TaxTMI 
TaxTMI 
2023 (3) TMI 757
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...., and shown gross receipt of Rs.3.75 crores on which net profit declared, before remuneration to partners, was Rs.23,70,039/- . The total income returned to tax was Rs.9,18,841/-. During assessment proceedings several additions were made to the income of the assessee totaling in all to Rs.13,15,38,617/- which majorly included addition of Rs.11,86,87,480/- being current liabilities reflected in the books of the assessee, added for the reason that the genuineness of the credit balance remained unexplained. Minor additions made were on account of disallowance of building construction expenses & depreciation on motor cars amounting toRs.59,10,574/-& Rs.14,79,549/- respectively. The matter was carried in appeal before the ld.CIT() who deleted the entire addition made on account of unexplained credit balance of Rs.11.86 crores except for an amount of Rs.70,000/-.With respect to the disallowance made of building construction expenses the ld.CIT(A) deleted majority of the disallowance of Rs.50,46,501 and confirmed only the balance of Rs.8,64,073/-; so also, with respect to the disallowance of car depreciation the ld.CIT(A) deleted disallowance of Rs.8,63,961/- and upheld the balance of Rs.....
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....resses etc were furnished by the assessee in respect of these transactions, and even further, these were not squared-up in subsequent years nor these were found part of the opening balance. 3. The Ld. CIT(A) has erred in taking the opening balance at Rs.3,62,12,517/- in Annexure 'C' of his order, whereas on totaling, the actual opening balance comes to Rs. 3,10,87,717/- and thus granted excess relief amounting to Rs.51,25,800/-. 4. On the facts and in the circumstances of the case, the Ld. Commissioner of Income Tax(Appeals)-XV, Ahmedabad ought to have upheld the order of the Assessing Officer on above issues in accordance with above." 4. The ld.DR pointed out that Ground No.1(a) to (c) related to same issue i.e. deletion of credit balance pertaining to sundry creditors amounting in all to Rs.1,19,93,502/-. ld.DR first drew our attention to the facts of the case from the assessment order (para 3.2) wherein he pointed out that the AO had noted from Schedule-10 of Audit Report that the assessee had shown current liabilities as follows: Sundry creditors Rs.2,32,06,459/- Deposit of Shivranjani Rs.9,16,81,021/- Advance from Shivranjani Rs. ....
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....prayer to admit additional evidences submitted a list of all sundry creditors showing Name of the party, op. balance, purchases during previous year, payments during previous year, other debits and final balances in respect of sundry creditors of Rs.2,32,06,458.55/- which was subjected to remand report. The remand report and rejoinder report are already discussed. The details / evidences with this list was already examined by A.O. during remand proceedings. The further details and evidences as submitted by appellant with rejoinder to remand report were examined by me along with the details & evidences filed earlier in this regard and this Ann. A is prepared on above discussed parameter. It is evident from the list submitted earlier by appellant with submission dt. 09/07/12 and subjected to remand report (page 18-19) that there are sundry creditors of Rs. 2,34,35,970.55/- as on 31/03/09 while in 4 cases on account of debit of Rs. 2.29.512/-, the net sundry creditor were of Rs. 2,32,06,458.55/-. It is in this regard the Ann. A reflect the total amount of sundry creditor at Rs. 2,34,38,053/-. From this analysis of Annexure-A following discrepancies were culled out: (i) Sr. no....
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....able." 8. The ld.DR thereafter stated that on the earlier date of hearing the Bench had directed the Revenue to file a chart summarizing party wise the facts/basis of the addition made by AO, deleted by Ld.CIT(A) and the arguments of the Revenue against the order of the Ld.CIT(A).He stated that in accordance with the said direction the arguments against the deletion of addition by the Ld.CIT(A) had been summarized in a chart giving details of the basis on which the AO in his remand report had found these sundry creditors to be not genuine, the basis on which the ld.CIT(A) had held them to be genuine and also detailing his arguments against the finding of the ld.CIT(A). Copy of the chart was filed before us and is reproduced as under: Chart giving all relevant details in respect of each and every Creditors which is in dispute - M/s Shital Builders PAN ABGFS5271G - AY 2009-10 Disputed Creditors as per Grounds of Appeals S No. Name Amount Remarks Observation in Assessment order Observation in Remand Report CIT (A)'s Stand Narration as to what is the discrepancy leading to Revenue's app....
