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Case Law Details

Case Name : DCIT Vs Mojika Real Estate and Developers Pvt. Ltd. (ITAT Jaipur)
Appeal Number : ITA No. 1236/JP/2018
Date of Judgement/Order : 25/11/2020
Related Assessment Year : 2014-15
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DCIT Vs Mojika Real Estate and Developers Pvt. Ltd. (ITAT Jaipur)

Conclusion: Rejection of books of accounts under section 145(3) was not justified as once the books of accounts had been prepared/recasted, AO could not go back to the stage of survey proceedings  to contend that since no books of accounts were available at that point in time, he would not consider the books of accounts so recasted/prepared and furnished subsequently.

rejection books  account specific defect pointed out AO

Held: In the instant case, AO had rejected the books of accounts invoking the provisions of section 145(3) and had made an addition of Rs 50 lacs in the hands of assessee company. The reason why AO had rejected the books of accounts was that the books of accounts were not found/available at the time of survey and the same had been prepared subsequently and were thus not reliable. The survey was conducted at the premises of assessee on 4.09.2013 and it was an undisputed position that the books of accounts maintained on the tally software were deleted and could not be retrieved by the experts of the department during the survey proceedings. However, basis vouchers and other details available with assessee, the books of accounts were subsequently re-casted and were audited and basis the same, the return of income was filed by assessee. Therefore, once the books of accounts had been prepared/recasted, AO could not go back to the stage of survey proceedings and contend that since no books of accounts were available at that point in time, he would not consider the books of accounts so recasted/prepared and furnished subsequently. AO was well within his rights to question the results or the effect of the transactions so reflected in the books of accounts as to whether the same represented a true and fair picture and identified the defects, if any, however, once the books of accounts had been prepared and submitted for his verification, he could not deny the very existence of such books of accounts. Therefore, the rejection of books of accounts was not justified in the instant case in absence of any specific defect so pointed out by AO.

FULL TEXT OF THE ORDER OF ITAT JAIPUR

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