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Showing 481 to 500 of 1570 Records
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2024 (5) TMI 1090
Maintainability of petition - appealable order - Cancellation of registration of the petitioner - non-filing of return for consecutive six months - HELD THAT:- In the instant case, the petitioner has not preferred any appeal. This allows the revenue to raise the point of alternative remedy for which the writ petition is not maintainable.
It is also correct that during March, 2020 and 28th February, 2022, the situation in the country owing to pandemic was not normal. The business entities have suffered commercial loss during this period for lack of business, at the same time filing of the returns have become irregular owing to prevailing condition at the relevant point of time. The petitioner’s default took place during the pandemic and, as such, a sympathetic consideration is required to be given keeping in mind that by retaining the order of cancellation, the petitioner will be deprived of carrying on his business which will ultimately result into the loss to the Government exchequer.
The justice will be sub-served, if, it is directed that the order impugned dated 25th January, 2022 be set aside particularly when the default in filing the return for six consecutive months being the only ground for cancellation. The order dated 25th January, 2022 cancelling the petitioner’s registration is set aside and the registration is restored back to its original position. The department is directed to permit the petitioner to file the return for the period from December, 2020 till date. If the petitioner fails to file the return within a period of three weeks from date, the restoration of the registration will be again automatically cancelled.
The petition is disposed off.
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2024 (5) TMI 1089
Maintainability of petition - availability of statutory alternative remedy - Rejection of refund of tax - relevant date - rejection on the ground that the taxpayer failed to meet the deadline for submitting the application on 29.02.2024 - whether the petitioner’s application was within the period of two years from the relevant date or not? - HELD THAT:- The petitioner has got the statutory alternative remedy of appeal against the order of rejection of claim for refund. The argument as advanced, is not such an argument, which cannot be taken before the appellate authority. The ‘relevant date’ requires determination in view of Section 54 (14), explanation 2 (a) (i) of the Act on consideration of the documents, as submitted, filed by the petitioner, to arrive a conclusion, on what date the ship in which goods were loaded left India.
In the exercise of the writ jurisdiction, this Court considers it not appropriate, at this stage to determine such question which is a disputed question of fact and requires for its determination the evidence. The said exercise, can be done effectively by the appellate authority. Consequently, we are not inclined to entertain the writ petition.
This Writ Petition is dismissed, on the ground of availability of statutory alternative remedy.
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2024 (5) TMI 1088
Maintainability of petition - availability of alternative remedy - ITC of the GST on the job work manufacturing service - applicability of circular dated 17.07.2023 - HELD THAT:- The aspect of applicability of Circular dated 17.07.2023 to the petitioner’s case, can be looked into by the Appellate Authority if such a plea is raised before the Appellate Authority. It is not such a ground which cannot be taken in appeal.
Any plea of the order being without jurisdiction, or in violation of the principles of natural justice or in violation of the Fundamental Rights has not been raised before us during arguments. There is also no challenge to the vires of any statutory provisions - Any judgment on the point has not been placed before us to take a view contrary to the prima facie view taken in the order dated 02.04.2024 on entertainability of the writ petition in the presence of statutory alternative remedy of appeal.
The writ petition is dismissed only on the ground of availability of the statutory alternative remedy.
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2024 (5) TMI 1087
Delay in filing special leave petition - Nature of expenses - re-characterizing revenue expenses incurred by as capital expenditure by AO - correct approach in law and on the facts adopted or not? - As decided by HC [2023 (10) TMI 329 - DELHI HIGH COURT] on perusal from the assessment order would show that what worried the AO was that the assessee had made no effort to earn income.
Proposition put forth by the AO that since there is no income chargeable u/s 28 of the Act, therefore, no expenses could be claimed by an assessee u/s 30 to 37 of the Act, in our view, is completely unsustainable. This position has also been affirmed by the Tribunal.
HELD THAT:- There is delay of 152 days in filing the present special leave petition. Even on merits, we do not see any good ground and reason to interfere with the impugned judgment.
Recording the aforesaid, the application for condonation of delay and consequently the Special Leave Petition are dismissed.
