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TMI Blog2015 (3) TMI 647X X X X Extracts X X X X X X X X Extracts X X X X ..... the volume of business carried out by the assessee. The AO has given a categorical finding that no separate stock was maintained by the assessee and his father. It is contended that the addition has been made by the AO without considering the explanation offered by the assessee but is contrary to the records as it is admitted position that the assessee was not maintaining proper books of accounts, therefore the AO was justified in computing the profit on the basis of the material available before him. Hence, we see no reason to interfere in the order of Ld. CIT(A) same is hereby upheld. - Decided against assessee. Undisclosed debtors - AO had made addition on the basis that the assessee neither furnished list of sundry debtors as on 31.03.2008 nor could he explain the sundry debtors despite various opportunites - contention of the assessee is that everything was explained before the assessing officer and there was no undisclosed sundry debtors - Held that:- After considering the totality of the facts that if the sales effected to these debtors has been included into the suppressed sales and addition made thereof. Therefore, it would not be open to the Revenue to make addition o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact requires verification at the end of the assessing officer. - Decided in favour of assessee for statistical purposes. Unaccounted transfer in the bank account - Held that:- revenue has not placed anything on record suggesting that the amount deposited by Raj Bahadur Chand in fact belonged to the assessee. On the contrary, the assessee has produced evidences in the form of bank statement etc., therefore, we hereby direct the assessing officer to delete the addition. - Decided in favour of assessee. Discrepancy in balance sheet - CIT(A) allowing relief of ₹ 2,75,OOO/- to the assessee out of addition of ₹ 5,25,000/- - Held that:- this amount is treated as explained in part only. It is seen that vide report dated 26.09.2011 (which has been rebutted by the ld. AR) it has been mentioned that the gift amount of ₹ 2,50,000/- shown received from father does not stand proved since there is a finding that Shri Ganesh Shanker Punetha’s total income for the year was ₹ 2,30,884/- and he is shown to have even gifted an amount of Rs, 270,000/- to the wife of the appellant in this very year. Thus the sum total of gifts far exceeds the income shown in the return an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Commissioner of Income Tax (Appeals-II), Dehradun has erred in law and on facts in partly confirming the action of the ld. AO in upholding that out of the total business activity carried on in the same premises, 50% belonging to the father and son respectively without any basis on assumptions and surmises completely ignoring the details and facts furnished and verified during Assessment and Appellate proceedings and thus confirming the addition of ₹ 256,001/- on a/c of suppressed profit as per impounded material. 2. The ld. CIT(Appeals) also erred in law and on the facts of the case in confirming the addition of ₹ 177,685/- u/s 40A(3) in respect of transactions in the accounts of the firm M/s Punetha Vastra Bhandar owned by the father of the assessee upholding 50% belonging to father and 50% belonging to son (assessee) without any basis. 3. The Ld. CIT(Appeals) also erred in law and on the facts of the case in confirming the addition of ₹ 401,112/- as undisclosed sundry debtors of the firm M/s Punetha Vastra Bhandar owned by the father of the assessee upholding 50% belonging to father and 50% belonging to son (assessee) without any basis even after physica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent u/s 143(3) of the Income Tax Act, 1961 (hereinafter refer to as the Act) was framed. Thereby the assessing officer made various disallowance / additions on account of suppression of profit on the basis of impounded material amounting to ₹ 7,79,999/-, addition on account of invoking the provisions of Section 40A(3) of the Act amounting to ₹ 3,80,069/-, addition on account of undisclosed sundry debtors amounting to ₹ 8,02,223/-, addition on account of discrepancy in trading account, addition on account of unexplained cash amounting to ₹ 3,20,546/-, addition on account of trading difference in balance sheet in respect of asset, unexplained cash deposit of ₹ 1,60,000/-, unexplained cash deposit of ₹ 50,000/- and addition on account of assessee s benami deposit of ₹ 8,70,000/-. 4. Against this assessee filed an appeal before Ld. CIT(Appeal) who after considering his submissions treated 50% of business being carried out by the assessee. In respect of addition of ₹ 7,79,999/-, the Ld. CIT(Appeal) reduced the addition to ₹ 2,56,001/-, in respect of addition of ₹ 380,069/-. a direction was issued to the AO that suppressed pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry limit. The AO ought to have computed profit @ 5% of total turn over as prescribed u/s 44AF of the Act. Admittedly, the assessee has not claimed in return of income that it is entitled for the rate as prescribed u/s 44AF of the Act for computing the business profit. Therefore, at this stage, this contention of the Ld. Counsel for the assessee cannot be accepted and same is rejected. 