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2013 (11) TMI 808 - ITAT KOLKATAUnaccounted and unexplained transfer of funds - Transfer from seized funds - Held that:- assessee has produced the books of account and copy of ledger account of Naresh Kumar & Co., wherein it is pointed out that the amount of Rs.1,75,000/- was recorded in the bank account and the entire expenses incurred, which was reimbursed is also recorded in the books of Naresh Kumar & Co. and assessee also. As the assessee has produced sufficient evidence to prove the claim as bona fide, we are inclined to accept the same - Therefore, these are not unexplained, rather these are explained entries - Decided in favour of assessee. Disallowance u/s 40A(3) - Cash payments - Several payments on different dates in contravention of the provisions of section 40A(3) - Held that:- there is no basis of making this addition by the AO and he has not brought any instance of cash payment in violation of provisions of section 40A(3) of the Act. Unless and unitl revenue is able to bring any material from the seized material or from the books of account, the addition cannot be sustained - Decided in favour of assessee. Disallowance u/s 2(22)(e) - Advance payment - Business expediency or ultimate benefit of the shareholders - Held that:- The provisions of section 2(22)(e) are attracted, when a company makes payment to its shareholders whereas in contrast in present case payments have been made by the shareholder to the company. According to us, therefore, the provisions of section 2(22)(e) of the Act will not apply - Following decision of Assistant Commissioner of Income-tax v. Bhaumik Colour P. Ltd. [2008 (11) TMI 273 - ITAT BOMBAY-E] - Decided in favour of assessee.
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