Case Law Details
S.D. Traders Vs CIT (Allahabad High Court)
It has been argued by the counsel for the Revenue that CIT (A) has not travelled beyond the books of accounts and during appeal it was found that only confirmation was available of five parties and the rest of the creditors were untraceable, hence the addition of the amount was made which were part of the books of account. Likewise, the addition made as far as the labour charges are concerned was also on the basis of the books of account submitted by the assessee as such, it cannot be accepted that the CIT (A) had made additions on the basis of new source of income.
The argument of the counsel for the assessee relying upon the decision of the Apex Court in case of Shapoorji Pallonji Mistry (supra), Rai Bahadur Hardutroy Motilal Chamaria (supra) and Sardari Lal & Co. (supra) cannot be accepted as the said judgments have their very basis where the Appellate Assistant Commissioner had made addition or deletion on the basis of new source of income, but present case is not of new source of income, as CIT (A) has relied upon the books of accounts submitted by the assessee along with his return and had claimed expenditure made by him in profit and loss account and claim of sundry creditors shown in balance-sheet.
The Apex Court while dealing with the power of the Appellate Assistant Commissioner under Section 251 of the Act had in case of Nirbheram Deluram (supra) and Jute Corporation of India (supra) had held that power of Appellate Assistant Commissioner is coterminous with that of Income Tax Officer and he can do what the Income Tax Officer can do and also direct him to do what he has failed to do.
In the present case, the CIT (A) had deleted addition made by the Assessing Officer and had made two additions of the labour charges and sundry creditors on the basis of the profit and loss account, and balance-sheet filed by the assessee along with his return. Thus, there was no new source of income as claimed by the assessee. The case law relied upon by the assessee in case of Sardari Lal & Co. (supra) and Shapoorji Pallonji Mistry (supra) are all distinguishable in the facts of the present case, and the Hon’ble Courts in those cases had only dealt with the situation wherein AAC found new source of income and made additions to the income, while in the present case no such addition was made from any new source of income but from the return so submitted by the assessee himself.
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