8. Another contention of the assessee is that there is no basis to attribute 50% of the profit to the assessee. This contention of the assessee is devoid of any merit. It is not disputed by the assessee that he has been carrying out the business activity from the same premises. No evidence is placed on record proving the volume of business carried out by the assessee. The AO has given a categorical finding that no separate stock was maintained by the assessee and his father. It is contended that the addition has been made by the AO without considering the explanation offered by the assessee. This contention is contrary to the records. It is admitted position that the assessee was not maintaining proper books of accounts, therefore the AO was justified in computing the profit on the basis of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... btors were not disclosed by the assessee. However, the contentions of the Ld. Counsel for the assessee is that these debtors are duly explained and this can be inferred from the impounded material. Therefore, there was no occasion to make addition in this respect. After considering the totality of the facts that if the sales effected to these debtors has been included into the suppressed sales and addition made thereof. Therefore, it would not be open to the Revenue to make addition of same amount. This aspect requires verification by the Ld. AO, therefore this ground is restored to the file of AO for verification. The AO is hereby directed to verify whether sales effected to the debtors in question is included into the supported sales or not and profit on such sales is estimated or not. If AO finds that sales have been included he would delete the addition. This ground is allowed for statistical purposes. 12. Ground no. 4th is against the confirmation of addition of ₹ 1,60,273/- Ld. Counsel for the assessee submitted that the cash found during the course of survey has been duly explained. He drew our attention to paper book page no. 156 on the contrary, Ld. Sr. DR support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gifts / balances pertain to earlier year i.e. assessment year 2007-08. This fact requires verification at the end of the assessing officer. We hereby direct AO to verify the claim of assessee. In case, the assessing officer finds that deposits pertain to earlier year, he would delete the same. However, it would be open to Revenue to tax the same in relevant Assessment Year if law so permits. The ground of the assessee appeal is allowed for the statistical purposes. 14. Ground no. 6 : The ground no. 6 is against the confirmation of addition of ₹ 1,60,000/-. Ld. Counsel for the assessee submitted that the authorities below were not justified in making addition. He submitted that it was demonstrated by the assessee that the amount belonged to one Shri Raj Bahadur Chand who confirmed the same. He submitted that all evidences were furnished in support thereof, there was no occasion to confirm the addition. He submitted that cash was deposited in Karnataka where the appellant has no business activity and therefore, the explanation offered by the assessee is correct. He further submitted that no inquiry was made from the depositor, the depositor is having PAN. On the contrary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld. CIT(A). That out of the entire business turnover only 50% business turn over belong to the assessee. Ld. Sr. DR submitted that the Ld. CIT(Appeal) was not justified in treating that only 50% the business turn over belonged to this assessee. He submitted that the assessing officer in the case of assessee-son had treated the entire business belonging to his son. On the contrary, Ld. Counsel for the assessee adopted the argument that were addressed in ITA No. 1152/Del/2012 Ld. Counsel for the assessee adopted the arguments that were addressed in ITA No. 1152/Del/2012. He submitted that there was no basis for bifurcating business turnover equally between son and father. 18.1. We have heard the rival contentions the facts are identical as were in ITA No. 1152/ Del/2012. Following the same reasoning as recorded in para 8 of this order. We hereby upheld the order of Ld. CIT(Appeal). This ground of revenue appeal is rejected. 19. Ground no. 2 is against the allowance of relief of ₹ 2,75,000/-. Ld. Sr. DR submitted that the Ld. CIT(Appeal) was not justified in deleting the addition. He submitted that the assessing officer has given a detailed finding the same be upheld. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... record, we find that the Ld. CIT(Appeal) has given a finding that no action is taken against the recorded bank Account holder, no inquiry was made by the assessing officer to find out involvement of the appellant. The Ld. CIT(Appeal) has given a finding that the assessee was merely an introducer of bank account. However, it is transpired from the assessment order the Assessing Officer has observed that according to material available on records there were certain deposits in account no. 10925759010. Thus we are not able to accept the argument that the assessee was merely an introduced of the account if he was merely introduces of the account then how the details related to the account of third party was found during the course of survey at his premises. Therefore, we hereby set aside this issue to the file of the assessing officer as to give a clear finding in respect of addition made what was the basis and material available before him for making such addition. Moreover, the Ld. CIT(Appeal) has not given any finding on this aspect of the matter. This ground of the revenue is allowed for the statistical purposes. In the result appeal of the Revenue is partly allowed for stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee that he has been carrying out the business activity from the same premises. No evidence is placed on record proving the volume of business carried out by the assessee. The AO has given a categorical finding that no separate stock was maintained by the assessee and his father. It is contended that the addition has been made by the AO without considering the explanation offered by the assessee. This contention is contrary to the records. It is admitted position that the assessee was not maintaining proper books of accounts, therefore the AO was justified in computing the profit on the basis of the material available before him. Hence, we see no reason to interfere in the order of Ld. CIT(A) same is hereby upheld. This ground of the assesssee s appeal is dismissed. We hereby reject this ground of appeal. Hence, ground no. 2 and 3 of the assessee s appeal reject. 23. Apropos to ground no. 4 the similar ground was taken in ITA No. 1152/Del/2012 as ground as ground no. 3. The Representative of the parties have adopted the same argument. There is no change under facts and circumstances pointed out. Therefore, for the same reasoning as in para 11 of the order which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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