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Income Tax - Highlights / Catch Notes

Home Highlights April 2014 Year 2014 This

AO has made a lump sum trading addition by estimating ad hoc ...

Income Tax

April 29, 2014

AO has made a lump sum trading addition by estimating ad hoc income of assessee at Rs.10 lakh after rejection of books of accounts u/s 145(3) of the Act - it is not open to the AO to uphold other disallowances and addition on other counts - AT

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  1. Disallowance on an ad-hoc basis - in the absence of necessary documentary evidence the AO had no alternative except to make the disallowance on an ad-hoc basis.

  2. Ad hoc disallowance of 10% of expenses - Since the AO or the Ld. CIT(A) has not rejected the books of account of the assessee they could not have estimated (ad hoc...

  3. Addition made on account of unaccounted cash receipts – Cash receipts of brokerage – Sale of car parking charges - the assessee’s purchases cannot be doubted on ad-hoc basis - AT

  4. Addition on account of inflation of purchases - suppliers were not maintaining the stock register and their books of accounts were rejected at the time of assessment...

  5. Discount to customers - Merely because the receipt vouchers were made by the assessee cannot be a ground to make ad hoc disallowance out of the claim of discount - AT

  6. Royalty & lump sum fee – The payment of lump sum fees for the technical know-how and the royalty is allowable as revenue expenditure - AT

  7. Leakage of revenue - Any disallowance should be specific and properly quantified - presumptive and ad-hoc addition based on an outlandish consideration of plugging...

  8. Ad hoc additions on account of entertainment expenses and on account of Seminars/conferences - there was no material on record to show that any part of the these...

  9. Ad-hoc disallowance of various expenses on the ground that said expenses incurred in cash and not further, supported by necessary bills and vouchers - once the Assessing...

  10. Notification regarding exemption of duties of Central Excise against scrips issued under the RoSCTL scheme and additional ad-hoc incentive for apparel and made-ups sector.

 

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