TMI Blog2014 (3) TMI 1209X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee furnished copies of account of the said party and stated that the outstanding balances in the accounts of the said party were on account of purchases. The second advance of Rs.3,97,000/- outstanding in the account of M/s M.K. Industries was claimed to have inadvertently shown as advance from customers. Although the said amount outstanding was on account of purchases, however the assessee failed to furnish any evidence in respect of the same and the addition was confirmed in the hands of the assessee. The assessee had filed to furnish any further evidence before us and in view thereof we find no merit in the ground of appeal No.4 raised by the assessee and the same is dismissed. Disallowance of various expenses - AO during the course of assessment proceedings had noted the assessee to have incurred expenses on repair and maintenance, advertisement, postage courier, printing stationery, traveling expenses and Diwali expenses and disallowed - HELD THAT:- The said disallowances were made in the hands of the assessee as the assessee had failed to produce the bills and books of account before the Assessing Officer. In the totality of the facts and circumstances of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayable to following 4 parties:- (i) M/s S.Gunveen Singh Rs. 743/- (ii) S.Arunjit Rs. 59,869/- (iii) S.Simarjit Rs. 59,802/- (iv) Sh.Arun Kumar Rs.1,11,875/- Total: Rs.2,32,289/- Provisions of section 41 (1) of the IT. Act, 1961 have been misconstrued and misapplied in the Appellant's case. 4.That the Ld. Commissioner of Income Tax (Appeals) has wrongly confirmed addition of Rs.8,638 + Rs.3,97,000 total Rs.4,05,6387- on account of Advances received from the following two parties:- M/s. Industrial Machinery Corp. Rs. 8,638/- M/s. M.K. Industries Rs. 3.97.000/- Total: Rs. 4.05.638/- 5.That the Ld. Commissioner of Income Tax (Appeals) is not justified in confirming addition of Rs.2,00,000 out of addition of Rs.3,10,440 made by the Ld. Assessing Officer on account of low G.P. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of the sundry creditors totaling Rs.22,12,450/- and as the assessee had failed to discharge his liability, the said amount was added as income under section 68 of the Act. It was further noted by the Assessing Officer that the assessee had reflected liability of Rs.2,32,289/- on account of commission payable. The assessee was asked to furnish confirmation and also since when the same was outstanding. The Assessing Officer had noted that during the year under consideration the assessee had not incurred any expenditure on commission and had also not incurred any expenditure on commission in assessment years 2007-08 and 2008-09. The explanation of the assessee before the Assessing Officer was that the said commission payable pertains to assessment year 2004-05. The Assessing Officer added sum of Rs.2,32,289/- as income of the assessee under section 41(1) of the Act. 6.Before the CIT (Appeals) the assessee furnished written submissions which are reproduced under para 4.2 at pages 4 and 5 under which it was explained that the assessee had purchased goods from M/s K.S. Munjal Industries totaling Rs.6,80,200/- and the same amount was outstanding for three years. The assessee fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under section 41(1) of the Act was confirmed by the CIT (Appeals). The issue arising in the present appeal is whether in such circumstances where the amount had been outstanding for a number of years, the said amounts should be treated as income of the assessee either under section 41(1) of the Act or as held by the Assessing Officer under section 68 of the Act. 11.We find that similar issue arose before the Hon'ble Punjab Haryana High Court in CIT Vs. GP International Ltd. (2010) 325 ITR 25 (P H). The Hon'ble High Court held as under: As far as the addition of Rs.3,30,000 is concerned, it has been held that during the provisions under section 143(3) read with section 250 of the Act, the assessee furnished a confirmation certificate from M/s Axis Chemical and Pharmaceuticals Ltd., Faridabad along with PAN number. On asking of the Assessing Officer, the assessee has confirmed that the said liability is still outstanding. In spite of that material, the Assessing Officer made the addition of the amount on the basis that this liability has ceased to exist and the same is not payable by the assessee, and treated the said liability as income by invoking provision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of M/s M.K. Industries was claimed to have inadvertently shown as advance from customers. Although the said amount outstanding was on account of purchases, however the assessee failed to furnish any evidence in respect of the same and the addition was confirmed in the hands of the assessee. The assessee had filed to furnish any further evidence before us and in view thereof we find no merit in the ground of appeal No.4 raised by the assessee and the same is dismissed. 15.The ground No.5 is not pressed and the same is dismissed as not pressed. 16.The issue in ground No.6 raised by the assessee is against the addition of Rs.50,000/- upheld by the Assessing Officer on account of disallowance out of various expenses. The Assessing Officer during the course of assessment proceedings had noted the assessee to have incurred expenses on repair and maintenance, advertisement, postage courier, printing stationery, traveling expenses and Diwali expenses and disallowed sum of Rs.96,100/-. 17.The CIT (Appeals) restricted the same to Rs.50,000/-. The said disallowances were made in the hands of the assessee as the assessee had failed to produce the bills and books of account be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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