AI Drafter 
TaxTMI 
TaxTMI 
2025 (4) TMI 901
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....ing and rebutting the same in remand proceedings. 2. On the facts and circumstances and in law, the Ld. CIT(A) has erred in admitting the additional evidences under Rule 46A of the Income-tax Rules, 1962 without verification of additional evidences by the AO even though the assessee has belatedly filed its ITR and Audit report on 26.05.2014 i.e. after a delay of eight months and no evidences were filed that audit had been conducted on or before 30.09.2013. 3. On the facts and circumstances and in law, the Ld. CIT(A) has erred in deleting the addition made by the AO on account of purchases and development expenses claimed by the assessee in profit and loss account amounting of Rs. 2,90,20,819/-in spite of the fact that the assessee has failed to submit the books of accounts, bills or vouchers etc. to substantial its claim during the assessment proceedings. 3. Succinctly, the fact as culled out from the record is that return declaring total income of Rs.39, 10,260/- was filed on 26.05.2014 through e- filing which was processed u/s 143(1) at the same income. The case was selected for scrutiny and hence a notice u/s 143(2) was issued on 7-9-2015 which was duly serv....
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.... computation of income of 6 parties/contractors were also enclosed. However, in the absence of books of a/c, bills and vouchers verification of expenses was not possible. To enquire about the genuineness of expenses, summons u/s 131 for personal presence were issued on 04.03.2016 to Shri Mohd. Hamid and Smt Shagufta Parveen of Jaipur to whom such expenses were allegedly paid. On the same day a letter was issued to the assessee to produce books of a/c, bills and vouchers on 11.03.2016. A show cause notice for imposing penalty u/s 271(1)(b) was also issued on that day as the assessee had failed to produce books of a/c on 04.03.2016. Both the payees i.e. Shri Mohd. Hamid and Smt. Shagufta Parveen did not attend on 08.03.2016 and hence fresh summons u/s 131 were issued to them requiring their personal presence on 10.03.2016. However, both of them did not attend in person and sent return reply through post enclosing therewith copy of ITR, computation of income and PAN card only. The parties avoided personal presence and production of books of a/c just to escape interrogation by the Department. On 09.03.2016 summons u/s 131 were also issued to five outstation parties to whom purchase, an....
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....stated as under :- "In the P&L a/c we have debited a sum of Rs. 2,90,20,819/- on account of purchases and internal development expenses for improvement of land. We have already submitted details of work done on land as landscaping, levelling of land, fencing etc. for amounting to Rs. 2,50,60,966/- Difference of Rs. 39,53,853/- is on account of purchases of Mitti, Khambi, wire for fencing etc. from open market. Further, the land which was transferred to M/s M.M.Realty during the year was immeasurable condition having lot of pitfall on it and open without fencing lot of expenses were incurred for its improvement to make it in saleable condition which are quite genuine." The assessee Id. A/R has not submitted any item wise, date wise details, any books of account, bills or voucher etc., its claim of its claim of incurring purchase and development expenses. The assessee has also not controverted the adverse finding of inquiry conducted by the Department. The facts being so the purchase and development expense debited by the assessee were held to be bogus and thereby an addition of Rs. 2,90,20,819/- was made to the income of assessee. 4. Aggrieved from the order of the as....
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....and 26.03.2024. However, the remand report is still pending, neither have any adjournments been sought by the Ld. AO. In view of the same, the appeal of the appellant is being decided on the submissions made by him and the material on record. In order to meet the ends of justice, the additional evidence submitted by the appellant under Rule 46A of the IT Rules is hereby admitted. From the assessment order of the Ld. AO and the submissions made by the appellant, it is seen that the appellant has submitted all the necessary details in respect of the expenses incurred by him. All the ledger accounts, bills and vouchers have been produced. The TDS has been paid u/s 194C, the copy of ITR acknowledgments have been provided, all the transaction have been carried out through the banking channels. Hence, the said expenses cannot be help to be bogus in nature. The appellant cannot be forced/compelled to produce its parties to prove genuineness of the transactions. By submitting the necessary documents, the appellant had discharged the onus cast upon him to prove the genuineness of the transactions quite sufficiently. Further, since all the details were available wi....
