Punit Goel Vs ACIT-2 (ITAT Lucknow)
Where purchases are accepted as genuine, outstanding trade creditors arising from such purchases cannot be treated as unexplained cash credits merely because some suppliers fail to respond to notices; similarly, books cannot be rejected merely for non-production of some vouchers when the books and major supporting records have already been furnished.
Core Issue: The Tribunal considered three principal issues: the addition arising from the difference between receipts reflected in Form 26AS and the receipts declared in the return, the addition under Section 68 in respect of outstanding trade creditors representing credit purchases, and the rejection of books of account followed by estimation of net profit.
Facts: The assessee was engaged in civil contract work and had declared receipts in the return which differed from the gross receipts reflected in Form 26AS. The assessee explained that certain deductors had deducted TDS on the gross amount inclusive of service tax, whereas service tax was separately accounted for and was not offered as income. The assessee also had outstanding balances payable to suppliers against purchases made on credit. During assessment, the Assessing Officer questioned these creditors and ultimately treated certain outstanding balances as unexplained cash credits. The AO also rejected the books of account and estimated the net profit on the ground that all vouchers were not produced, despite the assessee having furnished books, ledgers and major vouchers electronically.
