TaxTMI 
TaxTMI 
2025 (8) TMI 43
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....g the course of assessment proceedings the Assessing Officer noted that the assessee in the Profit & Loss Account has shown total sales at Rs. 39.71 Crores, cost of sales at Rs. 32.45 crores and other expenses at Rs. 3.72 Crore thus, showing a book profit of Rs. 4.13 crore before payment of salary and interest to the partners. He therefore asked the assessee to furnish the party-wise details of purchases and other expenses. The assessee produced the purchase register before the Assessing Officer reflecting the names of the suppliers along-with the amount. Since the purchase register does not reflect the details such as the addresses and PAN of the suppliers, therefore, the Assessing Officer held that the authenticity of the purchases could not be ascertained. According to the Assessing Officer, though the assessee, vide submission dated 04.12.2019, claims to have furnished details on 25.10.2019 in respect of parties for expenses exceeding Rs. 1,00,000/-, however, the assessee had neither furnished such details on 25.10.2019 nor made any submission on said date. Furthermore, the assessee furnished only details of sundry creditors on 04.12.2019. Thus, the assessee according to the As....
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....red loans during the year. He issued notices u/s 133(6) of the Act to the various parties from whom the assessee had shown to have taken unsecured loans. However, no replies were received from any of the parties. The Assessing Officer noted that in the audit report filed along with the return of income the assessee has shown unsecured loan received at Rs. 25 lakhs from Shri Ashish Madan Mutha. However, in the confirmation of this party filed during the course of assessment proceedings in response to the show cause notice the assessee has shown to have received an amount of Rs. 20 lakhs only from this party. In absence of any proper explanation to his satisfaction regarding the discrepancy, the Assessing Officer made addition of Rs. 5 lakhs to the total income of the assessee u/s 68 r.w.s. 115BBE of the Act. 5. The Assessing Officer further noted that the assessee has deposited an amount of Rs. 43 lakhs in its bank account during the demonetization period which was deposited in two installments i.e. Rs. 40 lakhs on 02.12.2016 and Rs. 3 lakhs on 08.12.2016. On being asked by the Assessing Officer the assessee explained the source of cash deposited as under: 1. Cash on hand a....
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....the appellant. Further the appellant did not submit details / evidences of the expenses claimed by the appellant and in the absence of which notice u/s 133(6) of the Act also could not be issued to the appellant. However on perusal of the submission made by the appellant it is seen that the appellant has submitted date-wise details of all the submissions made before the AO and the relevant documents submitted before the AO along with them. Further it is also seen that the appellant has shown turnover of Rs. 39,71,30,604 against which it has claimed expenses of Rs. 36,17,58,045/- After going through the submissions of the appellant and the AO 's order, it is seen that on one hand the appellant has made the following submissions: "1.1 The assessee is in the business of trading in marble, granite and other stones. It filed ROI on 28.09.2017 declaring total income Rs. 1,55,00,900. 1.2 The assessee's sales during the year amounted to Rs. 39,71,30,604/-. The expenses incurred and depreciation as per books during the year were Rs. 36,17,58,045/- as detailed below: S.No. Particulars Amount (Rs.) 1 Cost of sales 32,45,46,670/- ....
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.... dealer under the Maharashtra Value Added Tax Act, 2002. The assessee duly filed monthly and annual returns. The assessee's transactions were reviewed and assessed for the said financial year without any adverse observation/addition. Copy of the VAT order dt 05.12.2019 is enclosed in Annexure J 1.11 In para 3.9 of the Asst order the AO has alleged that copies of books of accounts were not furnished. We submit that the assessee had produced a tally back up of accounts for the year on 04.12.2019 which is duly acknowledged by the Dept (Ref "Annexure 1 Reply 04.12.2019") and taken the AO through this on laptop in the course of assessment proceedings on 25.10.2019. At the relevant time no discrepancies or adverse observations were made wrt the books of account. The assessee undertakes to make available the Tally back up of its books of accounts for verification of the AO. (In case there are not readily available in the Dept). 1.12 For ease of understanding we have summarized ledger transactions of the expenses as mentioned in para 1.2 above giving breakup in terms of materiality. It is to be noted that almost entire expenses are paid for by cheques. There ....
