2014 (8) TMI 1054 - AT - Income Tax

Bogus sale of machinery - Held that - . It has not been disputed by the ld. AR of the assessee that machinery in question was held as an asset by the company. The assessee produced the details of M/s. Shekhawati Transport Company wherein the GRs bear the stamp of Municipal Council Kishangarh. The ld. CIT(A) has given an appropriate findings of fact that the machinery was sold by the assessee. - Decided against revenue Addition u/s 68 - CIT(A) allowed part relief - Held that - The relief of 59, 000/-in respect of addition u/s 68 of the Act has been given verifying the returns filed by the creditors and by relying on the judgemnet of Hon ble Rajasthan High Court in the case Shree Barkha Synthetics Ltd. vs. ACIT (2005 (8) TMI 67 - RAJASTHAN High Court ) . Thus in view of the facts and circumstances we find no infirmity in the order of the ld. CIT(A) which is upheld.- Decided against revenue Addition on unexplained share capital - Held that - The assessee discharged its primary onus in respect of addition by filing the copies of share application forms GIR numbers and wards of the shares subscribersthe assessee discharged its primary onus in respect of addition of 3.30 lacs by filing the copies of share application forms GIR numbers and wards of the shares subscribers. - Decided against revenue Addition on unrecorded investment / expenses noticed in seized document - Held that - There is finding of fact given by the ld. CIT(A) that the AO has not mentioned as to how the figure of 1, 42, 667/- was arrived at. Since no reasons are mentioned in the assessment order therefore the ld. DR could not controvert the findings of the ld. CIT(A).- Decided against revenue

Summary

Issues: Appeal against order of CIT(A) for assessment year 1989-90 regarding additions made by AO under different heads.

Analysis:
1. Ground No. 1: The AO made an addition of Rs. 1,20,000 under income from other sources for the sale of machinery, considering it bogus. The CIT(A) deleted the addition based on evidence of sale provided by the company, including dispatch details and GRs, concluding the sales were genuine. The Tribunal upheld CIT(A)'s decision, finding no infirmity in the order.

2. Ground No. 2: The AO added Rs. 59,000 under section 68 of the IT Act due to alleged cash creditors not produced before AO. The CIT(A) deleted part of the addition based on confirmations and evidence from creditors, citing jurisdictional High Court's decision. The Tribunal upheld CIT(A)'s order, finding no infirmity.

3. Ground No. 3: AO added Rs. 3,30,000 on account of unexplained share capital. The CIT(A) deleted the addition as the appellant provided details of share subscribers, GIR numbers, and relied on relevant court decisions. The Tribunal upheld CIT(A)'s order, finding no infirmity.

4. Ground No. 4: AO made an addition of Rs. 1,42,677 for unrecorded investment/expenses. The CIT(A) confirmed part of the addition but deleted the balance due to lack of evidence on how the figure was calculated. The Tribunal found no reasons mentioned in the assessment order and upheld CIT(A)'s decision.

In conclusion, the Tribunal dismissed the appeal of the Revenue, upholding the CIT(A)'s orders on all grounds, finding no infirmity in the decisions.