2022 (9) TMI 282 - AT - Income Tax

Estimation of profit - Calculation with regard to profit loss earned by the assessee in respect of the transaction in shares - Addition on Share trading - AO noted that the appellant had undertaken transaction in shares and in absence of any details he estimated the profit @ of 1% of the transaction - HELD THAT - Appellant undertaken transaction in shares and assessee did not furnish any calculation with regard to profit or loss earned by it either before the AO or before the CIT(A) and thus ld. CIT(A) had no other alternative to uphold the addition on estimated the profit at the rate of 1% of the transaction and at the time of hearing before us also assessee did not file any calculation chart to show profit or loss earned by the assessee in respect of share transaction undertaken by assessee is less than estimated by AO and as such the material available on record it can be informed that the order passed by the ld. CIT(A) need not required to examine further and addition made on account of share transaction on estimated the profit at the rate of 1% - Appeal of the assessee is dismissed.

Summary

Issues:
1. Delay in filing the appeal
2. Non-appearance of the assessee during the hearing
3. Adhoc estimated addition on loans and advances
4. Adhoc addition on shares trading
5. Upholding of additions by the CIT(A)

Delay in filing the appeal:
The appeal was filed by the assessee against the order of the National Faceless Appeal Centre, Delhi for A.Y. 2018-19, with a delay of 45 days. The assessee attributed the delay to the illness of the director. The Tribunal allowed the delay, considering it for the ends of justice.

Non-appearance of the assessee during the hearing:
Despite multiple notices issued to the assessee, no one appeared on behalf of the assessee during the hearing. The Tribunal had no option but to proceed with the case with the assistance of the ld. DR.

Adhoc estimated addition on loans and advances:
The AO added an estimated profit of Rs. 17,52,500/- on loans and advances due to non-compliance by the assessee. The CIT(A) upheld this addition. The Tribunal confirmed this addition as the assessee failed to provide any clarification or explanation regarding the profit earned from the loans and advances.

Adhoc addition on shares trading:
An adhoc addition of Rs. 72,500/- was made on share trading of Rs. 72,50,000/- as the assessee did not provide details of the transaction. The Tribunal upheld this addition as the appellant failed to furnish any calculation to prove the actual profit or loss earned from the share transaction.

Upholding of additions by the CIT(A):
The sole issue raised by the assessee was the adhoc addition of Rs. 72,500/- on share trading. The Tribunal held that since the assessee did not provide any evidence or calculation to refute the estimated profit, the addition was upheld. The appeal of the assessee was dismissed, confirming the additions made by the AO and upheld by the CIT(A).

In conclusion, the Tribunal dismissed the appeal of the assessee, upholding the adhoc additions made on loans and advances as well as share trading due to the lack of evidence or calculations provided by the assessee to support their case.