Latest Income-Tax Details

For Full Access To All Latest Judgments on Income Tax
Click Here To Subscribe Now
Take a tour of our Income-Tax Library

Revenue has raised the ground that the Ld. CIT (A), Ludhiana has erred in law to delete the addition of Rs. 1,09,35,518/- on account of Commission Income despite considering the fact" that AO has proved that assessee is merely an entry provider and assessee's books are not reliable, hence AO has rejected assessee's books of account.

Shanti Prime Publication Pvt. Ltd.

Sec. 68 of Income Tax act, 1961—Cash Credit—Additions made by the AO merely on assumptions and presumptions are no sustainable in the eyes of law.

Facts: Revenue has agitated the action of CIT(A) in deleting the addition made by AO on account of sum shown as payable in the name of M/s. Vasu Trading Co. AO observed that under the head Current Liabilities, the assessee has shown an amount of Rs. 29, 72, 94, 000/- in the name of M/s. Vasu Trading Co. AO held that the concern M/s. Vasu Trading Co. was merely an entry provider and has no worth of its own. He, therefore, added this amount to the income of the assessee as undisclosed income u/s 68. CIT(A) deleted the addition. Being aggrieved, revenue went on appeal before Tribunal.

Held, that additions made by the AO merely on assumptions and presumptions are no sustainable in the eyes of law. CIT(A) after duly verifying the accounts of the respective concerns, source of funds and the differences being reconciled has rightly deleted the additions so made by the AO. We do not find any infirmity of the CIT(A) on this issue and the same is upheld. - DEPUTY CIT V/s VASU KALIA - [2020] 81 ITR (TRIB) 507 (ITAT-CHANDIGARH)