ITA No. 5166/Mum/2011 (Assessment Year: 2008-09) and C.O. No. 73/Mum/2012. Case: 1. ACIT, Central Circle 15(1), Room No. 104, Matru Mandir, 1st Floor, Tardeo Road, Mumbai 400007, 2. Swapnil Enterprises, B-104 Harshad Apartments, Behind Evarad Nagar, E.E. Highway, Sion (East), Mumbai - 400 022 Vs 1. Swapnil Enterprises, B-104 Harshad Apartments, Behind Evarad Nagar, E.E. Highway, Sion (East), Mumbai - 400 022, 2. ACIT, Central Circle 15(1), Room No. 104, Matru Mandir, 1st Floor, Tardeo Road, Mumbai 400007. ITAT (Income Tax Appellate Tribunal)
| Case Number | ITA No. 5166/Mum/2011 (Assessment Year: 2008-09) and C.O. No. 73/Mum/2012 |
| Judges | Shri B.R. Mittal, J.M. and Shri B. Ramakotaiah, A.M. |
| Issue | Income Tax Act, 1961 - Sections 144, 37(1), 68 |
| Judgement Date | August 31, 2012 |
| Court | ITAT (Income Tax Appellate Tribunal) |
Order:
B. Ramakotaiah, A.M., (Mumbai 'A' Bench)
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The Revenue appeal preferred against the roder of the CIT (A)- 26 Mumbai, dated 29.04.2011 and assessee preferred cross objection. Briefly stated, assessee is a registered firm engaged in the business of transportation of debris and other materials arising of demolished structures. Since details called for are not filed by assessee, AO rejected the books of account and disallowed 25% of the expenditure claimed in the books of account in an order u/s 144. Further since assessee has not furnished any details, an amount of `32,43,130/- was also added as income under section 68 has increased in current liability and further an amount of `37,40,960/- again under section 68 in unsecured loans shown during the year.
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Before the CIT (A) assessee submitted that out of the expenditure claim, disallowance was of `85,28,956/- i.e. 25% of the total expenses aggregating to `3,41,15,825/-. It was submitted that major expenditure pertain to the payments towards work to a single party Offbeat Developers Pvt. Ltd and balance of expenditure was towards day-to-day maintenance. It was also further submitted that expenses on Oil, diesel and payments to other transport shown as purchases on which TDS was made. Therefore, as against `85,28,956/- disallowed by AO, the CIT (A) sustained 10% of the disallowances of other expenses at `.1,37,140/-. After considering the submissions including that amount of unsecured loan of `45,67,250/- from ICICI Bank was also disallowed, the CIT (A) deleted the addition under section 68. Therefore, the Revenue is aggrieved. No opportunity was given to AO and no details were furnished in the course of assessment. The Revenue has raised four grounds in this regard.
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In the cross objection, assessee contends that AO was not correct in completing the assessment under section 144 which was bad in law suffering from legal infirmities.
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We have heard the learned DR and the learned Counsel. At the outset it was noticed that in the assessment proceedings there was non furnishing of information which lead to AO for disallowance of 25% of the expenses and also making addition as unexplained cash credits and loans under section 68. Even though the estimation was little high pitched which is not according to the spirit of the provision of section 144, we are of the opinion that the CIT (A) also equally erred in deleting the amounts. First of all there was no additional information before...
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