TaxTMI 
TaxTMI 
2022 (5) TMI 672
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.... through a very bad phase over a period of five years and was making an average net loss of 4% on turnover grounds of appeal of the assessee. 3. The First Appellate Authority is not justified in directing the Assessing Officer to examine the claim of the assessee with regard to interest payment when the accounts are rejected and profits are estimated. 4. The First Appellate Authority has grossly erred in sustaining the disallowance of Rs. 5,53,92,352/- u/s. 40(a)(ia) of the Income Tax Act when the books of accounts are rejected and income is estimated. Further when the department has not brought evidence with respect to details of these payments and payees, the disallowance ought to be deleted. 5. The First Appellate Authority is not justified in sustaining the addition of Rs.7,23,82,604 /- for the simple reason that it is not appearing as a loan in the Balance Sheet as at 31-03-2008. As the Profit and Loss Account and Balance Sheet has been rejected by the department and profits are estimated, no addition should have been made on the basis of unaudited book figures whether given to the bank or not. 6. When Books of Accounts are rejected and prof....
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....d his estimation on any comparable cases, without appreciating the fact that the AO has considered the audited accounts for A. Y 2007-08, in the absence of audited accounts for the year under consideration". 3. The additional grounds filed by the assessee are admitted in view of the decision of the Hon'ble Supreme Court in the case of NTPC Ltd reported in 229 ITR 383 (SC), as these are purely legal ground and no investigation of fresh facts is required. 4. Briefly stated facts of the case are that the Assessing Officer received information that the assessee is a beneficiary of accommodation entries during the financial year 2008-09 through the concerns managed by 'Shri Praveen Kumar Jain'. The assessing officer after recording reasons to believe that income escaped assessment, issued notice under section 148 of the Act, on 10/03/2015. The assessee filed return of income and assessment under section 147 read with section 143(3) of the Act has been completed on 30/03/2016. The Assessing Officer rejected books of accounts of the assessee and estimated profit at the rate of 5% on the turnover of Rs.173,69,18,226/-which was worked out to Rs.8,68,45,911/-. The income of Rs.5,10,37,....
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....ame of the Concern Amount (Rs.) 1. R.S. Enterprises 80,45,300/- Analysis of the information on record shows that the above entities are providers of accommodation entry for bogus sales. The above parties are non-genuine and the accommodation entries provided for amount aggregating to Rs. 80,45,300/- has resulted suppression of the income of the assessee for the A. Y. 2009-10. The assessee has not filed the return of income for the year under consideration. In view of the above, I have reason to believe that the income chargeable to tax, in the garb of bogus purchase by way of accommodation entries to the tune of Rs. 80,45,300/- from the aforesaid entities have escaped assessment for A. Y. 2009-10 for the reasons of omission on part of the assessee in the return within the meaning of Section 147 of the I. T. Act, 1961. Therefore, I am satisfied that this is a fit case to issue notice u/s. 148 r.w.s. 147 of the I. T. Act, 1961. 9. Before us, the Ld. counsel of the assessee assailed the reasons recorded on 26/02/2015 by the Assessing Officer on many grounds. Firstly, on the ground of non-application of mind by the Assessing Officer. He submitted that in second ....
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....f the fourth para to presume that he did not apply his mind while recording reasons, is not justified. The Assessing Officer has duly recorded the fact of non-filing of the return of income, not once but twice. Accordingly, we reject the contention of the Ld. Counsel of the assessee that AO has not applied mind, while recording reasons. Further the Ld. counsel submitted that in the case, no return of income was filed and therefore satisfaction was to be recorded under Explanation 2(a) below section 147 of the Act. The Ld. counsel relied on the decision of the Hon'ble Bombay High Court in the case of General Electoral trust Vs Income-tax Officer, Mumbai reported in 289 CTR 284 (Bom). The relevant funding of the Hon'ble High Court is reproduced as under: "7. Mere non filing of return of income does not give jurisdiction to the Assessing Officer to re-open the assessment unless the person concerned has total income which is assessable under the Act exceeding maximum amount which is not chargeable to Income Tax. This is provided in Explanation 2 to Section 147 of the Act. This is for the reason that in terms of Section 139(1) of the Act the obligation to file a return of incom....
