2024 (8) TMI 1173

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.... perspective thereof and the order under appeal is a cryptic and nonspeaking order. 2. That the Id. CIT(A) has erred in law as well as on the facts of the case by confirming the adhoc disallowance 20% of the following expenses by treating the same as unverifiable, ignoring the fact on record that none of the expenses was claimed as an expenditure while filing the return of income at 'Nil' Income:- (1) Electricity Expenses Rs. 18,33,786/- (ii) Printing & Stationary Rs. 1,51,452/- (iii) Upfront fee Rs. 1,66,545/- Rs. 1,66,545/- Rs. 21,51,783/- *20% =Rs. 4,30,357/-. 3. That the Id. CIT(A) has erred in law as well as on the facts of the case by upholding the action of the Id. A.O. to make addition of Rs. 4,89,49,059/-, being the unsecured loan of Rs. 4,88,49,059/- from M/s Godwin Construction Pvt. Ltd. and Rs. 1,00,000/- from 6 (six) persons, holding the same as unexplained cash credits u/s 68 of the Act and the observations made and conclusions drawn are based on incomplete appreciation of facts on records and the submissions of the appellant have not been considered in right perspective thereof. 4. That the authoriti....

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....ssessee was asked to produce the supporting evidence/details/books of account vide show cause dated 04/03/2015. Since, no bill/vouchers and books of accounts were submitted before AO for verification, the Assessing Officer proceeded to disallow 20% of the expenditure claimed by the assessee. (i.e. Rs. 21,51,783/- x 20% = 4,30,357/-). 4. Aggrieved, the assessee preferred an appeal before the Ld. CIT(A) and Ld. CIT(A) sustained the same. 5. Aggrieved the assessee is in appeal before us and at the time of hearing, the Ld. AR brought to our notice page 23 of the Paper Book which is the return of income filed by the assessee for assessment year 2012-13. He submitted that no doubt assessee has declared net loss of Rs. 2,20,96,385/- in its profit and loss account. However, not claimed any expenditure under Income Tax Act and also submitted that assessee has not carry forward the above said loss, therefore, making ad hoc disallowances is not proper. 6. On the other hand, the Ld. DR relied on the orders of the lower authorities. 7. Considered the rival submissions and material placed on record, we observed that the Assessing Officer has disallowed 20% of the expenses claimed by ....

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....h PAN numbers of all the depositors were filed. Photocopies of the same are placed at pago no.14 to 27 in the paper book. The Id. A.O. has made addition only on the ground that the loan of sister concern was classified as loans from friends & relatives in Tax audit report of the appellant and now the same is being shown as loan from sister concern. He further made a finding that M/s Godwin Construction Private Limited has not submitted details of debtors being shown in his books of account. The addition so made by the Id. A.O. is totally unlawful & unjust because the classification of a loan under loans and advances from friends & relatives instead of loan from sister concern would not make the loan as unexplained. It is further submitted that the confirmation was duly filed before the Id. A.O. during assessment proceedings along with letter dated 25.03.2015 and return filing proofs was also placed in the paper book as explained above. It is further submitted that the total amount of loan of Rs. 4,88,49,059/- was paid to the appellant by the said sister concern only through banking channel and there was no cash transactions in the said account and therefore the co....

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.... 11. Aggrieved with the above order, assessee is in appeal before us. 12. At the time of hearing, the Ld. AR brought to our notice relevant findings of the lower authorities and submitted that Assessing Officer has not doubted the genuineness of the transaction and he brought to our notice page 7 of the Paper Book wherein assessee has responded to the remand proceedings and further he brought to our notice page 44 to 61 and page 62 to 66 wherein ledger copies of the assessee in the books of account of Godwin Construction Pvt. Ltd and in assessee's books, in both ledger's, the transactions were reflected. Further, he brought to our notice page 67 of the PB which is confirmation of balances received from Godwin Construction Pvt. Ltd. He brought to our notice page 94 of the PB where the breakup of the loan credits were given in the books of Godwin Construction Private Limited, the amounts outstanding declared by the assessee are clearly shown. Further he submitted that the assessment order passed in the case of Godwin Construction Pvt. Ltd. which is placed at page 96 of the PB where there was no discussion on the present issue and he submitted that the same Assessing Officer has ....

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....hat the bank books are not books of accounts and Assessing Officer has not raised any doubts about the availability of cash Rs. 8,00,000/-. After considering the submissions of the assessee, the Ld. CIT(A) dismissed the grounds raised by the assessee with the following observations:- "9.3 The undersigned has carefully gone through the assessment order, written submission as well as verbal arguments of Ld. A.R.. It is seen that, AO has observed that the cash deposits of Rs. 5,00,000/- on 07.01.2012 an Rs. 3,00,000/- on 08.11.2011 was made by the appellent company. Its bank accounts no. 5000805736 Allahabad bank 55 Meerut Cant. During the assessment proceeding, no details were submitted by the appellant company, hence, the same were added back to the appellant company. During the appeal proceedings, Id. A.R. of the appellant has submitted that, the addition made should be deleted because, firstly, bank books are not books of accounts and secondly, Id. A.O. has not raised any doubts above the availability of cash of Rs. 8,00,000/- in his remand reports. Hence, it was contended that, addition made by AO should be. deleted. 9.4 The undersigned has carefully gone throug....