[aurangabad_ca] Re: [Thane CAs] UNEXPLAINED EXPENDITURE - OPINION REQUIRED
Dear Mr Pahwa,
From Your it appears that,
Cost of truck as per books is Rs 5 Lacs on which your client must have claimed the depr.
ther must be liability of Rs 2 lacs payable to the seller of truck.
The matter of dispute is properly documented with proof.
If your client is not accepting the claim of creditor ( Rs 2 Lacs) and so is reflected in Books.
Now pl confirm wheter credit bal is appearing in books or your client has written off and adjusted WDV of truck.
Pl enlighten us to express opinion.
regards,
CA R B JOSHI
----- Original Message -----
From: RAJ PAHWA <rkpahwa@hotmail.
Date: Tuesday, January 12, 2010 4:16 pm
Subject: [Thane CAs] UNEXPLAINED EXPENDITURE - OPINION REQUIRED
To: CA GROUP THANE <thanecas@yahoogroup
>
> Dear Friends,
>
>
>
> In the case of one of my clients, a partnership firm, a second
> hand truck was purchased for Rs. 5 lac and an agreement was
> entered into between my client and the seller of the truck that an
> amount of Rs. 3.00 lac has been paid at the time of execution of
> agreement and the balance will be payable after the truck is
> registered in the name of buyer. The seller completed all the
> formalities and the papers were lodged with the registeration
> authority for transferring the name of the owner. However in the
> meantime a dispute arose between the parties and the payment could
> not be made to him despite the fact that the truck was transferred
> in the name of my client. During the course of assessment
> proceedings the AO asked for the copy of agreement which was given
> to him. He asked as to why the balance payment was not made. The
> position was explained to him. Not satisfied with our explanation
> the AO has made an addition of Rs. 2.00 lac on account of
> unexplained expenditure without making mention of the section
> under which the addition is being made. I have two queries:
>
>
>
> 1. Whether the addition made without mentioning the section under
> which it is being made is justified
>
> 2. Whether the stand of the AO is justified. In my opinion if we
> had shown the full payment and failed to produce the receipt for
> the balance amount of Rs. 2.00 lac then the AO could have raised
> an objection.
>
>
>
> I shall feel obliged if you kindly support your view with some
> case laws.
>
>
>
> Thanks
>
>
>
> CA R K PAHWA
>
> RAJPURA (PUNJAB)
>
> CELL 9815623217
>
> ____________
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