TMI Blog2021 (10) TMI 1188X X X X Extracts X X X X X X X X Extracts X X X X ..... during the appellate proceeding went through the cash flow statement prepared on the basis of the copies of seized material taking into account the opening cash balance, bank withdrawals which is also made available before us being part of the Paper Book. Apart from that in the remand report dated 27.10.2010 available at page 10 to 15 of the PB so filed before us. The Ld. AO admitted such facts and the documentary evidences filed in its explanation of the sources of funds by the assessee and hence, the Ld. CIT(A) deleted both the additions. According to us, there is no ambiguity in making such decision made by the Ld. CIT(A). Hence, the said is hereby confirmed. This ground of appeal preferred by Revenue fails. Cash sale of agricultural equipment - HELD THAT:- CIT(A) while allowing the appeal alongwith this ground of appeal relied on the basis of the documents, facts and the remand report and further observed that the cash flow cannot be suspected in the absence of any adverse evidence relied upon by the Ld. AO which according to us is without any ambiguity so as to warrant interference. This ground of appeal is allowed. Lifting the goods from the Custom Authorities - HE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ground that the appellant has included this quantity while calculating the value of closing stock which is proper and thus, confirmed. This ground of appeal preferred by the Revenue fails. Addition on account of GP rate at 20% - HELD THAT:- CIT(A) deleted the addition on the basis that the sales as per audited profit and loss account is much more than the sales as per Sales Tax Department because the exempted sales are not included in sales tax returns. Therefore, the estimation is not correct. Regarding GP of 20%, the Ld. CIT(A) mentioned that despite logical explanation the estimation of turnover at 4.50 crore and 20% GP without bringing on record any sound reasoning for doing the same. There was no reason to reject the actual sale of ₹ 44011886/- and GP of 11.15% as of against the Ld. CIT(A) which according to us is without any ambiguity so us to warrant interference and hence, this ground of appeal preferred by the Revenue is found to be devoid of any merit and thus, dismissed. Addition of notional interest on loan outstanding - HELD THAT:- CIT(A) while deleted notional addition took into consideration this particular aspect of the matter that the Ld. AO has no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of purchases, part payment made as been recorded. The above said amount therefore, cannot be treated as advance free of interest. Addition based on difference of balances - HELD THAT:- It appears that the Ld. CIT(A) deleted the addition on the basis of the reconciliation filed by the assessee before the AO and before him as well without any ambiguity so as to warrant interference. Hence, the appeal preferred by the Revenue is found to be devoid of any merit and thus, dismissed. - I.T.A. No.2895/Del/2011 (Assessment Year 1992-93) - - - Dated:- 17-8-2021 - SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND MS. MADHUMITA ROY, JUDICIAL MEMBER Revenue by: Smt. Sushma Singh, CIT DR Assessee by Sh. S.K. Chaturvedi, CA ORDER PER MADHUMITA ROY, J.M. 1. The instant appeal filed by the Revenue is directed against the order dated 31.03.2011 passed by the Ld. CIT(A)-XXIII, New Delhi arising out of the order dated 24.12.2009 passed by Ld. ACIT, Circle 23(1), New Delhim u/s 144(1)/254 of the Income Tax Act, 1961 (hereinafter referred to as the Act ) for AY 1992-93 with the following grounds: 1. On the facts and circumstances of the case the Ld. CIT(A) has erred in de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash deposit. 15. On the facts and circumstances of the case the Ld. CIT(A) has erred in deleting the addition of ₹ 2,95,000/- made by the AO on account of unexplained cash deposit. 16 On the facts and circumstances of the case the Ld. CIT(A) has erred in deleting the addition of ₹ 13,03,279/- made by the AO on account of loans and advances. 17 On the facts and circumstances of the case the Ld. CIT(A) has erred in deleting the addition of ₹ 28,26,860/- made by the AO on account of difference in books of accounts. 18. The appellant craves leave to add, alter or amend any of the grounds of appeal before or during the course of hearing of the appeal. 