9911796707
TMI Blog2014 (6) TMI 840X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs Nil. In this case information was received by AO from the investigation Wing that during the year under consideration, Assessee had deposited huge sum of cash in the bank account maintained with Vitrag Co- op Bank Ltd and later during the investigation the Director of the Assessee had admitted that the source of initial cash deposits of Rs 69,37,812/- cannot be explained by him and offered the same for tax. Accordingly the case was reopened by issuing notice u/s 148 of the Act and thereafter assessment was framed u/s 143(3) r.w.s. 147 vide order dated 18.12.2009 and additions were made on account of low Gross profit (Rs 1,01,36,860/-), on account of unexplained investment (Rs 69,37,812/-), on account of income from unexplained cash c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e order of the Assessing Officer. 4. It is, therefore, prayed that the order of the CIT(A) may be set-side and that of Assessing Officer may be restored to the above extent. 4. Before us, Ld DR with respect to penalty on GP addition, submitted that even during the during the course of assessment proceedings and at the time of penalty proceedings the Assessee did not produce the books of accounts and other details and merely submitted that the computer hard disk had crashed and the hard copy of the books of accounts were destroyed by the termites. In the absence of books of accounts AO rejected the books results u/s 145(3) and worked out the GP after considering the average GP of earlier years and after giving the credit of the GP shown by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the AO was fully justified in levying penalty and therefore his order be upheld. Ld DR also relied on the decision in the case of CIT vs S. Krishnaswamy & Sons (1996) 219 ITR 157(Mad) and other decisions in its support. 5. On the other hand Ld AR reiterated the submissions made before AO and CIT(A) and supported the order of CIT(A). He also placed reliance on the decision in the case of Navjivan Oil Mills Vs CIT (2001) 252 ITR 417 (Guj) and the decision in the case of ACIT vs Inducto Ispat Alloys Ltd (ITA No 3937/Ahd/2008). 6. We have heard the rival submissions and perused the material on record. In the present case penalty u/s 271(l)(c) was initially levied on 3 additions viz understatement of gross profit (Rs 1,0136,860/-), unexplain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to Rs 69,37,812/- in the bank account and which was also admitted by the Director of the Assessee as undisclosed income. It is also a fact that on the aforesaid addition, Assessee had not preferred appeal. It is Assessee's submission that the aforesaid bank account was disclosed in the Balance Sheet. It is also the Assessee's submissions that Assessee was facing severe financial crunch and the loans from Karnataka Bank were outstanding due to which Karnataka Bank was not allowing to operate the account smoothly and therefore the account with Vitrag Co-op. Bank was opened. It is also the submission of the Assessee that the Assessee is a BIFR company and because of huge losses the Assessee did not prefer against the addition because, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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