Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2010 (9) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2010 (9) TMI 848 - KERALA HIGH COURTAddition under Section 69C – appellate authority partly allowed the appeal by deleting additions made as such but by sustaining addition of only peak of the purchases - Tribunal on second appeal cancelled the entire additions on the ground that section 69C is not applicable - Held that:- It is seen from the assessment orders that AO has accepted the profit arrived under the profit and loss account and only one addition under Section 69C is made. If the addition under Section 69C has lead to disallowance of cost of materials purchased, then the same cannot be sustained. Therefore, the entire account and transactions call for examination before making addition under Section 69C. Further, in view of the fact that the purchase account does not record correct position, it is for the officer to examine the correctness of the other accounts maintained by the assessee. Thus the Tribunal was not justified in allowing the appeals by holding that Section 69C is not applicable. In fact, in our view Section 69C applies to the facts of this case but what we feel is addition under Section 69C when it relates to purchases, the genuineness of which are not doubted should not lead to disallowance of expenditure on purchases - remand the matter to the AO for reconsideration.
|