Sanjay Sharma Vs. ACIT (ITAT Delhi)
Assessing Officer has accepted not only he sales figures but has also accepted that total purchases. Under accounting principles, a liability can only be brought into account by a credit entry in the books of account in favour of the person to whom the money is payable’ Thus, there is marked difference between a credit representing a liability payable by the assessee and a credit representing monies received from another person. It is because of this distinction, a liability for purchase which has been credited in the account of the supplier cannot be added under section 68 of the Act, more so when the purchase has been accepted as genuine and a deduction therefore has been allowed.
FULL TEXT OF THE ITAT JUDGEMENT
This appeal by the assessee is preferred against the order of the CIT(A)- 38, New Delhi dated 19.03.2019 pertaining to A.Y. 2015-16.
2. The sum and substance of the grievance of the assessee is that the CIT(A) erred in sustaining the addition of Rs.7,99,173/- out of sundry creditors outstanding at the close of the A.Y under consideration.
3. Briefly stated the facts of the case are that the appellant is an individual having source of income from house property, business or profession and income from other sources. During the course of scrutiny assessment proceedings, the Assessing Officer issued notices under section 133(6) of the Income tax Act, 1961 [hereinafter referred to as ‘the Act’ for short] to the following parties:
Comments are closed.