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....itially received in FY 15-16 from Ashish Mutha which was erroneously shown as Advance received from a Customer but this error was rectified in the next year i.e. FY 16-17 and a journal entry was passed to show the effect. In addition to this, Rs 20 lacs was also received during the year FY 16-17. So Form3CD had effect of showing journal entry of Rs 5 lacs as well as receipt of Rs 20 lacs received from Sh.Ashish Mutha received in the current year. In view of the above the clarification given by the appellant, the claim of the appellant appears to be valid and hence the addition of Rs 5 lacs made by the AO is hereby deleted." 9. So far as the addition of Rs. 40 lakhs added by the Assessing Officer u/s 69A as unexplained money is concerned, the Ld. CIT(A) / NFAC deleted the same by observing as under: "From the above table, it is observed that number of documentary evidences have been provided by the appellant during the assessment proceedings and the appellate proceedings. Further it is seen that the total cash sales is actually 1.67% of the total turnover shown by the appellant. The issue regarding discrepancy of opening balance as noted by the AO has also been explained....
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....ssessing Officer under section 69A of the Income-tax Act, 1961 ignoring the fact that the books of accounts, in general, and the complete cash book, in particular, were not produced by the assessee for verification during the assessment proceedings and specific finding to that effect has been recorded by the Assessing Officer in the assessment proceedings? 11. Grounds of appeal No.1 and 2 relate to the order of the Ld. CIT(A) / NFAC in deleting the addition of Rs. 1 crore made by the Assessing Officer. 12. The Ld. DR strongly challenged the order of the Ld. CIT(A) / NFAC in deleting the additions made by the Assessing Officer. He submitted that many details were not filed by the assessee and no books of account were ever produced before the Assessing Officer. The assessee made purchases from unknown parties. He submitted that the Ld. CIT(A) / NFAC has deleted the addition by relying on the additional evidences submitted by the assesse which were admitted at the back of the Assessing Officer. Since the Ld. CIT(A) / NFAC has violated the provisions of Rule 46A of IT Rules, 1962 r.w.s. 251 of the Act and has not called for a remand report from the Assessing Officer, therefore, t....
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....14 passed u/s 143(3) dt 18.02.2016 3 Asst order for AY 2014-15 passed u/s 143(3) dt 30.12.2016 4 Asst order for AY 2015-16 passed u/s 143(3) dt 28.07.2017 Sr No Particulars Ground No.2 : Disallowance of Rs 1 crore out of purchases expenses 1 Supporting documents uploaded on portal on 04.12.2019 ie Purchase register alongwith ledger extracts & invoice copies Ground No 3: Cash Deposits of Rs 43 lakhs 2 Monthly VAT Return in Form 231 from April 2016 to Oct 2016 3 Sales Tax Assessment Orders: Central Sales Tax (CST): Dt 05.12.2019 Value Added Tax (VAT) Dt 30.11.2019 4 Ledger extract of cash sales [Annexure O before CIT(A)] 5 Copies of Invoices of cash sales for the year [Annexure N before CIT(A)] 6 Submission before AO dt 12.12.2019 [Annexure F before CIT(A)] 7 Monthwise summarized details of sales as per books and VAT Returns for y e 31.03.2017 (Annexure P before (CIT(A)] 8 Cash book summary for y e 31.03.2017 furnished before CIT(A) in Annexure Q 14. He submitted that no additional evidences were filed before the Ld. CIT(A) / NFAC. The Assessing Officer simply made the addition without pointing....
