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2018 (10) TMI 781 - AT - Income TaxAddition u/s 40A(3) - expenses which has been incurred in cash - Held that:- The addition has been made as unexplained expenditure/payment outside books of account for which addition has been made by the Assessing Officer. There is no such disallowance made u/s 40A (3) made by AO which has been claimed by the assessee as an expenditure out of the income disclosed by him. The very basis on which the ground has been raised is erroneous as application of Section 40A (3) was never a dispute. As clearly brought on record by the assessee that not only during the course of assessment proceedings but also during the course of appellate proceedings, the entries in the said loose papers were, first of all shown to be belonging to M/s. Gahoi Builwell Ltd., in whose case during scrutiny proceedings, exactly the same documents have been examined and verified and no addition has been made in the case of the said company; and secondly, the contents noted in the loose paper were reflected in the books of K4U. Once these facts are undisputed, ostensibly these additions could not have been made in the hands of the assessee at all. CIT (A) was thus correct on facts in directing the Assessing Officer to verify these facts and delete the additions. - Decided against revenue.
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