TaxTMI 
TaxTMI 
2023 (7) TMI 1480
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....ary proof regarding maintenance of books of account as per accounting standard AS-I?" 3. "Whether on points of law and on facts & circumstances of the case, the Ld. CIT(A) was justified in giving a finding which is contrary to the ratio of the decisions of Hon'ble Allahabad High Court in the case of Awadhesh Pratap Singh Abdul Rehman & Bros Vs. CIT 201 ITR 406 (All.) regarding parameter of satisfaction for rejection of books of account?" 4. "Whether on points of law and on facts & circumstances of the case, the Id. CIT(A) was justified in accepting fresh evidence produced by the assessee, if any without allowing the AO, proper opportunity to examine the same, thereby violating the provisions on law under Rule 46A of the I.T. Rules?" 5. "Whether on points of law and on facts & circumstances of the case, the Ld. CIT(A) was justified in giving a decision in favour of the assessee and against the revenue though there is no nexus between the conclusion of fact and primary fact upon which conclusion is based? 6. "Whether on points of law and on facts & circumstances of the case, the Ld. CIT(A) was justified in deleting the addition of Rs. 2,32,59,2....
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.... Sub:- Appeal filed under section 253 by the Revenue in the case of PSA construction For the A.Y. 2014-15-- request regarding - Appellant The revenue Partnership firm Assessment year 2014-15- Trading of tractors, trolly and parts ITR us 139 03-09-2014 Rs.77,71,280/- Assessed income us 143(3) 24-12-2016 Rs.3,10,30,484/- Addition Rs.2,32,59,204/- 8% on cash payment of Rs.4,09,06,963/- calculated at Rs.,3,34,49,568/-, reduced declared NP of Rs. 1,01,90,365/- and net NP of Rs.2,32,59,204/- added, based qu.no 14 page 8 of statement of Shri Sanjay Singhal (Para-6 page-3) Revenue effect 97,56,280/-( aprox.) It is assessee's appeal, hence, CBDT Circular no 17/2019 dated 08-08-2019 and does not fall under exceptional cases vide CBDT circular no 03/2018 dated 11-07-2018, is applicable in the case. AO is observation Based on survey finding and statement and various discrepancies, the AO was in view that books of accounts is not reliable. (Para03 Page-01) 1. AO show caused the assessee for rejection of books of account (para-4 page-2) 2. AO adjudicated assessee explanation on production of books of acco....
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.... additional evidences. Gr-5 CIT A errored in ignoring contradictory facts stated by the Shri Sanjay Singhal and facts on records. Due date Grounds of appeal 27-06-2018- Filed on 20-07-2018. Evidences on records Reasons for applying section 145(3) * Statement of Shri.U.S.N. Murty,accountant, recorded on 08-03-2018, *Entries the vouchers which given to him by the partners. And for other vouchers denied to be aware of them Reply-4& page 1 * expenses vouchers for 5 different place was confronted to the assessee to verify form regular books of account, Shri. Murty categorically, accepted that vouchers were not entered in regular books of account. (Reply 6 page 2) * The vouchers pertains to 13-02- 2016 and date of survey is 08-03-2016. The assessee failed to verify expenses vouchers in regular books of account. The books are with the assessee in computers and was not properly recorded and was complete. Hence, there is sufficient cause to doubt books result and rejection us 145(3). The accountant categorically re affirm that enters only those vouchers, which are given to him for accounting entry. He also admitted that there are some....
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.... disclosed income at the rate of 8% of turnover of previous three years. The survey operation closed peacefully after 27 hours. From the statement and facts collected from incriminating material, the books of accounts was found not reliable and results was disturbed. The assessee voluntary disclosed income at the rate of 8% of income. Reasons for rejection of books of accounts is based on facts on the spot and not on presumption or surmise. Retraction from statement The assessee filed affidavit to retract his admission from his statement recorded during the time of survey operation. Para-8 and 9 of the affidavit the assessee claimed to be in depression, a patient under treatment of depression and was under disturbed mental state(para-13),lost equilibrium of mind(para-14) loss of memory (para-16), under treatment of cervical problem in 04-06-2014.( para-10) Not reliable for the reasons as under *The assessee was a patient of cervical problem some where 2014 and two years was elapsed on the date of survey. The medical report furnished categorically denies that parenchyma, i.e. outer membrane made of cell, is found intact and no significant abnormally detected. The prob....
