TMI Blog2017 (4) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... n 69C of the Act, as unexplained expenditure, towards difference between purchase price found in loose slips and amount recorded in books of account. The Commissioner of Income Tax (Appeals), after considering the relevant facts, has rightly deleted the additions - Decided in favour of assessee - ITA No. 217/VIZ/2013, C.O.No.92/VIZ/2013 - - - Dated:- 31-3-2017 - SHRI V. DURGA RAO, HON BLE JUDICIAL MEMBER SHRI G. MANJUNATHA, HON BLE ACCOUNTANT MEMBER For The Assessee : Shri G.V.N. Hari Advocate. For The Department : Shri R.S. Aravindakshan Sr.DR ORDER PER G. MANJUNATHA, ACCOUNTANT MEMBER This appeal filed by the Revenue and the Cross objection filed by the assessee are directed against order of the Commissioner of Income Tax (Appeals), Vijayawada, dated 18/01/2013 and it pertains to the Assessment Year 2006-07. ITA No. 217/VIZ/2013 2. Facts of the case, in brief, are that the assessee is an individual engaged in the business of film distribution in the name and style of M/s. Bharathi Pictures, filed its return of income for the Assessment Year 2006-07 on 30/10/2006, declaring a loss of ₹ 1,80,716/-. A survey operation under section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 1,01,29,747/-, but not for ₹1,85,00,000/- as stated by Assessing Officer. The assessee further submitted that while talks for purchase of distribution rights for Krishna Guntur districts were in progress, producer of the film M/s. P.B. Arts has sent a draft agreement for ₹ 1,85,00,000/-, however, he did not agreed to pay the amount of ₹1,85,00,000/- and finally agreed to purchase the film for a price of ₹1,01,29,747/-, which was paid in the form of ₹ 21,86,951/- by cheque and ₹ 79,42,796/- by DDs. The assessee further submitted that M/s.P.B. Arts has written a letter dated 12/02/2008 and confirmed the price paid for purchase of the film, wherein they have categorically stated that they received consideration of ₹ 1,01,29,747/-. The assessee further submitted that letter stated to be written by M/s.P.B.Arts addressed to Sri V.Rama Krishna has signed by N.R.K. Anand was found during the course of survey in his premises, was mistakenly written by the producer, hence, assessee ignored that letter. Therefore, no credence can be given to the letter addressed to the person, who is neither proprietor of the firm nor associated with the transact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1,85,00,000/-. The Commissioner of Income Tax (Appeals) further held that the Assessing Officer has obtained an information from the producer, wherein he had confirmed that distribution rights of future film of Allaripidugu for Krishna Guntur districts have been sold for a consideration of ₹ 1,01,29,747/-. The Assessing Officer, without any evidence to justify the on money payment of consideration in cash, made additions of ₹ 83,70,253/- under section 69C as unexplained expenditure, therefore, directed the Assessing Officer to delete the additions. Aggrieved by the order of the Commissioner of Income Tax (Appeals), the Revenue is in appeal. 8. The Departmental Representative submitted that Commissioner of Income Tax (Appeals) ought to have sustained the addition of ₹83,70,253/- towards cost of rights purchased for future film Allaripidugu , as the same was incurred in cash and the expenditure was neither recorded in the books of the assessee nor by the producer. The Commissioner of Income Tax (Appeals) erred in deleting the addition made by the Assessing Officer, ignoring the evidences found during the course of survey. The impounded documents at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration of ₹ 65 lakhs and ₹ 1,20,00,000/-. It is the contention of the assessee that distribution rights of the future film for Krishna Guntur districts have been purchased for a consideration of ₹1,01,29,747/-, but not for ₹ 1,85,00,000/-, as stated by the Assessing Officer. The assessee further contended that the Assessing Officer made additions solely based on a loose slip in the form of letter addressed by the producer of the film M/s. P.B. Arts to one Sri V.Rama Krishna, which states that film has been purchased for a consideration of ₹1,85,00,000/- and the payment has been made in cash for ₹83,70,00/-, ₹ 76,30,000/- by DDs and ₹ 25,00,000/-by way of cheques. But, the fact remains that the documents considered by the Assessing Officer to make additions are neither addressed to the assessee nor related to the transactions with the producer for distribution rights of the future film. Therefore, Assessing Officer was erred in relying upon the document, which is not at all belonging to the assessee, while making additions under section 69C of the Act. 11. Having heard both the sides and considered the material available on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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