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2014 (3) TMI 492 - ITAT MUMBAIAddition made u/s 68 of the Act – Held that:- The assessing authority had treated the account as a running account, adding only the incremental flow of funds for the year as unexplained - No verification of the sort required, of the amounts in question was however made in the set aside proceedings, so that the direction by the tribunal remains to be complied with - The primary onus lies on the assessee - Its claim that all the entries, debit or credit, comprising the sums to be duly vouched, as by bank advices, and reflected in the bank's statement, shall however be required to be exhibited – thus, the matter is remitted back to the AO for adjudication. Penalty u/s 271(1)(c) of the Act – Held that:- As the matter has been already remitted back to the AO for verification and fresh adjudication – thus, the penalty levied cannot be survived – the AO shall be at liberty at if deem fit, to initiate penalty proceedings. Addition made u/s 41(1) of the Act – Held that:- The decision in Mahindra and Mahindra Ltd. vs. CIT [2003 (1) TMI 71 - BOMBAY High Court ] followed - the waiver of a loan, where deployed for the acquisition of a capital asset, would not amount to income u/s.41(1), is completely misplaced - The waiver, if at all, could only be by the assessee - there is in fact no waiver of any loan or liability - the debtor being rather required to pay the entire sum as outstanding in his books, which is inclusive of the three credits under reference, to the assessee - the credit to the assessee's account is itself an admission of the liability to the assessee - the debt to the assessee company being proved with reference to the decision by a court of law, the same stood confirmed as the assessee's income for the relevant year - the account not appearing in the assessee's books of account nor it furnishing any explanation, much less satisfactory, as to the nature and source of its relevant asset/s in the form of a debt/s due to it - Section 69/69A/69B would have application – thus, there is no merit in the assessee's case and uphold the addition, modifying the order to the extent it adverts to or draws on section 41(1) of the Act – Decided against Assessee. Addition made - Profits on security transaction – Held that:- The reflection of the amounts in the loan account of Shri A. D. Narottam being in fact the very basis for the addition u/s.68 - the directions by the tribunal for the year are as apparent at variance with that for the earlier years - The Revenue is unable to show any infirmity in the order, being based on the factual findings in terms of the tribunal's order - the present proceedings arise out of the set aside proceedings, so that the directions by the tribunal, having since attained finality, shall obtain, and are binding on all authorities upto the tribunal – thus, the order upheld – Decided against Revenue.
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