Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2021 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (4) TMI 247 - AT - Income TaxEnhancement of income of the assessee by CIT-A - estimation of profit on turnover - CIT(A) after giving enhancement notice u/s. 251(2), enhanced the income of the assessee at 8% on the total turnover after reducing cash deposits - HELD THAT:- CIT(A) after giving enhancement notice u/s. 251(2) enhanced the income of the assessee at 8% on the total turnover after reducing cash deposits without considering the actual transactions statement, which was available before him, in which, there is a loss. Once the AO had considered and satisfied with these transactions that there is a loss, in our considered view, the CIT(A) again cannot enhance the income without rejecting the facts which were available before him. The purchase and sales are clearly reflected in that statement. No doubt the transactions were outside the books of account but the sales have been accepted by ld. CIT(A). Once the sales have been accepted the purchases cannot be denied i.e. both purchases and sales are genuine. In the statement, which is placed in paper book there is a loss of ₹ 17,69,957/- which is a genuine loss calculated. Therefore, the ld. CIT(A) cannot estimate profit on the turnover. Therefore, we are of the view that the CIT(A) was not justified to make enhancement on the income of the assessee. Thus, we uphold the action of the AO regarding carry forward & set off of loss as the assessee did not file his return of income within the prescribed time. Addition on account of dividend received from M/s. Sriram Chits - The authorities below were justified in making addition on this count as the dividend received was not reflected in the return of income filed by the assessee. Addition on account of interest on OD facility and interest on mortgage loan - We are of the view that once the income has been estimated on certain percentage based on the under the head "income from profit and business or profession, then, other disallowances on account of expenditure cannot be made. Therefore, the AO was not justified in making further addition after estimating the income of the assessee on the turnover. Therefore, this ground is partly allowed.
|