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2016 (4) TMI 635 - ITAT MUMBAI

2016 (4) TMI 635 - ITAT MUMBAI - TMI - Income from unexplained /undisclosed sources - Held that:- It is a classical case where various additions have been made by the AO without proper application of mind and has no distant connection with the material on record. We find that the third party transactions were added in the hands of the assessee without without any basis or material and thus, the AO framed the assessment in a hypothetical way putting the assessee to enormous harassment and inconve .....

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M For The Appellant : Shri R K Bothra For The Respondent : Shri Naveen Gupta ORDER PER RAJESH KUMAR, AM : This appeal by the assessee is directed against the order dated 1.6.2012 of Commissioner of Income Tax (Appeals)- 36, Mumbai (Hereinafter called as the CIT(A) for assessment year 2007-08. 2. The issue raised in the revised grounds of appeal no.1,2 and 3 are against the confirmation of addition of ₹ 1,40,43,154/-, ₹ 10,00,000/- and ₹ 26,00,000/- as income from unexplained /u .....

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ctions which were not confirmed or partly confirmed by those parties and thus made the additions of ₹ 1,40,43,154/- vide 5(a), ₹ 10,00,000/- vide para 5(b) and vide para 5(c) of the assessment order respectively. Aggrieved by the order of the AO, the assessee preferred an appeal before the First Appellate Authority. The ld. CIT(A) called for the remand report from the AO and in the said remand report the AO stated that the assessee was afforded an opportunity to appear before him, ho .....

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the remand report, which was replied by the assessee vide her reply dated 24.1.2012. The ld. CIT(A) finally observed and held that the assessee was not able to rebut the stand of the AO on the remand report and simply stated that all these transactions were through banking channels and were fully accommodated for. The ld. CIT(A) also observed that all the submissions made by the assessee were without any documentary evidence and therefore were not tenable and reliable in law. Hence, the ld. CIT( .....

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e received an amount of ₹ 35 lakhs from M/s Sera Organics Pvt Ltd on 24.1.2007 by cheque which was duly confirmed by the parties by a confirmation letter dated 1.4.2007, which is supported by a letter placed at page 13 of the paper book. The ld. AR further submitted that the AO wrongly observed as stated in para 5(a) of the Assessment order that the assessee has advanced ₹ 1,75,43,154/- to Sera Organic Pvt Ltd on various dates which were not accounted for which is totally wrong and a .....

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page 24 of the assessee s paper book. As per the certificate ₹ 109.50 lakhs was received by M/s Sera Organics Private Limited from M/s Chintamani Iron bank statement of M/S Sera Organics Pvt Ltd , ₹ 7.50 lacs from Jammudeep Metal and Tubes Pvt Ltd and ₹ 7.00 from Life Lines Metals and Tubes Pvt Ltd The assessee also filed a copy of ledger account of Sera Organics Pvt Ltd in the books of assessee, bank statement of M/s Millennium Metal issued by the Centurian Bank placed at pag .....

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served that ₹ 14 lakhs were received from M/s Chintamani Iron and Steel Co.Pvt.Ltd and ₹ 4 lakhs advanced which was not reflected in the bank statement and therefore, he disallowed ₹ 10 lakhs which is also totally wrong and against the facts. Before the AO and the ld. CIT(A), the ld.AR submitted a confirmation letter dated 1.4.2007 confirming ₹ 18 lakhs payable to M/s Chintamani Iron and Steel Co. Pvt. Ltd. The ld. Counsel submitted that during the year, the assessee rece .....

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in both bank account by three cheques of ₹ 14 lakhs , two times ₹ 8 lakhs. Out of the three cheques ₹ 14 lakhs was from M/s Chintamani Iron and Steel Co.Pvt.Ltd and rest of the two cheques were from other parties namely M/s Delite Tubs and Alloys Pvt Ltd and Jammudeep Metal and Tubes Pvt Ltd. which has been mentioned backside of the page 48 of the paper book. Similarly, at page 47, the assessee received ₹ 8 lakhs from M/s Chintamani Iron and Steel Co.Pvt.Ltd on 18.9.2006 .....

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the AO and confirmed by the ld. CIT(A) were wrong and without basis. In respect of third addition of ₹ 26 lakhs ,the ld. Counsel of the assessee submitted that during the year the assessee received various cheques from the said party and also repaid at the end of the year as per copy of account filed at page 37 of the paper book and net balance outstanding to M/s Jammudeep Metal and Tubes P Ltd was ₹ 26 lakhs which was confirmed by the party in the confirmation letter placed at page .....

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ed into various transaction of borrowings and repaying the advances by account payee cheques to these parties on various dates as is clear from page 37 of the paper book which was duly confirmed by the confirmation letter which is placed at page 36 of the paper book. The copy of the bank statement of to M/s Jammudeep Metal and Tubes P Ltd was also placed at pages 38 to 40 of the paper book, in which the transactions between the assessee and the said parties were duly reflected as being received .....

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