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Issues involved:
The judgment involves issues related to the deletion of cash credits in the name of individuals and the charging of interest under section 158BFA. Deletion of Cash Credits: The first issue pertains to the deletion of cash credits in the names of Shri Jai Narayan and Shri Roshan Lal. The case involved a search and seizure operation at the assessee's business premises. The Assessing Officer (AO) added cash credits from the regular books of account, which the assessee argued should not have been added in the block assessment u/s 158 BC. The CIT (A) deleted the peak amount from the 'Dasti Bahi' and allowed substantial relief. The ITAT directed the AO to determine undisclosed income from 'Arhat' based on income theory only. The AO made additions in the set-aside assessment proceedings, which were contested by the assessee. The CIT (A) noted discrepancies in peak amounts and transactions dates, leading to the deletion of certain additions. The ITAT upheld the CIT (A)'s decision, stating that no addition based on regular book entries can be made u/s 158BC. Charging of Interest u/s 158BFA: The second issue involved the direction to charge interest at 1% instead of 2% u/s 158BFA. The AO initially charged interest at 2%, but the CIT (A) directed to charge at 1% per month. The ITAT found that the applicable rate of interest during the relevant period was 2% and not 1%. Therefore, the ITAT set aside the CIT (A)'s direction and instructed the AO to charge interest at 2%. The judgment partly allowed the appeal filed by the Revenue and dismissed the Cross Objections filed by the assessee as infructuous.
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