SRI.K.R.SURESHKUMAR,,TRICHUR vs. THE ACIT, TRICHUR

We notice with the able assistance coming from the Revenue side that the assessee’s sole substantive ground challenges correctness of both the lower authorities’ action treating cash credit of Rs.1,62,33,155/- [in the capital account in the books of account of M/s. Kallada Tours and Travels] as unexplained under Section 68 of the Act followed by the rejection of his claim that this addition made deserves to be set off against brought forward losses of earlier years; respectively.

Learned DR highlighted the fact that the assessee appears to have filed his additional evidence application dated 26.08.2016 inter alia containing a list of the corresponding parties. We find no merit in the assessee’s instant additional evidence production since he appears to have submitted before the learned lower authorities (page 2 para 3 in the CIT(A)’s appellate order) that no details were not available way back in 2012. We thus fail to understand as to how the so called additional evidence pressed by the assessee at this belated stage could be termed as relevant or carrying genuineness once he himself admitted clearly before the Assessing Officer that no such details were available. This additional evidence petition stands rejected therefore.The very course of action follows in the assessee’s first and foremost substantial grievance that Section 68 addition deserves to be deleted once he had not even filed any details of the concerned parties involving varying sums. We thus uphold the impugned Section 68 addition of Rs.1,62,33,155/- in principle.

Next comes the latter issue of set-off of the impugned unexplained cash credits from the alleged brought forward losses of earlier years. Learned DR referred Fakir Mohammed Haji Hassan 247 ITR 290 (Guj) that such an income under the had “unexplained” addition does not deserve to be set-off against brought forward losses. We find no merit in Revenue’s instant latter argument in the light of the very hon'ble high court’s subsequent decision CIT vs. Shilpa Dyeing and Printing Mills (2013) 219 Taxman 279 (Guj) holding that Section 14 of the Act defines all the relevant heads of income including Section 68/69-69C of the Act; which in turn, are liable to be adjusted against brought forward losses as per law. We thus accept the assessee’s instant latter substantial ground in principle and direct the learned Assessing Officer to frame his consequential computation allowing his set-off claim subject to this taxpayer filing all the relevant details, in consequential proceedings within three effective opportunities of hearing. Ordered accordingly.

This assessee’s appeal is partly allowed for statistical purposes in above terms.