ITA No. 6771/Mum./2011, (Assessment Year: 2007-2008). Case: Bhadrecha Construction Pvt. Ltd. Vs ITO 8(1)-4. ITAT (Income Tax Appellate Tribunal)

Case Number:ITA No. 6771/Mum./2011, (Assessment Year: 2007-2008)
Party Name:Bhadrecha Construction Pvt. Ltd. Vs ITO 8(1)-4
Counsel:For Appellant: Shri Hariom Tulsian and For Respondents: Shri Pitamber Das
Judges:Rajendra, Member (A) and Dr. S.T.M. Pavalan, Member (J)
Issue:Income Tax Act, 1961 - Sections 119(5)(A), 144, 251, 251(2), 40(a)(1a), 40(a)(i), 40(a)(ia), 40(a)1(a), 40A(i)
Judgement Date:May 07, 2014
Court:ITAT (Income Tax Appellate Tribunal)


Rajendra, Member (A), (ITAT Mumbai 'C' Bench)

  1. Challenging the order dt. 20.06.2011 of the CIT(A)-16, Mumbai, assessee-company has raised following Grounds of Appeal:

  2. On the facts and in the circumstances of the case and in the law the Ld. CIT(A)-16 erred in enhancing the addition made by the Ld. AO at Rs. 60,00,000/- on account of unexplained credit by way of advance from M/s. Vasundhara Co-op. Housing Society Ltd. and on that account making a fresh addition of Rs. 94,42,869/- on the basis of finding of the Ld. AO in his remand report on account of unaccounted running sales bill raised by the assessee company on M/s. Vasundhara Co-op. Housing Society Ltd. without appreciating the facts submitted by the assessee company that the said sales has been booked in the subsequent year along with the cost of sales based on the facts and circumstances in the case and accounting policies, adopted by it.

  3. On the facts and in the circumstances of the case and in the law the Ld. CIT(A)-16 erred in making a fresh addition of Rs. 2,02,42,706/- on the basis of finding of the Ld. AO in his remand report for violation of the provisions of section 40(a)1(a) without appreciating the fact that the assessee company had deposited relevant TDS amount of Rs. 3,99,772/- on 31.03.2007 i.e. the date prescribed under the section for such payment and thereby had complied with the provisions of section 40(a)(1a) of the act.

  4. The appellant reserves the right to add; amend, modify, or subtract any ground of appeal at any stage of hearing.

  5. Assessee-company, engaged in the business of contracting, filed its return of income on 30.10.2007, declaring total income at Rs. Nil. Assessing officer (AO) finalised the assessment order u/s. 144 of the Act, on 21.12.2009, determining the total income at Rs. 1,27,39,000/-.

    First Ground of appeal pertains to enhancing the addition by the First Appeal Authority (FAA). During the assessment proceedings AO issued notices to the assessee on various occasions, but the assessee did not appear before him nor any details were filed. So, he had to pass best judgment order. While finalising the assessment, in the balance sheet filed by the assessee, he found that there were unsecured loan of Rs. 60 lakhs. As per the AO it was not known as to from where loans in question were raised, that confirmation or ledger account of the loans were not on record, that creditworthiness of the lenders and genuineness of the transaction was not proved. As a result, he made an addition of Rs. 60 lakhs to the total income of the assessee.

    2.1. Against the order of the AO, assessee preferred an appeal before the FAA. It was submitted before him that that money received by the assessee was trade credit, that it had...

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