Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (3) TMI 1148 - AT - Income TaxAddition on account of undisclosed brokerage income - addition is solely based on the statements recorded u/s 132(4) - HELD THAT:- No addition can be made solely on the basis of the statement recorded u/s 132(4) of the Act de hors any material found during search to support the same or any other substantial evidence gathered during post-search proceedings. The decisions mentioned in the written submissions are very much relevant for the purpose. The decision of ITAT Jodhpur Bench in the case of Chitra Devi vs ACIT [2002 (9) TMI 274 - ITAT JODHPUR] is most relevant in this regard. Accordingly, we order to delete this addition. ADDITION U/S 68 - Addition on the basis of peak creditors - unexplained cash/capital employed in debtors - CIT(A) has confirmed the addition under the Provisions of Section 69B - HELD THAT:- addition u/s 68 of the Act can be made only if any sum is found credited in the books of the assessee. A book means a collection of sheets of papers bound together with the intention that such binding shall be permanent and papers used are kept collectively in one volume. A book which contains successive entries of items maybe a good memorandum book but until those entries are totaled or balanced or both as the case may be, there is no reckoning and no accounts. A book which merely contains entries of items of which no account is made at any time, is not a ‘’book of account’ in a commercial sense. Thus the addition made u/s 68 is not justified. It is noticed that over and above the peak credit, the A.O. has further made an addition of ₹ 52,40,137/- on account of debtors exceeding the creditors. We have found that the peak determined by the A.O. is not correct, otherwise also, when once peak amount has been added then no separate addition is required. It seems that the A.O. has not properly prepared the list of debtors and creditors based on any logic CIT(A) has confirmed the addition under the Provisions of Section 69B - This section relates to investment made by the assessee in the acquisition of bullion/jewellery or other valuable articles but it does not speak about any investment in debtors. Moreover, Section 69B also stipulates the position where the investment exceeds the amount shown in the books of account. Since the assessee does not maintain any books of account wherein the debtors and creditors are reflected , therefore, this addition has also been wrongly made and upheld u/s 69B of the Act. Hence, in our considered opinion, only commission income has to be determined in this case and nothing more. Accordingly, we reverse the findings of the ld CIT(A) and order to delete the entire addition so made. Addition on account of interest income which is not the real income of the assessee - HELD THAT:- We have found that the A.O. has failed to cause enquiry in respect of these parties. In our considered opinion, the A.O. has wrongly considered the entire credits and interest entries in the hands of the assessee. Accordingly, we are in agreement with the submission of the ld. AR and order to delete the addition added on account of notional interest. Unexplained money u/s 69A - HELD THAT:- Surrender of peak amount of ₹ 52,40,137/-, we do not find and see any justification for treating the cash in question as unexplained. Such cash forms part of the peak amount surrendered by the assessee in A.Y. 2009-10 at ₹ 52,40,137/- and at ₹ 8,94,407/- in A.Y. 2010-11. In our considered opinion, no separate addition is called for on account of availability of cash. This can be out of the credits/ realization of debits of the peak amont of ₹ 52,40,137/- which has been surrendered in A.Y. 2009-10. It is also a fact that the cash found does not exceed the peak amount of ₹ 52,40,937/- which has been worked out for the period ending31-03-2009 whereas the cash has been found on a subsequent date i.e. 23-07-2009. Thus in the totality of the facts and circumstances of the case, there is no justification of treating the cash as unexplained. Consequently, the amount has been correctly deleted by the ld CIT(A). - Decided in favour of assessee.
|