TaxTMI 
TaxTMI 
2025 (9) TMI 1611
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in confirming the addition made by the Ld. Assessing Officer on account of variation in purchases and not considering the submission of the assessee that the default in underreporting of figures of TCS was on the part of the suppliers. 2. Regarding Ground No. 1, the assessee has taken us through the findings of the AO which are contained at para 5.3 of the order passed under section 143 dt. 21/12/2019 and the contents thereof read as under: "5.3 Cash deposits in specified currency notes during the period of demonetization: Perusal of information received from SBI, The Mall, Shimla and SBI, Kalbogh shows the following amount of cash deposit made by the assessee in his bank account in specified currency notes (of Rs. 1000/- & 500/-) and other bank notes on various dates :- Account No. Date of Deposit Amount Deposited (SCN) Amount Deposited (OBN) 65254284068, SBI, Shimla 10.11.2016 17,00,000/ 11.11.2016 3,27,500/- - 15.11.2016 4,13,000/- 5,87,000/- 16.11.2016 1,61,000/- - 17.11.2016 1,18,500/- 1,14,980/- 30446499791, SBI, Kalbogh 16.11.2016 2,49,000/- 4,0....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y. 2.1 Further, our reference was drawn to the written submissions filed before the Ld. CIT(A) which are contained at page 5 to 7 of the impugned order and the contents thereof read as under: "1.1 In that regard, it is most respectfully submitted that the assessee in the assessment year under consideration was engaged in liquor trade, whereby he had been allotted various vends in the State of Himachal Pradesh. A return of income declaring a net taxable income of Rs. 19,65,830/- was filed for the assessment year under consideration. In doing so, income from liquor vends amounted to Rs. 20,30,827- 22 was declared against the recorded turnover of Rs. 11,76,20,283/- in the assessment year under consideration and perusal of the balance sheet of the assessee would go to reveal that the assessee had ample amount of cash in cash. 1.2. The demonetization was announced by the Hon'ble Prime Minister of India on 08.11.2016, whereby currency notes in the denomination of Rs. 1000/- and Rs. 500/- were demonetized and were held not to be legal tender. However, time had been given to the persons who had cash in their books of accounts to deposit the same in the books of acc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ted and in such circumstances, source of cash so deposited stand duly explained and it was submitted that the addition so made and sustained by the ld CIT(A) may be directed to be deleted. 3. Regarding Ground No. 2, our reference was drawn to the findings of the AO which are contained at para 5.2 of the assessment order contents thereof read as under: "5.2 Difference of purchases claimed in trading account and in form 26AS: The assessee in his trading and P&L account for the F.Y. 2016-17 has shown purchases at Rs. 5,51,44,842/-. Perusal of revised Form 26AS for the period 01.04.2016 to 31.03.2017 supplied by the assessee alongwith his response dated 05.12.2019 reflects the following amount of purchase from various parties and TCS collected thereon :- S.No. Party Name Section under which TCS is collected Total amount paid/ credited (in Rs.) Total TCS collected 1 SBACCHUS Distillery (P). Ltd. 206CA 1,34,647.27 1346.47 2 Chander Mohan Sharma 206CA 60,18,161 60,182/- 3 HP Beverages Ltd. 206CA 4,19,67,717.06 4,20,128/- 4 K.M. Distillery (P) Ltd. 206CA 13,04,460/- 13,047/- 5 Kuldip Kaur 206CA ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oksons Brewery & Distillery. However, during the course of assessment, the assessee was able to submit the copy of purchase bills of the purchases made from M/s. Triloksons Brewery & Distillery which accounted for total purchase of Rs. 5,81,910/-. Therefore, it is established that the assessee has shown excess purchase of Rs. 3,65,132/- from the following parties :- Sr. No. Name of the Party Purchase as per Form 26AS (Rs.) Purchase as per Books of the assessee (Rs.) Excess purchase shown / Difference (Rs.) 1. Himachal Pradesh Beverages Ltd. 4,19,67,717.06 4,21,44,945 1,77,228 2. K.M. Distillery (P) Ltd. 1304460 1305003 543 3. Royal Wines (Kuldip Kaur) 2477807 3633964 156157 4. HPGICS Country Liquor Bottling Plants No record in Form 26AS (AS per Ledger Rs. 954,104) 985311 31,204 3,65,132 In view of the above discussion, the amount of Rs. 3,65,132/- claimed by the assessee as expenses on account of excess purchase, is disallowed and added back to income of the assessee. Penalty proceedings u/s 270A of the Income Tax Act 1961 for under reporting of income is initiated separately. 3.1 Fu....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ave been accounted and claimed by the assessee and has sustained the addition so made which may be directed to be deleted. 4. Per contra, the Ld. DR has relied on the findings of the Ld. CIT(A) which are contained at para 5.1 of the impugned order: "5.1 Now before me in the appellate proceedings, written submission has been filed. I have gone through the grounds of appeal and statement of facts, and written submission filed by the appellant. No effort has been made to explain the various additions made by the Assessing Officer. Source of cash deposit has not been explained. It has not been explained how SCN notes were lying at the premises of the appellant after the launch of demonetization scheme. Books of accounts, vouchers and other evidences of the deposits of SCN notes during that period have not been filed before me. So far as the issue of purchase is concerned, the Assessing Officer has made out the case that the appellant has booked expenses on account of excess purchase and has identified names of four parties. The contention of the Assessing Officer has not been satisfactorily challenged by the appellant in the written submission, Hence, the addition of the As....
X X X X Extracts X X X X
X X X X Extracts X X X X
....idual sale entries in the cash book has not been disputed. Therefore, in such a situation, where the sales are duly reflected in the books of accounts and reported to tax and the books of accounts stand accepted, the cash realization from such sales even though in SBN notes as on the date of demonetization stand explained and cannot be held as unexplained and the addition of Rs 10,20,000/- so made is hereby directed to be deleted. 6. Regarding the excess purchases, the AO basis reporting in Form 26AS has held that the assessee has booked excess purchases as against the figures reported in Form 26AS by four suppliers. During the appellate proceedings, the assessee has submitted its ledger account in the books of two suppliers namely, Himachal Beverages Ltd. and Royal Wines and submitted that as against the actual sale by these suppliers to the assessee as so reflected in their respective books of accounts, while reporting the transactions as part of TCS compliance, they have reported a lower figure and where the actual sale as per books of accounts of the suppliers and actual purchases from these suppliers in the books of accounts of the assessee is compared, no excess purchases ....