9911796707
TMI Blog2016 (2) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... oducing vouchers for sale of goods, such an addition could not be sustained - Decided in favour of assessee - I.T.A. No.5312/Mum/2013, Cross-Objection No.249/Mum/2014 - - - Dated:- 5-2-2016 - SHRI B.R.BASKARAN, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN, JUDICIAL MEMBER For The Revenue : Shri Uday B Jakke For The Assessee : Shri Devendra Jain PER SANDEEP GOSAIN, JM: This is an appeal filed the revenue challenging the order dated 29.5.2013 passed by the ld.CIT(A)-35, Mumbai for the assessment year 2010-11 in which the revenue has raised the issue of deletion of addition of ₹ 20,74,957/- on account of unexplained expenditure u/s 69C of the Income Tax Act, 1961. The assessee has also filed cross-objection thereto. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, the assessee submitted details vide his letter dated 29.11.2012 in which he has given specific details about purchases made, VAT account, sales tax payment and banks details. The AO did not find favour of the submissions and explanation of the assessee and added the sum of ₹ 20,74,957/- u/s 69C of the Act to the total income of the assessee. Being aggrieved by this, assessee preferred an appeal before the ld. CIT(A). 3. Before the ld.CIT(A), the assessee contended that only because of names of the suppliers are mentioned in the list of suspicious dealers declared by the Sales Tax Department, Government of Maharashtra which were displayed on official website of the Government of Maharashtra, the AO disallowed the purchases and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the AO and relied only on the statement given by them to Sales Tax Department, Government of Maharashtra. b) That the transactions were supported by the proper documentary evidences. The payments made to the parties by the assessee were in conformity with certificate issued by the bank authorities with regard to payment made by the assessee to the various parties; c) The AO did not doubted the identity of the suppliers; d) No opportunity was granted to the assessee to cross-examine the creditors. e) Confession made by third party; f) Non-production of parties by the assessee cannot be held against the assessee; g) The findings of the Sales tax department are not conclusive and in no way establishes that the purchases ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as the case may !be,' may be deemed to be the income of the Assessee for such Financial Year From' the reading of . Section 69C it is very clear that the section applies in the following two circumstances: I. Firstly, an expenditure have been incurred and;' II. Secondly, the assessee fails to indicate satisfactorily the source of such expenditure or any part thereof. This is a deeming provision whereby such unexplained expenditure or part thereof is to be treated as the Income of the assessee for such year . Thus the provision will apply only where the two conditions are jointly found in a case i.e. (i)an expenditure have been claimed as revenue expenses in computing the income of the year and(ii) the source of su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n on the basis of statements given by the parties before the Sales tax department. He has further placed reliance on the decision rendered by Hon ble Gujarat High Court in the case of CIT Vs. M.K. Brothers (163 ITR 249). He has further relied upon the decision rendered by the Tribunal in the cae of ITO Vs. Premanand (2008)(25 SOT 11)(Jodh), wherein it has been held that where the AO has made addition merely on the basis of observations made by the Sales tax dept and has not conducted any independent enquiries for making the addition especially in a case where the assessee has discharged its primary onus of showing books of account, payment by way of account payee cheque and producing vouchers for sale of goods, such an addition could not be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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