9911796707
TMI Blog2014 (7) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... ocation of section 68 is confirmed in relation to the credit/s, assessing them under the residuary head of income, i.e., ‘income from other sources’ – Decided against Assessee. - I.T.A. No. 2636/Mum/2011 - - - Dated:- 18-6-2014 - Shri Sanjay Arora, AM And Shri Amit Shukla, JM,JJ. For the Appellant : Shri K. Gopal For the Respondent : Shri Morya Pratap ORDER Per Sanjay Arora, A. M.: This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-33, Mumbai ( CIT(A) for short) dated 05.01.2011, dismissing the assessee s appeal contesting its assessment u/s.143(3) of the Income Tax Act, 1961 ( the Act hereinafter) for the assessment year (A.Y.) 2003-04 vide order dated 19.12.2008. 2. The issue arising in the present case is the maintainability in law of section 68 of the Act in the facts and circumstances of the case. 3. The law in the matter is well settled, so that a cash credit appearing in the assessee s books of account has to be proved as to its nature and source, failing which, section 68, which is a rule of evidence, deeming the amount credited as the assessee s unexplained income for the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrap or had the assessee adduced its own money under the garb of sale of scrap. The affidavit of Shri Dinesh Sharma who was one of the partners of assessee s firm which entered into development agreement with Golden Dyes Corporation India P. Ltd. to develop a housing project at the factory premises situated at Hardas nagar has filed now. It has been stated in this affidavit that whatever items were lying in the building structure, which was taken for development purposes, they were sold for a consideration of ₹ 157.60 lacs. The affidavit of Shri Shashikant R Kadam who engaged in the business of rendering services of repairs and maintenance of plant and machinery used in the manufacturing of dyes chemical and labour contractor is also placed by which it has been stated that he facilitate for sale of scrap on behalf of the assessee. These affidavits filed now at the time of hearing of the appeal. One of the affidavits of Shri Dinesh Sharma was asked to file by the Bench. To verify the truth-ness of the contents of the affidavits, it is necessary to send back to the file of the AO, as they were not filed earlier. Accordingly, to meet the end of justice, we set aside the orders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact, there is no mention of even any attachments, which we have rather presumed on the basis of the nature of the sale transaction. This would only, it may be noted, clarify the ownership status of the said plant machinery, stated to be at the site, establishing its transfer to and acquisition by the assessee. On the contrary, not to speak of its description or specification in some detail, there is as afore-noted no whisper of any plant machinery in the said agreement, which is inexplicable. Lest one may argue of it being an omission (which though cannot be lightly inferred) or of little consequence, it needs to be appreciated that its value constitutes about 17% of the contract value and, in fact, a much higher % age thereof when reckoned upon excluding the land value comprised therein; the land value a constant - and the others clearly forming two distinct and separable parts of the agreement. The seller cannot but be conscious of its value, so that the same can only be considered to have been taken into account in arriving at the contract value. Then, again, even so, why could not the assessee as much as obtain a confirmation from the seller to that effect? In fact, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 in the instant case is on account of the assessee s inability to substantiate the same as having been derived or realized by the assessee in the course of its business. As such, the contention that the income, though brought to tax u/s. 68, is assessable as business income, is contrary to the facts circumstances of the case. One could understand a case as - taking example of the present case where, though the existence of the plant machinery sold and its fair value, in proximity of the amount credited, stands proved, yet becomes assessable under section 68 in view of nonconfirmation of the buyers. As such, it being confirmed that the amount under question has its origin in the said plant machinery (scrap), one could argue that though the source of income (receipt) may not have been exhibited, its nature stands so, so that the income, though thus liable to be assessed under section 68, would yet be considered as business income, arising to the assessee in the course of his only business. In the present case, however, both the nature and source of the credit/s are unexplained. As such, the only head of income under which the income is liable to be considered for assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
