Case Law Details
Pradeep Sawhney Vs ITO (ITAT Delhi)
ITAT Delhi held that the revenue can bring expenditures incurred in earlier years to be taxed in subsequent years if it is proved that the expenditure incurred was bogus.
Facts- The assessee has shown creditors of Rs.1,54,67,677/-. AR of the assessee was asked to file confirmation from all 35 creditors as shown in the balance sheet. AR of the assessee filed confirmation from only 7 creditors, total amount for which confirmation has filed is only Rs.45,84,804/-. No confirmation has filed for the balance amount of Rs.1,08,82,873/- by the assessee during the course of assessment proceedings. However, notice u/s 133(6) of the Income Tax Act, 1961 was also issued to some of the parties but the same were received back. Hence, the balance amount for which confirmation has not received/filed is hereby added back to the declared income of the assessee.
Aggrieved, the assessee filed appeal before the ld. CIT(A). The ld. CIT(A) examined the issue at length in detail and confirmed the addition made by the AO. Being aggrieved, the present appeal is filed.
Major issue raised here is whether revenue can bring the expenditure incurred in the earlier years to be taxed in the subsequent years.
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