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2015 (10) TMI 1487 - AT - Income TaxBusiness receipt - Held that:- Merely because a payment is reflected in AS-26 and is shown to have been made to the assessee, it cannot be brought to tax in his hands when the said money is not received by the assessee. We have noted that the stand of the assessee is that these payments made by BPCL, AIR and IOC were never received by the assessee, and the monies, received fraudulently in the name of and on behalf of the assessee, were received by some other person. Neither this aspect of the matter is examined on merits, nor any effort is made to find out through appropriate inquiries through related banks, the actual beneficiary of these payments. It is only elementary that income tax proceedings are not adversarial proceedings and the powers vested in the income tax authorities are to be used when circumstances so warrant or justify. It is a fit case in which the Assessing Officer ought to have established the trail of money and find out actual beneficiary of the payments which were admittedly made through banking channels. As a matter of fact assessee has given ample evidence that some other person had opened a bank account in assessee's name and appropriated the funds on his own, in such account. All these facts require to be properly investigated. In this view of the matter, we delete the additions in respect of monies said to have been paid by BPCL, AIR and IOC and restore the matter to the file of the AO with the direction that the same can be brought to tax in the hands of the assessee only when, a result of proper inquiries to be carried out in the light of our above observations and after confronting the assessee, it can be established that assessee was actual beneficiary of these payments. In any other case, the appropriate action is to be taken in the hands of the actual beneficiary of these payments. As far as the variation in BHEL receipts (Rs. 24,89,710), we direct the Assessing Officer to examine the explanation of the assessee on merits and in the event of these receipts having been included in the receipts disclosed for the subsequent year on account of late receipts, exclude the same for double taxation in this year as well.
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