INCOME TAX OFFICER, WARD-1(1)(1), AHMEDABAD, VEJALPUR, AHMEDABAD vs. AAVISHKAR IMPEX PRIVATE LIMITED, NAVRANGPURA, AHMEDABAD

Vijaykumar Khalas for the purchases as alleged unexplained expenditure u/s.69C of the IT Act, 1961 and in taxing the same applying the provisions of Sec. 115BBE of the Act.

7. Appellant prays that the delay in filing of appeal may kindly be condoned

filed by revenue “1. On the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in deleting the addition of Rs. 16,58,71,338/- made u/s 68 of the Act on account of cash credits.

2. On the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in deleting the addition of Rs.82,10,000/- made u/s. 68 of the Act on account of short term borrowing as non-existent liability.

4. "It is, therefore, prayed that the order of Ld. CIT(A) may be set aside and that of the Assessing Officer be restored".”

3. The assessee is a company and filed return of income for assessment year 2020-21 on 15-02-2022 admitting a total income of Rs. nil after adjusting the carry forward business loss of Rs. 1,05,215/-. The return of income was processed on 21-06-2022 and selected for complete scrutiny in respect of business purchase. Relevant notices u/s. 143(2), 142(1) along with questionnaire was issued and show cause notice was issued on 15-12- 2022. The assessee furnished partial details and evidences as mentioned by the Assessing Officer in the assessment order. On page 6 of this assessment order, the Assessing Officer observed that the assessee has furnished the confirmation of the ledgers, copies of details relevant to the supplies. The Assessing Officer observed that the assessee has not furnished the details relevant to trade payable liability which was arrived at and existed from which year as well as the reason for the liability existence till the relevant assessment year. The Assessing Officer further observed that the assessee has not explained the identity of one trade payable party namely; Mahima Enterprises with the PAN No. and that also with the relevant party namely M/s. HHEC of India. After verifying the documents, the Assessing Officer held that the unexisted liability is maintained by the assessee every year as a cushion to neutralize some other stock in the balance sheet and thus the amounts can be in the shadow of sundry payable which was treated as unproved liability credited into the books of accounts which is utilized for every year to equalize the unaccounted purchase/unaccounted stock. Thus, the Assessing Officer made the addition to Rs. 16,58,71,338/- u/s. 68 of the act. The Assessing Officer related to short term borrowing made addition u/s. 68 amounting to Rs. 82,10,000/- thereby holding that the relevant unproved/unexisted liability which was credited into the accounts in the form of the short term borrowings must be added to the income of the assessee. The Assessing Officer further made addition of Rs. 159,11,47,972/- in respect of the corresponding purchases and the expenditure claimed thereon and further held that the assessee has not proved the genuineness of the purchases by providing necessary, cogent evidences like copy of bills, bank statement highlighting the evidences for the payments and hence added back the said to the total income u/s. 37 of the Act. The Assessing Officer further made addition of Rs. 19,04,35,450/- in respect of payment made by the assessee to Shri Neel Vijay Kumar and treated the same as unexplained expenditure u/s. 69C thereby observing that the assessee has not given the details related to the sales during the year under consideration.

5. We are first taking the assessee’s appeal as the assessee submitted before us that there is a delay of 109 days in filing the present appeal for which the assessee has filed the detailed affidavit stating thereon that the assessee company is engaging part time accountant for writing books and accounts and making compliance to income tax and other allied laws. Due to the said accountant’s ill health he was not attending the case regularly and assessee company and its director was not aware of appellate proceedings/hearings/notices issued by the CIT(A) and could not appear and represent the case properly before the ld. CIT(A). Therefore, the CIT(A) has passed ex-parte order. In fact before the Tribunal also, the assessee was not able to take cognizance of the ex-parte order within the stipulated period and thus filed belated appeal before the Tribunal. The ld. A.R. submitted that the delay may be condoned and the matter may be remanded back to the file of Assessing Officer and the Assessing Officer also has not taken cognizance of the relevant materials filed before him. As mentioned in para 3 page 4 of the assessment order, the assessee has submitted the details subsequently but all the details were not taken into account by the Assessing Officer.

6. The ld. D.R. submitted that the assessee was given ample opportunity to file the relevant documents before the Assessing Officer as well as before the CIT(A) and therefore the Assessing Officer as well as CIT(A) has passed proper order.

Thus, appeal of the assessee being filed by the assessee is partly allowed for statistical purposes.

Revenue and the same is also related to A.Y. 2021-22 in respect of the same assessment order which was challenged by the assessee. The said appeal filed by the assessee is already remanded back. Hence, the appeal of the Revenue is also partly allowed for statistical purposes.

उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद