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TMI Blog2023 (4) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... roducts, as unexplained cash credits u/s 68 of the IT Act. The appellant prays that the said income may please considered as Business income as. declared by the Assessee. 3. On the facts and circumstances of the case, the Assessing officer has erred in law and on the facts of the case in violating principle of natural justice by not giving opportunity to you petitioner to cross examine art the evidences 7 witnesses and information used against them for their rebuttal while in making additions under section 68 of the Income Tax Act. Therefore, the order is bad in law The CIT(A) ignored this ground, and did not adjudicate, without giving any justification. The appellant prays that the said ground may please be properly adjudicated. 4. On the facts and circumstances of the case the Assessing officer has erred in law and on the facts of the case in disallowing business expenses incurred for earning income and maintaining business operations during the year. The CIT(A) ignored this ground, and did not adjudicate, without giving any justification. The appellant prays that the said ground may please be properly adjudicated. 5. On the facts and circumstances of the case, and in la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... delay was during the pandemic period and in view of the order of the Hon'ble Supreme Court, in order dated 10/01/2022, passed in M.A. No.21 of 2022 in M.A. No.665 of 2021, in Suo Motu Writ Petition (Civil) No.3 of 2020, there is no delay as limitation has already been extended by the Supreme Court as well as by the Parliament by way of "The Taxation And Other Laws (Relaxation & Amendment of Certain Provisions) Act, 2020". 6. We have heard rival submissions on the issue of condonation of delay in filing the appeal. The Hon'ble Parliament by way of the "The Taxation And Other Laws (Relaxation & Amendment of Certain Provisions) Act, 2020" has extended the time limit for filing of any appeal, reply or other applications, etc. which has been extended till 31st day of the March, 2021. The Hon'ble Supreme Court has also extended the limit for filing appeals, etc. during pandemic period. The relevant part of the order of the Hon'ble Supreme Court is as under:- "5. Taking into consideration the arguments advanced by learned counsel and the impact of the surge of the virus on public health and adversities faced by litigants in the prevailing conditions, we deem it appropriate to dispose o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer, for examining the identity and creditworthiness of the loan creditor issued summons under section 131 of the Act, however, the same were returned unserved marked as "not known" and, therefore, the Assessing Officer asked the assessee to produce said party for examination and verification of the identity & creditworthiness. However, the assessee failed to produce said creditor before the Assessing Officer. The Assessing Officer further noted that an information was received from the Investigation Wing of Income-tax Department, Mumbai that M/s Josh Trading Pvt Ltd was one of the group concern of Shri Pravinkumar Jain, who has engaged in providing accommodation entry in the form of loan. The Assessing Officer also referred to the statement of Shri Pravinkumar Jain, wherein he has specifically mentioned that M/s Joshi Trading Pvt Ltd was managed and controlled by him for the purpose of giving accommodation entries. During the course of the assessment proceedings, in the statement, one of the directors of the assessee company, Shri Nihal Garware confessed that he did not know M/s Joshi Trading Pvt Ltd or their promoters. In view of these facts, the Assessing Officer was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wledgement of the loan creditor, etc. The Ld.Counsel also referred that Shri Pravinkumar Jain has retracted from his statement and, therefore, the lower authorities are not justified in sustaining the addition for unexplained cash credit of Rs.85 lakhs. 12. On the contrary, the Ld. Departmental Representative submitted that summons under section 131 of the Act sent by the Assessing Officer at the addresss of the cash creditor return unserved and the assessee did not provide any new or current address of the said cash creditor. Therefore, the Assessing Officer asked the assessee to produce the said cash creditor; however, assessee failed to do so. In the circumstances, identity of the creditor is not established. The creditworthiness of the said party was also doubtful. He further submitted that when the assessee is able to furnish affidavit of retraction from Shri Pravinkumar Jain, then assessee could very well produce the directors or promoter of the cash creditor company, M/s Josh Trading Pvt Ltd, which was controlled by Shri Pravinkumar Jain. 13. We have heard the rival submissions of the parties on the issue in dispute and perused the relevant material on record. The Ld.Couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of Rs.9,90,000/- received as fees, amount of Rs.2,62,000/- received as miscellaneous income and amount of Rs.95,000/- for sale of products, which have been assessed by the Assessing Officer as unexplained cash credit under section 68 of the Act. The Ld.CIT(A) also has upheld the addition. However, in respect of fees of Rs.9,90,000/-, the Ld. CIT(A) has disallowed business expenses incurred for earning said income also. 17. The facts in brief qua the issue of commission income of Rs.9,90,000/- received by the assessee from 'M/s Lifeline Pharma' is concerned, the assessee has shown income of Rs.9 lakhs from providing marketing consultancy to M/s Lifeline Pharma. According to the assessee, TDS of Rs.90,000/- was deducted on the said commission income. It was submitted by the assessee that M/s Nihal Garware, director of the assessee company rendered the services corresponding to the commission income and, therefore, finding of the Assessing Officer and Ld.CIT(A) that no services have been provided by the assessee company is not justified. 18. Before us, the Ld.Counsel for the assessee has submitted that firstly, income has already been offered by the assessee for the purpose of inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y detail the AO has rightly added the same as unexplained cash credit u/s 68 of the I.T. Act. This ground of appeal is therefore treated as dismissed. 4.1.5 The appellant had offered income of Rs.95,000/- as sale of product. Appellant submitted that it was generated out of scrap sale. No details like name and address of the persons from whom these income have been received. The directors of the company had categorically admitted u/s 131 on oath that no business activity was conducted by the company. No detail has been furnished by the appellant during the appeal proceedings as well. In absence of any detail the AO has rightly added the same as unexplained cash credit u/s 68 of the I.T. Act. This ground of appeal is therefore, treated as dismissed." 21. We have heard rival submissions of the parties on the issue in dispute and perused the relevant material on record. We find that in absence of any documentary evidence, the action of the Ld.CIT(A) in upholding the addition under section 68 of the Act is justified. However, the corresponding income which has already been declared in the regular return of income needs to be reduced or subtracted from the total income. Thus, the in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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