TMI Blog2016 (7) TMI 508X X X X Extracts X X X X X X X X Extracts X X X X ..... details were not furnished by the assessee. Ld.CIT(A) while upholding the action of AO has inter alia noted that details called for by AO were neither furnished before AO nor during appellate proceedings and further assessee had also not explained the basis for revising the returned income to NIL as against returned loss of ₹ 38,90,070/- after selection of the case for scrutiny and issuance of notice u/s.143(2) of the Act. In view of the contrary submissions by the assessee and the AO, we are of the view that one more opportunity be granted to the assessee to produce the entire books of account, vouchers, and such other details required by the AO, more so when the ground No.1 with respect to unexplained cash credit is also remitted back to the file of AO. - Decided in favour of assessee for statistical purposes. - I.T.A. No. 764/Ahd/2012, I.T.A. No. 765/Ahd/2012 - - - Dated:- 14-6-2016 - Shri R. P. Tolani, Judicial Member And Shri Anil Chaturvedi, Accountant Member For the Appellant : Shri Tushar P. Hemani, AR For the Respondent : Shri K. Madhusudan, Sr.DR ORDER Per Shri Anil Chaturvedi, Accountant Member Both these appeals by the Assessee are direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the transactions. The AO noted that the assessee did not furnish the details called for by the AO. He therefore held that assessee has not discharged the onus of proving the identity, genuineness and creditworthiness of the transactions and, accordingly, he considered the aggregate amount of ₹ 93,95,000/- as unexplained cash credit u/s68 of the Act. Aggrieved by the order of AO, assessee carried the matter before the ld.CIT(A), who after considering the submissions of the assessee, the remand report and assessee s reply to remand report, granted partial relief by deleting the addition to the extent of ₹ 60,60,000/- but however confirmed the addition of ₹ 33,35,000/- received by assessee from Shanti Metals Pvt.Ltd. by holding as under:- 3.2. I have considered facts of the case and appellant s submissions. Assessing Officer, on verification has found appellant s contention about loans from four parties namely, Ashish Apparels Pvt.Ltd. White Metals Pvt.Ltd., Goyal Fincap Pvt.Ltd. and Devendra Kumar Gupta (HUF) totalling to ₹ 40,60,000/-, being brought forward from earlier years to be correct. Loans brought forward from earlier years cannot be added u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by CIT(A) was non-furnishing of the bank statement of Shanti Metals Pvt.Ltd. He submitted that when assessee has furnished the confirmation, the return of income, Balancesheet and Profit Loss account, it has discharged the onus cast upon by the assessee as required u/s.68 of the Act. He further submitted that transactions with Shanti Metals Pvt.Ltd. are genuine transactions and if given an opportunity, the assessee will produce Shanti Metals Pvt.Ltd. before the AO and also furnish the necessary evidences as required by the authorities to discharge the onus cast upon the assessee as required u/s.68 of the Act. He therefore submitted that one more opportunity be granted to the assessee to produce the required books of account and other details so as to establish the genuineness of transactions. As far as the ground of appeal in assessee s appeal for AY 2006-07 is concerned, he submitted that since the loan from Shanti Metals Pvt.Ltd. was considered as unexplained cash credit, the interest paid by the assessee on the loan was also disallowed. The Sr.DR, on the other hand, supported the order of AO and ld.CIT(A) and further submitted that despite various opportunities granted by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest on loan to Shanti Metals Pvt.Ltd.) being connected to the ground raised by assessee in AY 2005- 06, the same is also set aside to the file of AO to decide it afresh. Thus, this ground in AYs 2005-06 2006-07 are allowed for statistical purposes. 5. Next ground in Assessee s appeal in ITA No.764/Ahd/2012 for AY 2005-06 is with respect to estimating Net Profit. 5.1. During the course of assessment proceedings, AO noticed that the assessee had filed return of income on 29/10/2005 claiming business loss of ₹ 38,90,070/-. The case of assessee was selected for scrutiny assessment and notice u/s.143(2) of the Act was issued on 10/10/2006. Thereafter, the assessee filed a revised return of income on 31/10/2006 showing the total income at Rs.NIL as against the loss of ₹ 38,90,070/- claimed in the original return of income. The AO noted that the assessee did not produce the books of account and vouchers for verification nor furnished detailed working of inventories, thereby depriving the AO to verify the correctness of the figures. AO also noted that the other details called for by the AO with respect to the interest payment to persons specified u/s.40A(2)(b) were n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f account arbitrarily is not tenable in the eyes of law. He therefore submitted that the addition be deleted. In the alternate, he submitted that the Net Profit on 1% of sales is at higher side and some reasonable estimate may be made. Ld.Sr.DR, on the other hand, supported the orders of AO and ld.CIT(A). 5.3. We have heard the rival submissions and perused the material on record. The issue in the present case is with respect to rejection of books of account by the AO on the ground of alleged non-production of the books of account before the AO. It is assessee s contention that it had produced the books of account before AO and other required vouchers. On the other hand, it is AO s contention that the required details were not furnished by the assessee. Ld.CIT(A) while upholding the action of AO has inter alia noted that details called for by AO were neither furnished before AO nor during appellate proceedings and further assessee had also not explained the basis for revising the returned income to NIL as against returned loss of ₹ 38,90,070/- after selection of the case for scrutiny and issuance of notice u/s.143(2) of the Act. In view of the contrary submissions by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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