TaxTMI 
TaxTMI 
2025 (8) TMI 1184
X X X X Extracts X X X X
X X X X Extracts X X X X
....s. 21,35,502/- u/s. 36(1)(iii) of the Act. 3. The Ld. CIT(A) has erred in law and on facts the case in partly confirming the addition of alleged suppressed sales to the extent of Rs. 1,90,470/-. 4. Alternatively and without prejudice, the addition shall be restricted to the element of profit embedded in alleged suppressed sales. 5. The Ld. CIT(A) has erred in law and on facts of the case in confirming action of the Id. AO in treating business sales of Rs 43,88,500/-as unexplained cash credit u/s. 68 of the Act. 6. Both the lower authorities have failed to appreciate that additions u/s. 68 & 36(1)(iii) of the Act cannot be made based on rejected books of accounts. 7. The Ld. CIT(A) has erred in law and on facts of the case in confirming invocation of provisions of Section 115BBE of the Act. 8. Alternatively and without prejudice, the Ld. AO has erred in law and on facts of the case in computing tax at the rate of 60% by applying amendment to Section 115BBE of the Act retrospectively. 9. Both the lower authorities have passed the orders without properly appreciating the facts and they further erred in grossly ignoring var....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tions near demonetization period and non-furnishing of stock register. The Ld. AR submitted that the Assessing Officer failed to appreciate that business transactions do not take place necessarily as per past trends and mere variation from the same does not constitute a defect in books of accounts. The Ld. AR further submitted that non-maintaining of day to day stock register is not a ground to reject books of accounts and reliance was placed on the decision of Hon'ble Gujarat High Court in the case of Jaytick Intermediates Pvt. Ltd. v. ACIT - [2016] 73 taxmann.com 195 (Gujarat). The Ld. AR also submitted that it is well settled that the books of accounts cannot be rejected without finding material defects in the same, for which he placed reliance on the following judgements : a. CIT v. Symphony Comfort Systems Ltd. - [2013] 35 taxmann.com 533 (Guj.); b. Ashoke Refractories v. CIT - [2005] 199 CTR 115 (Cal.); c. CIT v. Poonam Rani - [2010] 326 ITR 223 (Delhi); a. ACIT v. Hirapanna Jewellers - [2021] 189 TTP 608 (Vishakhapatnam) 6.1 With regard to the addition of Rs. 43,88,500/- as unexplained cash credit u/s 68 of the Act, the Ld. AR submitted....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of stock could be ascertained. The Ld. DR submitted that the month-wise and item-wise stock details, along with computerized sales and purchase registers, were submitted by the assessee vide reply to the show cause notice through a letter dated 23.12.2019, however, the stock register was not furnished. The Ld. DR submitted that the sales and purchases were made by the assessee for the first time in the months of October and November 2016, in respect of some items such as plastic films, plastic bags, metalized film, corona treated polyester film, etc. Out of these, one item, namely 'plastic bags', was included in the assessee's stock for the first time in November 2016, as per the chart showing the monthly summary of stock items filed. The Ld. DR contended that the assessee dealt mostly in these items in the months of October and November 2016, which generated cash and these items were mostly purchased from M/s Jindal Poly Films Limited and M/s Delux Packaging, which became known only after the details of the purchase and sales ledgers were furnished by the assessee in the last reply dated 23.12.2019. The Ld. DR further submitted that the names of such purchase parties ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....bmitted that only the sales and purchase registers, furnished after the show cause notice, disclosed the details of stock traded during the year and the identity of the purchase parties. However, this left insufficient time to ascertain the genuineness of the transactions. Hence, the non-filing of crucial details required to determine the genuineness of the transactions- especially those carried out beyond the regular business pattern of the assessee- led to the conclusion that the identity and genuineness of such transactions could not be proved by the assessee. The Ld. DR contended that such cash sales were not shown despite a higher volume of sales in the preceding year. The Ld. DR, thus contended that the cash sales made during the year and the subsequent cash deposits were not explained by the assessee and, therefore, the cash deposit amounting to Rs. 43,88,500/- during the demonetization period remains unexplained. 8. Heard the arguments of both the parties and perused the material available on record. The assessee has sold plastic bags which have been purchased from M/s Jindal Poly Films Limited and M/s Delux Packaging. The inquiry made by the Revenue with regard to the p....