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....ank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. Copy of ledger from the books of the assessee in case of creditor for FY 2008 to 2010-11 is enclosed herewith as per Annexure 3. Copy of invoice is attached as per Annexure 4. Annexure 2,4,6,8,10,12,14,16,18 and 21 establishes the similar pattern, writing etc. 3 Gulabsinh Amarsingh 92378 The pattern, writing of the bills is similar with that of other creditors. As above NO PAN and entry not confirmed by the creditors as per copy of ledger submitted by the assessee. Assessee has submitted name, address, copy of bill, confirmation and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. The pattern, writing of the bills is similar with that of other creditors. Copy of ledger from the books of the assessee in case of creditor for FY 2008 to 2010-11 is enclosed herewith as per Annexure 5. Copy of invoice is at....
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.... of creditor for FY 2008 to 2010-11 is enclosed herewith as per Annexure 11. Copy of invoice is attached as per Annexure 12. Annexure 2,4,6,8,10,12,14,16,18 and 21 establishes the similar pattern, writing etc. 7 Sanjaybhai L. Gohil 815740 The pattern, writing of the bills is similar with that of other creditors. As above As above Assessee has submitted name, address and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. The pattern, writing of the bills is similar with that of other creditors. Copy of ledger from the books of the assessee in case of creditor for FY 2008 to 2010-11 is enclosed herewith as per Annexure 13. Copy of invoice is attached as per Annexure 14.Annexure 2,4,6,8,10,12,14,16,18 and 21 establishes the similar pattern, writing etc. 8 Shalibhadra Traders - Balasinhor Kheda 2925 The Handwriti ng is identical with that of the bill of Shantinath Transport of Jivraj Park, Ahmedabad. As above NO PAN and entry not confirmed by the creditors as per copy of ledger sub....
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....ss and payment is made through bank. Expense incurred is professional and TDS deducted. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. The pattern, writing of the bills is similar with that of other creditors. Copy of ledger from the books of the assessee in case of creditor for FY 2008 to 2010-11 is enclosed herewith as per Annexure 20. Copy of invoice is attached as per Annexure 21. Annexure 2,4,6,8,10,12,14,16,18 and 21 establishes the similar pattern, writing etc. 12 Ankit Traders 11564 No bills submitted, No confirmation before A.O. As above On perusal of the Ledger accounts furnished by assessee during the course of appellate proceedings, Entry is not confirmed by the Creditor. Assessee has submitted name, address, copy of bill and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills submitted. No confirmation filed before the A.O. The said f....
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....Trading Co. 425193 No bills, NO PAN, No confirmation before AO. As above NO PAN and entry not confirmed by the creditors as per copy of ledger submitted by the assessee. Assessee has submitted name, address, copy of bill and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills, No PAN, No confirmation before the A.O. The said fact is also mentioned in Anne-A of CIT(A)'s order. Copy attached as per Annexure 22. 17 Innovative Infra Pvt. Ltd. 645417 No confirmation, No bills submitted before A.O. As above On perusal of the Ledger accounts furnished by assessee during the course of appellate proceedings , Entry is not confirmed by the Creditor. Assessee has submitted name, address, copy of bill and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills, No confirmation before the A.O. The said fact is a....
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....fore the A.O. The said fact is also mentioned in Anne-A of CIT(A)'s order. Copy attached as per Annexure 22. 22 Laxmi Traders 1E+0 6 No bills, NO PAN, No confirmation before AO. As above NO PAN and entry not confirmed by the creditors as per copy of ledger submitted by the assessee. Various purchases in the month of Sept 2008 for steel and o/s balance was paid through cheque of Rs. 650000/- dated 28.05.2009 and Rs. 741000/- dated 02.06.2009. Therefore, can not be held as unexplained current liabilities. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills, No PAN, No confirmation before the A.O. The said fact is also mentioned in Anne-A of CIT(A)'s order. Copy attached as per Annexure 22. 23 Maruti Traders 806225 No bills, NO PAN, No confirmation before AO. As above NO PAN and entry not confirmed by the creditors as per copy of ledger submitted by the assessee. As against the purchase of cement during month of September 2008, total o/s balance was paid by cheque of Rs. 5 Lakh on 28.05.2009....