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2024 (5) TMI 1086
Carry forward and set off of unabsorbed depreciation without any limitation of period - carry forward after period of 8 years - As decided by HC VISHALDEEP SPINNING MILLS LTD [2023 (7) TMI 20 - GUJARAT HIGH COURT] once the Circular No.14 of 2001 clarified that the restriction of 8 years for carry forward and set off of unabsorbed depreciation had been dispensed with, the unabsorbed depreciation from A.Y.1997- 98 upto the A.Y.2001-02 got carried forward to the assessment year 2002-03 and became part thereof, it came to be governed by the provisions of section 32(2) as amended by Finance Act, 2001 and were available for carry forward and set off against the profits and gains of subsequent years, without any limit whatsoever - HELD THAT:- We are not inclined to interfere with the impugned judgment and order passed by the High Court. Hence, the Special Leave Petition is dismissed.
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2024 (5) TMI 1085
Validity of order passed u/s 92CA - jurisdiction to pass an assessment order post limitation period - second reference made to TPO - objection of limitation noting that Section 144C (8) - petitioners had argued that the period of nine months when computed from the passing of the order of the ITAT would have come to an end on 31 December 2018 - HELD THAT:- The order of the ITAT dated 14 July 2017 and to the extent that certain aspects were remanded for the consideration of the TPO directly were neither questioned nor assailed at any time by the respondents. In fact, and as the writ petitioners have rightly pointed out, the aforesaid directions as framed were duly acknowledged and accepted and which fact becomes evident from not only the various notices which were issued by the jurisdictional AO and form part of our record such as but also by the action of the TPO itself which had proceeded to pass an order on 17 October 2017. It thus becomes apparent that the principal order of the ITAT dated 14 July 2017 had come to be duly implemented by the TPO on 17 October 2017 itself.
Once the TPO had proceeded to pass the order of 17 October 2017, all that the AO was obliged to do was pass an assessment order in accordance with the procedure prescribed in Section 92CA (4) of the Act.
The original order of assessment dated 21 February 2014 ceased to exist in light of the directions as framed by the ITAT on 14 July 2017. Consequently and in terms of the aforesaid order of the ITAT, a fresh order of assessment was liable to be drawn before the expiry of nine months from the end of the relevant financial year. It is conceded on behalf of the respondents that the aforesaid period undoubtedly came to an end on 31 December 2018.
We, additionally, find that the prescription of nine months would also be applicable to a fresh order which is liable to be made in accordance with Section 92CA of the Act. This since Section 153 of the Act speaks not merely of assessments but also orders that are liable to be framed u/s 92CA.
The order which is spoken of in Section 92CA of the Act, as explained above, is the one which the TPO may come to make in accordance with sub-section (3) thereof. It is thus manifest that the assessment exercise was liable to be concluded within a period of nine months when computed from 14 July 2017.
Although the TPO had acted in pursuance of the order of the ITAT and proceeded to pass an order on 17 October 2017, the jurisdictional AO for reasons unknown and undisclosed, chose not to pass a consequential assessment order as mandated by Section 92CA (4) of the Act. What the AO, however, chose to do was make a fresh reference on 27 December 2018 requiring the TPO to pass an order in accordance with the judgment of the ITAT dated 14 July 2017. That reference was clearly unmerited since the TPO was obliged to act in accordance with the directions of the ITAT. It had in any case already taken all consequential steps in terms thereof and passed an order on 17 October 2017.
We are therefore of the firm opinion that in light of the directions as were formulated by the ITAT and stood embodied in its order of 14 July 2017, no fresh reference as the AO chose to make was warranted. Once the ITAT had chosen to remit the matter directly to the TPO, the said authority was legally obliged to proceed in accordance therewith and did not need to derive any authority from a reference being independently made by the AO.
Section 92CA (1) reference rests solely upon the AO being of the opinion that a reference is required to be made to the TPO for computation of ALP. That power stands conferred upon the AO and is available to be exercised in the course of assessment.
Section 153 (3) of the Act speaks of assessments as well as orders under Section 92CA that may be required to be made pursuant to an order passed by an ITAT in exercise of its appellate jurisdiction comprised in Section 254 of the Act. In our considered opinion, the reference which the AO proceeded to frame on 27 December 2018 was thus clearly superfluous and in any case cannot be sustained on the basis of Section 153 (4) of the Act.