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....Ld. DR, said information was duly provided to the assessee by the Assessing Officer during the course of the assessment proceeding after filing return of income in response to notice under section 148 of the Act. However, the Ld. counsel has not produced any evidence to support that source of the information was asked from the Assessing Officer. It was the onus of the assessee to file necessary evidence in support of its claim that such information was asked from the Assessing Officer and he had not supplied. In absence of any such evidence before us, no adverse inference can be drawn against the Revenue. 13. Fourthly, The Ld. counsel submitted that information of the bogus purchase cannot be prima-facie be true as it was against normal human behaviour. The Ld. counsel submitted that assessee was having huge limits from the bank and there was no requirement of such entries. He submitted that assessee was eligible for 100% tax-exemption under section 10AA of the Act and therefore there was neither a necessity of loan nor of any need for bogus purchase to reduce the profit. He further submitted that anyway the assessee was already running into heavy losses and therefore there was ....
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....t, but during the relevant time, the law did not authorize the Assessing Officer for carrying out any enquiry from the assessee prior to issue of notice under section 148 of the Act. Therefore, the contentions of the Ld. Counsel are accordingly rejected. 17. Sixthly, the Ld. counsel submitted that approval by the Joint Commissioner of Income-Tax was without application of the mind, as he did not see the reasons recorded as well as supporting material. He also submitted that Ld. JCIT had not asked for a copy of the return of income by the assessee. 18. We find that before us, the assessee has submitted a copy of proforma (PB-7), wherein the approval has been granted by the Ld. Add. CIT/JCIT. No other documentary evidence to support that reasons recorded as well as supporting material was not available with the authority approving the reasons recorded. No adverse inference can be drawn on the basis of the arguments without supporting any material. The onus is on the assessee to substantiate its claim. It is for the assessee to obtain complete copy of correspondence between the Assessing Officer and the authority who has approved the reasons recorded, including record from the o....
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....us according to the Ld. counsel, the ITO did not have jurisdiction of the case and therefore issuing notice by him was illegal. Further, he submitted that if the notice issued by the ITO was legal, then subsequent assumption of jurisdiction by the DCIT was illegal and therefore order passed by the present Assessing Officer is either way null and void. In support of the contention, the Ld. counsel relied on the decision of the Cuttak Bench of Tribunal in the case of Dilip Kumar Chatterjee Vs ACIT (OSD), Bhubneshwar reported in (2018) 97 taxmann.com 283 (Cuttak-Trib). 25. The Ld. DR on the other hand submitted that as per the territorial jurisdiction order dated 15/11/2014 issued by the Additional Commissioner of Income Tax-8(3), Mumbai the ITO 8(3)(3) was having jurisdiction of the alphabet 'Va' to 'Vn' having returned income or loss of upto Rs.30 lakh under jurisdiction of Principal Commissioner of Income-Tax-1 to 5 and 16 and in case of return income exceeding Rs.30 lakh, the jurisdiction lied with ACIT/DCIT 8(3)(2). The Ld. DR submitted that in view of the no regular return of income filed by the assessee, the ITO 8(3)(3) was justified in issuing notice for reopening of the ca....
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....er; (b) where he has made no such return, after the expiry of the time allowed by the notice under *{sub-section (2) of section 115WD or sub-section (1) of section 142 or under sub-section (1) of section 115WH or under section 148 for the making of the return or by the notice under the first proviso to section 115WF or under the first proviso to section 144] to show cause why the assessment should not be completed to the best of the judgment of the Assessing Officer, whichever is earlier: (c) where an action has been taken under section 132 or section 132A. after the expiry of one month from the date on which he was served with a notice under sub-section (1) of section 153A or sub-section (2) of section 153C or after the completion of the assessment, whichever is earlier.] 28. Further as per section 124(4), if the assessee calls and question the jurisdiction of the Assessing Officer, then the Assessing Officer shall, if not satisfied with the correctness of claim, refer the matter to the Income-tax Authorities mentioned in section 124(2) for determination of correct jurisdiction before the assessment made. 29. In the instant case before us, being case of no ....
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.... by Finance Act, 2016 which is w.e.f. 1.6.2016 brings within ambit of Section 124(3) of the Act cases when notice is issued consequent to search u/s.153(A) or 153(C) of the Act preventing/prohibition an assessee from raising the issue of jurisdiction. It does not include notices issued u/s.158 BC of the Act. This further supports the view that time bar u/s.124(3) of the Act to question the jurisdiction of the Income Tax Officer would not apply to the cases where return has been filed consequent to notice u/s.158 BC of the Act. 18. It was next submitted that even absent statutory provision, the respondent/assessee is barred from raising the issue of jurisdiction after having participated in the proceedings before the Deputy Commissioner of Income Tax, Nagpur on 18 itl127.06.odt principle of waiver of its right to question his jurisdiction. A waiver would mean a case where a party decides not to exercise its right to a particular privilege, available under the law. In this case, the Respondent/assessee has a right not to be assessed to tax by an Income Tax Officer, who is not the Assessing Officer. However, the waiver can only be of one's right/privilege but non- exercis....