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.... by the creditors as per copy of ledger submitted by the assessee. Assessee has submitted name, address and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills, No PAN, No confirmation before the A.O. The said fact is also mentioned in Anne-A of CIT(A)'s order. Copy attached as per Annexure 22. 28 Shree Ramdev Trasnport 72224 No bills, NO PAN, No confirmation before AO. As above NO PAN and entry not confirmed by the creditors as per copy of ledger submitted by the assessee. Assessee has submitted name, address and payment is made through bank. There is sufficient evidence for confirming the balance as on 31.03.2009 and disallowance and addition made in respect of creditor is not justified and not sustainable. Same as above. No bills, No PAN, No confirmation before the A.O. The said fact is also mentioned in Anne-A of CIT(A)'s order. Copy attached as per Annexure 22. 9. Ld.DR stated that he relied on the said chart for his arguments, which briefly put were to the effec....
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....S6290C. 2 Anand V.Dave 22 382024 Not Confirmed by the Creditor Name & complete address & Phone No. along with copy of bill of the consultant submitted. PAN : AAOPD 7887 L also submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. 3 Aniruddh S. Save 24 216333 Not Confirmed by the Creditor Copy of Bill of the supplier along with PAN : AJJPD 2855 N submitted. TDS deducted. 4 Ankit Traders 26 11564 Not Confirmed by the Creditor Name & Address along with copy of PAN CARD of supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAN:AAFF A3859C. 5 Arth Communication 28 11948 Not Confirmed by the Creditor Name & complete address & Phone No. along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent ....
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.... 13 Dev Corporation 42 353650 No Pan not Confirmed submitted by the Creditors. Name & complete address of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAN: APIPP8571N. 14 DhulibenTanchodbhai 43 3203 No Pan/ Address, no Confirmation submitted by the assessee. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAYMENT MADE 15 Dinesh Traders 45 7500 No PAN, Not Confirmed by the creditor. Name & complete address & Phone No. along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Confirmation is enclosed. PAN: ABTPV8242M. 16 Ganpat R Vatukia 47 434995 No PAN, Not Confirmed by the creditor. Name & complete address & Phone No. along with copy of bill of the supplier submitted. Payment....
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....nfra P Ltd 60 645417 No Confirmation given Name & complete address & Phone No. along with copy of bill of the supplier submitted. PAN: AABCI2364P .Confirmation of the supplier is enclosed. 25 Jainam Traders 63 76924 No PAN, Not Confirmed by the creditor. Name & complete address of the supplier submitted Payment duly made by A/c Payee Cheques in subsequent years. Confirmation is enclosed. PAN: 26 Jala Hardware & sanitary 64 1998 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Confirmation is enclosed. PAN: AAFPL1219H. 27 Jay Ambe Enterprise 66 13256 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. ....
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....dress, &no Transaction during Confirmation submitted by the assessee. Staff Worker. Salary of March 09 pending. Payment duly made in subsequent years. Copy of A/c for payment verification is enclosed. 37 KaileshbenRavjibhai 83 3432 No Pan/ Address no Confirmation submitted by the assessee. Staff Worker. Salary of March 09 pending. Payment duly made in subsequent years. Copy of A/c for payment verification is enclosed. 38 K. K . Stones 85 9985 No PAN, Not Confirmed by the creditor. Name & complete address of the supplier submitted Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. 39 K. K . Stones & Builders 86 6554 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. &nbs....
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.... No Confirmation given Name & complete address along with copy of bill of the supplier submitted. PAN of the supplier also submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAN:ASSPM1101G. 48 Maruti Stone Industries 103 35945 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. 49 Maruti Traders 105 806225 No Pan/ Address, &no Confirmation submitted by the assessee. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAYMENT MADE 50 Mukesh Trading Co 106 591600 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment....
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....lete address along with copy of bill of the supplier submitted. PAN of the supplier also submitted. PAN: AKTPG3546J. 59 Sarvodaya Enterprise 125 2789 No Confirmation given Name & complete address along with copy of bill of the supplier submitted. PAN of the supplier also submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAN:AARF S2707D. 60 Shalibhadra Traders 128 2925 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. 61 Shantinath Transport 130 2925 No PAN, Not Confirmed by the creditor. Name & complete address along with copy of bill of the supplier submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. ....