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....ated 12.08.2019 addressed to the Assessing Officer has submitted the following details: 17. Similarly, the assessee vide letter dated 15.11.2019, copy of which is placed at page 106 of the paper book has filed the details of sundry creditors exceeding Rs. 1 lakh and list of parties for expenses exceeding Rs. 1 lakh during the year with names / full addresses / PAN etc. Similarly the assessee vide letter dated 04.12.2019 which was uploaded on 04.12.2019, copy of which is placed at pages 192 to 195 of the paper book in which the assessee has filed the details of sample purchase accounts along with invoice copy and purchase register for financial year 2016-17 and the hard copy of the same was produced before the Assessing Officer subsequently. The various other details furnished before the Assessing Officer are also given in the paper book. The Assessing Officer without pointing out any defect in the books of account, has made an adhoc addition of Rs. 1 crore. Further, the assessment orders for assessment years 2013-14 to 2015-16 which were passed u/s 143(3) of the Act show that no additions were made out of purchases. The GP and NP rates declared by the assessee for the impugned a....
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....ave heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and Ld. CIT(A) / NFAC and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. It is an admitted fact that as on 31.03.2016 an amount of Rs. 5 lakhs is shown in the name of Ashish Madan Mutha as "advances from customers". This amount of Rs. 5 lakhs has been transferred to loan account through journal entry and after receiving another amount of Rs. 20 lakhs from Ashish Madan Mutha, the assessee has shown receipt of Rs. 25 lakhs. Since the assessee has erroneously shown this loan of Rs. 5 lakhs received in the preceding year as advance received from customers but rectified the same in the subsequent year through a journal entry, therefore, we do not find any infirmity in the order of the Ld. CIT(A) / NFAC deleting the addition by accepting the contention of the assessee on this issue. Ground No.3 raised by the Revenue is accordingly dismissed. 23. Ground of appeal No.4 raised by the Revenue relates to the order of the Ld. CIT(A) / NFAC in deleting the addition of Rs. 40 lakhs made by the Assessing Officer u/s 69A of the Act. ....
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....find the Assessing Officer in the instant case made addition of Rs. 40 lakhs out of total cash deposit of Rs. 43 lakhs in the bank account on the ground that the assessee could not explain the source of such cash deposits in specified bank notes during the demonetization period. We find the Ld. CIT(A) / NFAC deleted the addition, the reasons of which have already been reproduced in the preceding paragraphs. We do not find any infirmity in the order of the Ld. CIT(A)/ NFAC on this issue. Admittedly the assessee has filed number of documentary evidences during the course of assessment proceedings explaining the source of such deposits which is out of the cash sales. Further, the total cash sales during the year roughly 1.67% of the total turnover shown by the assessee. Since the assessee has produced the cash book, sales registers and monthly VAT returns during the course of assessment proceedings and the cash withdrawals of Rs. 7,60,000/- has been explained with the help of cash book and bank book which were produced during the course of assessment proceedings, therefore, we do not find any infirmity in the detailed order of the Ld. CIT(A) / NFAC accepting cash deposit of Rs. 40 lak....
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....511) Details of sales ,Gp,Np for current year & 4 preceding years : Statement enclosed 1 Partners details : 1) Dilip shantilal Jain Share : 90% Pan : ABOPJ0510F central circle 2(2) 2) Vishesh Nirmal Jain Share 10% Pan : AGPPV3929C central circle 2 ( 2) Ledger extracts enclosed 2 List of unsecured loans is enclosed in schedule 3 to the Financial accounts and annexure VI to Form 3CD. e Confirmation of account enclosed Details of bank accounts along with bank reconciliation statement F (i) Corporation Bank A/C no. - 510361000001934 (ii) HDFC Bank A/C no. - 01032320000427 (iii) ICICI Bank A/C no. - 699705010178 Details of bank accounts of partners (i) Dilip Jain Corporation Bank a/c no. 520401000080271 (ii) Dilip Jain HDFC Bank A/c No. 01031000035765 (iii) Vishesh Jain Corporation Bank : 520401000072722 (iv) Vishesh jain HDFC Bank : 01031000071865 4 Loans & advances : The assessee is a manufacturer & trader in marble and other stones used in building construction associated business concerns u/s 40A(2)(b) of Income Tax Act 1961 Associates concerns: B 5 F 1. Kumar Promotes Rs .1,00,00,000/- ( Loan ) 2. S p Agarwal Rs 75,000/- ( ....