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....u Kadam v. Savitribai Sopan Gujar and CCE v. Flock (India) (P) Ltd.) 20 itl127.06.odt 20. It was lastly submitted that, by virtue of the subsequent Order dated 18.1.2000 passed by the Commissioner of Income Tax, Raipur, the earlier order dt.6.7.1999 passed u/s.127 of the Act by him stands revived. Consequently, all the proceedings taken between 6.7.1999 till the Order dated 18.1.2000 by the Deputy Commissioner of Income Tax, Nagpur become regular and he will retrospectively enjoy the status of the Assessing Officer even on 22.9.1999, when he issued the notice u/s.158 BC of the Act. 21. Transfer of proceedings u/s.127 of the Act cannot be retrospective so as to confer jurisdiction on a person who does not have it. Section 127 of the Act does not empower the Authorities under the Act to confer jurisdiction on a person who does not have jurisdiction with retrospective effect. In fact, the explanation under Section 127 of the Act clearly provides that all the proceedings under the Act which are pending on the date of such order of transfer and all the proceedings which may be commenced after date of such order of transfer would stand transferred to the Assessing Offic....
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....ccepts the claim of the assessee and transfers the case to another Assessing Officer in view the objection by the assessee. (In terms of sub-section (3) to Section 124 of the Act, the petitioner had lost his right to question jurisdiction of the Income Tax Officer, Ward No. 1(1), Noida.)" 32. Further, the Hon'ble High Court also rejected the plea of the assessee of invoking section 127 of the Act. The relevant finding of the Hon'ble High Court is reproduced as under: "21. Contention of the petitioner that the transfer by Income-Tax Officer, Ward- 1(1), Noida to Income-Tax Officer, Ward-58 (2), Delhi required an order under Section 127 of the Act is fallacious and without merit. Section 127 relates to transfer of case from one Assessing Officer having jurisdiction to another Assessing Officer, who is otherwise not having jurisdiction as per directions of the Board under Section 120 and Section 124 of the Act. Under sub-section (1), transfer order under Section 127 can be passed by the Director General, Chief Commissioner or Commissioners from one Assessing Officer to another Assessing Officer subordinated to them. Sub-section (2) applies where the Assessing Officer to wh....
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....ter is distinct and stands on a different footing. 23. In view of the above discussion, objections as to the jurisdiction of assessing officer in the present case cannot be equated with lack of subject matter jurisdiction. They relate to place of assessment. Income-Tax Officer Ward 1(1), Noida would not per se lack jurisdiction, albeit he had concurrent jurisdiction with the Income-Tax Officer Ward 36(1)/58, Delhi. In the facts of the present case the contention raised about the lack of jurisdiction would not justify quashing the notice under Section 147 /148 of the Act". 33. In the case of Subhash Chander (supra) also the Hon'ble Punjab and High Court has held as under: "6. A perusal of sub-section (3)(b) of section 124 of the Act shows that the jurisdiction of an Assessing Officer cannot be called in question by an assessee after the expiry of one month from the date of which he was served with a notice under sub-section (1) of section 142 of the Act or after completion of assessment, which was to be earlier. It is further evident that sub-section (4) of section 124 has been made subject to the provisions of sub-section (3) in case an assessee has questioned ....
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....mmissioners if more than one Commissioner is involved and then by the Board. The Apex Court in the case of Rai Bahadur Seth Teomal (supra) has quoted with approval a judgment in the case of Wallace Bros. & Co. Ltd. v. CIT [1945] 13 ITR 39 (FC). The relevant extract is reproduced below: "The question then-arises whether the objection as to the place of assessment, i. e., by the Income-tax Officer of Calcutta could be challenged in appeal to the Appellate Assistant Commissioner and then before the Appellate Tribunal. In our opinion it could not be. The scheme of the Act shows that no appeal in regard to the objection to the place of assessment is contemplated under the Act. Under s. 64(3) of the Act a question as to the place of assessment, when it arises, is determined by the Commissioner. Any such order cannot be made a ground of appeal to the Appellate Assistant Commissioner under s. 30 of the Act which provides for appeals against orders of assessment and other orders enumerated in s. 30 but no appeals is there provided against orders made under s. 64(3). Similarly appeals to the Appellate Tribunal which lie under s. 33 of the Act also do not provide for any appeal on th....
