9911796707
TMI Blog2016 (5) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee to the Profit and Loss account and claimed as an expenses by the assessee in the return of income filed with the Revenue, as per the agreement with Casio India Pvt. Ltd. are to be part of gross revenue or were reimbursed by Casio India Company Pvt. Ltd. separately and if these expenses are found to reimbursed by the Casio India Company Private Limited separately, then the total amount of courier charges of ₹ 9,51,665/- claimed by the assessee as revenue expenses will be disallowed, otherwise the income as computed by the CIT(A) is confirmed. We order accordingly Undisclosed cash deposits - Held that:- The total payment made for the undisclosed purchases made from Thakkral Computers Private Limited through the bank account is 24,55,282/- and hence there will also be sales corresponding to the said purchases. Both the sales and purchases with respect to these electronic items so purchased from Thakkral Computers Private Limited is not declared and disclosed by the assessee to the Revenue in the return of income filed with the Revenue. There are cheques deposited of ₹ 22,50,000/- on different dates in the Kotak Mahindra Bank Limited by the assessee for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... phold the same Decided against revenue Double stage of estimation - DR submitted that the CIT(A) erred in giving relief of double stage by first estimating commission @11% on sales and then applying profit rate of 15% - Held that:- . No explanation with evidences has been submitted by the assessee before the authorities below to explain the income which need to be brought to tax in context of the undisclosed sale of ₹ 2.09 crores made through the assessee by Casio India Company Private Limited. The CIT(A) in a very reasonable and fair manner first estimated commission income @11% on undisclosed sale made and on the courier charges , which was in parity with and equivalent to the ratio of commission income of ₹ 39,11,279/- being given by Casio India Company Private Limited to the assesssee on disclosed sale of ₹ 3.52 crores which is also confirmed by the TDS certificate and the books of account of the assessee and on the same ratio estimated 11% commission on undisclosed sales of ₹ 2.09 crores and, thereafter, the CIT(A) applied the 15% ratio of profit on commission income on disclosed sale and undisclosed sales whereby giving benefit of the deduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19,55,282/- on account of unexplained investment without appreciating the fact that the assessee failed to furnish any explanation during the course of assessment proceedings. 5. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in changing single stage of estimation of income @5% to double stage of estimation. 6. The appellant prays that the order of the CIT(A) on the above grounds be reversed and that of the assessing officer be restored. 3. None appeared on behalf of the assessee despite several opportunities being given to assessee as per order sheet entries , since January 2011 and when this appeal was called for hearing on the date fixed for hearing of this appeal , again none appeared on behalf of the assessee, hence, we are proceeding to dispose off this appeal ex-parte after hearing the learned Sr. DR and on the basis of the material available on record. 4. The assessee is an individual and proprietor of the firm M/s. Saira Impex. The assessee is a consignee agent of M/s. Casio India Company Private Limited and is working on commission basis. 5. During the course of assessment proceedings u/s 143(3) read with Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same to the income of the assessee vide assessment orders dated 31.12.2008 passed u/s 143(3) of the Act. 6. Aggrieved by the assessment orders dated 31.12.2008 passed by the AO u/s 143(3) of the Act, the assessee filed first appeal with the CIT(A). 7. The assessee filed a statement of facts along with the grounds of appeal before the CIT(A), in which it was stated that she was carrying on business as consignee agent of M/s. Casio India Company Private Limited on commission basis. The assessee s books of account were regularly maintained for the businesses carried on by the assessee which were regularly audited as per the provisions of Section 44AB of the Act. The audit report was duly filed along with return of income on 31.10.2008. The assessee submitted that she had given necessary evidences/documents/explanations in the course of assessment proceedings u/s 143(3) read with Section 143(2) of the Act to the authorized representative. It was only on reading of the assessment order dated 31.12.2008 it appeared that the details/explanations given by the assessee to the counsel were not submitted by the counsel to the AO, which has resulted into various additions resulting in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the AO . In view of the fact that the assessee has herself conceded that the income has not been correctly calculated and offered for taxation, the CIT(A) found that action of the AO in calculating the profit on sales of ₹ 2,09,07,668/- on which the assessee had not declared any profits could not be faulted with. Further the assessee had himself submitted on 29.11.2009 that the net profit rate of 10% to 15% or any other figure should be calculated on sales as commission received which would include the deduction of expenses claimed. The CIT(A) found that in the assessment order dated 31.12.2008 u/s. 143(3) of the Act, the AO had added back ₹ 9,51,665/- claimed as deduction of courier expenses in the P L account by the assessee as per the agreement for consignee agent made between the Casio India Company Private Limited and the assessee, it clearly states that the expenses of courier were to be reimbursed by Casio India Company Private Limited and if this was so then the expenses would not have been incurred by the assessee at all. The CIT(A) considered the submissions of the assessee and observed that as the assessee had herself offered that correction in her commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served that the assessee has entered into an agreement for consignee dated 11.01.2005 with Casio India Company Pvt. Ltd. , whereby there was a sale of ₹ 3.52 crores which was made through the asssessee by Casio India Company Private Limited which was declared to the Revenue , further there was sale of 2.09 crores which was sale made by Casio India Company Private Limited through assessee , which was not disclosed in the return of income filed by the assessee with the Revenue. The AO made an enquiries u/s 133(6) of the Act with Casio India Company Private Limited and observed that an agreement with Casio India Pvt. Ltd., stipulates that the assessee is not entitled for any commission for sale made outside Maharashtra. The assessee did not submit evidences to substantiate that this sale of ₹ 2.09 crores which was not disclosed to the Revenue does not entitle it to any income as per agreement with Casio India Pvt. Ltd. which could be brought to tax by the Revenue. The AO has duly made enquiries with Casio India Pvt. Ltd. u/s. 133(6) of the Act. During the course of appellate proceedings , it was submitted by the assessee that she had given necessary documents/evidences to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by Casio India Company Pvt. Ltd. separately and if these expenses are found to reimbursed by the Casio India Company Private Limited separately, then the total amount of courier charges of ₹ 9,51,665/- claimed by the assessee as revenue expenses will be disallowed, otherwise the income as computed by the CIT(A) is confirmed. We order accordingly. This will dispose of grounds 1 2 of the revenue s appeal. 12. With respect to ground no.3, during the course of assessment proceedings u/s 143(3) read with Section 143(2) of the Act, the AO observed that as per the AIR information , the assessee had received interest amount of ₹ 4,225/- from Kotak Mahindra Bank Ltd. . The assessee was asked to give details of interest earned from the Kotak Mahindra bank. In this regard the assessee submitted that she had no such bank account in Kotak Mahindra Bank and no interest was received by her. The information was called by the AO u/s. 133(6) of the Act from Kotak Mahindra Bank in respect of interest received by the assessee. The bank statement revealed that the assesse had deposited cash amounting to ₹ 5 lakhs and cheques amounting to ₹ 22,50,000/- on different dates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ronic items while the addition to the extent of ₹ 22,50,000/- with respect to deposits of cheques for which no details were furnished by the assessee to satisfy the ingredients of Section 68 of the Act , was confirmed by the CIT(A) and also addition on account of interest income of ₹ 4226 credited in Kotak Mahindra Bank Limited was confirmed by the CIT(A) vide orders dated 16.12.2009. 15. Aggrieved by the orders dated 16.12.2009 of the CIT(A), the Revenue is in appeal before the Tribunal. 16. The learned DR relied on the order of the AO while none appeared for the assessee despite several opportunities given to the assessee , since 2011. 17. We have heard the learned DR and have perused the material on record. We find that the assessee had made payment of ₹ 24,55,282/- to Thakkral Computers Pvt. Ltd. through banking channels from the IndusInd Bank which is an bank account duly disclosed and declared to the Revenue and sources of credit in the said bank account stood explained as per the facts emerging from the orders of the authorities below. The assessee has neither disclosed the purchases made from Thakkral Computers Private Limited nor the correspondin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 24,55,282/- has been made by the assessee from IndusInd Bank, which is a regular bank account of the assessee duly declared in the return of income filed with the Revenue. The AO alleged that the assessee has made investments which are not recorded in the books of account and, hence, the same should be treated as income u/s. 69 of the Act. Despite giving sufficient opportunities, the assessee failed to discharge its onus before the AO. Thus, the AO made an addition of ₹ 24,55,282/- to the total income of the assessee on account of unexplained investment u/s 69 of the Act vide assessment order dated 31.12.2008 passed u/s 143(3) of the Act. 19. Aggrieved by the assessment orders dated 31.12.2008 passed by the AO u/s 143(3) of the Act, the assessee filed first appeal before the CIT(A). 20. The CIT(A) observed that as per the assessee , the transactions of purchases with Thakkral Computers Private Limited whereby payment of ₹ 24,55,282/- was made , is an unaccounted transactions. The assessee had submitted that ₹ 5 lacs cash deposit in Kotak Mahindra Bank represent part of the profits of these transactions and since the profit is more than 20%, Section 44AF o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made payment of ₹ 24,55,282/- to Thakkral Computers Pvt. Ltd. out of the regular bank account with IndusInd Bank whereby the credits are duly offered for tax by the assessee as per the facts emerging from the orders of the authorities below, the said payments of ₹ 24,55,282/- to Thakkral Computers Pvt. Ltd. had not been recorded in the books of account. The assessee has come forward with the explanation that this represent unexplained purchases and correspondingly unrecorded sales were made. It was further submitted that 5% of the investment be treated as profit u/s. 44AF of the Act and the same should be brought to tax. The CIT(A) has estimated profit at ₹ 5 lacs on these transaction based on the explanation of the assessee that ₹ 5 lacs deposited in cash in bank account with Kotak Mahindra Bank represents cash sales not disclosed to the Revenue with respect to the electronic items purchased from Thakkral Computers Private Limited and represents part of profit from these unrecorded purchase and sale of electronic items and the CIT(A) gave relief of ₹ 19,55,282/- as the sources of making payment were duly explained to be commission income credited in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
