1. As regards loans and advances and addition to capital account, the assessee submitted details of the same along with documentary evidences along with bank statements to explain cash deposits. The documents could not be submitted before A.O. because of the medical condition of the assessee was beyond control. The Ld. CIT(A) referred to the documentary evidences to the A.O. for calling the remand report. The remand report is reproduced in the appellate order in which the A.O. has stated that assessee was asked to submit copy of the ITR and bank statements of entries forwarding unsecured loans of Rs. 3.98 crores for the assessment year under appeal, details of the land sold along with sale deed resulting in short term capital gain of Rs. 15.92 crores which the assessee has surrendered in A.Y. 2010-2011 during the search. The A.O. noted that assessee has however not submitted details of the short term capital gains, but, an affidavit was filed that income has been surrendered and declared in A.Y. 2011-2012, on which, taxes have been paid. The assessee was asked to furnish confirmations and bank statements and ITR of the parties from whom unsecured loans h....
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....00/- Cash utilized in Rhea Distribution Company 38,86,000/- Total Addition in Rhea Distribution Co. (in Capital Account) 13,50,20,500/- During A.Y. 2013-14 Cash received out of surrendered income 1,16,09,500/- Total (B) 14,66,30,000/- Thereafter it has been explained that the details of addition to Capital Account of Rs. 24,50,91,663/- in his prop. concern M/s. Rhea Distribution Company was as under :- A. Cash received during A.Y. 2012-13 (Out of income surrendered) (Deposited in various Bank accounts and then introduced in capital account of Rs. 13,11,34,500/- and cash introduced directly in firm and utilised in firm Rs. 38,86,000/-). Rs. 13,50,20,500/- B. Unsecured Loan received in bank account of Rhea Distribution Co. (Prop. Firm) (in the ITR shown as capital) Rs. 3,98,00,000/- C. Loan and Advances given by the Proprietor Roop Kishore Madan in preceding years from his proprietorship concern Roop International and transferred to the balance-sheet of another proprietorship concern M/s. Rhea Distribution Company. Rs. 9,02,95,000/- D. Less :- Drawings of the Assessee Rs. 2,00,23,837/- Total addition to Capital Account (A+B+C-D) Rs. 24,50,91,663/- ....
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....confirmed and documentary evidences have also been filed before A.O. The assessee in the rejoinder reiterated the same facts along with documentary evidences, on which also no adverse comments have been made by the A.O. Learned Counsel for the Assessee, therefore, submitted that since during the course of search statement of assessee was recorded in which he has surrendered Rs. 15.92 crores, on which, taxes have been paid, but, Rs. 15 crores was not actually received which cash was later on received and introduced in the books of account, therefore, this amount was available with the assessee to explain the addition of Rs. 13,50,20,500/-. The assessee further explained that balance cash of Rs. 1,16,09,500/- was received in subsequent A.Y. 2013- 2014 which was also deposited in the Bank account of assessee which have been accepted by the A.O. in the Order under section 143(3) of the I.T. Act, 1961. There were thus no justification to make addition of Rs. 13,50,20,500/-. 10.2. Learned Counsel for the Assessee as regards addition of Rs. 3,98,00,000/- reiterated that assessee filed confirmations along with bank statements and income tax returns. Therefore, initial onus upon assessee ....
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....ave considered the rival submissions and perused the material on record and documentary evidences. It is not in dispute that in A.Y. 2011-2012 assessee made surrender of Rs. 15.22 crores as additional income which have been accepted by the A.O. in the Order under section 143(3) of the I.T. Act, 1961, copies filed at page 122 of the PB. The assessee during the course of search has made a statement that out of total amount of Rs. 15.92 crores, Rs. 15 crore is still to be received. Thus, the assessee paid taxes on the entire surrendered amount in preceding A.Y. 2011- 2012, but, according to explanation of assessee Rs. 15 crores is yet to be received. The explanation of assessee had been that this Rs. 15 crore was received in assessment year under appeal which is introduced in the books of account of the assessee. therefore, to that extent assessee is able to explain the source of Rs. 15 crores, on which, no adverse inference have been drawn by the A.O. as well in the remand proceedings, therefore, there were no justification to make any addition to the extent of Rs. 15 crores against the assessee. 12.1. As regards other two additions are concerned, the assessee produced sufficient d....