TaxTMI 
TaxTMI 
TaxTMI 
2024 (10) TMI 881
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....e above said years. They are being adjudicated first. 3. The facts relating to the case are discussed in brief. The assessee is engaged in the business of mining, manufacturing, trading and transportation of boulders and stone grit materials. The Revenue carried our search and seizure operations in the hands of the assessee on 11-04-2018. Consequent thereto, the present assessments were completed. During the course of search proceedings, certain materials marked as BK-1, BK-2 & BK-3 were found and seized. These materials contained details of money transactions entered in the name of director of assessee company, viz., Shri Brishban Agrawal for the period from 29-10-2016 to 02-12-2016. It was in the form of ledger account copy containing opening debit balance of Rs. 7,12,59,318/- and entries of debits and credits thereafter. 4. When questioned about the opening debit balance of Rs. 7,12,59,318/-, the assessee company submitted that the same represents money paid to the above said director and he was spending the same on behalf of the assessee company. It was admitted that some of the payments have been duly accounted for in the books and some payments were omitted to be accounted.....
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....business transaction of the company either disclosed or undisclosed, the same was given to the managing director Mr Brishbhan Agrawal to upkeep the same and the said fund was infused again by him as and when needed in the Company which is clearly evident from the transaction recorded in the seized ledger account of Mr Brishbhan Agrawal as pasted above. Further Mr Anand Kumar Agrawal, the present Managing Director of the company has also stated in his stated that the business cash of the company are either lying in the counter or given to the Directors. As a matter of trade practice, it was done for the security reason... Sir, on the bare perusal of the nature of transactions as mentioned in the above said account and statement recorded during the search proceedings, it is clearly evident that this ledger account of Brishbhan Agrawal is related only to the business of the appellant company which is explained in 68 pages (page no. 2-5 & 25-89 of reply dated 31-03-2021 of AY 2017-18) during assessment proceeding and thus nothing is unexplained in that seized ledger account. The nature of transactions as mentioned above are also occurred prior to the date of 29-10-2016 and includ....
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....rs in connection with incurring business expenses and also for other purposes. Out of the above said amount, the assessee is claiming deduction of Directors remuneration of Rs. 65,03,993/- paid by way of cheque and further sum of Rs. 74,77,364/- paid towards labour charges paid by way of cash. 9. First of all, it is noticed that this is a rough sheet and the assessee has explained the nature of this sheet. Though it contained opening balance of Rs. 7,12,59,318/-, the details relating to the earlier period were not available. It is the assessee, who has scrutinized the details and has come up to surrender a sum of Rs. 5,72,77,961/- after claiming deduction of Rs. 65,03,993/- towards Directors remuneration and Rs. 74,77,364/- towards labour charges payments. Though the AO did not accept both the claims, the Ld.CIT(A) has allowed deduction of Directors remuneration of Rs. 65,03,993/-. We noticed that it was stated by the assessee that the cash balance was kept with the Director Shri Brishbhan Agrawal for security purposes or as "Imprest cash". That is, the cash available in the books is partly kept with the above said director for safe custody purposes and in order to have control ov....
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....horities are expected to assess the income under the correct head of income only. Accordingly, we are of the view that the tax authorities are not justified in treating the surrendered income as unexplained cash credit. Accordingly, we set aside the order passed by the Ld.CIT(A) on this issue in all the years referred above and direct the AO to assess the same as business income only. We find support for our decision from the following case laws:- (a) Shri Krishna Kumar vs. DCIT (162 taxmann.com 518) (b) Veer Enterprises vs. DCIT (158 taxmann.com 655) (c) Baljinder Kumar vs. DCIT (157 taxmann.com 739) (d) Pramod Singla vs. ACIT (154 taxmann.com 347) (e) Bjaj Sons Ltd vs. DCIT (128 taxmann.com 406) (f) PCIT vs. Dharti Estate (163 taxmann.com 179) 11. Adjudication of above said two issues would fully dispose of appeals filed by the assessee for AYs.2013-14 and 2014-15. 12. One more common issue urged by the assessee in AYs.2015-16, 2016-17, 2017-18, 2018-19 and 2019-20 relates to the addition of interest income of Rs. 2,01,600/- in respect of loan given to Shri Ishwar Chandra Garg. 13. The facts relating to this issue are that the seized records showed that a credit ba....