Case Law Details
This court is of the opinion that the impugned order is unreasoned and has blindly accepted the Commissioner (Appeals)’s logic that propriety demands that the assessee’s surrender –restricted to Rs. 50 lakhs should be accepted. The expenses claimed were Rs. 1 crore. Once the assessee admitted that Rs. 50 lakhs was claimed excessively, the onus of showing that the balance Rs. 50 lakhs was a justified expenditure lay upon it. The assessee did not discharge that onus; the assessing officer was therefore justified in bringing in to tax that expenditure.
Full Text of the High Court Judgment / Order is as follows:-
This appeal urges the following question of law :–
Whether the learned ITAT erred in restricting the addition of Rs. 1.00 crore to Rs. 50 lakhs on account of bogus claim of consultancy charges payments to M/s. T & G Quality Management Consultants Limited, an entity controlled by one S.K. Gupta who admitted to providing accommodation entries.
2. The brief facts of the case are that on 12-12-2006 search and seizure action was conducted at the business of Shri S.K. Gupta along with various concerns in which he and his family members were interested. Action under section 132 of the Income Tax Act, 1961 was conducted in the case of various companies owned or controlled by him and also in the case of different individuals connected with the said companies. From the computerized books of account seized during the search and the numerous bills seized from the business premises of Shri S.K. Gupta, it was found that various companies controlled by him had issued bills to Link Engineers Pvt. Limited of substantial amount (for software development and for providing professional services.) During the course of survey at both the office during the financial year 2004-2005 and financial year 2005-2006 premises, it was discovered that there was no documentary evidence other than bills to support the fact that the relevant services had been provided by the companies of Shri S.K. Gupta.
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