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.... for payment verification is enclosed. PAN: ACVPS6056K. 70 Timber Point 152 140018 No Confirmation given Name & complete address along with copy of bill of the supplier submitted. PAN of the supplier also submitted. Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. PAN: AADFT5198L. 71 Yogini Trading Co 155 749200 No PAN, Not Confirmed by the creditor. Name & complete address of the supplier submitted Payment duly made by A/c Payee Cheques in subsequent years. Copy of A/c for payment verification is enclosed. Total 2,34,38,053 Referring to the above he pointed out that each and every discrepancy noticed by the AO had been explained as being of no relevance and taking note of which the Ld.CIT(A) had found and held the sundry creditors as been genuine. ii) The next argument taken up by the ld. Counsel for the assessee was that primary argument of the ....
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....missed. However, on further appeal before the ITAT, the assessee had succeeded, inasmuch as his appeal was allowed by the ITAT vide its order dated 13.04.2007. The order of ITAT has been challenged in this appeal. It would be worthwhile to mention that the aforesaid creditors shown in the books of accounts, are the sundry creditors, from whom as per the assessee, he had made purchases. They are thus the creditors. The Tribunal found that even if it is accepted that the books were rejected, significantly the Assessing Officer had not disallowed the purchases from those creditors nor the trading results have been disturbed. In this behalf, learned counsel for the assessee also drew our attention to the orders of the AO, as per which the assessee had shown the total turnover of Rs.1,03,44,054/-, on which gross profit rates declared was 68.94% as compared to sales of Rs.21,18,994/- in the previous year. The AO accepted the aforesaid figures and categorically observed as under: "The GP rate as well as the sales has been substantially increased during the year in comparison to the last year. Sales trading results are not disturbed." 3.This finding of AO remained undistu....
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....erial available on record, it is seen that in para-3 of the assessment order, the AO observed that the assessee had shown numerous sundry creditors along with details, as was available from the examination of the assessee's books of account vis-à-vis his balance sheet. The assessee is a road contractor. He received material for the construction of the road. The amounts in question represented purchases made on credits. The provisions of Section 68 of the Act are clearly not attracted to amount representing purchases made on credits, as is also held in 'CIT Vs. PanchamDass Jain', 205 CTR 444 (All). The assessee raised this issue by way of written submissions (APB 37 to 160, relevant portion at para-5, on page 43) dated 10.05.2014 filed before the CIT(A). The ld. CIT(A) has, however, not addressed this grievance at all and merely upheld the addition made under Section 68 of the Act. On behalf of the assessee, a comparative chart of net profit rate of the assessee for the assessment years has been filed before us. In the earlier years also, no such addition was made. For the assessment year 2007-08, under scrutiny assessment, the assessment was made at 8%. The posit....
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....n of addition of the aforesaid two amounts under Section 68 of the Act did not arise inasmuch as the provisions of Section 68 of the Act would not be attracted on the purchases made on credit. 9. We, accordingly, answer the question referred to us in affirmative, i.e., in favour of the assessee and against the Revenue. There will be no order as to costs." 21. We find the Delhi Bench of the Tribunal in the case of ITO vs. Swati Housing & Construction (P) Ltd., while dealing with an identical issue, has observed as under:- "15. Lastly in so far as addition on account of sundry creditors are concerned, Ld. DR submitted that all the sundry creditors remained unverified even in response to enquiries made by the AO u/s 133(6). AO at page 5 of the assessment order has clearly mentioned that assessee has not filed any supporting bills/ vouchers or books of accounts. Accordingly, he submitted that such an addition has to be made u/s 68 and in support he relied upon the following judgment of Hon'ble Karnataka High Court in the case of Rekha Krishna Raj Vs. ITO [2013] 215 Taxman 159/33 taxmann.com. 16. On the other hand, Ld. Counsel for the assessee sub....
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....unsel for the assessee again countered by drawing our attention to page no.33 of the CIT(A)'s order wherein the ld.CIT(A) had dealt with the issue of application of provision of law under which the addition was made , pointing out that the AO has not specified the section under which he has made the addition whether as unexplained credits u/s 68 of the Act or u/s 41(1) of the Act as liability ceasing to exist. The relevant portion of the order is as under: "....One cannot comprehend reasonably that such assessee can have bogus depositors and all sundry creditors as unexplained to such level of Rs. 11 cr. & more. In reference to current liability, I am inclined with the contention of appellant that A.O. when has no dispute about genuinity of purchase, sale, op. stock and cl. stock then without rejecting books of accounts, how all such liabilities can be held as unexplained. On the merit side also, the A.O. has not discussed even mentioned that if such liabilities are unexplained then under which provisions of Act this addition is made. Whether the same is under 68 of the Act since the addition of deposits are also aggregated with it or under section 41(1) of the Act contend....
