ITAT upholds Additions made on unaccounted  Income received in Cash Towards Sale of Shares [Read Order]

The Income Tax Appellate Tribunal (ITAT ) Pune bench upheld the addition made on unaccounted income received in cash towards the sale of shares. There are no materials/documents on record to show that such unaccounted cash payments were not paid to the assessee.

The facts of the case was that, when a search and seizure action under Section  132 of the Income Tax  Act conducted upon the Jay Shriram Sugar and Agro Products Ltd. (JSAPL), Certain loose papers were found and seized in the said premises, which contained some transactions related to the Assessee Kirti Bipin Thorat,  and her family members, who were in fact the major shareholders of the company-JSAPL

Before the AO, Assessee submitted that the  company JSAPL had incurred huge loss and, therefore 43,934 shares held by the assessee in JSAPL were sold by  the assessee and transferred to Maruti N. Navale and group at a price of Rs. 60/- per share for a total amount of Rs. 26,36,040/-.

The seized documents revealed that for such transaction of shares, Navale & Group has paid the assessee an additional amount of Rs. 17,76,960/- by cash in F.Y. 2013-14 relevant to the present A.Y. 2014-15 and this payment receipt was not disclosed by the assessee. Therefore AO  had added the same as assessee's unaccounted income during the year.

Therefore the AO issued notice to Assesee and  CA of Maruti N. Navale.However  assessee did not appear and did not provide any evidence that unaccounted cash payments were not paid to the assessee.

Aggrieved by the order, assessee filed an appeal  before the CIT(A), who dismissed the appeal. Therefore the assessee filed an appeal before the tribunal.

It was observed by the tribunal that the assessee has not attended the proceedings Also he could not justify this cash receipt in lieu of sale transactions of shares. Thus There are no materials/documents on record to show that such unaccounted cash payments were not paid to the assessee.

After considering the facts submitted and circumstances, the two member bench of G.D. Padmahshali,(Accountant Member) and  Partha Sarathi Chaudhury, (Judicial Member) upheld the addition made on unaccounted income received in cash towards the sale of shares.

Rishab Jain appeared for the assessee and Ganesh Budruk appeared for the revenue.

To Read the full text of the Order CLICK HERE

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