Whether Order of 14 July 2017 should be construed as being a reference governed by Section 153 (4) and consequently the expanded period of limitation of twelve months becoming applicable? - We find ourselves unable to sustain that submission bearing in mind the indubitable position which emerges from a plain reading of Section 153 (3) of the Act and which encompasses and makes adequate provisions for a fresh order u/s 92CA (4) being liable to be made pursuant to an order of the ITAT u/s 254 of the Act. Since the aforesaid contingency is already provisioned for in sub-section (3), there would exist no justification for such an order of the ITAT being placed or viewed as traceable to sub-section (4) of Section 153 of the Act.
Tested on the undisputed facts, we find that the period of nine months when reckoned from 14 July 2017 undoubtedly came to an end on 31 December 2018. Once that terminal point was reached, the respondent clearly stood deprived of jurisdiction or authority to pass an order of assessment pursuant to the directions of the ITAT. We have already found that the TPO had acting in terms of the directions as framed by the ITAT already passed a consequential order on 17 October 2017. All that was required of the respondents thereafter was for the AO to frame an order of assessment in accordance therewith.
This, for reasons unfathomable, was something which the AO failed to do. The second reference which was thereafter framed by the AO and was dated 27 December 2018 for reasons aforenoted was clearly unwarranted and in any case cannot be viewed as conferring a fresh lease of life to the power to assess.
Thus while we refuse to interfere with the order of the DRP impugned herein, we allow the instant writ petition and hold that the second respondent stands barred in law from passing any further orders of final assessment pertaining to AY 2009-10. The petitioner shall consequently be entitled to all consequential reliefs.
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2024 (5) TMI 1084
Provisional attachment order u/s 281B - seeking revocation of the attachment of Fixed Deposit Receipts (FDRs) - HELD THAT:- By communication issued by ACIT (Hq) on behalf of PCIT (Central), Kanpur Nagar, as intimated to the DCIT approval was accorded for extension of provisional attachment u/s 281B of the FDRs in the above mentioned case. Reference is also invited to the letter dated 07.02.2024 filed by the assessee to this office vide which the assessee has requested for releasing the FDR in view of the hardship faced in the business of the assessee. Your attention is also invited to the Hon'ble High Court order [2024 (5) TMI 979 - ALLAHABAD HIGH COURT] in the above matter.
Considering the petition of the assessee and Hon'ble High Court Order as directed to convey that the Ld. PCIT (Central) Kanpur has been pleased to revoke all the provisional attachments made u/s 281B of the IT. Act, 1961 of the FDRS in the above mentioned case
Therefore directed to request you to kindly take immediate necessary steps for releasing all the FD etc, under intimation to this office. An action taken report must be sent to this office positively within a week of receipt of the letter. In view of the above, we find corrective action has been taken, in the present petition.
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2024 (5) TMI 1083
Nature of receipt - money receipt on account of relinquishment of its right to operate a hotel as a licensee - capital receipt or business receipt - HELD THAT:-Appellant has carried us to various findings recorded by the AO in the assessment order, terms of agreement, settlement agreement and the consent terms recorded by the sole Arbitrator.
As respondent/assessee states that he shall argue the matter tomorrow.
In view of the aforesaid, put up tomorrow [i.e. 15.5.2024] for further hearing at 10.30 am.
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2024 (5) TMI 1082
Estimation of income - bogus purchases - Assessee approached the co-ordinate Bench for A.Y. 2012-13 wherein the addition was restricted to 3% of gross profit - As assessee has already declared gross profit rate of 1.42% for the year, balance 1.58% was confirmed - HELD THAT:- By this time neither the registry nor the parties informed the Bench that AO has filed an appeal against the same order though the appeal of the Revenue was filed on 3rd October, 2023. Had it been known to the Bench that the cross appeal of the Revenue is pending, perhaps that would have been heard and disposed off together. It would have been duty of the Registry to tag the cross appeals and fixed them together for hearing.
However, in this case as the issue is already decided by the co-ordinate Bench that assessee should have been earned the excess gross profit of only 1.58%, the appeal of the Revenue becomes infractuous. Accordingly, we dismiss the same.
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2024 (5) TMI 1081
Admissibility of additional evidence - LTCG - Deduction u/s 54F - Evidences filled by assessee to establish the fact that agricultural land at the time of sale was not a capital assets and that otherwise the sale consideration was invested in accordance with provisions of section 54F was rejected for the reason that the same were not placed before the AO - HELD THAT:- We are of considered view that same certainly would require taking into consideration the evidences which were filed as additional evidences by invoking provisions of Rule 46A.
