9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (12) TMI 1705 - AT - Income TaxAddition u/s 69B - unexplained investments and interest thereon - HELD THAT - Peak determined by the A.O. is not correct otherwise also when once peak amount has been added then no separate addition is required. It seems that the A.O. has not properly prepared the list of debtors and creditors based on any logic. CIT(A) has confirmed the addition under the Provisions of Section 69B. This section relates to investment made by the assessee in the acquisition of bullion/jewellery or other valuable articles but it does not speak about any investment in debtors. Section 69B also stipulates the position where the investment exceeds the amount shown in the books of account. Since the assessee does not maintain any books of account wherein the debtors and creditors are reflected therefore this addition has also been wrongly made and upheld u/s 69B of the Act. Hence in our considered opinion only commission income has to be determined in this case and nothing more. Accordingly we reverse the findings of the ld CIT(A) and order to delete the entire addition so made. - Decided in favour of assessee. Addition u/s 68 - unexplained cash addition as assessee could not prove the source of advances received - HELD THAT - Revenue s claim that during the course of survey concerns giving advances were found to be non-existent. However the assessee claims that the above concerns were having PAN and the new address could have been ascertained from Registrar of Companies. It is also noted that the ACB Govt. of Rajasthan Jaipur has conducted the similar enquiries against the concerns at Mumbai and found the concerns were not existing on the given registered office addresses. The ld.AR of the assessee submitted that lower authorities have referred and relied on the enquiries conducted by the ACB Govt. of Rajasthan however no such report of ACB was made available to the assessee at any stage. Assessee was not provided opportunity to controvert the report if any. There is violation of natural justice. Law does not allow such act. Thus it will be in the interest of equity and justice to restore the issue to the file of the AO to decide it afresh - Decided in favour of assessee for Statistical purposes.
Issues Involved:
1. Legality of search proceedings under Section 132 and subsequent assessment under Section 153A. 2. Addition of ?13,00,000 under Section 69B of the Income Tax Act, 1961. 3. Addition of ?34,500 as undisclosed income from other sources. 4. Addition of ?1,38,00,000 under Section 68 of the Income Tax Act, 1961. Detailed Analysis: 1. Legality of Search Proceedings and Assessment under Section 153A: The assessee did not press this ground during the hearing, and hence, it was dismissed as not pressed. 2. Addition of ?13,00,000 under Section 69B and ?34,500 as Undisclosed Income: - The Assessing Officer (AO) made the addition based on undisclosed investment through finance broker Sh. Manish Tambi and the interest earned thereon. - The AO relied on incriminating documents seized during the search operation on Sh. Manish Tambi, which included names of various individuals, including the assessee. - The AO's findings were based on statements and documents that suggested undisclosed investments and interest earned. - The assessee argued that transactions with Sh. Manish Tambi were through banking channels and no documents were found during the search at the assessee's premises. - The assessee also contended that the seized documents were not made available for cross-examination and the AO's reliance on these documents was misplaced. - The Tribunal referred to previous judgments, including those involving Sh. Manish Tambi, where it was held that only commission income should be taxed and not the transactions recorded in seized documents. - The Tribunal upheld the AO's addition, emphasizing that the assessee did not effectively counter the AO's findings and circumstantial evidence. 3. Addition of ?1,38,00,000 under Section 68: - The AO treated the cash receipts of ?1.38 crores as unexplained, based on agreements found during the search. - The AO's findings included discrepancies in the existence and addresses of the companies involved, non-existence of directors at the time of the transaction, and insufficient cash balances in the companies. - The assessee argued that there was no prohibition on receiving cash advances, the transactions were recorded in the cash book, and the agreements were notarized. - The assessee also contended that the companies were incorporated under the Companies Act and any change in address could be verified from the Registrar of Companies. - The Tribunal noted that the AO did not provide the assessee with the ACB report or an opportunity to cross-examine the findings, violating principles of natural justice. - The Tribunal restored the issue to the AO for fresh adjudication, directing that the ACB report be made available to the assessee for contesting the case. Conclusion: - The appeal was partly allowed for statistical purposes, with the Tribunal directing a fresh adjudication on the addition of ?1.38 crores under Section 68, while upholding the additions under Sections 69B and undisclosed income from other sources.
|
