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2016 (3) TMI 1077 - AT - Income TaxUnexplained cash credit u/s 68 - Held that:- CIT(A) granted relief to the assessee by observing that the assessee had explained the sources to be out of cash withdrawn by the partners from their bank accounts and out of regular cash in hand. The said contention of the assessee was supported by copies of partner’s bank pass book and also cash book as maintained by them in regular course of business. The ld. CIT(A) further observed that the assessee has successfully demonstrated the source of each and every amount credited in the capital account of the three partners. The explanation of the assessee is fully supported by documents placed in the paper book in the form of bank pass book, extracts from the regular books of accounts of respective partners and the financial statements of the partners. Therefore, the ld. CIT(A) was quite justified in directing the AO to delete the addition - Decided against revenue Addition on account of unexplained credit in the capital contribution of the assessee firm - Held that:- In the present case we find no infirmity in the order of the ld. CIT(A) wherein he has categorically held that sufficient stock of ready and dyed fabric was actually available with the parent firm M/s Nath International out of which 1,89,517 meters of stock was withdrawn by the partners and was introduced as their capital contribution in the assessee firm. The ld. CIT(A) further held that the findings of the AO that no such stock were available with the said firm is factually incorrect and in view of the above facts noted by the ld. CIT(A) the addition made by the AO cannot be held as sustainable - Decided against revenue Disallowance of rent paid - assessing officer held that the rent paid by the respondent for 4 rental premises out of 7 rental premises occupied by the respondent during the relevant assessment year is not genuine - Held that:- AO mixed two different types of information and wrongly interpreted them and arrived at the conclusion arbitrarily without giving the assessee any opportunity of being heard. From the written submissions of the assessee before the authorities below, it is amply clear that ht property situated at A-1, Sector 26, Noida was used for activities, the property situated at B-114, Sector 5, Noida and Kanodia House, Lohai Road, Farrukabad were used for production activities and the property at 504A, Nagarjuna Apartments, Mayur Vihar – 1, New Delhi was used for office of the assessee and all four disputed rent was paid for the purpose of the business of the assessee. These facts have not been controverted by the AO as well as by the ld. Sr. DR. Hence, the conclusion of the ld. CIT(A) is sustainable. When the assessee had provided detailed usage of premises, we are unable to see any valid reason to interfere with the conclusion of the first appellate authority and thus we uphold the same - Decided against revenue
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