Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (11) TMI 264 - AT - Income TaxAddition on account of section 68 - Income to be determined on estimate basis Unexplained sundry creditors - Assessee is an individual and is engaged in trading in Iron and Steel materials under the name and style of M/s. Vaishno Steel as a proprietary concern - A search and seizure action u/s.132 of the Income Tax Act was conducted at the residential premises of Sri Satish S Luthra of Nasik during which certain books of accounts of M/s. Vaishno Steel which were belonging to the assessee were seized - AO initiated proceedings u/s.153C of the Income Tax Act Held that:- Examination of the seized materials show that blank bills/vouchers pertaining to some of the parties appearing as sundry creditors in the books of the assessee were recovered during search action u/s.132 pertains to Sri Vikas P. Guptha, i.e. assessee - Despite sufficient opportunities given, the assessee could not prove to the satisfaction of the AO regarding the genuineness of the sundry creditors appearing in the balance sheet as at 31-03-2004, 31-03-2005 and 31-03-2006. Therefore, the sundry creditors appearing in the books of account, under the peculiar facts and circumstances of the case cannot be accepted as genuine and some addition has to be made. Addition of the total sundry creditors under the facts and circumstances of the case will give absurd result which is not possible in the type of trade the assessee is engaged in Also, it is not reasonable to add 3% profit as may be determined on the unproved trade creditors - Under the facts and circumstances of the case, this is a fit case for rejection of the book results and going for estimated addition - Considering the totality of the facts and circumstances of the case, adoption of 1% Net profit on the turnover for various assessment years will be reasonable and will meet the ends of justice Decided partly in favor of Revenue.
|