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2016 (4) TMI 638 - HC - Income TaxCash credit entry - addition on liability towards the suppliers - Held that:- The Assessing Officer has accepted purchases of ₹ 1,09,67,551/- out of which ₹ 1,00,49,705/- stood paid during the relevant assessment year. Therefore, the remaining amount is a liability which the assessee has to discharge, which he discharged in the next financial year. How the said amount can be treated to be a cash credit entry after the purchase amount accepted by the Assessing Officer, could not be explained by the learned counsel for the Revenue. We find that the very basis of the order passed by the Assessing Officer and as affirmed by the learned Commissioner and the Tribunal is erroneous. Such amount is the liability towards the suppliers and could not be added as a cash credit entry, when the purchase of the material including the price of the material supplied by the 15 suppliers is admitted. Thus, the addition of ₹ 9,17,846/- as cash credit entry is not sustainable. Consequently said finding is set aside and the question of law is answered in negative and in favour of the assessee and against the Revenue.
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