Srabani Construction (P) Ltd Vs DCIT (ITAT Cuttack)
In respect of addition of Rs.51,84,803/- made by the AO u/s.68 of the Act with regard to sundry creditors, on observing the financial statement it is found that the assessee could not produce the creditors as well as could not satisfy the three ingredients i.e. identity, creditworthiness and genuineness of the transaction as per the Section 68 of the Act and accordingly, the same was added to the total income of the assessee. The assessee has filed return of income declaring at Rs.4,41,370/- which has been accepted by the AO while determining the total income of the assessee in the reassessment proceedings. The assessee has prepared trading profit and loss account which is duly certified by the Chartered Accountant u/s.44AB of the Act. The assessee is engaged in the business of construction work. The profit shown in the income has been arrived after deducting expenditure from the total gross turnover of the assessee. The gross turnover for the impugned financial year is Rs.8,33,46,703/- and the net profit has been shown as per Annexure/1 Part-B of the tax audit report which is placed at page 19 of the paper book in which the net profit has been shown before tax is Rs.4,41,371/- which has been accepted by the AO. Once the purchase and sales and net profit declared in the return of income has been accepted by the AO then the sundry creditors should also be accepted. Our this view is supported by the decision of coordinate bench of the Tribunal in the case of Lycos India Limited, ITA No.02/CTK/2018, order dated 01.09.2020.
