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 686 - AT - Income TaxEnhancing the income of the assessee u/s 40A(2)(b) by CIT - enhancement in respect of purchases made from sister concern and on account of suppressed sale to the sister concern - Submission of assessee that the learned CIT(A) is not empowered to make enhancement in respect of a new source of income which is not the subject matter of the assessment order and which has not been considered by the Assessing Officer - HELD THAT:- Since, the facts of the instant case are identical to the case decided by the Co-ordinate Bench of the Tribunal in the case of Hari Mohan Sharma [2019 (2) TMI 113 - ITAT DELHI], therefore, respectfully following the same, we hold that the learned CIT(A) in the instant case was not justified in enhancing the income of the assessee in the form of new source of income which has not been considered by the Assessing Officer and thus he had exceeded his jurisdiction u/s 251(1)(a) of the Act. Accordingly, grounds no. 3, 4 and additional grounds are allowed. Addition u/s 36(1)(iii) - Addition being interest @12% per annum for two days on account of advance of ₹ 2,20,00,000/- given to one of its supplier - CIT(A) sustained the addition made by the Assessing Officer on the ground that the assessee is not into business of lending of money - HELD THAT:- A perusal of the audited balance sheet, copy of which is placed at page 18 of the paper book shows that the share capital and reserves and surplus of the assessee company at the beginning of the year was ₹ 11,93,456.12/- and at the close of the year was ₹ 11,67,33,870/-. Thus, own capital and free reserves of the assessee company throughout during the year was much more than the interest free advance of ₹ 2,20,00,000/- given to M/s Lakshya Overseas. We, therefore, respectfully following the decision of Reliance Utilities and Power Ltd. [2009 (1) TMI 4 - BOMBAY HIGH COURT] hold that the learned CIT(A) was not justified in sustaining the addition of ₹ 14,194/- made by the Assessing Officer u/s 36(1)(iii) of the Act. Under valuation of closing stock - as submitted that the learned CIT(A) has not considered the submission of the assessee on this issue properly, if given an opportunity, the assessee is in a position to substantiate either before the Assessing Officer or learned CIT(A) that there is no undervaluation of closing stock - HELD THAT:- Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore this issue to the file of the Assessing Officer with a direction to give one final opportunity to the assessee to substantiate its case that there is no undervaluation of closing stock and decide the issue as per fact and law. We hold and direct accordingly. Ground raised by the assessee is allowed for statistical purpose.
|