TaxTMI 
TaxTMI 
2024 (4) TMI 542
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..... 60,75,000/- in respect of alleged rent which was neither due nor received inspite of fact that confirmation of tenant is also filed before the CIT(A). (ii) Addition of Rs. 1,90,000/- even though as per copy account filed, the amount was received in last year. (iii) Addition u/s. 40(i)(ia) even though confirmation of parties, copies of returns, certificates of their C.As. were also filed with the CIT(A). 2. The Ld. CIT(A) has erred on facts as well as in law in sustaining addition of Rs. 1,12,613/- even though the profit allowed to M/s. Rovani food Pvt. Ltd. sister concern was Rs. 19,800/- that is hardly 1.3% of purchases from it. 3. The Ld. A.O. as well as the Ld. CIT(A) have erred on facts as well as in law in making and confirming addition of Rs. 2,50,000/- u/s. 40A(3) even though there is no doubt about genuineness of transaction and is also covered by exceptional circumstances. 4. The Ld. CIT(A) has erred on facts as well as in law in sustaining addition of 1/5th of travelling expenses even though it does not involve any personal element. 5. The Ld. CIT(A) has erred on facts as well as in law in sustaining 20% of all telephones expenses, all vehicle running and ma....
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.... not rented the property on the ground floor and observed that the lease deed mentioned property let out in respect of basement and first floor. The ld AO accordingly show caused the assessee as to why the rental income should not be added for the first floor portion. In response, the assessee submitted that there is no first floor constructed on the subject mentioned property at all. It contains only basement, ground floor and open terrace. The basement and ground floor had been duly given on rent to the aforesaid tenant and rental income derived thereon had been duly offered to tax. The assessee also placed evidence of the schedule of property from the sale deed to prove the aforesaid contention. It was also submitted that no further construction was carried out by the assessee. The ld AO however did not agree to the aforesaid contentions and proceeded to add the alleged rental income for the first floor portion and made an addition of Rs. 60,75,000/- in the assessment. The assessee submitted the photographs of the building on record. The assessee also submitted the confirmation dated 20.08.2015 from the tenant stating that lease deed had wrongly mentioned the fact of first floor....
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....e year ending 31.03.2014 and the ledger account of 'unclaimed credits written back' for the year ended 31.03.2014 together with the computation of total income and ITR acknowledgement for AY 2014-15 dated 21.11.2014 which are enclosed in pages IV to VIII of the PB. Hence, it is proved that assessee had duly offered the receipt of Rs. 1,90,000/- as its business income for AY 2014-15. We find however that a sum of Rs 1,90,000/- is found credited in the books of the assessee during the year under consideration. It is a fact that no satisfactory explanation has been given by the assessee before the lower authorities and before us also. Hence, the said receipt of money credited of Rs. 1,90,000/- which is found credited in the books of the assessee is to be added as unexplained credit u/s 68 for the year under consideration. However, in order to avoid double taxation, we hereby direct the ld AO to delete the very sum of Rs. 1,90,000/- for AY 2014-15 which has been voluntarily offered to tax by the assessee in the return of income for AY 2014-15. Accordingly, ground No. 1(ii) raised by the assessee is disposed of in the above mentioned terms. 10. Ground No. 1(iii) raised by the assessee ....
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....oods to the tune of Rs. 14.18 lakhs. Out of this, goods worth Rs. 1,11,825/- were sold to M/s. Rovani Food Pvt Ltd. Further, since the assessee got some other client for these goods, goods were purchased back from M/s. Rovani Foods Pvt. Ltd with a small margin of Rs. 800. Similarly, goods of Rs. 13,69,519/- were sold to M/s. Rovani Foods Pvt. Ltd on 30.12.2010 immediately after the sale, assessee got the new client and consequently these goods were repurchased from M/s. Rovani Foods Pvt. Ltd by giving them margin of Rs. 19,000/-. Accordingly, it was pleaded that the assessee by doing purchase and sale transaction with M/s. Rovani Foods Pvt Ltd had merely enabled Rovani Foods Pvt. Ltd to earn margin of Rs. 19,800/-. The ld AO further did not agree to this contention and disallowed the purchase made from M/s. Rovani Foods Pvt. Ltd amounting to Rs. 15,01,397/- as bogus transaction. It was also submitted by the assessee that out of goods repurchased from M/s. Rovani Foods by the assessee, those goods were sold by the assessee to 3rd parties and assessee had earned a profit of Rs. 73,971/-. The assessee furnished the complete details of purchase and sales made to M/s. Rovani Food Pvt. L....
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....gorically given his finding that Gaurav Babbar is related to the assessee stationed in Delhi and no business exigency of incurrence of the expenditure in cash has been demonstrated by the assessee. We find from the ledger account reproduced at page 10 of the assessment order that the assessee has paid salary of Rs. 3 lakhs to Gaurav Babbar and out of which, a sum of Rs. 2,50,000/- alone has been disallowed by the ld AO. Hence, the genuineness of the payment of salary has been accepted by the ld AO. In the instant case, the identity of the payee is established and transaction with Gaurav Babbar is hereby held to be genuine. But in order to make the assessee's case fall under the exception provided in the proviso to section 40A(3) of the Act, the assessee is duty bound to explain that the place where the payee is stationed does not have bank facilities and the assessee had pressing emergency to make the said payment in cash out of business exigencies. In the instant case, it is not in dispute that Gaurav Babbar (payee) is stationed in Delhi where bank facilities are available in every nook and corner of Delhi as rightly observed by the ld CIT(A). Further, the assessee was not able to....
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....essee in subsequent years. With regard to traveling expenses of Mrs. Vandana Babbar, it was submitted that she was an interior decorator, who went to Goa to convince the party M/s. Sampuran Foundation and got the sale order for the assessee for Rs. 37 lakhs which was duly supplied in December, 2011 after importing goods from China. Accordingly, it was pleaded that the said travelling expenses are meant for the purpose of business. Further, she went to Amritsar to meet M/s. Rolls Snackers Pvt. Ltd who wanted coffee machines, grinder, stick blender, slush machines, sandwich griller double, dough mixture, softy machines, mixture, meat minser, fryer double, spiral mixture and potato peeler and wanted to purchase these machines from point of view of interior decoration. She had gone on 27.04.2010 and procured order worth Rs. 10 lakhs which was supplied by the assessee by 20.07.2010 and 31.08.2010. Accordingly, it was pleaded that this travelling expenses was also meant for the purpose of business. 21. The assessee pleaded that his business activity is split over Daryaganj to two buildings in Okhla Industrial area and residence in Sainik Farms. Accordingly, the assessee submitted that t....