We are of considered view, that CIT(A) has fallen in error in not admitting the additional evidence and the additional grounds by relying on the decision of Goetze (India) Ltd. [2006 (3) TMI 75 - SUPREME COURT] - There is no justification to deny the additional ground and additional evidences for mere failure to take the same before the AO. The settled proposition of law being that powers of CIT(A) are co-terminus to AO - There is no prohibition under law that as CIT(A) cannot accept additional claim without assessee revising the return. Accordingly, we considered it to be an appropriate case to allow the appeal for statistical purposes only.
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2024 (5) TMI 1080
TP Adjustment - interest on outstanding receivables - international transaction or not? - Determination of Arm's Length Price (ALP) - HELD THAT:- The issue is no longer res integra. Hon'ble Bombay High Court took a view in the case of CIT Vs. Patni Computer Systems [2013 (10) TMI 293 - BOMBAY HIGH COURT] on the amendment to Section 92B of the Act by way of Finance Act, 2012 with retrospective effect from 01/04/2002 that, the interest on outstanding receivables is an international transaction, and it certainly requires separate benchmarking.
There is no dispute that the learned DRP in the directions dated 08/06/2022 directed AO to adopt the SBI short term deposit interest rate for the subject year as the ALP interest rate and re-compute the adjustment to be made to the total income by applying credit period of thirty days or as per the agreement or invoice. There is no appeal by the Revenue as to this direction in respect of application of credit period of thirty days or as per the agreement of invoices. AO is, therefore, under the obligation to verify the invoices and apply the credit period of either thirty days or as per agreement or invoices, whichever is longer.
Rate of interest - We are of the considered opinion that the ends of justice would be met by accepting the interest rate on similar foreign currency receivables/advances as LIBOR+200 points, by applying the credit period of thirty days or as per agreement or invoice. Accordingly, we direct AO/TPO to re-compute the same. Grounds are allowed in part accordingly.
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2024 (5) TMI 1079
Capital Gain on sale of plant - real owner - capital asset in the name of assessee or not? - HELD THAT:- As abundantly clear that the assessee has never admitted that the sale cum GPA executed by M/s. Deccan Townships Pvt Ltd with regard to remaining 10 acres was in the name of the assessee - also not admitted by the assessee that the assessee will submit the capital gain computation and pay the resultant tax in due course.
As abundantly clear there was no admission in the eyes of law to pay the tax dues based on the statement recorded u/s. 132 rather the assessee has only sought time to file the copy of the sale deed for the remaining Ac 10-00 gts of land and paying the taxes after computing the capital gains. In fact, this statement was also retracted by the assessee before filing the return of income. Even otherwise, no addition can be made in the hands of the assessee, u/s 153A in the absence of incriminating material.
Undoubtedly, the capital asset has been defined in section 2(14) of the Act which provides that “an asset which is held by the assessee and not connected with the business or profession of the assessee is required to be treated as capital asset.” Admittedly, the land admeasuring Ac. 10-00 is owned and registered in the name of A. Vindhyavali and not in the name of the assessee.
The registered document clearly shows that the property was owned, registered and held by Smt. A. Vindhyavali who is not connected with the assessee in any manner. Thus, it is clear that the land owned by Smt. A. Vindhyavali was not a capital asset in the hands of the assessee and therefore, no addition can be made in respect of such land for capital gains arising out of the sale of the capital asset.
Admittedly, the assessee was only the owner of Ac. 22-27 gts, and assessee has offered the STCG in the FY 2019-20 relevant to the AY 2020-21. This has been recorded by the AO in the order itself.
With respect to the objection of the Revenue that no opportunity of hearing was given to the AO before relying upon the sale deeds. It will be sufficient to mention here that the AO mentioned about the sale deeds with respect to the agricultural land and AO further referred to the sale cum GPA entered by the assessee.
CIT(A) has granted the relief based on the Agreement of sale cum GPA dated 19/08/2019 wherein it is clearly mentioned that the assessee was only the owner of Ac. 22-27 gts. Though the ld.CIT(A) had also referred to the other registered sale deed in the name of Smt. A. Vidhyavali for the purpose of concluding that the assessee was not the owner of the Ac. 10-00 gts.