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....o clarify the Revenue's stance on these matters with the utmost respect for the decisions of the appellate authorities. II. Issue Involved in Assessment 1.1 During the assessment, the assessee claimed development expenses amounting to Rs. 2,90,20,819 against the sale of various land parcels. Despite the Assessing Officer's (AO) due diligence and provision of multiple opportunities, the assessee's responses were either incomplete or non- responsive, displaying a consistent pattern of evasiveness, which ultimately resulted in the disallowance of the development expenses. 2. Assessee's Business and Initial Information Submission 2.1.BusinessOverview: The assessee, engaged in the real estate business, declared sales of Rs. 6,23,30,330 with a net profit of Rs. 51,98,803. The Profit & Loss account includes a debit of Rs. 2,90,20,819 as internal development expenses. 3. Non-Cooperation in Verification of Development Expenses 3.1 Failure to Produce Books and Supporting Evidence: Despite the AO's specific requests on 26.02.2016 for books of account, bills, and vouchers, the assessee provided only partial deta....
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....nses, thereby obstructing a comprehensive examination. The AO's extensive efforts to conduct a fair and exhaustive assessment were undermined by the assessee's non-cooperation, necessitating the disallowance of unverifiable expenses. The AO's conclusions were reached with due care and prudence, given the lack of transparency by the assessee. 4. Failure to Record Reasons for Admitting Additional Evidence 4.1 In addition to procedural non-compliance, the Ld.CIT(A) failed to document any specific reasons for admitting the additional evidence submitted by the assessee. Rule 46A mandates that, in cases where new evidence is accepted, the appellate authority must provide documented reasons justifying this decision. The absence of such reasoning in the Ld. CIT(A)'s order not only violates procedural requirements but also weakens the credibility of the order. 5. Prejudice to the Revenue 5.1 By admitting additional evidence without sharing it with the AO, the Ld. CIT(A) effectively deprived the Revenue of a fair opportunity to address or counter the evidence submitted by the assessee, resulting in substantial prejudice to the Revenue. ....
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.... appellant under Rule 46A of the IT Rules is hereby admitted." 2.2.The Findings of the Ld. CIT(A) are Factually Incorrect: 1 On 15.12.2023, the Ld. CIT(A) requested a remand report based on the additional evidence submitted during the appellate proceedings. However, the documents were not provided to the jurisdictional Assessing Officer. A report has been called from the AO and same is marked as Annexure-A (2 pages) The Ld. CIT(A) admitted the additional evidence submitted by the assessee with a remark that - Remand report is not received Even without providing the AO with these documents, which are essential for preparing a remand report. 3.Rule 46A of Income Tax Rules 1961 3.1 Under Rule 46A of the Income Tax Rules, 1962, "additional evidence" refers to any oral or documentary evidence that an appellant seeks to present before the Commissioner of Income Tax (Appeals) [CIT(A)] which was not produced during the original assessment proceedings before the Assessing Officer (AO). The rule outlines specific circumstances under which such evidence may be admitted: i. Refusal by the AO: If the AO refused to admit evi....
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....additional evidence. b. Cross-examine the witnesses (if any). a. Produce evidence in rebuttal. iii. The Ld. CIT(A) failed to adhere to these essential requirements, thereby violating the principles of natural justice and rendering the proceedings unsustainable. 4.3. Supporting Case Law 1. ITO v. Kripa Shanker Gupta (2008) 14 DTR (All) 103 * Held that the CIT(A) cannot admit additional evidence without complying with Rule 46A. Any admission of such evidence in violation of Rule 46A vitiates the appellate order. 2. CIT v. Manish Buildwell Pvt. Ltd. (2012) 204 Taxman 106 (Delhi HC) * The Hon'ble High Court observed that the CIT(A) must record reasons for admitting additional evidence and ensure that the AO is provided with a reasonable opportunity to examine and rebut the same. Non-compliance with Rule 46A was deemed a violation of natural justice. 3. Smt. Prabhavati S. Shah v. CIT (1998) 231 ITR 1 (Bom) * The Bombay High Court emphasized that the conditions under Rule 46A must be fulfilled before additional evidence can be admitted. 4. DCIT v. Keshav Cement & Infra Ltd. (2015) 371 I....
