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2017 (9) TMI 728

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..... t of the assessee for verification of the credits in the bank account of the Assessee. In our considered view the assessee has sufficiently explained the addition made by the AO which is the sufficient explanation as per section 271(1)(c).Considering the fact that the assessee has sufficiently explained the facts, hence no penalty was leviable. The ground of appeal of the assessee is allowed. - ITA Nos. 6030 to 6035/Mum/2013 And ITA No. 1064/Mum/2016 - - - Dated:- 11-9-2017 - Shri P K Bansal, Vice President And Shri Pawan Singh, Judicial Member For The Appellant : Shri Vipul Joshi For The Respondent : Dr. P. Daniel ORDER Per Bench This group of seven appeals were directed against the order of the CIT(A) 40/52, .....

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..... to Transactions in Securities (ORTS)]. The assessee was a member of the Bombay Stock Exchange. The assessee was showing income from shares and securities. The assessee is one of the accused in multi crore securities scam of 1992. Till due date of filing of return of income assessee has not filed the return of income. The AO issued notice to the assessee on 15th January, 1977. No response was made by the assessee. Therefore, the AO issued another notice to the assessee requiring to file it return of income and to furnish details thereof during the relevant assessment year. However, the assessee furnished certain details of interest earned during the year. Accordingly the AO assessed the income as per provisions of Section 144. The AO made ad .....

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..... furnish any evidence before the Tribunal regarding following the cash system of accounting, in absence of which the appeal of the assessee was dismissed. 7. We have considered the rival submissions and have gone through the orders of the authorities below. We have seen that identical grounds of appeal were considered by the Coordinate Bench of the Tribunal for A.Y. 2004-05. The Tribunal passed the following order: - 4. We have perused the record and considered the matter carefully. The dispute raised is regarding method of accounting in respect of interest income. The claim of the assessee is that in the earlier year it had been following cash method of accounting but the same had been rejected by the lower authorities. In assessm .....

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..... years: - 4. Considering the above mentioned facts, it is accepted that the assessee has followed cash system of accounting in earlier years and that the additions cannot be made on accrual basis in the present year. 8. Considering the order of the Coordinate Bench in assessee s own case on identical ground of appeal, the ground appeal raised in the present appeal is restored to the file of the AO for passing the order afresh after considering the fact that the assessee is following cash system of accounting. Needless to say that the AO shall provide opportunity of hearing before passing the order in accordance with law. In the result, appeal filled by the assessee is allowed for statistical purposes. 9. Following the forego .....

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..... . The assessee filed appeal against the addition on account of interest income of ₹ 90,870/- which was added considering the income on accrual basis. On appeal before CIT(A) the addition was confirmed. No appeal was filed against addition on account of difference of interest of ₹ 94,350/- and interest on fixed deposit and ₹ 10,83,695/- on F.D. with Bank of India, M.G. Road Branch. The AO levied penalty in respect of all three addition. The AO levied penalty @100% of the amount of tax sought to be evaded. 13. On appeal before the CIT(A) the penalty on addition of ₹ 90,870/- was deleted, however on other additions i.e on account of difference of interest of ₹ 94,350/- and interest on fixed deposit and ₹ .....

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..... ian and prepared a report dated 29.03.2005 and reported that there was a credit of ₹ 2,55,88,77/- on account of maturity of fixed deposit. Further it was revealed that the assessee earned interest of ₹ 10,83,695/- on account of maturity of F.D. with Bank of India. The assessee gave his consent to tax the said interest. The assessee further during the course assessment proceedings contended that due to calculation mistake (typographical error) the interest on F.D. was referred as ₹ 3,06,222/- instead of ₹ 4,00,552/-. The addition on account of difference of ₹ 94,530/- and further addition on account of interest income of ₹ 10,83,695/- was in the income at the instance of the assessee. The learned A.R. argu .....

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