ITAT Rajkot Judgments — August 2019

The Tribunal upheld the CIT(A)'s decision, finding the reassessment invalid due to a 'change of opinion' by the AO. The CIT(A) had also found that the loss on sale of government securities and amortization of premium were allowable business expenditures.

The Tribunal upheld the CIT(A)'s decision to restrict the disallowance on cash purchases to 25% and delete the addition on estimated gross profit. It found no error in the CIT(A)'s reasoning regarding the increased turnover and the fall in gross profit margin.

The Tribunal held that the expenditure claimed as repair and maintenance, based on the purchase of old parts and scrap machinery, was not proven to be incorrect by the AO. However, the assessee failed to provide information for the cash credit, indicating concealment of income.

The Tribunal noted the assessee's persistent absence and lack of representation. It was presumed that the assessee was not serious in pursuing the appeal.

The Tribunal held that the Revenue failed to provide cogent documents to support the claim that the assessee actually received the higher value. The initial transfer was for conversion purposes, and the assessee later got the land back through a civil suit.