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....g Officer in reasons to believe has recorded bogus purchase of Rs.80,45,300/-. In the assessment order in para 13, he made addition for the said amount as under: "13. The case was reopened on the basis of an information of accommodation entry of Rs 80,45,300/-: The assessee was asked to produce details in support of the entry, but tailed to produce. Hence, Rs.80,45,300/- is added back to total income of the assessee. Penalty proceedings u/s. 271(1)(c) of the Act, is being initiated for furnishing inaccurate particulars and concealing the taxable income." 38. The Ld. CIT(A) treated the said addition as subsumed in the addition for net profit sustained by him. The relevant finding of the Ld. CIT(A) is reproduced as under: "4.6 So far as sixth ground of appeal challenging the addition of Rs.80,45,300/- towards accommodation entry taken from R. S. Enterprises is concerned, it is seen from the reasons recorded by the AO that the allegation is that the same represents bogus purchase by the appellant. Since the net profit of the appellant from the business has already been estimated, there is no case for making separate addition in respect of this entry. Accordingly, ....
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....e assessee should be denied the deduction under section 10AA of the Act. If the income of the relevant unit is finally positive, then assessee may be considered for deduction under section 10AA if the assessee so satisfies the terms and conditions specified therein. The ground of the appeal of the assessee is accordingly allowed for statistical purposes. 43. The ground Nos. 1, 8 and 10 of the appeal of the assessee are general in nature and therefore we are not required to adjudicate upon specifically. Accordingly same are dismissed as infructuous. 44. In ground No. 2 (two), the assessee has challenged applying of net profit rate of 3% on the turnover by the Ld. CIT(A) as against the net profit rate of 5% applied by the Assessing Officer. The plea of the assessee is that as per the data of the textile industry there was an average net loss of 4% on turnover across the textile industry. 45. The Revenue in the solitary ground raised in its appeal has challenged reducing by the Ld. CIT(A) of the net profit rate from 5% to 3%. 46. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. 47. Brief facts qua the iss....
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....oks results of the assessee might not be rejected invoking section 145(3) of the Act. In view of non-compliance by the assessee, the Assessing Officer rejected the book results i.e. loss declared on the basis of unaudited accounts of the assessee and estimated the net profit. The Assessing Officer noticed net profit rate of 5% estimated by the assessee in audited accounts for assessment year 2010-11. Taking the guidance from the assessment year 2010-11, the Assessing Officer proposed net profit at the rate of 5% on the turnover of Rs.173,69,18,226/- for the year under consideration, which was available in audited accounts for AY 2010-11 and computed net profit of Rs.8,68,45,911/-. The Assessing Officer also observed income under the head non-operative income of Rs.5,10,37,137/-for the year under consideration in the audited accounts for AY 2010-11, therefore, he added the said income to the estimated income from operation of Rs.8,68,45,911/- and thus added total income of Rs.13,78,83,048/- (8,68,45,911 + 5,10,37,137) . 48. On further appeal, the Ld. CIT(A) observed that the assessee has not produced any material to show correctness of the book results, which were rejected by the....
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..... However, it has submitted a report published by ICRA Management Consulting Services Limited on Impact of Economic Slowdown on Indian Textile and Clothing Industry which was on account of a study assigned by CITI (Confederation of Indian Textile Industry), Texprocil (The Cotton Textiles Export Promotion Council), AEPC and SRTEPC. This report tells that the average net profit margin in India of Textile and Clothing companies in made ups segment, in which the appellant is operating, in Q3 of FY 08 was 3%, in Q4 FY 08 was 0%, in Q1 FY 09 was -4% in 02 FY 09 was -4% and in Q3 FY 09 was -2%. These figures were based on analysis of sample of 81 Indian companies. In view of the fact that the AO has not based his estimation on any comparable cases and also in view of the data furnished by the appellant, I am of the opinion that net loss shown by the appellant in the book results may be accepted. The AO is directed to rework the net profit accordingly, So far as addition of non operating income amounting to Rs.5,10,37,137/- by the AO to the net profit is concerned, the appellant has clarified before the AO during the course of remand report proceedings that the same consists of FD interest....
