TaxTMI 
TaxTMI 
2025 (1) TMI 1790
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....ed that in view of the closure of the firm in July 2015 due to misunderstandings among partners assessment order dt: 30.12.2016 could not be served on the firm/partners consequent to which there was a delay in filing appeal. 4. The Id CIT(A) erred in sustaining addition of Rs. 38.10 lakhs as unexplained expenditure U/s 69C of the Act as against the admitted income Rs. 2.70 lakhs. 5. The Id. CIT(A) failed to note that the appellant had purchased the oil and received oil tankers from M/s. Haritha Shakthi (India) Ltd along with delivery challans on 27.11.2013 and that based on delivery challans entries were made in the stock registers and the same oil tankers were sold and' forwarded by Assessee firm to its purchaser M/s. Southern Online Bio- Technologies Ltd on 27.11.2013 and also to others, as the purchasers are located locally at Hyderabad. In the above facts, the authorities below without regard to the records, erred in holding that Assessee had sold the Oil/ Stocks before purchases and held such alleged purchases as unexplained investment/expenditure. 6. The authorities below failed to note that oil tankers were sold on the same day upon receipt thr....
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.... and the impugned order could not be served on the firm/partners consequent to which there was a delay in filing appeal. 4. The ld. CIT(A) failed to note that the assessee firm was closed in July 2015 due to misunderstandings among the partners, assessment order U/s.143(3) dt: 30.12.2016 was not served on firm/partners and similarly the show cause notices for levy of penalty was also not served consequent to which there is a delay in filing quantum and penalty appeals. 5. The appellant further contends that there was no mensrea or contumacious conduct on the part of Assessee firm and therefore the levy of penalty without considering the merits available on record is bad in law 6. The appellant contends the Authorities below did not consider any merits of the case while passing ex-party penalty order. F 7. The authorities below ought to have noted that based on receipt of oil tankers along with delivery challans, entries are made by the appellant firm in stock register before sales and therefore such sales cannot constitute unexplained investment for levy of penalty. 8. The ld. AO ought to have also noted that while oil is purchased Tanke....
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.... the partners and consequently the office of the firm located at Hyderabad was closed and both the partners left Hyderabad to their native places. Thus, the learned AR has contended that, due to closure of the partnership firm office and non-availability of partners at Hyderabad, the assessment order passed by the Assessing Officer was not received and served upon the assessee causing the delay in filing the appeals before the learned CIT (A). It is only when a notice u/s 221(1) of the I.T. Act, 1961 was served on one of the partners of the assessee firm Shri V. Purnachandra Rao on 14/09/2018 by post, the assessee came to know about the assessment order passed by the Assessing Officer. Thereafter, the assessee immediately filed the appeals before the learned CIT (A) on 05/11/2018. The learned AR has further submitted that in the meantime, the Assessing Officer has passed order u/s 271(1)(c) of the Act ex-parte on 27/06/2017 and the assessee also filed the appeal against the said order on 5/11/2018 itself. Thus, he has pleaded that the delay in filing the appeals before the learned CIT (A) was due to sufficient and reasonable cause of having no knowledge of the assessment order as w....
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....rder, the assessee filed the belated appeals before the learned CIT (A) after the delay of 638 days. The assessee explained the delay by narrating the background and subsequent development regarding the business activity of the assessee. The learned CIT (A) has reproduced the contends of the affidavit in the impugned order and for the sake of completeness, the same are again reproduced as under: 7. A similar affidavit was also filed in respect of the appeal against the penalty order u/s 271(1)(c) of the I.T. Act, 1961. Thus, the assessee in the affidavit explained the delay of 638 days, due to non-receipt of the assessment order passed by the Assessing Officer as business of the assessee firm was discontinued in the month of July, 2015 and consequently, the office of the firm at Hyderabad was closed and both the partners left Hyderabad to their native places. The assessee has clearly explained that one of the partners of the assessee firm namely, Shri V. Purnachandra Rao at Goothy, Anantapur District received the notice u/s 221(1) of the I.T. Act, 1961 dated 12/09/2018 on 14/09/2018 by post and thereafter, another letter dated 27/09/2018 for payment of demand was received by the....
