II. Direct Tax Case laws:
1.
Sahitya Housing Pvt. Ltd vs. Dy. Commissioner of Income-tax, ITA No.
246/Hyd/2011, Date of pronouncement: 24/01/2014, ITAT – Hyderabad.
S. 40(A)(3) – if banking facilities are not available at the place where land is purchased no disallowance u/s 40A(3)
Sec
40A(3) itself provides that the exceptions will have to be prescribed
having regard to the nature and extent of banking facilities available,
considerations of business expediency and other relevant factors. In
the case under consideration, no banking facility is available where
the properties were purchased by Assessee, therefore, there was no
choice for the assessee except to make the payments in cash due to
exceptional or unavoidable circumstances as provided under Rule 6DD. In
view of the above discussion, we set aside the order of CIT(A) and
delete the additions
(Please click here to view the Judgment)
2. The Deputy CIT Central Circle versus Sri K. Babu Rao, ITA No. 329/Hyd/2012, Date of order: 24.01.2014, ITAT – Hyderabad.
The unsubstantiated loose sheets cannot be considered as a conclusive
evidence to make any addition towards undisclosed income. Guess work is
not possible in case of search assessment framed u/s. 143(3) or u/s.
153A of the Act.
It was held by the Supreme Court in the case of CBI vs. V.C. Shukla
(1998) 3 SCC 410 that "file containing loose sheets of papers are not
books" and hence entries therein are not admissible u/s. 34 of the
Evidence Act, 1872. In the present case, the seized material (two note
books) marked as KBR/A/02 and KBR/A/04 wherein certain entries are found
recording various transactions pertaining to the assessee. These
entries in the notebook are unsubstantiated and on that basis the AO
reached to the conclusion that the figures mentioned therein are to be
read by adding 3 zeros and thereby he came to conclude that there is
undisclosed income in these 6 assessment years. In our opinion, the
document recovered during the course of search was a dumb document and
led nowhere.
(Please click here to view the Judgment)
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