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....- Assessment year 1984-85 - Whether purchases made by assessee had been found by all lower authorities to be bogus and not genuine, Assessing Officer was justified in adding amount of purchases towards its income - Held, yes The facts on records extracted from survey and assessment proceedings and is apparent. The apparent is real. The facts and surrounding information on records, and statement disclosed the truth the paid in cash many expenses and there is no agreement with subcontract. The assessee denied to have maintained stock register and also to have maintain muster roll. These are surrounding facts and valid reasons for rejection of books of account. The reliance is placed on decisions held as under ♦CIT Vs Durga Prasad More 82 ITR 540 [SC] ( Page -1 to 3) It was held that the apparent must be considered real until it is shown that there are reasons to believe that the apparent is not real and that the taxing authority are entitled to look into the surrounding circumstances and find out the reality and the matter has to be considered by applying the test of human probability. ♦Sumati Dayal Vs CIT [1995] 125 CTR 124 (SC) (Page 3 to 5) It was held t....
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....ls and vouchers but the same were not accepted by the AO with an observation that the same have been prepared by the assessee as an after thought after the survey proceedings. Ld. AO has observed that the assessee has manipulated the books of accounts and other documents, hence, the same cannot be relied upon. Finally, the addition of Rs.2,32,59,204/- for the assessment year 2014-2015 was made by the assessee. 7. It was also submitted by the ld. Sr-DR that the assessee has submitted a correct statement by way of an affidavit of the partners Mr. Sanjay Singhal on 08.04.2016 before the ld.AO taking shelter of his disturbed statement of mind, great medical stress and strain, the assessee in the said affidavit has said that, he forgot completely that the return filed by the assessee-firm M/s PSA Construction for the assessment year 2013-2014 was subject to scrutiny under scrutiny assessment u/s.143(3) of the Act. During the course of assessment proceedings for AY 2013-14, the books of accounts along with bills and vouchers were duly produced and verified by the ld. AO and has made a retraction from the statements recorded u/s.133A of the Act on 09.03.2016. The partner of the assesse....
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....e Return of income based on audited financial statements had already been filed not only for the year under consideration but also for the immediately preceding and succeeding year. 2. 10.09.2013 Return of Income filed u/s 139(1) along with Audited Balance Sheet, and Tax Audit Report for A.Y 2013-14. 3. 07.05.2014 Tax Audit Report in Form 3CD uploaded electronically along with Audited Balance Sheet and Profit & Loss Account for A.Y 2014-15. (Placed on Page No.192 to 204 of the PB and Letter filed before AO is placed on Page No. 220 to 221 of the PB) 4. 03.09.2014 Return of Income filed u/s 139(1) for A.Y 2014-15. (Placed on Page No. 67 of PB) 5. 08.09.2015 Return of Income filed u/s 139(1) for A.Y 2015-16. 6. 17.12.20 15 Assessment Order passed u/s 143(3) for A.Y. 2013-14 vide order dated 17.12.2015 The then Learned DCIT-2(1), Raipur had accepted book results of the assessee and the factum of having maintained the books of accounts and bills and vouchers was also affirmed by the then Learned DCIT-2(1), Raipur. Assessment got completed much before the date of Survey u/s 133A on 08.03.2016. 7. 08.03.20 16 to 09.03.20 16 S....
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....cknowledged that books of accounts along with bills and vouchers have been maintained- kind attention invited to Question No.11 on Page 103ofPB. e) Survey team acknowledged that books of accounts have been maintainedkind attention invited to Question No.13 on Page 104 of PB. f) Surrender was made due to non availability of bills and vouchers during survey. - g) The Learned AO himself recorded his finding of fact that the books of accounts along with bills and vouchers were produced by the assessee in Para No. 1 on Page No. 1 and Para 4.1 on Page No. 5 of the Assessment Order. Arguments: Nothing prevents the assessee to produce the books of accounts along with bills and vouchers during the course of assessment proceedings before the AO even if the same were not produced before the survey team owing to any reason and the Learned AO was duty-bound to examine the books of accounts. 17. Statement recorded u/s 133A has no evidentiary value: as has been held by the Hon'ble Supreme Court in the case of CIT vs. S Khader Khan Son (2012) 82 CCH357. 18. Non production of books of accounts at the time of survey cannot be a ground fo....