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....e AO is that the bills were found to be identical in pattern and in common hand writing. For this reason they were found by the AO to be not reliable piece of evidence for granting relief. Further, the Department's plea is also that no third party evidence confirming the advance outstanding was filed by the assessee. 17. Admittedly all these sundry creditors pertain to purchases made by the assessee during the course of carrying on its business and that out of total purchase of Rs.4.58 crores accounted for by the assessee in its P& L account during the impugned year, the AO had disallowed an amount of Rs.2.34 crores i.e. approximately 50% of the purchases. Further, we also noted the fact that there is no analysis before us as to whether this outstanding balance of sundry creditors of Rs.1.19 crores pertained to purchases made during the year alone or reflected a part of the opening balance also. 18. Considering all of the above, we find that the AO had disallowed balance outstanding of the sundry creditors relating to the business of the assessee for the reason that their bills appeared to be bogus, and there was no confirmation of their outstanding balance. What it implies i....
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.... 21. Invocation of section 41(1) of the Act for cessation of liability could not have been possibly done on balances pertaining to the impugned year considering the very short period of the liability for treating it as ceasing to exist. The AO has neither specified the section being invoked for making the disallowance nor is there any analysis of the outstanding balances as relating to the current year and the preceding years. Therefore the addition is held not sustainable on these counts also. 22. Moreover we agree with the ld.CIT(A) that the assessee had discharged its onus of establishing genuineness of these sundry creditors having furnished all details relating to the sundry creditors and also establishing the fact that the payment to all of them was made through banking channel, which fact has not been controverted by the Revenue. The Revenue's case for holding them as nongenuine rests only on account of bills of these parties appearing to be manipulated. No exercise however has been carried out by the Revenue to confirm this aspect from an expert. Therefore, on merit also considering specific finding of the ld.CIT(A) regarding assessee's discharging its onus of e....
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....f the ld.CIT(A) was contrary to what the AO had noted in the assessment proceedings with respect to the said parties stating clearly that no PAN or address or no confirmation with respect to these parties had been submitted by the assessee. He drew our attention to the page no.18 and 20 of the CIT(A) order containing the report of the AO in remand proceedings with respect to the said parties at point no.76, 87 and 26 as under: Sr. No. Name of the creditor/depositor Page No. Credit Balance as on 31.3.2009 (Rs.) Discrepancy noticed in the submission of the assessee 76 Devensinh C. Vaghela 177 250000 No PAN/Address no confirmation submitted by the assessee 87 Samirchandra Nair 267 5500000 No PAN/Address no confirmation submitted by the assessee 26 Leesa Security P.Ltd. 231 25000 No confirmation given 27. The ld. Counsel for the assessee countered by stating that the ld.CIT(A) had dealt with the finding of the AO in his remand report and had found them to be contrary to the facts on record, and after taking note of all the evidences filed by the assessee tabulated in Annexure-'C' of his order, the ld.CIT(A) had deleted the ....
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....o the aforesaid three parties with evidences. In view of the above, we see no reason to interfere in the well reasoned order of the ld.CIT(A), passed after appreciating all relevant facts relating to the issue. Ground no.2 raised by the Revenue is dismissed. 29. Ground No.3 raised by the Revenue, it was pointed out, relates to discrepancy in totaling of opening balance noted by the ld.CIT(A) in Annexure-C of loans and advances. It was pointed out that while dealing with the issue of addition made on account of unsecured loans, the ld.CIT(A) had tabulated all information in Annexure-C relating to various parties, and had held that with respect to the opening balance of the said parties, no addition in any case could be made under section 68 in the impugned year, and had accordingly deleted the addition on account of the same. In the present ground, the plea of the Revenue is that there is a calculation error with respect to the opening balance made by the ld.CIT(A).That while opening balances were to the tune of Rs.3.10 crores, the ld.CIT(A) noted the same at Rs.3.60 crores, therefore giving excess relief of Rs.51.31 lakhs. Both the parties agreed that the issue may be restored b....
