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2014 (4) TMI 533 - AT - Income TaxRejection of books of accounts – Bogus accommodation entries - Held that:- In the search and on the basis of material recovered and statements obtained it has been duly established that assessee was indulging in bogus accommodation entries - No actual sale and purchase was done by the assessee - Proper books of accounts were not maintained – thus, there is no infirmity in the orders of the authorities in which the books of accounts have been rejected – Decided against Assessee. Estimation of income on accommodation sale bill/turnover – Held that:- The assessee is indulging in bogus accommodation entry business and no actual sale and purchase activity has been done - The books has also been rejected and it has been noted that proper books are not maintained - a reasonable estimates @2% of investment has been made by the AO, which cannot be faulted with – though the AO has written that addition was made on the basis “accommodation fresh investment”; the method of computation of the amount of investment is not on record – thus, the matter is remitted back to the AO for fresh adjudication – Decided in favour of Assessee. Treatment of income u/s 69 of the Act – Held that:- The nature of seized documents has not been brought on record by the AO or the CIT(A) - No details has been submitted by means of paper book - Nothing is on record to suggest that the brokers were examined or the assessee was asked to produce them - the purchases have been duly registered at the circle rate specified - No addition can be made on the basis of observation of the AO that element of payment outside the books of accounts over and above the sale deed is a normal feature in property transaction – Relying upon K.P. Verghese vs. Income Tax Officer, Erankulam [1981 (9) TMI 1 - SUPREME Court] - the burden of proving is that of Revenue when there is allegation of understatement on concealment in the consideration - no addition can be made in this regard on the basis of dumb documents - the matter is required to be remitted back to the AO for fresh adjudication. Confirmation of addition amount to sale on protective basis – Held that:- The statement /affidavit of the assessee after two months of the search was an afterthought and was not backed by necessary evidences about genuine and non-genuine business - During the appellate proceedings the assessee had not been able to counter any of the findings of the authorities below with suitable evidence - the addition has been made only on protective basis – Relying upon Lalji Haridas v. ITO [1961 (7) TMI 8 - SUPREME Court] – thus, there is no infirmity in the order of the CIT(A) – Decided against Assessee.
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