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....nct or decisive: It is open for the person who gave the statement to prove that the statement was incorrect or otherwise unreliable. Reliance is placed on the following judicial pronouncement: S. No. Title Citation Authority CLC Referen< 1. Pullangode Rubber Produce Co. Ltd. vs. State of Kerala (1973) 91 ITR 18 Hon'ble Supreme Court Page 12 2 . ITO vs. Vijay Kumar Kesar (2010) 327 ITR 497 High Court of Chhattisgarh Page 1; 8. Statement of the assessee was not voluntary: Reliance is placed on the following judicial pronouncement: s. No. Title Citation Authority CLC Reference 1. Kailashben Manharlal Chokshi vs. CIT (2008) 76 CCH 1026 High Court of Gujarat Page 181 2. DCIT vs. Vipin Aggarwal (2016) 46CCH 291 Chandigarh Tribunal Page 190 9. CBDT has laid emphasis on collection of evidences vide CBDT circular dated 10.03.2003 and 18.12.2014: The copy of CBDT Circular dated 10.03.2003 and 18.12.2014 is placed on Page 711 to 714 of the Paper Book. Prayer; It is humbly prayed that the rejection ....
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....38,23,872/- 5.68% 6. N.P before Partner Remuneration & Interest 97,40,300/- 2.32% 7. Less: Remuneration to Partners 10,00,000/- 0.24% 8. Less: Interest to Partners 26,05,935/- 0.62% 9. Net Profit computed as per the modus operand! which was applied for A.Y 2012-13, 2013-14 & 2015-16. 61,34,365/- 1.46% 10. Returned Income 77,71,280/- Note-1 Note:l Returned income is higher than the income computed based on the direction u/s 144A given in other assessment years, therefore, no adverse view is warranted. Thus, by applying the same modus operand! which was applied by the Learned AO in the assessment of A.Y 2012-13, 2013-14 and 2015-16, the Net Profit after deducting depreciation, partner's remuneration and interest works out to Rs.61,34,365/- which is less than the Returned income of Rs.77,71,280/-, thus, the returned income of the assessee deserves to be accepted even on this score. 11. Rule of consistency does apply to Income Tax Proceedings: Reliance is placed on the following judicial pronouncements: s. No. Title Citation Authority CLC Refer....
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....s were found on computer but the bills and vouchers were not found at the premises of the assessee, therefore, it was proposed by the survey team that in absence of bills and vouchers, why the net profit should not be calculated a@ 8% under the provisions of Section 145(3) of the Act. The assessee has submitted that as stated in the affidavit of partner of the assessee firm was under mentally stress having certain medical issues and accepted the proposal of the survey team in order to buy peace. Ld.AR further submitted that the ld. AO himself in the latter part of his assessment order has recorded that the books of accounts along with bills an vouchers were submitted by the assessee during the assessment proceedings and the same were not accepted inferring that books are manipulated and prepared by the assessee as an afterthought, no adverse finding regarding the contents of the books, bills and vouchers was produced by the assessee, was observed by the AO. 10. Here the arguments of the ld. AR that the assessee cannot be prevented by any law to produce the books of accounts along with bills and vouchers during the course of assessment proceedings before the AO even if the same w....
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....r MT while the brick kiln is at the Ghaziabad and appellants have purchased coal for Rs.5800/- to Rs.6400/-. It is interesting to note that no details of any trader has been specifically mentioned nor the source of the information has been disclosed or verified while observing the above. 15. The Tribunal has not given any independent finding for accepting the order of the assessing officer in rejecting the books of accounts, but has only said that the same has also been upheld by the First Appellate Authority and no interference is required without taking into consideration the grounds taken by the assessee. It was the duty of the Tribunal, which is the final fact finding authority, to have considered the grounds raised by the assessee and to have returned a finding after considering the same. Though the Tribunal has recorded that the books of accounts were duly presented when the show cause notice was given to the assessee, and no discrepancy was found in the same, but non-presentation of the books of accounts at the time of survey cannot be the sole reason for rejection of the books of accounts. The order of the Tribunal in this regard deserves to be set aside and be rem....
