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2021 (10) TMI 161 - AT - Income TaxSuppressed sales - Addition on the basis statement of search - HELD THAT:- As assessee has admitted that there is suppression of expenditure due to business exigencies, which included unaccounted purchase of raw materials. Hence there is suppression of both purchases and sales. Accordingly, the Ld. CIT(A) has taken the view that, in the facts and circumstances of the case, the gross profit only should have been assessed instead of assessing entire suppressed sales - there is no error in the decision so reached by Ld. CIT(A). When there is suppression of both purchases and sales, then what could be assessed is the profit element embedded therein. Before us, both the parties could not show as to how the decision so reached by Ld. CIT(A) was not correct, in the facts and circumstances of the case. Hence, we are of the view that the CIT(A) was justified in directing the AO to restrict the addition to the gross profit amount in respect of suppressed sales. Accordingly, we confirm his order passed on this issue. Addition of sundry creditors balance for want of details - A.R. has submitted that the sundry creditors balance represents trade creditors and all the creditors have running account - HELD THAT:- The fact remains that the assessing officer has made the impugned addition only for the reason that the assessee has not furnished relevant details called for by him - in the interest of natural justice, we are of the view that the assessee should be provided with one more opportunity to furnish explanations and details on this issue. Accordingly, we set the order passed by Ld. CIT(A) on this issue in all the three years and under consideration and restore the same to the file of AO for examining the same afresh. After providing adequate opportunity of being heard, the AO may take appropriate decision in accordance with law. Disallowance of prior period expenses - AO made this disallowance for want of details and also for the reason that this expense did not relate to AY 2010-11 - CIT(A) confirmed the same on identical reasoning - HELD THAT:- Before us also, no detail was furnished. Accordingly, we confirm the order passed by Ld. CIT(A) on this issue.
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