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....a vs. K.T. Shaduli [(1977) 39 STC 478 (SC)]: This ruling emphasized that "no evidence should be taken behind the back of any party." The AO was deprived of the opportunity to review the additional evidence, violating the requirement for procedural transparency. v. Smt. Kamla Devi vs. ITO (82 Taxman 144) (ITAT Delhi): It was held that the CIT(A) must confront the AO with any additional evidence; failure to do so compromises the fairness of the proceedings. In the present case, the Learned Commissioner of Income Tax (Appeals) [Ld. CIT(A)] proceeded without providing the additional evidence to the Assessing Officer (AO), thereby denying the AO a fair opportunity to examine and verify its authenticity. This action contravenes Rule 46A and violates the principles of natural justice, as laid down by statutory guidelines and supported by judicial precedents. 6.2 Therefore, it is respectfully submitted that the order of the Ld. CIT(A) be set aside, and the AO's order be confirmed. The additional evidence submitted was part of the audited books of accounts, and the assessee deliberately failed to present it during the assessment proceedings. The documents subm....
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....lity, and it is the AO's prerogative to verify such evidence, especially when it has been introduced late. In this case, the Ld. CIT(A)'s acceptance of additional evidence without verification by the AO does not align with the procedural requirements under Rule 46A and prejudices the AO's ability to conduct a fair assessment. Ground 3 : Erroneous Deletion of AO's Addition of Development Expenses Ground: "On the facts and circumstances and in law, the Ld. CIT(A) has erred in deleting the addition made by the AO on account of purchases and development expenses claimed by the assessee in profit and loss account amounting to Rs. 2,90,20,819/-in spite of the fact that the assessee has failed to submit the books of accounts, bills, or vouchers to substantiate its claim during the assessment proceedings." 1. Submission: The order of the Ld. CIT(A) lacks appreciation of critical facts and has taken a contrary view, stating: "From the assessment order of the Ld. AO and the submissions made by the appellant, it is seen that the appellant has submitted all the necessary details in respect of the expenses incurred by him. All the le....
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....ssee vide letter issued on 26.02.2016, was asked to furnish the details of internal development expenses and produce books of a/c along with supporting evidence and the case was fixed for hearing on 04.03.2016. On that day a letter dated 02.03.2016 along with some details was received through post. As per these details, internal development expenses aggregating to Rs. 2,50,60,966/- had been paid to 7 parties/contractors. Details of TDS made by the assessee u/s 194C and copy of ITR acknowledgements and computation of income of 6 parties/contractors were also enclosed. However, in absence of books of a/c, bills and vouchers verification of expenses was not possible." 3.2. Incomplete Submission of Evidence by the Appellant i. The AO issued a letter to the appellant on 26.02.2016, asking for detailed information on internal development expenses and supporting documents, with a hearing scheduled for 04.03.2016. In response, the appellant only provided a letter dated 02.03.2016 with partial details, submitted through post. Although the appellant attached details of internal development expenses amounting to Rs. 2,50,60,966/- and listed 7 parties/contractors inv....
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....bills, and vouchers crucial for verification. ii. The Ld. CIT(A) overlooked the appellant's non-compliance in submitting complete records, equating document submission with verification. This procedural lapse affects the credibility of the expenses claimed For verification of the genuineness of these transactions, the Assessing Officer (AO) issued summons to the parties involved. However, these summonses were not complied with by the contractors or parties, which raises further questions about the credibility of the claimed expenses. The AO's inability to verify the authenticity of the work performed through primary supporting documents, such as books of accounts and vouchers, and the non-compliance of summoned parties, provided justifiable grounds for questioning the legitimacy of these expenses. Mere documentary evidence of payment does not suffice to establish the genuineness of the expenses. The Supreme Court has laid down the principle that the onus is on the assessee to prove not only the identity of the parties and the transaction itself but also the genuineness of the work claimed to have been done. Supporting Case Laws: ....
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....ng Channels for Transactions While the appellant has argued that conducting transactions through banking channels suffices to establish the legitimacy of expenses, it is respectfully submitted that banking channel transactions merely reflect the movement of money, not the actual performance of work or services. Banking Channels Indicate Mode of Payment, Not Verification of Work Performed * Banking channels serve as a medium to facilitate payments between parties and merely record the transfer of funds. They demonstrate that a payment was indeed made from one party to another, but they do not attest to the work or services for which such payments are claimed. * Payment through a bank does not confirm whether the services for which the expense is recorded were genuinely rendered or to what extent the work was performed. This is especially relevant when significant amounts are claimed as expenses, requiring a higher standard of proof beyond mere financial transfers. 2. Completion of Work and Performance Must Be Verified Independently of Banking Transactions * The completion and authenticity of work must be substantiated by primary ....