CIT(A) has decided the issue solely on the basis of registered documents which are admissible in law as they are “documents in rem” and we also draw the strength from Explanation to Section 3 of the Transfer of Property Act, 1882 which provided that “any document which is registered shall be deemed to have notice of registration”. CIT(A) had decided the issue on the basis of the documents available with the Ld. AO. Thus, there is no violation of the principle of natural justice and Rule 46A of the IT Rules, 1962.
There is no error in the reasons given by the learned CIT (A) to delete the addition made by the AO towards the capital gain derived from sale of land. Decided against revenue.
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2024 (5) TMI 1078
Unexplained investment - Addition for payment made to company - submissions of assessee regarding genuine share transactions denied - HELD THAT:- It is a fact that the total investment were through banking channel and specific after withdrawals from Axis Bank Account - Once source of deposits of this account is explained and admitted then again making addition on account of withdrawals from there amount it unjustified. Assessee had made withdrawals in Goa during family visit,
The addition is on account of credit in bank account or somewhere else is totally irrational. Once the source of deposit is explained then making of addition on account of withdrawals of amount is erroneous.
Addition from undisclosed source which is part of circulation of cash transaction is regarding the bridal business. Assessee claimed that deposits were taken from customers as security and later on when bridal dresses and ornaments were returned the same were refunded.
AO and CIT(A) erred in holding 30% of deposits merely on the basis of suspicion. Considering the nature of business of hiring bridal items by the assessee the gross income generated therefrom of Rs. 4,25,562/- and accepted by the department, the security amount can easily be calculated at 10% times of the hire charges, which works out at Rs. 38,68,745/-.
Therefore assessee had satisfactorily explained the bank entries regarding cash deposits and withdrawals. In view of above material facts and circumstances passing of impugned orders has led to miscarriage of justice which is required to be remedied. Assessee appeal allowed.
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2024 (5) TMI 1077
Delay in filing of appeal against order denying grant of registration u/s 12A and 80G - Exemption u/s 11 - Delay in filing of appeal by approximately 4½ years - HELD THAT:- From the contents of the Affidavit filed by the accountant, it is seen that the assessee was operating in remote part of the village with only one accountant, who was working on a part time basis. In the case of Collector Land Acquisition, Anantnag vs. MST Katiji and others [1987 (2) TMI 61 - SUPREME COURT] held that it is well established that rules of procedure are handmaid of justice. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred. Accordingly, there is no mala fide intention in filing appeal against the order denying grant of registration u/s 12AA r.w.s. 80G of the Act. Accordingly, in the interest of justice, we are hereby condoning the delay.
Non-granting of registration u/s 12A and 80G - CIT observed that though the assessee is an educational trust, but it is collecting substantial amounts from it’s students towards meal and hostel fees, registration fees, admission fees etc, thus the assessee is primarily running a profitable business and not doing any charitable activity - HELD THAT:- On going through the facts of the instant case, considering the model of education, being residential boarding and hostel facility, followed by the assessee / applicant trust, the fact that on identical set of facts the assessee / applicant trust has also been granted provisional registration from A.Y. 2022-23 to A.Y. 2024-25, we are of the considered view that it is a fit case where the matter should be restored to the file of Ld. CIT for de-novo consideration of assessee’s claim for registration u/s 12A/80G of the Act, after giving due opportunity of hearing to the assessee. Accordingly, in the interest of justice, looking into the facts of the instant case, we are hereby restoring the matter to the file of Ld. CIT for de-novo consideration and to pass appropriate orders, in accordance with law, after giving due opportunity of hearing to the assessee to present it’s case on merits.
Denial of exemption u/s 11 as assessee did not have the requisite registration under Section 12A - HELD THAT:- Since we have already restored the issue regarding grant of registration under Section 12A of the Act to the file of CIT for de-novo consideration, accordingly, the present issue also is directed being restored to the file of Assessing Officer with a direction to pass appropriate orders in light of disposal of application of the assessee for grant of registration under Section 12A of the Act, in the set-aside proceedings.
