9911796707
TMI Blog2019 (11) TMI 1424X X X X Extracts X X X X X X X X Extracts X X X X ..... nds wherein it has taken four grounds. A perusal of these grounds would reveal that grievance of the assessee revolves around single issue viz. the ld.CIT(A) has erred in confirming the addition of Rs. 58,23,060/-, which was added by the Assessing Officer with aid of section 56(2)(viib) of the Income Tax Act, 1961. 3. Brief facts of the case are that the assessee has filed its return of income on 25.8.2013 declaring total income at Rs. 1,43,790/-. The assessee at the relevant time was engaged in the business of manufacturing steam basmati and non-basmati rice. Its case was selected for scrutiny assessment and notice under section 143(2) was issued and served upon the assessee. On scrutiny of the accounts, it revealed that the assessee comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order, the assessee carried the matter in appeal before the ld. First Appellate Authority. It reiterated its contentions. However, the appeal did not bring any relief to the assessee. The ld. CIT(A) has concurred with the Assessing Officer. 5. Before us, the ld. counsel for the assessee contended that as far as actual encashment of cheques is concerned, that aspect has not been disputed by both the Revenue authorities. According to them, the assessee is following mercantile system of accounting, and therefore, the moment it received cheques, it should have recognized the actual receipt of the consideration. He took us through section 56(2)(vii) of the Act and contended that this section employees expression "receive" which cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amounts, and not a notional one, because in various authoritative pronouncements it has been construed that the amounts should have been actually received. ITAT, Kolkatta Bench has considered identical aspect, and made following discussion: "6. We have considered the rival submissions and also perused the relevant material available on record. It is observed that its shares were issued by the assessee-company during the year under consideration at premium to certain companies in lieu of the shares held by the said companies and there was thus no inflow of cash involved in these transactions. The said transactions were entered into in the books of account of the assessee-company by way of journal entries and it did not involve any cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case. In the said case, the three NBFCs had taken loans from proprietary concern belonging to the same group. Since the said loans were required to be liquidated as per the RBI guidelines and there was no cash available with the NBFCs to repay the loans, the shares held by the three NBFCs were transferred to a partnership firm namely Jatia Investment Co., and the amount receivable against the said sale of shares was adjusted by the NBFCs against the loan amount payable to proprietary concern. The partnership firm of M/s. Jatia Investment Co. thus received shares from the three NBFCs and also took over the loans payable by the said NBFCs to the proprietary concern. These transactions were entered into in its books of account by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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