2. A search and seizure action u/s 132 of the Act was carried out on 14/15 th September, 1994. Initially the assessments were framed by and under the order dated 13.12.2008. However, the Ld. Tribunal was pleased to restore the matter to the file of the Ld. Assessing Officer upon which the assessment order was passed on 24.12.2009 with certain additions. During the appellate proceeding the Ld. CIT(A) finally upon issuing remand reports first dated 20.12.2010 and the other dated 23.03.2011 finally deleted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee explained the goods lifted from Custom Department to the tune of ₹ 9,50,000/- by filing confirmation of Steelex International detailing the manner in which goods had been lifted by paying the said amount from their bank account being no. 2250 of Synd Bank, Nariman Point, Mumbai. The assessee along with the said confirmation and bank statement is also available being part of the Paper Book filed before us. It is the goods of the Ld. AO that he could not verify the details and thus, made additions the Ld. CIT(A), on the other hand, deleted such addition on the ground that confirmation was already filed and the Ld. AO has also failed to bring any adverse evidence on record to reject such contention of the appellant which, according to us is just and proper and without any ambiguity so as to warrant interference. Hence, this ground of appeal filed by the Revenue found to be devoid of any merit and thus, dismissed. The addition of ₹ 18,11,000/- and ₹ 13,45,750/- as unexplained investment has been challenged before us by the Revenue. Upon verification of the document, it was found that the assessee has made payment of ₹ 1 crore and 61.1 lakh on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash flow cannot be suspected in the absence of any adverse evidence relied upon by the Ld. AO which according to us is without any ambiguity so as to warrant interference. This ground of appeal is allowed. 6. The deletion of addition of ₹ 1508644/- made by the AO on account of lifting the goods from the Custom Authorities is the subject matter before us. It appears from the records that the copy of the audited profit and loss account along with the other relevant documents have been filed by the assessee before the Assessing Officer. The Ld. AO vide para 4.B.1 has mentioned that the balance amount of goods lifted from customs has not been accounted for in books of accounts, thus 10% of the goods at ₹ 15086440/- (20776940 5690500) is estimated as profit/income of the assessee. The AO has not mentioned anything except that this purchase was not accounted for without any evidence at all. In spite of having all seized material and the documents of Customs Authorities the AO has not verified the same. Neither has given any adverse comment on the audited profit and loss account. Ld. CIT(A) in his order in para 13 has categorically mentioned that all above grounds are b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s cash deposited in account on 11.05.1991 is the issue before us. The said amount deposited in the bank was not explained by the assessee and thus, the ld. AO added the same to the total income of the assessee. We have perused the cash flow statement available at page 36 of the Paper Book filed before us which reflects that there were sufficient cash available as on 30.04.1991 and also the sufficient explanation was made by the appellant. Hence, the Ld. CIT(A) deleted such addition. Hence, according to us the Ld. CIT(A) has rightly deleted the same. In that view of the matter, ground preferred by the Revenue is found to be devoid of any merit and hence dismissed. 10. The addition of ₹ 239000/- on account of unexplained cash deposit is the issue before us. The Ld. AO added the same on the pretext that the same remained unexplained in the absence of books of account and other evidences. The First Appellate Authority on the basis of the evidences adduced by the assessee which is also made available before us deleted such addition which according to us is just and proper. Hence, this ground of appeal preferred by the Revenue fails. 11. The deletion of addition of ₹ 44 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the basis of facts, documents and remand report from the AO on the ground that the appellant has included this quantity while calculating the value of closing stock which is proper and thus, confirmed. This ground of appeal preferred by the Revenue fails. 14. The deletion of addition of ₹ 4991098/- made by the AO on account of GP rate at 20% has been challenged before us. The assessee declared sale in the profit and loss account at ₹ 4400886/-, whereas as per intimation from Sales Tax Department, it was sum of ₹ 3913620/- and CST of ₹ 23319204/- it was submitted by the assessee that figures intimated by the Sales Tax Department was the taxable sales, whereas in audited accounts the total sale included exempted one is also included. Further that the sale declared at ₹ 44011886/- was duly verified and audited neither the AO was having any adverse information or material to reject but on the basis of the information for the Sales Tax Department regarding sales, which was much lessor the sales declared rejected the sales as per audited statements and estimated the sale at 4.50 crore and GP was calculated at 20%; but difference of actual GP to the tune ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /- and the same was added to the total income of the assessee. During the First Appellate Authority the assessee submitted the same. typed 18. The Ld. CIT(A) while deleting the addition observed as follows: - {44} I have considered the Assessing Officer's observation before making addition in this regard. It is apparent that there is some mistake in arriving at the addition of ₹ 13,99,170/- being 5% of the loan advanced. The Assessing Officer has also recorded in the order that amount of ₹ 60 lacs had been returned by M/s. Plaza Panchsheel Properties during the year under consideration, which means that even for argument purposes, no interest was due to the assessee with respect this amount from the date of receipt of ₹ 60 lacs. Assessee has submitted that the loan was advanced to M/s. Plaza Panchsheel Properties Pvt. Ltd. in Financial Year 1986-87 and the assessee had been charging interest on the said amount @ 15% till 89-90, but thereafter the financial condition of M/s. Plaza Parchsheel Properties was not sound so as to endanger the principle amount loaned. In view of this, no interest was charged from Financial Year 1991-92 onwards and an am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Assessment years 1994-95 95-96. 21. Thus, it appears that the voucher which was seized from the residence of Ms. Vandana Goyal was at ₹ 20858/- being the Visa charges of our travelling and thus, the same was rightly deleted by the Ld. CIT(A). The same is thus, hereby confirmed. This ground of appeal preferred by the Revenue, therefore, fails. 22. The deletion of addition of ₹ 6 lacs made on account of creditors has been challenged before us. The facts culled out form the AO s order that out of ₹ 6984000/- as has been shown as outstanding creditors by the assessee. The assessee filed confirmation from all parties except those of M/s M.B. Enterprises ₹ 150000/- and M/s Anand International ₹ 450000/-. Hence, the same are added to the assessee s total income ₹ 600000/-. 23. The Ld. CIT(A) deleted the addition while doing so. He has relied upon the judgment passed in the matter of Sugauli Sugar Works Ltd., 236 ITR 518 (SC). According to us, there is no ambiguity in such order passed by the Ld. CIT(A). Hence, we confirm the same. 24. In that view of the matter, this ground of appeal preferred by the Revenue fails. 25. The fact cul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roneous as made by the Ld. CIT(A) is without any ambiguity and thus, the same is hereby confirmed. The ground of appeal filed by Revenue fails. 28. The deletion of addition of ₹ 13003279/- on account of interest at 18% of loans and advances has been challenged before us by the Revenue. The AO disallowed thee said sum of interest on outstanding loans and advances amounting to ₹ 7240435/- which was deleted by the Ld. CIT(A) following the order passed by the Ld. Tribunal in assessee s own case in ITA No. 588/Del/1995 for AY 1991-92 the relevant portion where of is as follows: - {97} I have considered the basis of addition made by the Assessing Officer and the explanation of the appellant reiterating the stand that the funds advanced without interest are not from the funds borrowed on interest. It has also been that similar addition made in Assessment Year 1991-92 was deleted by the Hon'ble ITAT by making the following observations:- 9.3 we have heard the learned representative of the parties, also gone though the relevant record and perused the paper book. While the assessee is showing interest income of ₹ 22,98,869/-, he claimed an expenditure of ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income of the assessee. Since, the same was not reconciled by the assessee as of the observation made by the Ld. AO. However, fact remains that during assessment the reconciliation was filed to explain the difference of balances. The AO did not consider the same and the facts that in addition of ₹ 1852910/-, the notional speculation profit on forward transactions was carried forward and ₹ 1000000/- was paid by account payee cheque from Bharat Tin Udyog, the concern of wife of Late Shri S.P. Goel. No gain accrued to the appellant. The gain/loss were duly accounted for on the basis of finality of transaction. 31. The Ld. CIT(A) while deleting the addition observed as follows: - {100) It is seen that the Assessing Officer has not accepted the reconciliation filed by the appellant by making the observation that it was not understood as to how this reconciliation was made, especially when the assessee had no books of accounts as the same have been lost. However, the perusal of reconciliation shows that the same has been prepared entirely from the bank account maintained by the assessee and the copy of account of M/s. Pradeep Bhalla Co. The entry of ₹ 10 l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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