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2016 (4) TMI 1317 - ITAT CHANDIGARHAddition u/s 68 - Held that:- In the facts and circumstances of the present case in the face of numerous documentary evidences crying for bonafide of the assessee as against only suspicion and surmises in favour of the Department, we do not hesitate to hold that the proposition laid down by the Hon'ble Supreme Court in DURGA PRASAD MORE [1971 (8) TMI 17 - SUPREME COURT] is not applicable in the present case. Even the Assessing Officer has not been able to bring on record any adverse material, on his own investigations, the results have been in favour of the assessee. Suspicion, howsoever strong, cannot take part of the documentary evidences. Second contention of the Department with respect to the prices being manipulated and later on the company delisted from the Stock Exchange, we want to add that the company was very much in existence at the time of transaction and whatever happen later on is of no relevance. The grounds of appeal raised by the Revenue are dismissed Disallowance u/s 14A - Held that:- Punjab & Haryana High Court in the case of Lakhani Marketing Inc 2014 (7) TMI 44 - PUNJAB AND HARYANA HIGH COURT] is squarely applicable to the facts of the present case, as no exempt income has been earned by the assessee during the year. As regards the contention of the learned D.R. that the said judgment was delivered before the insertion of Rule 8D, we are of the view that the Rule 8D is just a mechanism provided to compute the disallowance under section 14A of the Act. The provisions of the Rules can never prevails over the provisions of the Act. The judgment has been given in the context of the provisions of the section. If the situation demands for no disallowance, the computational provision does not come into the picture at all. In view of this, we uphold the action of the learned CIT (Appeals) in deleting the disallowance. The grounds raised by the Revenue are dismissed. Addition u/s 69 - Held that:- The submission of two capital accounts does not in anyways be correlated to the cash deposits in bank. Therefore, this contention of the Assessing Officer is totally devoid of any merits. Further, we do not understand as on what basis the Assessing Officer has made addition of ₹ 16,10,000/-. Nowhere neither in assessment order nor in remand, he has detailed his reasoning. In view of this, we do not hesitate to confirm the order of the learned CIT (Appeals). Decided against revenue
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