Ryatar Sahakari Sakkare Karkhane Niyamit Vs ITO (ITAT Bangalore)
ITAT Bangalore held that addition under section 68 of the Income Tax Act towards unexplained money send back for de novo reassessment due to difference in amounts and unclear information.
Facts- The assessee filed return of income in the status of AOP on 28.09.2016 declaring NIL income after set off of brought forward loss. As per information available with the department, Shri Doshi Amrutlal Talakchand is involved in suspicious transactions and assessee is one of the beneficiaries involving amount of Rs.198,05,82,912. The AO after recording reasons and obtaining approval from the Competent Authority, issued notice u/s. 148 to the assessee on 29.06.2021 and other statutory notices were also issued.
Post investigation, AO issued show cause notice proposing to make addition of Rs.54,52,400 as undisclosed income u/s. 68 of the Act. There was no reply from the assessee till 27.03.2023 to the show cause notice, accordingly the AO considered Rs.54,52,400 as from undisclosed sources and added u/s. 68 r.w.s. 115BBE of the Act. First Appellate Authority confirmed the order of the AO. Being aggrieved, the present appeal is filed.
Conclusion- Held that there is difference between the amount noted by the assessee and submissions made by the assessee made with Shri Rajkumar Amrutlal Doshi. As per the assessee there is transaction of Rs.33,19,760 during the year. However the AO has made addition u/s. 68 of Rs.54,52,400 which is also confirmed by Shri Rajkumar Amrutlal Doshi and he has stated that the bills shall be prepared in the name of others. But there is no clear information that how the transactions have been recorded by the assessee. The assessee has produced sales invoices, gate pass copy and central excise invoice number, copy of audit report and copy of financial statements. Shri Rajkumar Amrutlal Doshi has denied any purchase and sale transaction with the assessee. During the course of arguments, the ld. AR submitted that there is no cross-examination provided to the assessee before making the addition, but the assessee could not prove that during the course of reassessment proceedings any request was made with the AO for cross-examination, therefore the arguments made by the ld. AR on the cross-examination is rejected. Considering the entire facts of the case, we remit this issue back to the AO for de novo reassessment as per law.
