ACIT Vs Shrinidhi Enterprize (ITAT Surat)
General Modus Operandi Insufficient -No Evidence of Bogus Labour or Loans -Unsecured Loans Through Banking Channels Held Genuine
General Modus Operandi Insufficient -No Evidence of Bogus Labour or Loans -Unsecured Loans Through Banking Channels Held Genuine-Telescoping of Survey Disclosure Accepted by Tribunal- Additions Based on Third-Party Statements Without Specific Evidence Not Sustainable
Revenue challenged deletion of additions relating to alleged bogus labour expenses & unsecured loans, based on information from search & survey in the case of Sadhani Brothers group.
A.Y. 2015-16
Assessee, a real estate developer, declared income of Rs.7.60 crore including additional Rs.3.09 crore surrendered during survey. AO held labour expenses of Rs.4.93 crore claimed through Sadhani Brothers’ entities as bogus, citing affidavits & lack of machinery with contractors, and disallowed the entire sum along with Rs.2.46 lakh commission.
CIT(A) deleted the addition noting that (i) assessee furnished PANs, ITRs, confirmations, bank statements & deducted TDS, (ii) survey at assessee’s premises found no discrepancy in labour or construction work, (iii) surrendered income of Rs.3.09 crore already subsumed any inflation.
Tribunal upheld CIT(A)’s order, holding that AO relied on general modus operandi & third-party statements without specific incriminating evidence linking assessee.
A.Y. 2016-17