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....nover, which could form a basis for estimating the profit of the assessee for the year under consideration. The Ld. CIT(A) has observed that while estimating net profit rate at the 5% of turnover, the Assessing Officer as relied on the book result for assessment year 2007-08 and assessment year 2010-11. In view of above circumstances, we set aside the finding of the Ld. CIT(A) on the issue in dispute and uphold the finding of the Assessing Officer. Further, the direction of the Ld. CIT(A) to exclude the export incentives from the non-operative income is also not justified . The Assessing Officer has applied the net profit rate of assessment year 2010-11 worked out on the basis of audited accounts. If the said incentive has been separately considered as part of the non-operative income in assessment year 2010-11, same cannot be considered as part of book result for the year under consideration. Accordingly, we direct the Assessing Officer to examine the addition of export incentive as non-operative income on comparative book results for assessment year 2010-11. Accordingly, the ground No. two of the appeal of the assessee is dismissed, whereas solitary ground No. one of the appeal o....
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....7,90,291/- 55. The Ld. CIT(A) upheld the disallowance relying on the decision of the Patna Bench of the Tribunal in the case of Prabhat construction company (supra). The Tribunal in said case held that provision of section 40(a)(ia) shall apply in case of estimation of the income under section 145(3) of the Act. 56. Before us the Ld. counsel of the assessee relied on the decision dated 10/03/2017 of the Hon'ble Supreme Court in the case of M/s Pradeep Singh Wazir Vs CIT in civil appeal No. 3891/2017, wherein the Hon'ble Supreme Court held as under: "The appellant/assessee is involved in undertaking transport contracts. During the relevant year, it entered into a contract with the army for carriage of goods and personnel etc. In this regard, an amount of Rs. 74,81,106/- is said to have been received from the army including interest element of Rs. 1043/-. An amount of Rs. 57,98,885/- was debited by the assessee as hiring charges. Upon verification, the Assessing Officer found that the details of the vehicles provided by the assessee through which the contract was supposed to be executed and hiring charges paid were cars, scooters, tractors etc. Confronted wit....
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....s the reason whichis rightly ascribed by the Commissioner of Income Tax (Appeals) to the order." 56.1 Respectfully following the ratio of the decision of the Hon'ble Supreme Court, no disallowance under section 40(a)(ia) Act is called for when invoking section 145(3) of the Act net, profit rate has been applied for estimation of profit. The ground No. four of the appeal of assessee is accordingly allowed. 57. The ground No. 5 (five) of the appeal of the assessee relates to addition of Rs.7,23,82,604/- for loan outstanding held as unexplained. Inground No. six, the assessee has challenged addition in respect of fixed assets. 58. The finding of the Assessing Officer in relation to unsecured loan and fixed assets is reproduced as under: "12.1 As enumerated above, in the audited balance sheet for the year ending 31- 03-2009 submitted by the assessee with SBI, there is an unsecured loan of Rs. 1,46,24,270/-. However for the year ending 31-03-2009 the assessee has submitted unaudited accounts wherein it has no unsecured loan creditor. Therefore in the course of assessment proceedings the assssee has been asked to file the name, address, PAN and the source of payment in ....
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....balancing figure. Therefore, there could have been no repayment. Moreover, the AO has rejected the books of accounts and has also admitted that information collected from the bank is incorrect, therefore, the addition was not justified. As regards discrepancy in fixed asset figures, the appellant has submitted that the value of fixed assets shown in the balance sheet received from the bank is as per provisions of the Companies Act whereas the balance sheet submitted alongwith the return of income is as per the provisions of Income Tax Act. Moreover, the books of account have been rejected by the appellant therefore, the comparison is not justified. The appellant has also stated that the copy of balance sheet obtained from the bank has not been provided to it. I have considered the submission of the appellant. So far as providing copy of balance sheet obtained from the bank to the appellant is concerned, the same has been filed with the bank by the appellant only, therefore, it is not understood as to why the AO should have provided the same to the appellant once again. Moreover, no evidence has been furnished by the appellant in respect of the submission made before the undersigned....
