TaxTMI 
TaxTMI 
2023 (3) TMI 1312
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....i. Addition u/s 68 of the Act amounting to Rs.10,00,000 received from debtors as unaccounted cash deposited in bank during demonetization period. 2) The learned Commissioner of Income-Tax(Appeals), NFAC has erred in law and on facts by not taking into consideration and giving judgment on ground of appeal no. 3 that. "The Ld. AO has erred by duplication of income of cash sales, firstly as sales as per profit and loss account and secondly as cash deposited in Bank." 3) The learned Commissioner of Income-tax (Appeals) NFAC has erred in law and on facts by not taking into consideration and giving judgment on ground of appeal no. 4 that. "The Ld. AO has erred by treating cash sales and recovery from debtors as unaccounted investment and charging tax accordingly." 4) The Appellant prays for granting such other relief as may be deemed just and proper by your honour's considering the factual and legal aspects of the case of the appellant. 5) The appellant craves leave to add, amend, alter, modify, substitute, delete, change, vary, withdraw all or any of the ground or grounds of appeal." 2. Brief facts of the case are that assessee is a partnership firm and dealer of Ind....
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....ring cash short of Rs.18,35,55,117/-. (ii) During the course of survey proceedings it was stated that cash deposited during the demonetization period was Rs.3,73,46,565/- whereas the position emerged from the Annexure at page no. 147 shows total deposits was of Rs.56,45,085 + Rs.3,68,02,582/- of valid currency and old currency respectively. Please clarify the difference in this regard. (iii) During the course of survey proceedings you claimed to receive the cash of 17,81,846/- from M/s Swastik Transport Udhna and M/s Swastik Logistic Udhna. Please provide the copy of ledger account of both the partis with complete address and PAN along with certified ledger with the respective party. (iv) During the course of survey a aum of Rs.12,51,000/- was offered voluntarily under the PMGKY scheme. Please provide the copy of account of relevant entry made in books of account and also produce the copy of tax challan in this regard. How the corresponding entries have been passed in partners account may also be explained. (vi) During the year under consideration it has been noticed that one BMW Car was purchased beside the three other vehicles including Mercedes Benz and Innova Car. P....
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....., assessee claimed to have received Rs.18,000/- cash on 1st, 2nd, 3rd, 4th, 5th & 6th December, 2016, whereas no such cash payments were made by Swastik Logistics Udhana as per copy of ledger accounts produced under section 133(6) of the Act. 7. The Assessing Officer made summary of cash sales from 01.11.2016 to 07.11.2016 and further on 08.11.2016 to 10.11.2016 and compared average sales of both the period and held average sales in the period of 08.11.2016 to 10.11.2016, which was higher, which is assumed to be @ 25% more, comparative to the period prior to demonetization period. The assessing officer worked out to be Rs.7,11,978/- from 08.11.2016 to 10.11.2016 respectively. The Assessing Officer on comparison of average cash sales from 01.11.2016 to 07.11.2016 and further from 08.11.2016 to 10.11.2016 worked out at Rs.20.77,219/-. On the basis of average cash sales before 08.11.2016 to 10.11.2016 and subsequent to 08.11.2016 to 10.11.2016. The Assessing Officer worked out unaccounted income of Rs.13,65,241/- (20,77,219/- - 7,11,978/-) and brought the same for taxation under section 68 r.w.s. 115BBE of the Act. The Assessing Officer also added Rs.10.00 lakh on account of discrep....
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....rvey under section 133A on 21.03.2017 in assessees premises, therefore, the return of assessee was selected for scrutiny. During scrutiny assessment, assessee filed its reply from time-totime. The assessing officer also issued show cause notice about cash-in-hand and reconciliation about shortage of cash. The Assessing Officer also issued show cause notice on other various issues. The Ld. AR for the assessee submits that Assessing Officer also noted that during the survey, assessee offered Rs.12.51 lakh under PMGKY scheme and sought clarification about the treatment of such amount in the books of account. The assessee furnished complete details and no further show cause notice or any clarification about discrepancies was sought for from the assessee by Assessing Officer. The Assessing Officer in order to verify the fact about sundry creditor from Swastik Transport Services Udhana and Swastik Logistics Udhana issued notice under section 133(6) of the Act and obtained ledger accounts of as in their books of account. On the basis of assessees ledge account, and in the books of accounts of sundry creditors, the Assessing Officer made addition of Rs.10 lakhs by noting alleged discrepanc....
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....erefore, without disputing the sales, the addition made by Assessing Officer under section 68 is not justified. The Ld. AR for the assessee further submits that petroleum products are essential commodity and its quantity is measured at different level and as such the assessee cannot be allowed much more quantity than the permissible limit prescribed by IOC, first quantity is measured by IOC Officer, secondly it is also checked by District Level Authority. It is undisputed fact that the sale of the assessee is accepted. Once the sales of assessee was not disputed, no addition on the basis of alleged excess average sales can be made by Assessing Officer. To support his submission, Ld. AR for the assessee relied upon the following case law: Income Tax Office Vs Manasa Medicals [ITA No.552/Bang/2022 dated 31.10.2022 Atish Singla Vs Income Tax Officer [ITA No.1185/Del/2021 dated 06.04.2022 Asst. Commissioner of Income-tax Vs M/s Hirapanna Jewellers [ITA No.253/Viz/2020 dated 12.05.2021] Shree Sanand Textiles Industries Ltd. vs. DCIT [ITA No.995/Ahd/2014 dated 06.01.2020] Mrs. Umamaheswari vs. Income Tax Officer [ITA No.527/Chny/2022 dated 14.10.2022] 16. On the other ha....