9911796707
TMI Blog2024 (11) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,800/- on 08.03.2018. It was noticed that assessee has declared a capital balance of Rs. 48,53,245/- in M/s. A.R. Constructions but did not disclose the capital introduced in M/s. Lakshmi Cold Storage and M/s. Vigneswara Cold Storage where the assessee invested amount of Rs. 1,45,64,960/- and Rs. 86,64,883/- respectively towards his 40% share in the firms. The Assessing Officer therefore considered that there are reasons to believe that the income has escaped assessment within the meaning of section 147 of the Act and thereafter issued notice under section 148 of the Act on 12.03.2020 after obtaining prior approval from the JCIT, Range - 2, Guntur. In response, assessee did not file any return of income to the notice issued under section 148 of the Act. However, assessee filed replies to various notices issued under section 142(1) of the Act from time to time. Considering the reply and after examining the submissions made by the assessee, Assessing Officer made the following additions : - i. Addition for cash introduced in the firm under section 68 r.w.s. 115BBE of the Act of Rs. 11,40,665/-. ii. Addition on account of introduction of capital in the firm under section 68 r.w.s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voking section 68 of the IT Act is not acceptable under law. 7. The CIT(A), NFAC grossly erred in considering the gifts received from father's HUF of Rs. 9,65,000/- for addition u/s 56(2)(x) of the IT act, when the subject amount does not fall within the mischief and ambit of Section 56(2)(ix) of the Act. 8. The appellant prays that the Hon'ble Tribunal may kindly: a. Delete the additions made u/s 68 of the Act amounting to Rs. 1,94,99,178/-, Rs. 11,40,665/-, and Rs. 24,50,000/-. b. Delete the addition of Rs. 1,40,000/- made u/s 68 of the Act. c. Delete the double addition of Rs. 9,65,000/- made u/s. 56(2)(ix) and 68 of the Act. 9. For these and other reasons that are to be urged at the time of hearing of the case the appellant prays that the impugned order is liable to be set aside in the interest of justice." 5. Ground Nos. 1, 8 & 9 are general in nature and needs no adjudication. 6. Ground Nos.2 & 3 are with respect to the addition of Rs. 1,94,99,178/- made under section 68 of the Act. On this issue, Ld. Authorised Representative [hereinafter "Ld.AR"] submitted that the assessee has made investments in the two firms by purchasing two cold storage units whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reflected in the books of M/s. A.R. Constructions and consequently in the assessee's capital account in M/s.Lakshmi Cold Storage and M/s. Vigneswara Cold Storage. We therefore direct the Assessing Officer to delete the addition of Rs. 1,94,99,178/- made under section 68 r.w.s. 115BBE of the Act as the source for the capital investment has been properly explained by the assessee. Accordingly, we allow the Ground Nos. 2 and 3 raised by the assessee. 9. Ground No. 4 is with respect to the addition of Rs. 11,40,665/-. Ld.AR submitted that assessee has withdrawn the cash from his capital account from the partnership firms which is placed in the paper book at page no. 181 disclosing the cash withdrawals during the F.Y. 2015-16. He therefore pleaded that these cash withdrawals have been utilised for the purpose of making investments and hence the source is properly explained. He therefore pleaded that addition made by the Assessing Officer be deleted. 10. Per contra, Ld. DR submitted that the cash drawings were made during the A.Y. 2016-17 whereas the investments in the firm was during the year 2017-18. Assessee has not proved beyond doubt the cash withdrawn has been utilised for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred from the bank accounts of the respective parties wherein the sources for the amounts available in the bank accounts of the parties granting unsecured loans to the assessee were not disputed by the Revenue, which was demonstrated by the Ld.AR, we are inclined to allow this ground raised by the assessee thereby deleting the addition made by the Assessing Officer. Accordingly, Ground No.5 raised by the assessee is allowed. 15. Ground No. 6 is with respect to the addition of Rs. 1,40,000/-under section 68 of the Act. The Ld.AR submitted that assessee has introduced capital by way of cash for Rs. 20,000/- and has paid insurance amount for Rs. 1,20,000/- which was credited at the capital account of the assessee. Ld.AR submitted that considering the quantum of cash of Rs. 20,000/- introduced by the assessee as capital which is very nominal amount, hence pleaded to be allowed. Further he also submitted that assessee paid an insurance amount of Rs. 1,20,000/- on behalf of the firm which was credited to the capital account as it has to be reimbursed to the assessee. He therefore pleaded that this amount also may be allowed. 16. Per contra, Ld. DR relied on the orders of the Revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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