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2014 (2) TMI 598 - ITAT AMRITSARAddition as unexplained receipt – Held that:- The assessee's case is built on presumption i.e. that the first payment was usually in cash that receipt had been accepted by Smt. Reema Aggarwal to be issued against cheque but not against the cash etc. -The CIT(A) was not satisfied that these presumptions can assist the appellant in the discharge of the onus cash upon it - a credit of this amount has been introduced in the books of the assessee and the onus lies squarely upon the assessee to prove the genuineness of the transaction recorded in its books - The assessee was running a business for a long time. Even though it had suffered losses, it had a running operation, stock in trade of the value of more than Rs.79 lacs and several other fixed asset - thus, the assessee firm and its partner did have access to money - In the face of clear denial by Smt. Reena Aggarwal and absence of any positive evidence with the assessee, the CIT(A) rightly upheld the addition made by the AO as unexplained money received by the assessee – Decided against Assessee. Application of section 36(2)(i) of the Act - Addition made on account of payment – Held that:- The Ld. CIT(A) has passed a well-reasoned order that the claim made by the assessee is not allowable as deduction u/s 36(1)(vii) of the Act since the condition prescribed u/s 36(2)(i) of the Act relating to bad debts is not satisfied in respect of the excess payment - The debt due to be paid by the assessee to M/s. Mahindra & Mahindra Ltd; was lesser than the amount actually paid by the assessee - The excess amount was never taken into account in computing income of the assessee in the present assessment year or in the earlier year prior to present assessment year - there is nothing to show that any sales were made by the assessee to M/s. Mahindra & Mahindra Ltd. Claim for deduction u/s 37(1) of the Act – Held that: Deduction u/s 37(1) of the Act is allowed in respect of expenditure incurred wholly and exclusively for the purpose of assessee's business - The assessee has not able to throw any light on the purpose for which the excess payment was made - It has not informed as to how the payment resulted in an expenditure incurred wholly and exclusively for the purpose of assessee's business or even as to how it was expenditure – thus, the CIT(A) has rightly rejected the claim of the assessee – Decided against Assessee.
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