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.... services or work without additional supporting records. 5. Conclusion: Need for Comprehensive Evidence to Establish Genuineness * We respectfully submit that while banking transactions confirm that funds were transferred, they do not inherently confirm that the work was performed or the services were rendered as claimed by the appellant. * The appellant's reliance on banking channels alone, without primary records like books of accounts, bills, and vouchers, does not fulfill the requirements of proof to establish the genuineness of the expenses claimed. * In the absence of corroborative documentation demonstrating the actual performance of work, the AO's findings questioning the authenticity of these expenses are both reasonable and justified. 2. Requirement for Research and Approval Processes in Awarding Contracts * As a company, the appellant is bound to follow a due diligence process, including research, background checks, and board approvals or memorandums, before awarding substantial contracts to service providers. The absence of records demonstrating these internal procedures reflects a lack of accountability and control ....
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....ome), they have the authority to add such unexplained amounts to the income under scrutiny. * Application of Judicial Mind: The AO must apply their judicial mind in the scrutiny process, considering all facts and circumstances before reaching a conclusion. This includes seeking clarification or additional information when there are discrepancies in the evidence. * Adherence to Principles of Natural Justice: The AO must give the assessee a fair opportunity to explain discrepancies or provide additional information if any inconsistencies are noted during scrutiny. * Judgment Summary: In CIT vs. Smt. P.K. Noorjahan, the Supreme Court emphasized that while the AO has the discretion to make additions based on unsatisfactory explanations, they must exercise this discretion judiciously and in a manner consistent with the principles of natural justice. The AO's duty is not just to increase the assessment but to verify the legitimacy and genuineness of the claims made by the assessee. * Relevance of the Case Law: * This judgment illustrates the AO's responsibilities in scrutiny assessments, especially when dealing with unexplained sources....
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....Failure of the Assessee to Discharge the Onus * After the AO shifted the burden, the assessee was required to produce primary evidence, including books of accounts, vouchers, and other records, to establish the genuineness of the expenses. The assessee's failure to provide these documents highlights a lack of cooperation and transparency in the verification process. * Importance of Assessee's Responsibility: The assessee cannot solely rely on the AO's inquiry. Tax laws mandate that when a claim is questioned, the assessee must substantiate it with adequate proof. Here, the absence of compliance from the assessee justifies the AO's questioning of the claim. 5. Necessity of Personal Presence: Personal presence of contractors was indispensable to ascertain: 1. Knowledge and Technical Capacity: To determine their understanding and expertise in performing large-scale development work. 2. Sources of Raw Materials: Especially the legal procurement of sand and other resources, which require licenses from the Rajasthan State Department. 3. Movement of Machinery and Labor: Verification of earthmovers, trucks, labo....
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....tradicting the assessee's claims of extensive improvements. Supporting Case Law: CIT v. Ram Narain Goel (1997) 224 ITR 180 (P&H) supports the use of physical inspection reports as substantial evidence for assessing the genuineness of claimed development expenses. Further, in Smt. Saroj Agarwal v. CIT (1985) 156 ITR 497 (SC), the Supreme Court upheld that physical verification by way of field inspection is a valid approach for evaluating claims of expenses in tax matters. the AO issued summons under Section 131 to contractors and third parties related to the assessee for verifying the genuineness of development expenses totaling Rs. 2,90,20,819. Despite the summons, the parties: 1. Submitted limited documents by post without appearing personally. 2. Avoided direct interrogation by failing to produce books of accounts and other essential evidence. 3. Blocked the AO's ability to verify their technical capacity, licenses, and operational ability to perform the claimed development work. As noted in Para 3.4 of the Assessment Order, the AO observed: "The parties avoided personal presence and production of boo....
