SV Milk & Milk Products Private Vs ACIT (ITAT Hyderabad)
The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT) partly allowed the assessee’s appeals for Assessment Years 2011-12 and 2012-13. For AY 2011-12, the Tribunal considered additions relating to share application money under Section 68, negative cash balance treated as unexplained expenditure under Section 69C, and cash payments for milk purchases. For AY 2012-13, it examined additions arising from reassessment, including an addition already set aside in earlier proceedings and disallowance of depreciation.
Regarding the addition of ₹2.30 crore under Section 68 towards share application money, the Tribunal noted that the Assessing Officer had originally made the addition without conducting any enquiry because the assessee had not responded to the notice issued under Section 142(1). During appellate proceedings, the assessee furnished confirmations and supporting records. The Tribunal observed that the Assessing Officer had rejected these documents mainly because certain land records were in Tamil and the confirmations were stereotyped, without examining the shareholders or conducting any independent enquiry. Holding that the evidence could not be rejected without proper verification, the Tribunal remanded the issue to the Assessing Officer for fresh examination after permitting the assessee to furnish Telugu or English translations of the Tamil documents and after conducting an appropriate enquiry.