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.... the form of PAN and copy of returns of income in case of Smt. Radhika Gupta. Being so, we deem it fit and proper to remit the issues back to the file of the Assessing Officer for fresh consideration. Further, we also make it clear that even if the income is estimated, the Assessing Officer may invoke the provisions of section 68/69 of the Act as Smt. Shobha Gupta ==================== held by the Tribunal in case of Sri P.V. Sitaramaswamy Naidu in ITA No. 264/Hyd/12 vide order dated 09/01/2013. 12. We have carefully gone through this judgement. This judgement is with regard to allowability of deduction while computing business income of the assessee. Now, we are concerned with the addition made u/s. 68 of the Act. In the present case, the Assessing Officer made addition with regard to credit shown in the name of Ms. Devi Indukuri at Rs. 30,07,392 and in the name of Mr. Nandyala Bhaskar Reddy at Rs. 80,00,000 totalling to Rs. 1,10,07,392. When the credit entry is shown in the books of account it is incumbent upon the assessee to explain the nature and source of credit, creditworthiness of the party and genuineness of the transaction. The fact that the entries are shown in t....
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....e assessee's business are rejected and income from such business is determined on estimate basis, a separate addition (which may not exceed the difference between the income as estimated by the Department and the income/loss as per books) may be made under section 68 towards cash credits which are not explained or which are not properly explained. This is because the source of the former is business whereas for the latter the Department does not have to locate any particular source [Kale Khan Mohammed Hanif vs. CIT (1963) 50 ITR 1 (SC) impliedly overruling Ramcharitar Ram Harihar Prasad vs. CIT (1953) 23 ITR 301 (Pat) and impliedly approving Srinivas Ramkumar vs. CIT (1948) 16 ITR 254 (Pat) and G.M. Chenna Basappa vs. CIT (1958) 34 ITR 576 (AP) on this point]. In this case, the Supreme Court held that the ITO having assessed the income of the assessee on a percentage basis, was also justified in treating the unexplained cash credit as profits from an undisclosed source. Repelling the contention that the entries found in the books of account of the business must be referable to the income of the business which had been computed on the basis of an estimate without accepting the r....
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.... Mining Co. (1972) 83 ITR 860 (AP). The Supreme Court in this case of CIT vs. Devi Prasad Vishwanath Prasad observed thus : "There is nothing in law which prevents the ITO in an appropriate case in taxing both the cash credit, the source and nature of which is Smt. Shobha Gupta ==================== not satisfactorily explained and the business income estimated by him under section 13 of the IT Act, after rejecting the books of account of the assessee as unreliable ..... Whether in a given case the ITO may tax the cash credit entered in the books of account of business, and at the same time estimate the profit must, however, depend upon the facts of each case ..... Where there is an unexplained cash credit, it is open to the ITO to hold that it is income of the assessee and no further burden lies on the ITO to show that that income is from any particular source. It is for the assessee to prove that even if the cash credit represents income it is income from a source which has already been taxed." 15. The Andhra Pradesh High Court in CIT vs. Janab Mohd. Suleman [Referred Case No. 13 of 1968 dt. 11th Nov., 1970] has expressed the same view on similar facts and circum....
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.... amount covered by the intangible addition but must be regarded as pointing to the receipt of undisclosed income earned during the assessment year under consideration. It is open to the Revenue to rely on all the circumstances pointing to that conclusion." 17. Thus, as explained by the Supreme Court, income from intangible additions is available to the assessee for, inter alia, introducing amounts in his account books. If any unexplained cash credits can be reasonably related to the amount covered by the intangible additions made in the past or in that very year, necessary set off may be given by the authorities on that account. In each case, the true nature of the cash credit must be ascertained from an overall consideration of the particular facts and circumstances of the case. However, where in the earlier years, there was disallowance of expenditure on the ground that there was no evidence though the requisite amount was in fact paid, it cannot be said that the corresponding amount is available to the assessee for use later. Smt. Shobha Gupta ==================== 18. Under section 68, the burden is on the assessee to prima facie prove the nature and s....
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....tion found between the cash credits and the additions made to profits, the assessee would not be entitled to set off cash credits against the past intangible addition. Smt. Shobha Gupta ==================== 19. Since it is for the assessee to provide the explanation for cash credits, when the assessee has not pleaded that the cash credits came out of the past intangible additions, it would not be open to the Tribunal to hold that the cash credits would be covered by such additions [CIT vs. G. M. Chennabasappa (1959) 35 ITR 261 (AP). The omission to claim set off of past intangible additions against cash credits would give rise to a presumption that the former amounts were not available for set off. When the alternate plea that tangible additions in the past could take care of cash credits of current year is not taken at the earlier stage and no materials are placed on record to substantiate the same, rejection of such plea would be justified. [R. Dalmia (Decd.) vs. CIT; (2002) 172 CTR 180 (Del) : (2002) 255 ITR 401 (Del)]. " 7. Further, regarding estimation of income, as we have directed the assessee to produce the books of account maintained by her, if t....