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....f Contractors and Assessee to Appear Under Section 131 The refusal of both the assessee and contractors to attend personally under Section 131 prevented the AO from: 1. Verifying the source and legality of raw materials (e.g., sand), which require licenses under Rajasthan State regulations. 2. Checking the movement and utilization of heavy equipment, transportation logistics, and labor charges related to the claimed development. 3. Cross-examining the contractors' financial and operational capacity to undertake large-scale development activities. Their evasive behavior hindered the AO's inquiry, justifying the disallowance of the expenses claimed by the assessee due to lack of cooperation and absence of credible evidence. While the assessee contended that all relevant documents were produced and the Ld. CIT(A) observed that sufficient documentation was submitted, this claim is insufficient in light of the non-compliance with Section 131 summons. Without personal attendance, the AO could not conduct the necessary cross-examination or verify the authenticity of documents. Hence, the limited submission of documents by post ....
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....is partly fenced up to 3-4 feet height. There is no agricultural or other activity on the land."(para first page number 4). * These observations confirm that the land was devoid of any development, landscaping, or agricultural activities, directly contradicting the appellant's claim. 2. Appellant's Claim of Land-Filling and Landscaping: No Evidence Provided * The appellant's statement that they engaged in land-filling and landscaping to prepare the land for sale remains unsubstantiated. No documentary evidence, invoices, or work orders were provided to support the claim of any development work, including land-filling or landscaping. 3. Ld. CIT(A)'s Limited Mention of Agricultural Activity * The Ld. CIT(A) selectively referenced the absence of agricultural activity without addressing the broader factual context, including the lack of any development work or landscaping. The Ld. CIT(A) has overlooked the AO's findings that no type of activity-agricultural or otherwise-was observed on the land. * Misrepresentation by the Appellant: The appellant has attempted to misrepresent the findings by selectively emphasizing agricu....
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.... submissions. The present submission seeks to address the financial discrepancies and manipulation of stock details by the assessee, as well as to present cogent legal arguments for the disallowance of the assessee's claims. It is humbly prayed that this submission be taken on record. I. Comparative Analysis of Stock, Sales, and Purchases 1. Pursuant to the directions of the Hon'ble Bench, the assessee-appellant submitted the Profit and Loss Account (P&L A/c) for the year under dispute through email and physical submission. 2. The Revenue sought financial data from the jurisdictional officer for Assessment Years (AY) 2012-13 to 2017-18. The jurisdictional officer provided P&L A/c data extracted from the Income Tax Returns (ITRs) filed by the assessee for the relevant years. 3. Based on this data, a comparative analysis of sales, purchases, opening stock, and closing stock of finished goods and raw materials has been prepared and tabulated below: Sr. No. Particulars Amount(Rs.) 1. Asstt. Years 2012-13 2013-14 2014-15 2015-16 2016-17 2017- 18 2. Sales 2,03,58,795/- 6,23,30,330/- 34,17,123/- ....
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.... burden of proof rests squarely on the assessee to establish the genuineness of transactions, including the identity and creditworthiness of investors and the authenticity of financial declarations. The Court further held that failure to provide cogent evidence renders the claims liable for disallowance. Applying the ratio of the above judgment, the assessee in the present case has failed to substantiate: 1. The authenticity of the reclassification of opening and closing stock; 2. The genuineness of levelling and fencing expenses amounting to Rs. 2,90,20,819/ -; 3. The legitimacy of stock declarations over the disputed assessment years. III. Prayer In light of the above analysis and judicial findings, it is most respectfully prayed that the Hon'ble Bench may: 1. Confirm the order of the Learned Assessing Officer (Ld. AO) and set aside the order of the Learned Commissioner of Income Tax (Appeals) [Ld. CIT(A)]; 2. Disallow the bogus expenses amounting to Rs. 2,90,20,819/- claimed by the assessee for AY 2013-14; 3. Confirm the Revenue's contention regarding manipulation of stock declarations; ....
