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2014 (6) TMI 539 - AT - Income TaxCapital Work-in-Progress - unexplained expenditure - additions u/s 69C - Held that:- when an assessee incurs expenditure from known sources section 69C does not get attracted; in order to invoke the section it has to be shown that the assessee had not explained about the source of such expenditure or part thereof. In the instant case there is no dispute with regard to the source of expenditure and it is also not in dispute that the assessee incurred expenditure. It is not the case of the Revenue that the assessee claimed it as business expenditure. It was only added to the "capital work-in-progress". - Decided against the revenue. Addition u/s 68 of the Act – Unexplained credits in books – Admission of additional evidence under Rule 46A of the Act - Held that:- under section 68 of the Act the AO is duty bound to prove that the assessee would have earned such additional income, by the use of the expression ‘may’ in section 68 of the Act, whereas in the instant case the AO tried to make a case on assumptions, without proving that the material available before the AO is wrong and insufficient. – Decided against Revenue. Revenue appeal before the tribunal - Commissioner has not given his reasons as to why he has authorised the AO to file an appeal on this issue - Held that:- AO has raised a soulless ground which deserves to be dismissed in limine. We could have saved a lot of time had the Commissioner not given his authorisation on such frivolous issues. On the contrary, it is incumbent upon the Commissioner, as a supervisory authority, to admonish the AO for making an addition without basic understanding of legal position. - In fact this is a peculiar case where even the Commissioner (Administration) who is supposed to supervise the proper functioning of the AO, under his charge, has allowed him to file appeals without properly examining the assessment order and the order of the learned CIT(A), which results in unnecessary expenditure to the assessee when appeal is filed by the Revenue and the assessee had to undergo the trauma of engaging counsel and paying substantial fees to defend the case when the Revenue has no case at all. - a token cost of ₹ 5,000/- imposed upon the revenue - Decided against the revenue.
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