TaxTMI 
TaxTMI 
2025 (1) TMI 1818
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....preciating the facts that, during the course of search proceedings, statement of Shri Bandaru Ramesh, one of the creditors of the firm was recorded. In the said statement Shri Bandaru ramesh had stated that he never undertook any contract work. 3. On the facts and in the circumstances of the case, the Ld. CIT (A) erred in deleting the addition of Rs. 3,14,08,070/- & Rs. 85,55,612/- without appreciating the facts that, during the course of search proceedings, statement of Shri Bandaru Ramesh, one of the key person of the firm was recorded and he stated that as per his knowledge the employees shown as creditors have not provided. any services to the firm. 4. Further, the Ld. CIT (A) failed to appreciate the fact that had the search not been conducted, amount of Rs. 3,14,08,070/- & 85,55,612/- as sundry creditors bong contractor's work remain unearthed and escaped assessment had never been brought to tax as the same has been reflecting in balance sheet under Sundry Creditors. 5. Any other ground that may be raised during hearing." 3. Facts in Brief:- The assessee is a partnership firm carrying on business of extraction and marketing of ....
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.... During appellate proceedings, the appellant submitted that the addition u/s 69C is unjustified as the credit balance of Rs. 3,14,08,070/- in the account of various creditors is opening balance brought forward from earlier years and since the expenditure has not been incurred in the previous year relevant to AY under reference, no addition could have been made u/s 69C of IT Act. For this argument appellant has relied on following judgements- ITA No. 1078/Bang/2014 in Glen Williams v/s ACIT ITO Vs Rahul kantilal Shah ITA No. 6805/Mum/2018 Syntensia Network Security Vs. ITO (ITA No. 2927/Mum/2017) The appellant further argued that even on merits these creditors are genuine, assessee has regular business transactions with them and they have been paid these amounts in the relevant previous year through banking channels. Appellant furnished various documents as mentioned in page 7 of the assessment order to support its claim of genuineness of the creditors. Appellant also submitted that major part of this credit balance has been paid in the relevant previous year and subsequent years. Appellant further submitted th....
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....nforcement of the debt even after expiry of the normal period of limitation as provided in the Limitation Act. It will be relevant to reproduce these observations of their Lordships from the said decision:- "The question whether the liability is actually barred by limitation is not a matter which can be decided by considering the assessee's case alone but it is a matter which has to be decided only if the creditor is before the concerned authority. In the absence of the creditor, it is not possible for the authority to come to a conclusion that the debt is barred and has become unenforceable. There may be circumstances which may enable the creditor to come with a proceeding for enforcement of the debt even after expiry of the normal period of limitation as provided in the Limitation Act." 11. In view of the above observations of Hon'ble Supreme Court, in the absence of creditor, it cannot be concluded by the Department that the debt is barred and has become unenforceable more particularly when the assessee is a limited company whose accounts are accessible to general-public. In the case of Sugauli Sugar Works (P) Ltd (Supra) the assessee had credited the a....
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....Dist.: Vizianagaram. As the mining activities are going on since 1984, the depth of the mine has reached over 250 Ft. To carry on such deep mining activities, huge teams of man-power in terms of labourers are required. The team of the management has appointed several labour contractors to carry out various mining activities. The work awarded to the labour contractor comprises of digging, carrying over burden, making path, stacking of ore and mutty, etc. The contractors are being appointed by the agent of the company who normally takes the stock situation of labour team, their financial condition and integrity of the contractor. After appointment, work is awarded to different contractors for different pits so as to calculate the work done by them. The agent personally supervises the work of each contractor and verifying the same directs the contractor to prepare his work bill. The work bill is being verified by the mining supervisor who transfers the said bill to the accounts department. After receiving the bills, the accounts department verifies the rates, etc. and after deducting "Tax at Source" makes payment to the contractor. The village Garividi is a very small place, and it is....
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....ure during the relevant previous year, the creditors are brought forward from earlier years and paid subsequently. As regards payment to contractors of Rs. 85,55,512, the counsel submitted that the assessee has discharged onus by producing copy of bills, details of work done by them, payment through banking channel after due deduction of tax at source and return of income filed by the contractors. The learned Counsel supported order of the learned CIT(A). 6. We have gone through the order of the authorities below as well as details submitted before us. It is undisputed fact that the amount of Rs. 3,14,08,070 added by Assessing Officer under section 69C of the Act is the sum of opening balance of various creditors brought forward from earlier years. No expenditure is incurred during the relevant previous year. The assessee has produced evidences regarding its payment in relevant previous year and subsequent years. The learned CIT (A) has decided this issue and the same is reproduced above. We find no infirmity in the order of the learned CIT(A). We decline to interfere with the order passed by the learned CIT (A) which is hereby upheld by dismissing the grounds raised by the Reve....
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....xpenditure, etc. Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the 2448[Assessing Officer), satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year. From the plain reading of section 69C it is clear that there are two conditions for invoking section 69C. First is, that the assessee has incurred any expenditure in the relevant previous year, and second is that the assessee does not offer any explanation about source of such expenditure. If both the conditions are fulfilled then only section 69C can be applied. But in the present case 1) Assessee is a partnership firm carrying on business of Mining of Manganese Ore minerals. It maintains regular books of accounts which are audited u/s 44AB of I.T. Act. 2) A Survey u/s 133A of IT act was conducted at premises of the assessee on 25.08.2021. Assessee filed return of income on 13.02.2022 declaring total income of Rs. 18,01....