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2016 (3) TMI 186 - AT - Income TaxAddition on account of unaccounted sales - Assessee’s main source of turnover is commission and compensation as well as services, fabrication and erection work - Held that:- Looking to the total financial exposures of the company in lieu of gross turnover, profit for the year, share capital reserve and surplus etc. and above all when all the books of accounts are audited then raising doubt on a transaction which has been carried out in the normal course of business then it was not correct on the part of the Assessing Officer to doubt about the transaction of a meagre amount without bringing on record any evidence in respect of transactions of suppressed sales. Assessing Officer should have appreciated that business is carried on by its management which has to look after its day to day activities and certainly whimsical doubt should not be raised about a transaction that goods costing of ₹ 8,05,578/- would be sold at a suppressed value of ₹ 4,42, 831/-. When the goods are three years old and are of no regular use by the company and also the fact that there is no other sale of products of the company then certainly this transaction would have occurred in a normal course of business. We do not find any reason in disbelieving the assessee. We, therefore, delete the addition - Decided in favour of assessee Proportionate disallowance of interest relating to investments meant for earning exempt income - Held that:- Assessee is having a capital reserve and surplus basis of ₹ 9.25 crores and the brought forward investment as on 31.3.2002 is ₹ 3.66 crores and it can be easily inferred from the figures that assessee was having sufficient source of capital and reserve and surplus which might have been utilized for the investments. In lack of any other evidence brought on record by the Revenue as well as respectfully following the decision of Jurisdictional High Court and decision of co-ordinate bench for various years in assessee’s own case, we are of the that no disallowance should have been made for interest in the case of assessee and we delete the same - Decided in favour of assessee
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