TaxTMI 
TaxTMI 
2023 (8) TMI 495
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....ng from the activity of chit. The brief facts of the case are that the assessee is a partnership Firm, engaged in the business of financing and running of chit for the last ten years. The assessee filed return of income for the AY 2016-17 on 21.11.2016 declaring income of Rs. 71,690/- which has been processed on 09.12.2016 u/s. 143(1) of the Income Tax Act, 1961 (hereinafter "the Act"). Thereafter, a search and seizure operation u/s. 132 of the Act, was conducted on assessee's premise on 22.09.2017; and thereafter, the AO issued notice u/s. 153A of the Act. Pursuant to which, the assessee filed the return of income admitting total income of Rs. 1,10,050/-. The AO noted that the assessee was earning income on account of foreman commission on chits which according to him has not been declared by the assessee in the original return of income filed u/s139(1) of the Act. When confronted with this issue, the assessee filed a letter dated 06.03.2018 which showed working of year wise foreman commission, wherein, it admitted an amount of Rs. 6,75,000/- on account of foreman commission for the year under consideration, wherein, the assessee claimed expenditure of Rs. 6,36,640/- and showed ne....
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....on records and the written submissions of the appellant. The appellant in his return of income u/s .139(1) had shown Rs. 62,730 as miscellaneous income apart from the interest on loan of Rs. 18,67,715. After deducting expenditure worked out his income as Rs. 9.89,424.50. The appellant, as mentioned by the AO has admitted Rs. 6,75,000 as his additional income on account of foreman commission. The appellant in his return of income u/s .153A, however, had shown miscellaneous income of Rs. 6,75.000 [including Rs. 62.730 shown earlier] and had claimed-chit division expenses of Rs. 2,60,000 towards defaulters and Rs. 3,13,910 towards salary and TA allowances. The Assessing Officer has added Rs. 6,36,640 [Rs. 2,60,000 plus Rs. 3,13,910 plus Rs. 62,730] on the ground that no evidence for the impugned expenses were recovered during the search and subsequently during the assessment proceedings. The onus is on the appellant to demonstrate the impugned expenditure has been incurred wholly and exclusively for the purpose of business both with reference to the quantum of expenditure and the purpose of having incurred the expenditure. As the appellant has tailed to discharge his onus, the fresh c....
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....lt, appeal filed by the assessee in ITA No.49/Chny/2021 for the AY 2016-17 stands dismissed. ITA No. 50/Chny/2021 for the AY 2017-18: 7. Since, the facts permeating AY 2017-18 are identical except the expenses claimed to the tune of Rs. 7,40,640/- regarding foreman commission, on similar reasoning, we confirm the action of the Ld.CIT(A) and dismiss the appeal filed by the assessee. 8. In the result, appeal filed by the assessee in ITA No.50/Chny/2021 for the AY 2017-18 stands dismissed. ITA No. 51/Chny/2021 for the AY 2018-19: 9. In this appeal, the assessee has raised grounds of appeal against the action of the Commissioner of Income Tax(Appeals)-18 dated 31.12.2020 for the AY 2018-19. 10. Ground No.2 is against the action of the Ld.CIT(A) confirming the disallowance of Rs. 4,02,924/- as expenditure by giving only partial relief of Rs. 7,96,896/- (Rs. 11,99,820/- minus Rs. 4,02,924/-). This assessment year i.e. AY 2018-19 is the searched assessment year, since search was conducted on 22.09.2017. The AO noted that the assessee had shown to have earned foreman commission as on the date of search Rs. 9 lakhs and thereafter till 31.03.2018 it earned Rs. 4,50,000/- (T....
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....irm. The assessee when asked by the AO to explain source of cash found/seized from the premise explained source to the tune of Rs. 46,86,610/- as given below: 1 Opening Balance Rs. 45,310 2 Cash admitted as miscellaneous income Rs. 5,22,270 3 Agricultural Income Rs. 2,94,030 4 Chit commission Rs. 9,00,000 5 Interest receipts Rs. 3,80,000 6 Payments made to bidders of chits Rs. Total Rs. 25,45,000 11.1 The AO after verification of the supporting documents/evidences accepted the aforesaid source of cash, and balance was added as unexplained u/s. 69A of the Act to the tune of Rs. 41,29,500/-, and brought to tax as per sec.115BBE of the Act. 11.2 Aggrieved, the assessee preferred an appeal before the Ld.CIT(A) who was pleased to confirm the same. Aggrieved, the assessee is before us. 11.3 We have heard both the parties and perused the records. We note that Rs. 88,16,110/- was found from the premise of the assessee during search; and as per the AO, the assessee was able to explain only source of Rs. 46,86,610/- (supra). Therefore, the balance amount of Rs. 41,29,500/- was added as ....