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Facts
The assessee's appeal for AY 2014-15 arises from an order of the CIT(A)/NFAC. The first ground challenging an addition under Section 68 was not pressed. The second issue involved an addition of Rs. 63,22,365/- on account of the alleged sale of 15% of potato produce in the black market.
Held
The Tribunal held that while the assessee maintained evidence, there were deficiencies in reconciling book entries. To address shortfalls, a lump sum addition of Rs. 10 lacs was made, granting relief of Rs. 53,22,365/-. Regarding the third issue, a 15% disallowance of loading/unloading expenses and interest to farmers was restricted to 5%.
Key Issues
Whether the addition on account of unexplained cash credit and alleged sale of produce outside books is justified. Whether the disallowance of expenses and interest to farmers is correct.
Sections Cited
68, 143(3)
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Income Tax Appellate Tribunal, “DB” BENCH, AGRA
Before: SHRI SATBEER SINGH GODARA & SHRI MANOJ KUMAR AGGARWAL
ORDER
PER SATBEER SINGH GODARA, JUDICIAL MEMBER:
This assessee’s appeal for assessment year 2014-15 arises against Commissioner of Income Tax(Appeals)/National Faceless Appeal Centre (in short, the “CIT(A)/NFAC”), Delhi’s DIN and Order No. ITBA/NFAC/S/250/2022-23/1044636526(1), dated 12.08.2022, in proceedings u/s 143(3) of the Income-tax Act, 1961, [hereinafter referred to as the ‘Act’].
Heard both the parties at length. Case file perused.
Learned counsel at the outset submits that the assessee does not wish to press it’s first and foremost substantive ground challenging
The second substantive issue between the parties herein regarding correctness of addition of Rs.63,22,365/- made by both the ld. lower authorities on the ground that the assessee had sold 15% of the potato produce out of books in the black market thereby rejecting its supportive evidence in favour of the book result.
Learned counsel has reiterated the assessee stand throughout that it had duly maintained all the relevant evidence wherein no unaccounted trading transactions have been specifically pointed out. The fact however remains that the assessee has not been able to reconcile all the deficiencies book entries noticed by the learned Assessing Officer. That being the case and on account of the assessee lack of proper reconciliation of its potato produce that was sold, it is deemed proper in the larger interest of justice to make a lump sum addition of Rs.10 lacs to meet out to cover all shortfalls. Ordered accordingly. The assessee gets relief of Rs.53,22,365/- in other words with a rider that the same shall not be treated as a precedent. This second substantive ground is treated as partly allowed.
Lastly comes to third issue between the parties wherein both the lower authorities have confirmed 15% disallowance of the assessee loading/unloading expenses and interest imposed to farmers, on ad-hoc basis.
We are of the considered view although in the larger interest of justice to restrict the same @ 5% only to cover all the alleged shortfalls
This assessee’s appeal is partly allowed.
Order pronounced in the open court on 10.02.2025