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TMI Blog2012 (8) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... has not been rejected by the A.O. at the time of assessment - CIT(A) was correct in deleting the addition - in favour of assessee. Addition being unaccounted expenses on machinery - not supported by the vouchers - Held that:- CIT(A) was correct in scaling down the addition of Rs.25,000/- to Rs.15,000/- goning through the reply of the assessee and order of the authority below that payments were made in cash and bills are not verifiable, therefore, we confirm the order of the CIT(A). - ITA No. 1338/Ahd/2010 - - - Dated:- 22-6-2012 - Shri Mukul Kr. Shrawat, and Shri T.R. Meena, JJ. By Appellant: Shri Samir Tekriwal, Sr. D.R O R D E R PER : T.R.Meena, Accountant Member This is an appeal at the behest of the Revenue wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee on 13.03.2007. During the course of survey the assessee firm had admitted additional unaccounted income to the tune of Rs.31,01,046/- under four different heads. The same is as under:- Amount invested in excess stock found :Rs.16,81,652/- Cash not reflected in the books :Rs. 6,93,344/- Cash utilized in various transactions :Rs. 4,26,050/- Unaccounted investment in construction of building :Rs. 3,00,000/- Total ----------------------- :Rs. 31,01,046/- ---------------------- As against the above referred admitted undisclosed income, the assessee firm has disclosed in their return of income only amount of Rs.7,68,322/- attributable to ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore, he made the addition of Rs.4,26,059/- u/s.69C as unaccounted expenditure. 5. Similarly unaccounted investment in building to the tune of Rs.3,00,000/- was admitted as additional income u/s 133A to building was belonged to sister concern M/s. V.N. Enterprise in which the family members of the partners of the assessee firm were having partnership interest. The partners have contributed funds to M/s. V.N. Enterprise and all such contributions were recorded in the respective capital accounts of the partners. The A.O. had gave opportunity on retraction of Rs.3,00,000/- on account of investment in M/s. V.N. Enterprise. Before the A.O., the assessee submitted that M/s. V.N. Enterprise belongs to a different entity, nothing had been found ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he DD No. ledger account of Sharma Machine Tools, In this situation appellants explanation regarding source of cash payments to be out of regular cash balance cannot be disregarded merely on the basis of statement of the partner U/S.133A. Appellant's submission is that statement u/s.133A admitting undisclosed income on this count was made due to messy state of books of accounts on the day of survey. As held in the case of Paul Mathews Sons (2003)263 ITR 101 (Kerala) and CIT vs. S. Khadar Khan Sons (2008) 300 ITR 157 (Mad.), any admission made during section 133A cannot by itself be made the basis for addition. The Madras High Court relied referred to CBDT Circular dated 10.3.2003 also in this regard. Without pointing out deficiency in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... N. Enterprise, which has mentioned Rs.2,80,000. But it seems that construction expenses may be more. What would you like to say about this? A.8 According to above mentioned D-25, loose paper page no.157, 158,159 and 160, Rs.280000 transferred from the accounts of the partners and credited into the account of V.N. Enterprise and expend for construction, for which, I declare Rs.3,00,000/- (three lakh) from unaccounted income as additional income of the firm during the current financial year, which we have expend in the V.N. enterprise and will pay the Tax on it. The addition regarding unaccounted investment of Rs.3,00,000/- has been made by the A.O. merely by relying on the above admission without any other evidence being found during th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10.03.2003 and has not confirmed the addition on the basis of admission made u/s 133A of the IT Act. During the course of assessment proceeding, the appellant filed ledger account of Patel Tulsibhai J, whose name is also written on top of page 20. The appellant produced books of accounts of V.N. Enterprise before the A.O. to substantiate its claim regarding transactions to be pertaining to V.N. Enterprise. The investment made by the partner in the sister concern which would have taxed in the hands of V.N. Enterprise not in the case of assessee firm. The disclosure was made in fear and without verifying the facts. The A.O. besides this statement, had not brought on record any evidence to substantiate the addition. Thus, CIT(A) orders may be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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