Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2019 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (11) TMI 744 - AT - Income TaxLoan fund amounts raised in assessee's name or in case of the private limited concerns - HELD THAT:- Additions of the so-called embezzled funds added by way of enhancement in the CIT(A)’s order under challenge. He has himself made it clear that the assessee and his private limited companies (supra) had raised the ICICI Bank loans in question. That being the case, it can be very well inferred that the same are not unexplained cash credits. There is also no material on record in the CIT(A)’s corresponding discussion that the said loan liability has been a subject-matter of remission or cessation u/s. 41(1). So is the case with the assessee’s fixed deposits and interest finance charges which prima facie have a nexus with the loan amounts only. Faced with this factual position, we direct the AO to treat the assessee’s loan fund amounts raised in his name or in case of the private limited concerns (supra) as duly explained and grant telescoping benefit to him regarding source of his fixed deposits as well as interest / finance charges. He shall then reexamine this entire inter connected issue as per law within three effective opportunities of hearing. This interconnected issue is taken as accepted for statistical purposes. Disallowance of expenditure only in the lower appellate proceedings - HELD THAT:- DR fails to rebut the clinching fact that the impugned addition is based on estimation only than any lack of nexus with the assessee’s trading activity in various commodities. The fact also remains that the assessee has also not been able to prove the same by way of cogent supportive evidence. We therefore deem it appropriate to restore the impugned disallowance to a lump sum amount of ₹1 lac only with a rider that same shall not be treated as a precedent in any other assessment year. Claim brought forward losses sought to be set off involving sum(s) each carried forward from earlier years and disallowed in the course of assessment as well as in the lower appellate proceedings - HELD THAT:- Both the learned representatives are ad idem on the instant issue requires afresh factual verification / reconciliation of all necessary details qua the brought forward losses carried forward from earlier assessment years. We therefore restore the instant issues as well back to the Assessing Officer. Inflated purchase disallowance - Admission of additional ground - HELD THAT:- We find no merit in Revenue’s foregoing technical plea going by hon'ble apex court’s landmark decision in National Thermal Power Corporation. Ltd. vs. Commissioner of Income-tax [1996 (12) TMI 7 - SUPREME COURT] considered in tribunal’s special bench order in All Cargo Global Logistics Ltd. vs. DCIT [2012 (7) TMI 222 - ITAT MUMBAI(SB)] that we can very well entertain such an additional ground in order to determine the correct tax liability of a taxpayer provided all the relevant facts are already on record. Going by the very analogy, we admit the assessee’s instant additional ground. Coming to merits of the issue of correctness of estimated disallowance regarding assessee’s potato purchases there is no issue that both the lower authorities have already accepted the correctness of assessee’s corresponding sale figures. They have thereafter proceeded to disallow the sum in issue @ 3% on estimation basis. We find in these peculiar backdrop neither the AO nor the CIT(A) have taken into consideration the assessee’s line of potato trading business wherein such a disallowance would result in very high profit ratio. We deem it appropriate in this backdrop that lump sum addition of ₹10 lac would meet the ends of justice with a rider that same shall not be treated as a precedent in any assessment year. The assessee’s “lead” appeal for assessment year 2006-07 is partly allowed in above terms.
|