2021 (9) TMI 887 - ITAT JAIPUR

Non-genuine creditors u/s 41(1) - proof of liability ceased to exist - case of the assessee was selected for limited scrutiny under CASS - CIT-A deleted the addition - HELD THAT:- As the assessee had not written off outstanding liabilities in his books of accounts and made the payments to these creditors in subsequent years through banking channels - no addition could have made under section 41(1) without proving that liability ceased to exist and that too in the year under consideration. Nothing has been brought on record to show that some benefit has actually accrued to the assessee during the year under consideration - CIT(A) has passed a speaking and reasoned order discussing all the facts and circumstances as well as legal propositions of law therefore, considering the totality of facts and circumstances and case laws exactly similar to the facts and circumstances of the present case, we find no reason to interfere in the order of the ld. CIT(A) qua this issue, hence, we uphold the same. - Decided in favour of assessee.

Unexplained credits u/s 68 - advances or cash received against which goods is supplied - assessee could not produce the confirmation from party HELD THAT:- The assessee furnished confirmation account, bank details, purchase and sale bills. Upon perusal of these details and evidences furnished by the assessee, we agree with the assessee’s claim. The assessee has produced copy of confirmation before the lower authorities duly reflecting the creditor's name along with its address, PAN, advance amount etc. - advances or cash received against which goods is supplied subsequently is not a cash credit as contemplated by section 68 of the Act. Simply because, the assessee could not produce the confirmation from this party, the genuineness of transaction cannot be doubted. All the relevant details proving the transaction as genuine were available on record despite that, the A.O’s mere emphasis was on the production of the confirmation from this party. In fact, the name and addresses were mentioned in the copies of bills of sale and purchase. Besides, the assessee by way of various documents duly proved that he had already supplied the goods against the advance amount subsequently on 28- 03-2017. In this regard, the assessee duly furnished bills - Decided in favour of assessee.