9911796707
TMI Blog2024 (2) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... e duty of the assessee to establish that there is sufficient stock available with the assessee and subsequently, sale was made. Thus, the preponderance of probability in favour of the assessee cannot be applied in this case - we set aside the order of the CIT(A) and remit the matter back to the file of the AO to examine the details filed by the assessee and decide the issue - Appeal filed by the Revenue is allowed for statistical purposes. - SHRI V. DURGA RAO, JUDICIAL MEMBER SHRI MANJUNATHA, G., ACCOUNTANT MEMBER For the Appellant : Shri D. Hema Bhupal, JCIT For the Respondent : Shri V. Karthickkrishnan, CA ORDER PER V. DURGA RAO, JUDICIAL MEMBER: This appeal filed by the Revenue is directed against the order of the ld. Commissioner of Income Tax (Appeals), National Faceless Appeal Centre [NFAC], Delhi, dated 29.03.2023 relevant to the assessment year 2017-18. 2. The appeal filed by the Revenue is delayed by 33 days in filing the appeal, for which, the Revenue has filed an affidavit for condonation of the delay, to which; the ld. Counsel for the assessee has not raised any serious objection. Consequently, since the Revenue was prevented by suff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - - December 99,43,055 10,45,780 - No proper justification or reasoning for the substantial increase in cash sales during October 2016 and November 2016 was submitted by the assessee. d. TN VAT returns for the month of October 2016 was found filed post demonetization on 20.11.2016 and for the month of November 2016, it was filed on 20.12.2016. Though filed within the due dates of the respective VAT act, the possibility of reporting bogus cash sales figures to arrive at the cash balance prior to demonetization period through the VAT returns could not be ruled out. e. On perusal of the Stock register furnished online by the assessee for the GOLD JEWELS 22Kt, it is seen that there are negative closing stock figures from 13.10.2016 to 29.10.2016. The peak of the same being (-) 5811.567 gms on 29.10.2016. The stock register furnished by the assessee is enclosed to this order as Annexure A. There cannot be a negative stock and in this case it only means that the sales are booked in excess of the stock or in other words the sales are bogus. Assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the SBN deposits aggregating to Rs.2,31,20,500 made in to their bank accounts during the demonetization window. Thus the cash credit to the extent of Rs.2,31,20,500 is assessed as Income u/s. 68 of the Income Tax Act and added to the total income of the assessee and brought to tax u/s. 115BBE. 4. Accordingly, after verifying the details and the explanations submitted by the assessee and the reasons for which the case is selected for scrutiny, the Assessing Officer has completed the assessment assessing total income of the assessee at ₹. 2,44,17,320/- by making addition of ₹. 2,31,20,500/-. 5. On appeal, the ld. CIT(A) has observed and held as under: 3.1 l have considered the assessment order, the responses filed by the appellant and the material on record. Since all the grounds of appeal relate to the addition of Rs. 2,31,20,500 under Section 68 of the Income Tax Act (the Act), they are all being dealt with together. 3.2 The Assessing Officer (AO) has focused on the cash deposits in demonetised currency, and has compared the cash sales in the previous, current and succeeding years, especially in the period covering September to December to show that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bank for the value of Rs. 60,58,049 (Quantity details not furnished) was noticed on 02.11.2016, during the periods prior to demonetization, the conversion of the same into Gold jewels was not furnished. Even assuming that the same was converted prior to 05.11.2016 and brought into Stock of Gold jewels, the negative stock is not fully wiped out. That is the closing stock as at 08. 11.2016 is still a negative stock figure. f. No proper justification for substantial cash sales in October 2016 and November 2016 was provided by the assessee and No proof of delivery either through the signature of the customer or otherwise are produced. And no identity of the buyers (email or phone number or address) for the sales effected during the period 01.10.2016 to 08.11.2016 was furnished. And to avoid this, it is seen that the bills were mostly split into sale value less than Rs.2,00,000 (or less than Rs. 70,000 as stated by the assessee). 3.4 In view of the foregoing, it has been held that bogus cash sales have taken place in the month of October and November 2016, leading up to the demonetisation period, and therefore specified bank note (SBN) deposits of Rs.2,31,20,500 have been f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed. 6. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. The ld. DR has pointed that based on the submissions of the assessee, the ld. CIT(A) came to a conclusion that there is adequate stock available with the assessee. However, the assessee has not filed the details of stock before the Assessing Officer and it was only submission made before the ld. CIT(A). It was further submission that when the assessee was not able to establish that sufficient stocks available with them, how the assessee could have been made sales as shown by it. Under these facts, the ld. CIT(A) has applied the preponderance of probability in favour of the assessee and deleted the addition, which appears to be not correct. Before us, the assessee filed certain details, such as, stock item register of Gold Jewels 22 kt, ledger account of purchase gold coins, etc. However, with those details, we are unable to find out sufficient stock is available with the assessee or not. We find that it is the duty of the assessee to establish that there is sufficient stock available with the assessee and subsequently, sale was made. Thus, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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