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....ncurred by them * The Ld. DR in its submission dated 23.12.2024 has mentioned "point no. 3.1.2 Evasions of Summons by Key Contractors" and "point no. 3.2.3 Noncompliance by Outstation Contractors" that the AO had issued summons U/s 131 to the contractor but the contactors failed to attend hearings & provided responses by post and also that some contractors did not submit their responses. * In this matter it is submitted that the creditors of the assessee have duly filed their submission in response to the summons issued by the AO U/s 131. (Pg No. 30-54 of paperbook) * The creditors could not attend the hearing personally but they have duly provided the following relevant documents on time: • Letter confirming the nature and details of transaction undertaken between them and the assessee • ITR & Computation • Copy of their PAN * All the basic documents related to the creditors were submitted at the assessment proceeding but the contention of the AO was that the assessee had failed to produce the party so as to establish genuineness of the transaction. Neither these creditors were related party of the assessee nor they have completel....
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....g the assessment proceeding * The assessee had provided the following documents before the Ld. A.O to verify the claim of internal development expense" • Complete details of expense including: * Name of parties * Respective amount of parties * Tax deducted on payment • ITR & Computations of the parties (Page No. 10 to 28 of the Paper book) * Thereafter, the Ld. A.O had issued summons to the parties and most of the parties have submitted their response (Page No. 30 to 54 of the Paper book) * The details provided by the assessee resulted in total of Rs. 2,50,60,966/- as the remaining balance of Rs. 39,53,853/- was incurred on account of purchase of mitti, khambi, wire for fencing from the open market. * "The Ld. A.O did not raise any objection on the documents submitted by the assessee" and still made of the addition on account of internal development expenditure only because of nonsubmission of bills or vouchers of such expenditure. 3. Documents submitted during the appeal proceeding * Since the Ld. A.O had made the addition only because of the non- submission of the bills & vouchers of the relevant par....
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....s. 1 crore, this case clearly falls under the ambit of this circular and hence the CIT(A) has to dispose off the appeal on priority basis. 9. The Ld. AR of the assessee to support the order of the ld. CIT(A) and the contention so raised also filed a detailed paper book the index of the paper book filed reads as under : S. No. Documents furnished before the Ld. A.O at the time of assessment proceedings. Page No. of Paper Book Remarks 1. Reply dated 02.03.2016 01-29 * The department issued notice U/s 142(1) on 26.02.2016 as per which the department required the following documents and information: * Detail and valuation of closing stock In the reply dated 02.03.2016 assessee enclosed complete detail valuation of closing stock * Detail and valuation of Opening stock In the reply the assessee also enclosed detailed valuation of opening stock * Detail of internal development expenses In the reply assessee provided the detail of internal development expenses of Rs.2,50,60,966/- along with that assessee also enclosed the Parties ITR, Computation of Income & Form 26AS to whom payment for internal development expenses were made. (Pg. No.....
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....ct of purchase and development (Pg. No.65-130) * The Assessee submitted an application for submitting additional evidences under rule 46(A) as on 15.06.2023 and had provided the bill of the following parties in respect of purchase and development expenses: * Bills copy of Arun Sharma HUF * Bills copy of Madhu Bala * Bills copy of Munjal Enterprises * Bills copy of Shagufta parveen * Bills copy of Flexible Machine Tools * Bills copy of Rajesh Kumar * Bills copy of Mohammad Ahmed * The assessee also submitted its written submission on 15.06.2023 * The Ld. A.O was requested to issue to remand report on 15.12.2023, 29.12.2023 and 25.01.2024. The Ld. PCIT was also requested to expedite the remand report vide communication dated 07.03.2024 and 26.03.2024. * No remand report was issued by the AO and hence appeal order was passed based on the evidences available on record. 10. As regards the contention of the raised while hearing the ld. AR of the assessee also filed a written submission to counter the arguments of the ld. DR wherein the ld. AR of the assessee contended as under : Whether Expenses under ....
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....hat for the purpose of Central Sales Tax, the definition of goods only includes only materials, articles, commodities and all other kinds of movable property. The immovable goods are not included in the definition of goods as the Central Sales Tax. Hence, since the assessee company was only engaged in selling plots/lands i.e., immovable property, it was not liable to be registered under this Act. Furthermore, the assessees who were liable to file the tax audit report were required to specify that whether they were liable to pay any kind of indirect taxes such as excise duty, service tax, sales tax, customs duty, etc. And the assessee who were liable to pay such indirect taxes were also required to mention their registration no. under the relevant act in their tax audit reports. In the present case, the assessee had filed the tax audit report for the relevant assessment year i.e., A.Y 2013-14 as on 30.08.2013 and at point no. 4, the assessee was required to provide the registration no under the relevant acts if it was liable to pay any kind of indirect taxes. However, since there was no liability on the assessee to be registered and pay any kind of such indirect ta....