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.... addition u/s 68 of the Act. ln respect of 26 parties from unsecured loan outstanding amounting to Rs. 2,87,45,854/-, the A.O. has no adverse comment in remand report and as per para 5.2.2(1) the same were held as genuine and explained deposit. In respect of 44 parties with total unsecured loan 7 advances 7 deposit of Rs. 6,29,34,4677-, ten parties having outstanding opening balance of Rs. 74,27,1317- were found to be having no details but as per para 5.2.2 (k) the A.O. has to initiate proper proceedings in the year when such loan/deposit were accepted and addition u/s 68 for the previous year was found not justified. Out of the balance, it is only deposit of Rs. 70,000/-(para 5.2.2(1)) which was found to be justifiable for addition u/s 68 of the Act. As per para 5.2.2(m) the balance advances of Rs. 38,00,000/- were found to be genuine and explained. Therefore, out of Rs.11,86,87,480/- only Rs. 70,000/- is upheld and confirmed and balance of Rs. 11,86,17,480/- (11,86,87,480 - 70,000) is directed." Para 5.2.2(l) dealing with unsecured loans of Rs.70,000/- disallowed is as under: "(I) Out of the balance 34 cases, it is only in the case of Shri Amarsinh bhai D. for an amou....
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....this entry of Rs.1,47,852 and IDS entry of Rs.3404 is mentioned. I am not inclined with these evidences for allowability of difference in bill of Rs.5467 (147852 -142385). As per settled legal proposition, any expenditure or part thereof as claimed by appellant u/s.37(1) of the Act has to be duly supported by bills or vouchers to reflect that the same is business expenditure and wholly and exclusively incurred by appellant for business. By deducting IDS out of it and by producing confirmation from the party does not absolve the appellant from the onus to furnish / submit necessary bills related to such expenditure. Therefore the difference of expenditure of Rs.5,467 is upheld and confirmed. (ii) Shri RameshbhaiRamsinghNinama The appellant neither with details dated 09.07.2012 nor in the rejoinder to remand report furnished any details viz. bill, ledger account, confirmation etc. It is therefore, as per reasoning given above at (i), the disallowance of Rs.56,513 and addition thereof is upheld and confirmed. Shri Maheshbhai Himmatbhai Solanki The appellant vide detail dated 09.07.2012 at page No.99 submitted a ledger account copy of the party showi....
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....s being same party for multiple expenditure (Page 289) the PAN, confirmation is available in the details of sundry creditors. It is therefore, the addition and disallowances for those expenditure as made by A.O. is neither justified nor sustainable. In conclusion the additions of Rs.8,64,073 (5467 +65513 + 78000 + 204593 + 51050) are upheld and confirmed as discussed above. The A.O. is directed to delete the balance disallowance and addition of Rs.50,46,501 (5910574 - 864073). The appellant gets part relief." 37. We have gone through order of the Ld.CIT(A) and have noted that the disallowance was upheld by him in the absence of any substantiation of the same by the assessee with necessary evidences. The ld. Counsel for the assessee was unable to controvert the factual finding of the ld.CIT(A), though he vehemently argued before us that the expenses were genuine. In view of the same, we see no reason to interfere in the order of the Ld.CIT(A) upholding the disallowance of building construction expenses amounting to Rs.8,64,073/-. This ground of appeal of the assessee is dismissed. 38. With to disallowance of motor car depreciation confirmed by the ld.CIT(A) to the extent of....
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....siness. Reference is invited to Hon'ble Madras High Court decision in the case of New Ambadi Estate Pvt.Ltd. v. State of Tamil nadu (2002) 256 ITR 0064. It is therefore a reasonable disallowance out of such depreciation is justified. Further, in the case of Toyota Altis car' the appellant claimed depreciation of Rs.3,28,500 being 50% of eligible claim being the vehicle was acquired after 30.09.2009 i.e. owned and used for less than 180 days. But, the rate of depreciation adopted is 50% at the place of 15% resulting into excess claim of Rs.2,29,950.(3,28,500 - 7.5% of 13,14,000). The appellant has not submitted any explanation about adoption of such higher rate of depreciation of 50% which is as per I.T.Rule is permissible for only "New commercial Vehicle which is acquired on or after 01.01.2009 but before 01.10.2009 and it is put to use before 01.10.2009 for the purpose of business and profession" (Refer Rule 5 of the I.T.Rule 1962 and Appendix I where under the head 'III Machinery and Plant at clause 3 (via) such rate is provided). The purchased vehicle is not a commercial vehicle because the appellant's business is of construction and development. Further as per I....