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.... were also produced before the AO for examination and the assessment was completed on 30.12.2016. Not only that, the delay in filing of the appeal is approximately 1 year and 8 month which is unexplainable. The delay in filing of the appeal is clearly attributable to the negligence and inaction on the part of the appellant and therefore the delay of 638 days in filing of the appeal is not condoned and the appeal is not admitted for adjudication, and the application for condonation of delay is rejected. The appeal is dismissed 9. We find that the reason for not accepting the reasons explained by the assessee by the learned CIT (A) is that, the Chartered Accountant of the assessee has participated in the assessment proceedings and, therefore, the assessee was very much aware about the ongoing assessment proceedings. However, the participation of the assessment proceedings by the CA of the assessee does not mean that, the assessee was aware about the outcome of the assessment order passed by the Assessing Officer and particularly, the addition, in question, made by the Assessing Officer requires further action on the part of the assessee to challenge the same. Therefore, o....
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..../28.R.L. NO. H.NO.E-1.543 KHAIRATABAD MARKET HYDERARAP RABAD-A LICENSE NO.13/2006 JUDITE 2 87850 144016 JUN 10 2019 -- - - - - m 17:23 R.0000050 PB5349 INDIA TELANGANA Before the Commissioner of Income Tax ( Appeals) -V - Hyderabad Income Tax Appeal ITA No. 10088/2018-19 In the matter of M/s Geethika Enterprises against Order passed U/s 143(3) by the ITO Ward 11(4), Hyderabad for Asst Year 2014-15 AFFIDAVIT I V. Purnachandra Rao Ex-Managing Partner of the firm M/s Geethika Enterprises aged about 39 Years R/o Gooty, Ananthapur Dist do hereby state on oath as under 1. That I was the Managing Partner of the aforesaid firm and well acquainted with the facts of the case. The Appellant is a firm came into existence on 06.11.2013 with two partners namely Sri. V. Purnachandra Rao Managing Partner and other lady partner Smt. Y. Sarala under the deed of partnership with registered office at Bachipalli, Hyderabad. The firm carried on business in the purchase and sale of Vegetable Oil. Tanker wise oil was purchased by the firm from M/s. Haritha Shakthi (India) Ltd and sales were also made tanker wise at the same time by endorsement of consignment to M/s Southern O....
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..... The said partner immediately initiated action on the issues with the help of the other auditors and filed the present appeals. 4. In the above process there was a delay of 638 days in filing of the appeal. The Id. AO had made an addition of Rs. 38.09 lakhs holding that the assessee firm had invested its undisclosed income in purchase of oil tankers on 27.11.2013. It is submitted that the assessee firm came into existence on 06.11.2013 and the first consignment of oil tanker was received from the seller company on 27.11.2013 and the same was sold to M/s Southern Online Bio-Technologies Ltd in on the same date and time upon endorsement of consignment. It may also be noted the firm since came into existence on 06.11.2013 it cannot be held under law that the firm in the first year had received undisclosed income for purchase of oil tanker before the commencement of business. Further Capital Contributed by partners was not considered by the Id. AO while the addition was made. There are catena of Judgements on the issue that in the first year of commencement of business the assessee cannot be held to receive undisclosed income. In this context it is suffice to refer to the decision ....
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....16 Ref : HSPL/2013-14/2712 To, M/s. Geethika Enterprises Flat No. 2, Block No. 17, Kendria Vihar, Bachipally, Hyderabad. Dear sir, Sub : Confirmation of Sale Transaction - reg. With reference to the above subject, We have reconciled our statement of account and hereby confirm that we have Sold Rice Bran Oil, Total Qty : 81263 Kg's on 27.11.2013 to M/s Geethika Enterprises, Block 17, Flat No. 2, Kendria Vihar, Bachipally, Hyderabad, as per the details below, but mistakenly we have mentioned the date in Delivery Challans as 28.11.2013. after reconcialiation of the statement we confirm that the sale of the above goods have made 27.11.2013 and accordingly we are herewith submitting the revised invoices and Delivery Challans for your information. SI.No. Date Product Inv No. Basic Amount Taxes Total Amount 1. 27.11.2013 Rice Bran Oil HSPL/2013-14/113 930150.00 46508.00 976658.00 2. 27.11.2013 Rice Bran Oil HSPL/2013-14/114 888975.00 44449.00 933424.00 3 27.11.2013 Rice Bran Oil HSPL/2013-14/115 961425.00 48071.00 1009496.00 4. 27.11.2013 Rice Bran Oil HSPL/2013-14/116 876275.00 43814.00 920099.00 Total 3656825.00 182842.00 3839677.00 We are en....