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2024 (5) TMI 1076
Addition u/s 80JJAA - claim denied Assessee failed to file the Form 10DDA within the prescribed time under the Statute - HELD THAT:- From the facts placed on record, it is observed that the chartered accountant of the assessee filed Accountant’s report in Form 10DA before the due date of filing of return of income. This position has not been disputed by the Department.
Admittedly, the above report was not accepted by the assessee before the due date of filing of return of income. Report in Form 10DA filed by the accountant of the assessee was accepted by the assessee on 06.01.2023, whereas in this case the order u/s 143 (1) was passed on 16.03.2023, denying the claim of deduction u/s 80JJA which means that at the time when the order u/s 143(1) of the Act was passed by the CPC, the assessee had accepted the Report filed by the accountant of the assessee in Form 10DA.
It would be useful to reproduce the relevant extracts of the decision of in the case of Association of Indian Panel Board Manufacturer [2023 (3) TMI 1374 - GUJARAT HIGH COURT] in which the Gujarat High Court, while dealing with similar issue held that although the requirement of furnishing report was mandatory, filing thereof is a procedural aspect. Once, it is seen that the audit report, in Form 10B was available with the assessing officer at the time of framing of assessment, even though the same may not have been filed along with the return of income, the assessee is entitled to claim of exemption u/s 11(1) and 11(2) of the Act.
We are of the considered view that the claim of the assessee/appellant for deduction u/s 80JJA of the Act cannot be denied for the reason that firstly, the chartered accountant of the assessee had uploaded Form 10DDA before the due date of filing of return of income, and it was only because of procedural lapse/mistake on the part of the appellant/assessee that the aforesaid form could not be accepted before the due date of filing of return of income, secondly, the assessee/appellant had duly accepted the Form 10DDA before the return of income was processed by the CPC on 16.03.2023, thirdly, the Gujarat High Court, has on similar facts observed that although the furnishing of report for claiming the deduction/exemption is mandatory requirement, the mode and stage of filing thereof is a procedural aspect and if the requisite audit report is available with the assessing officer before the assessment order is framed, then the claim of deduction cannot be denied to the assessee/appellant, even if the audit report may not have been filed along with the return of income. Appeal of the assessee is allowed.
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2024 (5) TMI 1075
Addition u/s 69 - Addition based on assessee made disclosure of his income during the course of survey operations - AO taxed this amount u/s 115BBE - CIT(A) confirmed the addition by holding that the appellant had failed to explain the source of investment - HELD THAT:- Both the AO as well as the CIT(A) had fell in serious error in resorting to the provisions of section 69, inasmuch as, the investments were not made during the previous year relevant to the assessment year under consideration. No doubt, the admission is extremely an important piece of evidence but it cannot be said that it is conclusive as observed in the case of Pullangode Rubber Produce Co. Ltd. v. State of Kerala [1971 (9) TMI 64 - SUPREME COURT]
It is always open to an assesee to show that it is incorrect. From the material on record, it is patently clear that the acquisition of assets in respect of which the addition was made were acquired prior to the previous year relevant to the assessment year under consideration. Therefore, provisions of section 69 cannot be invoked for the year under consideration. The question of offering any explanation in support of the source for the acquisition of the said assets does not arise for the year under consideration as said investment was not made during the previous year relevant to the assessment year under consideration. Therefore, the reasoning adopted by the CIT(A) is totally contrary to the settled position of law, which cannot be appreciated/sustained. Assessee appeal allowed.
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2024 (5) TMI 1074
Additions made based on the statement recorded during the course of survey - Estimation of gross profit rate - the assessee by way of an Affidavit retracted the statement recorded u/s. 133A - HELD THAT:- We find that the AO is not correct in making the addition as the undisclosed income of the assessee, whereas CIT(A) has made thorough analysis of the income of the assessee project-wise and estimated the gross profit at 12.5% which does not require any interference.
CIT(A) given direction to the reopen the other Assessment Years and recompute the income for the Assessment Years 2009-10 to 2016-17. Thus the grounds raised by the Revenue is devoid of merits and the same is hereby dismissed. Appeal filed by the Revenue is hereby dismissed.
