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2012 (9) TMI 41 - ITAT, MUMBAIAddition on account of cash payments - survey u/s 133A - Held that:- As regards addition of Rs.5.00 lacs the assessee had explained the same as cash loans taken from Shri B.K. Sheena during April, 1998, which has also been confirmed by him giving his Permanent Account Number and addition only on the ground that cash was kept and payments were made much later is not justified in the absence of any material to show that cash loans had been utilized elsewhere - loans were reflected in the assessment records of Shri B.K. Sheena and source had been explained, addition could not have been made only on the ground that Shri B.K. Sheena had not been produced - thus the claim of loan of Rs.5.00 lacs requires fresh verification and accordingly restored back to the file of AO for fresh order - in favour of assessee for statistical purposes. Estimation of income - two sets of trading, P&L account showing different figures of net profit had been found in survey - income estimation made @8% by CIT(A)- Held that:- As the trading-cum-P&L Account found at the time of survey was only projected and the word “projected” was clearly inscribed on it assessment based on projected turnover need to be rejected - once turnover is available as per audited accounts, income has to be estimated on a reasonable basis based on turnover as labour charges and purchases are not verifiable in the absence of books of accounts which have not been produced - estimation can not be made @8% under section 44AD which is applicable only in case of turnover not exceeding Rs.40.00 lacs and in the present case, turnover is Rs.2.80 crores - As the books of account for this year are not available and, therefore labour charges and purchases can not be cross verified and no comparative case for the current period has been brought to notice it would be reasonable to estimate net profit @ 6% this year - partly in favour of assessee. Allowability of expenses against royalty income by CIT(A) - income from lease of hotel - revenue appeal - Held that:- The hotel building had been leased out along with furniture, fittings etc. for running the hotel. Therefore, income has been rightly assessed as income from other sources. No infirmity in the order of CIT(A) in allowing the claim of the assessee - against Revenue. Addition on account of House property - Held that:- The AO had assessed income from Mangalore property without giving details of the property. Assessee has denied any property at Mangalore other than agricultural property income from which has been assessed as agricultural income. Under these circumstances addition on account of house property is not justified - in favour of assessee.
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