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....ther submitted before us the copy of the CBDT Circular dated 10.03.2003 & 18.12.2014 available at page Nos.711 to 714 of the paper book, wherein the Circular No.F.No.286/2/2003- IT(Inv), dated 10th March, 2003, it is directed that in respect of pending assessment proceedings also, the assessing officers should rely upon the evidences/materials gathered during the course of search/survey operations or thereafter while framing the relevant assessment orders. In Circular No.F.No.286/98/2013-IT(Inv.II), dated 18th December, 2014, it has specifically been directed that any instance of undue influence/coercion in the recording of the statement during Search/Survey/Other proceedings under the I.T.Act, 1961 and/or recording a disclosure of undisclosed income under undue pressure/coercion shall be viewed by the Board adversely. Ld.AR submitted that such directions/guidelines of the CBDT through its Circulars are binding on the revenue authorities, therefore, the conduct of the AO in not accepting books of account and the supporting documentary evidence during the assessment was against such guidelines. Based on such argument and contention, ld, AR prayed that rejection of books of accounts ....
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....facts of the case and the relevant case laws, ld. CIT(A) has decided the matter in favour of the assessee deleting the addition made by the AO with the observations that rejection of books and estimation of profit is based on merely the statement of assessee's partner u/s.133A of the Act, there are several facts which were discussed in the appellate order, considering the same, the action of the ld.AO based on no material, cannot be sustained. Ld. CIT(A) while discussing the issue has taken support from the judgment of the Hon'ble Jurisdictional High Court of Chhattisgarh in the case of ITO Vs. Vijay Kumar Kesar, reported in 327 ITR 497, wherein Their Lordship had held that the addition based on mere confession and not based on any document during survey cannot be sustained. The issue was addition of unexplained investment u/s.69B of the Act, where the addition was based solely on assessee's confession during the survey which was later retracted and Commissioner (Appeals), after considering material produced by assessee during assessment proceedings and on due appreciation thereof, had accepted explanation of assessee for retraction of his admission as bona fide and further accepte....
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....cisive having no supporting evidence to substantiate such confession, any addition made by the AO is subjected to be set aside. This contention of the assessee is worth acceptance in terms of judicial pronouncements by the Hon'ble Apex Court and Hon'ble Jurisdictional High Court as referred to supra. Ld. CIT(A) has accepted the said contention of the assessee under the situation when books of accounts and bills and vouchers along with supporting evidence etc. were submitted by the assessee, however, the same were summarily rejected by the AO without examining the same on the basis of presumption, surmises and having a preconceived notion. Therefore, the ld.CIT(A) has rightly reversed the finding of the ld. AO by deleting the addition made in the assessment order. Since the observation of the ld. CIT(A) was based on the facts, settled position of law and on proper appreciation of submissions along with material on record, respectfully following the judicial pronouncements which are binding to decide the issue in hand, we find no interference in the findings of the ld. CIT(A) in this regard and, therefore, without hesitation, the same is upheld. Thus, the controversy raised by the re....
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....¤¿à¤¯à¤® की धारा 145(3) के अंतरà¥à¤—त ६०% सतॠपà¥à¤°à¤¾à¤ªà¥à¤¤à¤¿à¤¯à¥‹à¤‚ के 8% की कर से गणना किया जाये। कृपया सà¥à¤ªà¤·à¥à¤Ÿ करे? जी, वरà¥à¤¤à¤®à¤¾à¤¨ में मैं आपको bills, Voucher of कि A4 2012-13, A4 2013-14, A4 2014-1509 Ay 2015-16 से संबंधित हैं ने पà¥à¤°à¤¸à¥à¤¤à¥à¤¤ नहीं कर पारसू दूà¤à¥¤ इस परिसà¥à¤¥à¤¿à¤¤à¥€ में निरà¥à¤®à¤¾à¤¤ AY 2015-16 वरà¥à¤·à¥‹ से सेवंबित Net propur à¤à¥€ ....
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....य करा हेतॠसमरà¥à¤ªà¤¿à¤¤ की थी, कà¥à¤¯à¤¾ आप से पà¥à¤¨à¤ƒ सà¥à¤µà¥€à¤•à¤¾à¤°à¤¤à¥‡ हैं, कृपया इससे इस पर लगने वाला कर किस पà¥à¤°à¤•à¤¾à¤° दिया जायेगा कृपया विकरण दें। जी को, मैंने पूरà¥à¤µ में पà¥à¤°à¤¶à¥à¤¨ कà¥à¤°à¤®à¤¾à¤‚क 10 के उतà¥à¤¤à¤° में नगर à¤à¥à¤—तानों की वजह से रॠ4,09,06,963/ की आम कराधान हेतॠचालà¥....