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2015 (5) TMI 847 - ITAT CHENNAI

2015 (5) TMI 847 - ITAT CHENNAI - TMI - Undisclosed investment in the money lending business - CIT(A) deleted the addition - Held that:- A bare reading of the assessment order shows that the Assessing Officer accepted the computation made by the assessee with regard to the outstanding amount at ₹ 23,52,000/- as per the transaction found in the seized material. The Assessing Officer also determined the outstanding amount as per the transaction entered in the seized material at ₹ 19,10 .....

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ties are set aside and the issue with regard to unexplained investment in the money lending business is remitted back to the file of the Assessing Officer to examine the issue afresh in the light of the provisions of Section 158BB of the Income-tax Act, 1961 - Decided in favour of revenue for statistical purposes.

Disallowance of bad debts - CIT(A) deleted the addition - Held that:- Admittedly, the assessee has not maintained any books of account. Only during the course of search oper .....

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bad debts is also not available. In the absence of such details, this Tribunal is of the considered opinion that the issue has to be reconsidered by the Assessing Officer. Accordingly, the orders of the lower authorities are set aside and the issue of bad debts to the extent of ₹ 16,60,000/- needs to be re-examined by the Assessing Officer. - Decided in favour of revenue for statistical purposes.

Unaccounted investment in the money lending business - CIT(A) deleted the addition .....

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ce of his family. He, according to the Ld. D.R., admitted that the money lending business belonged to him. In those circumstances, this Tribunal is of the considered opinion that the matter needs to be reconsidered after considering the assessment made in the hands of Shri Subramanian, the assessee’s son. Accordingly, we issue remitted back to the file of the Assessing Officer for reconsideration in the light of the material available on record - Decided in favour of revenue for statistical purp .....

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red opinion that the valuation of the building has to be made only on the basis of State PWD rates. Accordingly, we set aside the orders of the lower authorities and the issue of cost of construction with regard to Aranthangi building is remitted back to the file of the Assessing Officer. - Decided in favour of assesse for statistical purposes. - ITA Nos. 1207 & 1208/Mds/2011 - Dated:- 15-5-2015 - SHRI N.R.S. GANESAN AND SHRI A. MOHAN ALANKAMONY, JJ. For The Appellant : Dr. S. Moharana, CIT .....

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undisclosed investment in the money lending business. According to the Ld. D.R., during the course of survey operation, the revenue authorities found that the assessee has made advances to the extent of ₹ 67,38,155/- on 30.11.1997 to various persons. The assessee clarified that the above said sum of ₹ 67,38,155/- was the outstanding amount in his money lending business. The assessee also explained to the authorities that out of ₹ 67,38,155/-, a sum of ₹ 50,02,000/- was t .....

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terial, the Assessing Officer found that the total recovery of loan upto the date of search was ₹ 26,50,000/- and the total outstanding was ₹ 23,52,000/-. The Ld. D.R. further submitted that the interest element to the extent of ₹ 4,41,700/- was deducted in advance and embedded in the total loans advanced to various persons. The Assessing Officer verified and allowed the claim of the assessee. The Assessing Officer determined the outstanding amount as on the date of search as & .....

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e sheet is ₹ 19,10,300/-. Therefore, no addition was warranted to the money lending business. It is not known how the addition of ₹ 12,00,300/- was made by the Assessing Officer. Therefore, the CIT(Appeals) deleted the addition subsequent to his decision with regard to bad debts. 6. We have considered the rival submissions on either side and perused the relevant material on record. A bare reading of the assessment order shows that the Assessing Officer accepted the computation made b .....

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d to be provided by the assessee. Since the facts are not clear from the orders of the lower authorities, this Tribunal is of the considered opinion that the matter needs to be reconsidered by the Assessing Officer. Accordingly, the orders of the lower authorities are set aside and the issue with regard to unexplained investment in the money lending business is remitted back to the file of the Assessing Officer. The Assessing Officer shall examine the issue afresh in the light of the provisions .....

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rises for consideration is with regard to the claim of the assessee towards bad debts to the extent of ₹ 16,60,000/-. 8. Dr. S. Moharana, the Ld. Departmental Representative, submitted that the assessee claimed bad debts to the extent of ₹ 16,60,000/- out of the total outstanding loan which was determined by the Assessing Officer at ₹ 19,10,300/-. According to the Ld. D.R., the loan was not written off in the books. In response to the Question No.5, during the course of examina .....

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assessee, submitted that the seized material has to be taken in toto. The seized material shows the outstanding amount as on the date of search, in the money lending business and it also shows the bad debts. The CIT(Appeals), after referring to the seized material in which the profits were written, allowed the claim of the assessee to the extent of ₹ 16,60,000/-. Therefore, according to the Ld.counsel, the CIT(Appeals) has rightly deleted the addition. 10. We have considered the rival sub .....

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e seized material regarding bad debts. Furthermore, the details of money lent to the individuals are not available and with whom the assessee written off the loan amount as bad debts is also not available. In the absence of such details, this Tribunal is of the considered opinion that the issue has to be reconsidered by the Assessing Officer. Accordingly, the orders of the lower authorities are set aside and the issue of bad debts to the extent of ₹ 16,60,000/- needs to be re-examined by t .....

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pocket diary, the assessee found to have invested a sum of ₹ 29,37,400/- in money lending business. On examination of one Shri C. Subramanian, who is son of the assessee, clarified that he is looking after the business of the assessee and the diary was hand written of his father. However, the CIT(Appeals) deleted the addition on the ground that the money lending business is belonging to the assessee s son Shri Subramanian. According to the Ld. D.R., in the absence of any material and in th .....

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n the Assessing Officer accepted the return of the assessee s son, according to the Ld.counsel, there cannot be any addition in the hands of the assessee. Therefore, the CIT(Appeals) has rightly deleted the addition. 14. We have considered the rival submissions on either side and perused the relevant material on record. It is not in dispute that a pocket diary was found during the course of search operation, which disclosed the assessee s investment in the money lending business. The issue now a .....

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father. In fact, in response to Question No.19, he admitted that the documents are relating to Vijaya Finance and other finance of his family. He, according to the Ld. D.R., admitted that the money lending business belonged to him. In those circumstances, this Tribunal is of the considered opinion that the matter needs to be reconsidered after considering the assessment made in the hands of Shri Subramanian, the assessee s son. Accordingly, we set aside the orders of the lower authorities and th .....

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that during the course of search operation, undisclosed investment in the construction of a building at Aranthangi was found. Therefore, to ascertain the actual investment, the matter was referred to Departmental Valuation Officer. After receiving the valuation report from the DVO, the Assessing Officer determined the undisclosed income in the cost of construction to the extent of ₹ 15,54,035/-. However, the CIT(Appeals) deleted the addition on the ground that there was no seized material. .....

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seized material? The Ld.counsel submitted that in such a case, what is to be added is the valuation on the basis of State PWD rates. In this case, according to the Ld.counsel, the valuation made by the V.O. was based on the Central PWD rates. If the valuation was made on the basis of State PWD rates, the addition made by the Assessing Officer would reduce considerably. 18. We have considered the rival submissions on either side and perused the relevant material on record. The seized material fou .....

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the undisclosed investment to the extent of ₹ 15,13,165/- as undisclosed income. Now the contention of the assessee before this Tribunal is that the valuation has to be made only on the State PWD rates. We find much force in the contention of the assessee. State PWD rates have to be preferred when compared to the Central PWD rates. State PWD rates are prepared as per the local condition prevailing in the particular State. Therefore, this Tribunal is of the considered opinion that the valu .....

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