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....hers based on that notices were issued u/s. 131 of the Act requesting those parties to remain present but they submitted the details in DAK to that fact ld. DR draw our attention to chart at page 20 of her submission stating that Shri Mohd. Hamid did not appeared and submitted the details in part. Smt. Shagufta Parveen also not appeared and details were not given as requested. Summons issued to M/s. Flexible Machine Tools and Shri Arun Sharma were returned unserved. In the case of other contractor the reply were evasive and critical evidence / reply relevant to the issue were not given. The inspector was deputed by the ld. AO and after consulting he filed the reply on site. The assessee paid majority of the payment in cash. Ld. AO has not violated any the principles of natural justice in the assessment proceedings. The appeal filed by the assessee was not getting time barred and the ld. CIT(A) should have awaited the reply of the ld. AO and thus, the order of the ld. CIT(A) is bad and in law and that is why the revenue is in appeal. 12. On the other hand, ld. AR of the assessee in addition to the written submission so filed vehemently argued that the assessee has deducted TDS on....
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.... is a limited company engaged in the business of development, sale and purchase of land property. Return of income was filed by the assessee declaring income of Rs. 39,10,260/ -. The bench noted that while issuing notice u/s. 142(1) of the Act dated 26.02.2016 the assessee was asked to submit the details of the valuation of closing and opening stock and details of internal development expenses claimed by the assessee. The assessee submitted all the details of the internal development expenses so claimed for an amount of Rs. 2,90,20,819/ -. As is evident that while making the payment to those seven contractor the assessee has deducted as the compliance requirement under the law and thereby further supported the claim with submission of ITR and computation of those contractors, Form no. 26AS of those contractor wherein the contract details and TDS were reflected. Based on these details ld. AO issued summons and out of seven parties five have even filed the reply to the summons though the personal attendance was sought was avoided by the contractors. The ld. AO should have cross reverified that whether all the parties have offered the income so received by it based on the documents al....
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....provided the remand report even after so many reminders the Ld. CIT(A) passed the order as on 12.04.2024, based on facts and records available. As is evident that the assessee had filed the appeal before the Ld. CIT(A) on 28.08.2018 and the appeal order was passed on 12.04.2024 which means the appeal was pending before the Ld. CIT(A) for approximately six years and sufficient opportunity was granted to the ld. AO. Without prejudice to that rule 46A(4) provide that "Nothing contained in this rule shall affect the power of CIT(A) to direct the production of any document, or the examination of any witness, to enable him to dispose of the appeal, or for any other substantial cause including the enhancement of the assessment or penalty". As regards the filling of the audit report belatedly, the ld. AO has already considered the audited accounts and made the addition there from and there being no further grievance on that delayed filling of audit report and therefore, they contention has no effect either on merit or that of the admitting the evidence on those accounts. Thus, when the ld. CIT(A) has considered those evidence giving equal chance to ld. AO for providing his comments he h....
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.... payment of Rs. 2,50,60,966/- to seven contractors. In this matter we note that in the assessment proceeding in the very first reply of the assessee submitted on 13.07.20215, he had provided the following major documents as required by the ld. AO i.e.PAN Card, ITR Ack. and Computation of A.Y.2013-14, Audited Balance sheet and Profit & Loss of the A.Y.2013-14, Sales ledger in the book of Ascent Buildhome Developers Limited, Transfer deeds, Bank account statement of Punjab National Bank, Jaipur, Kotak Mahinda Bank, Raja Park, Jaipur and Kotak Mahindra Bank, Raja Park, Bhiwadi. The assessee also submitted the details of the payments made to the seven contractors, the assessee had provided the details in its reply dated 02.03.2016 showing details of internal development expenses, Copy of ITR & Computation of those contractors and Form 26AS of those contractors. The assessee also submitted the copy of ledgers and bills were also duly submitted at the time of appeal proceeding but the ld. AO remained silent in the remand proceedings. The ld. DR in its submission dated 23.12.2024 has mentioned vide point no. 3.1.2 Evasions of Summons by Key Contractors and "point no. 3.2.3 Non-complian....