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Tinna Overseas Ltd. Versus DCIT Central Circle – 17, New Delhi

2017 (10) TMI 590 - ITAT DELHI

Bogus claim of expenditure in respect of purchase of blown bitumen and also transport expenses - Held that:- In respect of the observations of the Ld. CIT (A) that blown bitumen is not a suitable raw material for production of Crumb Rubber modifier, whereas its raw material is natural asphalt is concerned, record does not support this observation of the Ld.CIT (A). In our opinion on this aspect there should have some enquiry conducted by the authorities below as to whether the blown bitumen has .....

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he AO should have enquired the truth or otherwise of the statement of Bhupinder Kumar Sekhri instead of believing it to be a gospel truth. We, therefore, find that there is want of enquiry on the part of the AO in respect of the purchase of blown bitumen and also about the transport charges. Since we believe that the verification of the fact on this aspect has a bearing on the assessment of the income of the assessee for the relevant years, we deem it just and necessary to set aside these two is .....

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0 and are the consequence of the search proceedings that took place on 11.11.2010 in Tinna Group of Cases. Facts involved are the same. So also the issues involved. Hence, we find it just and convenient to dispose them off by way of this common order. 2. Briefly stated facts are that a search and seizure operation u/s 132 of the Income Tax Act, 1961 (for short called as the Act ) on 11.11.2010 was conducted in Tinna Group of cases, wherein various books of account/documents were seized. Pursuant .....

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the same for the AYs 2006- 07 to 2008-09 made similar additions. 3. Challenging these additions assessee preferred appeals before the Ld. CIT (A) and Ld. CIT (A) dismissed the appeals by way of impugned orders. Therefore, in all these appeals the assessee is challenging the addition relating to the transport expenses. 4. At the outset, in respect of the appeal relating to the AY 2006-07, it is the argument of the Ld. AR that this assessment is time barred in as much as under the proviso to Sect .....

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Ld. AR placed reliance on the decisions reported in CIT Vs. RRH Securities Ltd. 380 ITR 612 and PCIT vs. Surver Agency Pvt. Ltd. in ITA No. 422/2017 decided on 17.08.2017 for this principle. 5. On a careful consideration of the matter, we are convinced that in view of the provisions contained in the first proviso to Section 153C of the Act in the light of the decisions of the Hon ble Jurisdictional High Court referred to above, the assessment for the AY 2006-07 is time barred and AO did not hav .....

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at the company claimed excessive expenditure during the period between 30.04.2005 and 14.11.2008 and so also there is no Mahesh Roadways at all. Basing on this and also on the statement of Bhupinder Kumar Sekhri AO found that 60% of the expenses are excessively booked. So also the Ld. CIT (A) in his order on paragraph no. 7.4 found that the booking of purchase of blown bitumen is bogus, since it is not a suitable raw material for the product manufactured by the Chennai and Silvassa Divisions of .....

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09 were also found but they were not considered by the AO. It is further contended by the Ld. AR that the complaint dated 27.11.2008 was withdrawn by the said Bhupinder, as such, nothing contained in the complaint could be considered. Lastly, he submits that the complaint of a Director of the assessee company which was withdrawn subsequently cannot be a basis for disallowance of the expenses in the hands of the assessee company and secondly in the absence of any material incriminating or corrobo .....

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closed income unearthed during search and mere statement cannot be held as un incriminating material and additions solely on the basis of statement recorded during the course of search cannot be made. He also placed reliance on CIT vs. Fair Finvest Ltd. (Delhi High Court) 357 ITR 146, CIT vs. Gangeshwari Metals Ltd. (Delhi High Court) 361 ITR 10, CIT vs. FCS International Marketing Ltd. (Punjab & Haryana High Court) 203 CTR 601, ACIT vs. Anima Investment Ltd. (3rd Member Delhi ITAT) 73 ITD 1 .....

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