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2017 (9) TMI 306 - AT - Income TaxAssessment of income - claim of the assessee that amount of cash found during survey has already been added to the income of his brohter - Held that - The assessee has no objection if the said claim be verified. - The AO would pass the order afresh in this regard after giving an opportunity of being heard to the assessee. Accordingly, this issue is hereby decided in the favour of the assessee against the revenue. Addition of capital revenue not explained properly - CIT-A deleted 30% of capital revenue - Held that - The only difference, between the opening and closing of capital account, was to be found of credit of ₹ 23,584/- CIT(A) has rightly sustained the addition of ₹ 23,584/- instead of ₹ 3,39,468/- Decided against the revenue. Assessment of profit - Sale of chemicals SBPS OR sale of Naptha - Held that - In view of the said finding of the CIT(A) we noticed that CIT(A) has already directed the AO to verify the profit of ₹ 4.440/-per tanker from the business of SPBS which has been assessed to tax. The finding of the CIT(A) is on the basis of the record and relevant material was available with them. There is no need to discuss the same being the CIT(A) has already discussed the matter at length above.Verification is yet to be done by the AO. Nothing distinguishable has produced before us to deviate the finding of the CIT(A) on this issue. Therefore, we decided this issue in favor of the assessee.
Issues Involved:
1. Confirmation of addition of ?3,81,637/- received by the assessee's brother. 2. Taxability of cash deposits amounting to ?2,13,83,250/-. 3. Taxability of sale of ?45,18,575/- relating to M/s. Galaxy Plast-O-Chem. 4. Deletion of 30% opening capital addition. 5. Taxability of commission of ?4,39,494/- on cash deposits. 6. Deletion of addition of ?55,130/- @ 4% of ?13,78,260/-. 7. Deletion of addition of ?3,46,249/- u/s 68 of the Act. 8. Nature of entries in impounded item No. A-15. Issue-wise Detailed Analysis: Issue No. 1: Confirmation of Addition of ?3,81,637/- The assessee challenged the addition of ?3,81,637/-, arguing that this amount was received by his brother Naresh B Vora from Naptha quota holder parties and the commission income was already assessed in Naresh B Vora's hands. The Tribunal found this needed verification and thus set aside the CIT(A)'s order, restoring the issue to the AO for verification. The AO was directed to verify if the amount and its commission were already considered in Naresh B Vora's hands and to pass a fresh order after giving the assessee an opportunity to be heard. This issue was decided in favor of the assessee. Issue No. 2: Taxability of Cash Deposits Amounting to ?2,13,83,250/- The revenue contested the CIT(A)'s decision that cash deposits amounting to ?2,13,83,250/- were considered in Naresh B Vora's hands and should not be taxed again in the assessee's hands. The Tribunal upheld the CIT(A)'s finding, noting that the AO had not specified the respective bank accounts for the deposits. The CIT(A) restricted the addition to ?3,81,637/-, and the Tribunal found no error in this decision, thus deciding the issue against the revenue. Issue No. 3: Taxability of Sale of ?45,18,575/- Relating to M/s. Galaxy Plast-O-Chem The revenue challenged the CIT(A)'s finding that the sale of ?45,18,575/- related to M/s. Galaxy Plast-O-Chem, a proprietary concern of Naresh B Vora, and not the assessee. The Tribunal upheld the CIT(A)'s decision, noting that the transactions were fictitious and related to Naresh B Vora's concern. The Tribunal affirmed the CIT(A)'s finding and decided the issue against the revenue. Issue No. 4: Deletion of 30% Opening Capital Addition The revenue contested the CIT(A)'s deletion of the 30% capital addition of ?3,39,000/-. The CIT(A) found that the capital account as on 31.03.1996 was ?11,07,976/- and the opening balance as on 01.03.1996 was ?11,31,56/-, with a difference of ?23,584/-. The CIT(A) sustained the addition of ?23,584/- and deleted the rest. The Tribunal found no error in this decision and confirmed the CIT(A)'s finding, deciding the issue in favor of the assessee. Issue No. 5: Taxability of Commission of ?4,39,494/- on Cash Deposits The assessee challenged the addition of ?4,39,494/- as commission on cash deposits, arguing that this amount was already assessed in Naresh B Vora's hands. The Tribunal found this needed verification and set aside the CIT(A)'s order, restoring the issue to the AO for verification. The AO was directed to verify if the amount and its commission were already considered in Naresh B Vora's hands and to pass a fresh order after giving the assessee an opportunity to be heard. This issue was decided in favor of the assessee. Issue No. 6: Deletion of Addition of ?55,130/- @ 4% of ?13,78,260/- The revenue contested the CIT(A)'s deletion of the addition of ?55,130/- @ 4% of ?13,78,260/-, arguing that Pooja Industrial Corporation was operated by Naresh B Vora and not connected with the assessee. The CIT(A) found that Pooja Industrial Corporation was indeed operated by Naresh B Vora and not connected with the assessee. The Tribunal upheld the CIT(A)'s finding and decided the issue against the revenue. Issue No. 7: Deletion of Addition of ?3,46,249/- u/s 68 of the Act The revenue contested the CIT(A)'s deletion of the addition of ?3,46,249/- u/s 68 of the Act, arguing that this amount was related to Pooja Industrial Corporation, operated by Naresh B Vora. The CIT(A) found that the assessee was not connected with Pooja Industrial Corporation and that the amount was already assessed in Naresh B Vora's hands. The Tribunal upheld the CIT(A)'s finding and decided the issue against the revenue. Issue No. 8: Nature of Entries in Impounded Item No. A-15 The revenue challenged the CIT(A)'s finding that the entries in impounded item No. A-15 pertained to the sale of chemicals SBPS and not Naptha. The CIT(A) found that the assessee was involved in providing hawala bills and not in the sale of Naptha, which required a license. The Tribunal upheld the CIT(A)'s finding and directed the AO to verify the profit from the business of SBPS. This issue was decided in favor of the assessee. Conclusion: The appeals filed by the assessee were allowed for statistical purposes, and the appeals filed by the revenue were dismissed. The Tribunal upheld the CIT(A)'s findings on most issues, directing further verification by the AO where necessary. The Tribunal's decisions were based on the evidence and records presented, finding no grounds to deviate from the CIT(A)'s conclusions.
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