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2024 (5) TMI 1073
Addition u/s 68 r.w.s. 115BBE - unexplained cash deposits during the demonetization period - assessee explained that this amount was deposited out of sale proceeds and past savings - HELD THAT:- AO did not point out any discrepancy in the purchases, sales and stocks recorded by the assessee in the books of accounts. In the circumstances, only an assumption that there could be some cash deposits based on the higher turnover in cash sales when compared to the cash sales made by the assessee in the immediately preceding assessment year is not correct.
Thus, in the absence of any adverse finding by the AO that the purchases, sales and stock are not genuine and in the absence of rejection of books of account, there is no justification in assuming that the assessee has made cash deposits outside the books of accounts. Thus, the addition made by the AO u/s 68 of the Act is delete. Decided in favour of assessee.
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2024 (5) TMI 1072
Unexplained credit u/s 68 - addition of entire credit entry by holding that the assessee failed to substantiate the transaction in any document - assessee received commission of 0.50% per Rs. 100/- - assessee failed to produce the details of any person for whom the assessee discounted cheque or given cash after receiving cheque or draftand no details were provided by the assessee, no bifurcation of amount was provided by the assessee - As assessee submits that the assessee used to earn commission in such manner from very small means of persons as nature of business does not require any capital to be invested. In the bank account, no huge balance ever remained at any point of time. Merely the assessee was unable to file party wise details, entire bank transaction cannot be taxed as income.
HELD THAT:- We find that no details of customer or persons to whom the assessee made transactions is given. Assessee in his submission explained that no details of such persons are maintained and the nature of business is peculiar.
This Tribunal in various cases as relied by the ld. AR of the assessee has made/restricted the addition @ 0.125% to 0.35%, however, this combination in case of ITO Vs Shri Deepak Viothaldas Suchak [2021 (8) TMI 1028 - ITAT SURAT] wherein the ld. CIT(A) restricted the addition on similar type of transaction @ Rs. 50 per lac on total turnover of Rs. 98.22 crores. However, on appeal before the Tribunal, this combination increased the disallowance to Rs. 75 per lac, therefore, taking a consistent view, the addition made in the assessment order in the case of assessee is restricted to Rs. 75/- per lakh i.e. 0.75% for Rs. 100/-.
On perusal of details of entire transaction, we find that amount deposited through cheque is of Rs. 2.05 crore and cash deposited only Rs. 18.7 lacs. The cheque returns amount is aggregating Rs. 17.22 lacs. Thus, net credit in the bank account is only Rs. 2.07 crores. Hence, the assessing officer while giving effect of this order shall consider aggregate amount in bank account of Rs. 2.07 Crore. With this observation, the grounds of appeal raised by the assessee is allowed partly
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2024 (5) TMI 1071
Interest levied u/s 220(2) on non-payment of FBT demand, including interest - as against refund due, an amount was adjusted, which comprised of outstanding Fringe Benefit Tax (FBT) demand u/s 115WE - case of the assessee that no intimation or notice of demand was served on the assessee qua the FBT liability - As submitted, suo motu, the assessee deposited FBT demand , despite that, FBT demand was again recovered from the refund due along with the interest levied u/s 220(2) - HELD THAT:- There cannot be levy of interest under section 220(2) of the Act for alleged non-payment of FBT liability. Furthermore, the record reveals that once the assessee came to know the fact that the demand relating to FBT liability was appearing in the portal of the Income Tax Department, it had opened a communication channel with the AO continuously seeking information regarding service of intimation and demand notice creating such liability. However, the requests of the assessee failed to evoke any response from the AO.
These are admitted facts on record on record as learned first appellate authority has not disputed assessee’s claim. The reason for negating assessee’s claim is, the assessee was aware of the tax liability uploaded by Revenue on e-filing portal.
Mere reflection of demand on e-filing portal does not absolve Revenue from properly serving the intimation and demand notice qua the FBT liability pertaining to assessment year 2009-10. Pertinently, in course of hearing of the present appeal, a report of the AO was called for with regard to assessee’s claim of non-service of intimation and demand notice pertaining to FBT liability.
However, the Revenue has failed to furnish any material before us, which can establish that the intimation and demand notice concerning FBT demand was ever served on the assessee. Though, it may be a fact that the assessee might have discharged the FBT liability appearing on the portal of the Income Tax Department in the year 2018, but that act of the assessee, by itself, cannot fasten interest liability under section 220(2) of the Act upon the assessee. Assessee appeal allowed.
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9911796707
