| |
| The Tax Publishers2019 TaxPub(DT) 0218 (Ahd-Trib) : (2019) 174 ITD 0584 INCOME TAX ACT, 1961
Section 69
Where AO made addition under section 69 on account of unexplained receipts, the same was not justified because once AO had worked out unaccounted receipts for the whole year on the basis of evidence found for period of six months, then such working was based on an estimate and assumption, and in the same manner corresponding expenditure ought to be assumed and estimated, because no entity could earn gross receipts.
|
Income from undisclosed sources - Addition on account of unaccounted income earned by way of suppression of professional receipts - Profits declared on suppressed receipts -
During search action under section 132 certain loose papers reflecting unaccounted receipts were found and impounded. These loose papers pertained to the period of six months. According to AO, assessee failed to explain as to how these unaccounted receipts have been recorded in the regular books of accounts. AO thereafter observed that trial balance sheet from regular books of account, was drawn out and receipts for nine months have been shown by assessee in regular books. Therefore AO made addition under section 69 as unexplained receipts. Held: Once AO had worked out unaccounted receipts for the whole year on the basis of evidence found for period of six months, then such working was based on an estimate and assumption, and in the same manner corresponding expenditure ought to be assumed and estimated, because no entity could earn gross receipts. This fold of dispute was ignored by AO on the ground that evidence was not submitted by assessee exhibiting incurrence of expenditure. Thus, addition under section 69 could not be sustained
Relied:CIT v. Gurubachhan Singh J. Juneja (2008) 302 ITR 63 (Guj-HC) : 2008 TaxPub(DT) 1637 (Guj-HC) CIT v. Samir Synthetics Mill (2010) 326 ITR 410 (Guj-HC) : 2010 TaxPub(DT) 44 (Guj-HC) CIT v. Balchand Ajit Kumar. (2003) 263 ITR 610 (MP-HC) : 2003 TaxPub(DT) 1199 (MP-HC) Rajnik And Co. v. Asstt. CIT (2001) 251 ITR 561 (AP-HC) : 2001 TaxPub(DT) 1347 (AP-HC) CIT v. President Industries. (2002) 258 ITR 654 (Guj-HC) : 2002 TaxPub(DT) 56 (Guj-HC)
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
IN THE ITAT, AHMEDABAD BENCH
 SUBSCRIBE FOR FULL CONTENT
|