TMI Blog2020 (9) TMI 535X X X X Extracts X X X X X X X X Extracts X X X X ..... ance claimed by the assessee was not reported by the ABS in it s reply and with regard to the cancellation of cheques and the stocks sold were required to be verified. With regard to the sales of M/s Adley Formulation the AO found that he same was not reflected separately in the statement of sales for the A.Y2013-14. CIT(A) deleted the addition without calling the remand report of the AO. Therefore, the issue needs to be verified with the books of account and if necessary cross verification to be made with ABS to reconcile the sales. Both the parties have agreed to remit the matter back to the file of the AO for further verification and reconciliation. Hence, in the interest of justice, we remit this matter back to the file of AO with a direction to reexamine the issue and decide the same afresh after providing reasonable opportunity of being heard to the assessee. Accordingly, ground is treated as allowed for statistical purposes. Disallowance of expenditure u/s 14A - HELD THAT:- There was no dispute that in the impugned AY, the assessee did not earn any exempt income. When the assessee has not earned any exempt income and there can be no disallowance under section 14A - I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the Ld. CIT(A) rejected the assessee s claim for want of cross verifications. CIT(A) ought have verified the information or should have called for the remand report from the AO. It is unjustified to reject the claim without making proper verification. Therefore we, remit the issue back to the file of the AO with a direction make necessary verifications and cross verifications and decide the issue afresh on merits after providing reasonable opportunity of being heard to the assessee. Thus, ground Nos. 2 3 are treated as allowed for statistical purposes. Disallowance of commission expenses - HELD THAT:- The evidences were placed by the assessee before the CIT(A) for the first time, we are inclined to remit this issue back to the file of the AO with a direction to examine the correctness and genuineness of the expenditure with the evidences produced by the assessee and decide the issue afresh on merits and after providing reasonable opportunity of being heard to the assessee. Accordingly, this ground is allowed for statistical purposes. - ITA No. 1022/Hyd/2017, ITA No. 863/Hyd/2017 - - - Dated:- 11-9-2020 - Shri P. Madhavi Devi, Judicial Member And D.S. Sunder Singh, Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave considered the rival submissions and perused the material placed on record. The ld. CIT(A) deleted the disallowance made by the AO based on the additional evidence produced by the assessee. We find that the additional evidence has placed by the assessee for the first time before the ld. CIT(A) and the ld. CIT(A) has decided the addition without calling for remand report from the AO and without making any verification of the expenditure independently. Therefore, in the interest of justice, we are of the view that the issue is to be remitted back to the file of the AO and accordingly, we remit the issue back to the file of the AO with a direction to reexamine the issue and decide the same on merits in accordance with law after providing reasonable opportunity of being heard to the assessee. Thus, ground Nos. 1 to 4 are treated as allowed for statistical purposes. 7. Ground No. 5 to 7 are directed against the action of the CIT(A) in deleting the addition made by the AO of ₹ 19,80,09,010/- on account of under reporting of consignment sales the assessee during the year made through M/s ABS Mercantile Pvt Ltd( in short consignee). 8. The AO found that the assessee had acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of cheques and the stocks sold were required to be verified. Similarly with regard to the sales of M/s Adley Formulation the AO found that he same was not reflected separately in the statement of sales for the A.Y2013-14. The Ld. CIT(A) deleted the addition without calling the remand report of the AO. Therefore, the issue needs to be verified with the books of account and if necessary cross verification to be made with ABS to reconcile the sales. Therefore, both the parties have agreed to remit the matter back to the file of the AO for further verification and reconciliation. Hence, in the interest of justice, we remit this matter back to the file of AO with a direction to reexamine the issue and decide the same afresh after providing reasonable opportunity of being heard to the assessee. Accordingly, ground No. 5 is treated as allowed for statistical purposes. 10. Ground Nos. 8 9 are directed against the action of the CIT(A) in deleting the addition of ₹ 5,06,343/- made by the AO on account of disallowance of expenditure u/s 14A of the Act. 11. We have heard the submissions of both the parties and perused the material placed on record. There was no dispute that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2017 by the assessee 17. The assessee has raised 6 grounds in its appeal, out of which ground Nos. 1 6 are general in nature, which need no adjudication. 18. Ground No. 2 is related to the addition of ₹ 18,55,71,506/- on account of difference of amount between the books of account of the assessee and the books of ABS Mercantile (P) Ltd. Ground No. 3 is related to sustaining the addition of ₹ 97,94,743/- made by the AO with regard to excess claim of purchases. 19. The AO made the addition of ₹ 18,55,71,506/- after calling for information u/s 133(6) form M/s ABS Mercantile Pvt. Ltd. wherein the ABS confirmed payables at ₹ 4,70,80,629/- as against ₹ 23,26,52,135/- reported by the assessee in the balance sheet. On calling for explanation, the assessee submitted the account copy of ABS in the books of the assessee and made certain adjustment to tally the balance in the books of the assessee with that of ABS. However no material was placed by the assessee to support the adjustments. Therefore the AO made the addition of ₹ 18,55,71,506/- in hands of the assessee. 19.1 Before the ld. CIT(A), assessee filed paper book with account copies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count (Rs) Sales made to you by vendor (as per 133(6) (Rs.) Excess debit (Rs. 1. G. Amphray Labs 6,76,20,369 6,48,48,309 27,72,060 2. SI Group Navi Mumbai 5,74,77,748 5,04,55,065 70,22,683 As found from the assessment order, the assessee failed to reconcile the discrepancies in purchases with reference to G. Amphray Labs and SI Group Navi Mumbai, inspite of giving show cause notice and giving opportunities hence the AO made the addition of ₹ 97,94,743/-. 21.1 On an appeal before the CIT(A), the assessee filed reconcilliation statement. However, ld CIT(A) not being satisfied with the explanation dismissed the ground of appeal of the assessee. 22. The ld. AR submitted before us that there was no difference in purchases and, thus, the addition of ₹ 97.94 lakhs is unwarranted. The Ld.AR further submitted that the differences were due to non- consideration of returned goods, credit notes and the cheques returned. The Ld. AR stated that though he has submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee stated to have been placed the following evidences before the ld. CIT(A): Invoice copy of M/s. Alborz Bulk Pharma Co., Iran, Unit 3,4, No.13, Mirza Hasani Alley, Ghaemmagham Farahani St, Tehran, Iran in Invoice No.EXP/114/2012-13, dated 12.07.2012 for 200kgs of HDPE Drums Cefixime @ 160 USD totaling amount of 3,20,000 USD. Invoice copy of M/s. Opsonin Pharma Ltd., Bagura Road, Barisal, Bangladesh in Invoice No.EXPj120j2012-13, dated 30.07.2012 for 300 Kgs of HDPE Drums Cefixime Trihydrate Micronized USP @136 totaling amount of 40,800 USD. The ld. AR argued that though payments were made subsequent to the date after the sale, merely because the payment was subsequent to the sale, does not permit the AO to make addition. Ld. AR further submitted that both the lower authorities failed to appreciate the evidences placed before them and requested for one more opportunity to substantiate its claim before the lower authorities. He further submitted that the assessee will extend all cooperation and assist the AO in completion of the assessment. He, therefore, requested to remit the matte back to the file of the AO for reconsideration and reexamination of the is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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