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2014 (1) TMI 184 - ITAT KOLKATAUnexplained unsecured loans – Held that:- On 23.11.2011, assessee was represented by its representative whereas on 30.11.2011 assessee himself had appeared personally - The gap between 23.11.2011 and 30.11.2011 was only a week - Within the short gap of time it would have been very difficult for the assessee to frame a fresh set of books of accounts avoiding all the cash loans shown earlier - Preponderance of probability tilts to assesee's side and its explanation that the book produced on 23.11.2011 was not the correct one cannot be brushed aside - Assessee had in support of the cash book produced on 30.11.2011, furnished confirmation from various parties from whom it had purchased the materials - Account of the assessee as appearing in ledgers of various parties were produced before CIT(Appeals - The auditor has certified that there were no personal loans in the books audited by him - He also filed a full copy of cash book audited by him – Ther was no reason to disbelieve the certificate and certification done by the auditors - Lower authorities ought not have brushed aside the cash book produced by the assessee on 30.11.2011 - When there were no unsecured loans appearing therein there was no question of any addition being made on the ground of any unsecured loan. Disallowance u/s 40A(3) – Held that:- The cash book produced by the assessee ought to have been considered - It is also noted that in the original assessment, Assessing Officer had made an addition under section 40A(3) considering withdrawals from the Bank account, which was deleted by the ld. CIT(Appeals), but substituted by him with the chart compiled from the cash book produced - Neither any withdrawal from Bank account could be considered as expenditure for the purpose of applying section 40A(3) of the Act, nor the payment shown in the cash book produced on 23.11.2011 for the purpose of applying section 40A(3) of the Act – Decided in favour of assessee.
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