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2014 (12) TMI 480 - DELHI HIGH COURTDeletion of profits on unaccounted sales - Whether the Tribunal was correct in deleting the addition made on account of profits earned on unaccounted sales - Additions on account of unexplained cash and unexplained investments in stocks had been restored to the file of the AO for further investigations – Held that:- The Tribunal held that the assessee had surrendered about ₹ 5 lacs on account of cash found at the time of search and also ₹ 6 lacs on account of excessive stock and therefore no addition should be made on account of profits outside the books of accounts - the factum that the assessee had earned undeclared profits outside the books was accepted - the entries recorded in the diary etc. were treated as incriminating and reliable material - In case the assessee was transacting business outside the books of accounts, necessarily he would have earned profit from the transactions - Some profit would have been used for personal expenses and entertainment etc. - The entire undisclosed profits would not have been redeployed in trade or for purchase of undeclared stocks - The factor and factum has not been taken into account - the assessee was unable to explain and match the entries given in the diary and the loose papers with the entries found in the books of accounts - The transactions were for a substantial amount – the assessee had also accepted addition of ₹ 50,000/- and ₹ 1,58,910/- on account of unexplained cash and unexplained excessive stock - assessee had earlier accepted undisclosed income of ₹ 2,78,450/- in the block assessment return - thus, the matter is to be remitted back to the Tribunal for fresh determination – Decided in favour of revenue.
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