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2017 (2) TMI 1304 - AT - Income TaxUnexplained investment - no source to explain such investments - Held that:- When both the balance sheets of the assessee-company and balance sheets of the companies in which the assessee had invested, reflected the amounts of investments and these correctly tallied, we cannot brush aside such accounts and auditor’s report. Doing so would be giving a licence to any assessee-company to prepare any balance sheet and thereafter go back and say itself that the balance sheet was not correct. The assessee cannot be allowed to approbate and reprobate. Once assessee prepared its books of account and balance sheet which were audited by a Chartered Accountant appointed under the Companies Act as true and fair, and where the amounts reflected in the balance sheet are also shown in the balance sheets of the companies where assessee had placed the investment, we cannot disregard such balance sheets. It may be true that the banker of the assessee denied giving any loans to the assessee. However, if the source of investment was not out of loan, the question of bank giving any confirmation does not arise. The addition was made, in our opinion, due to failure of the assessee to give proper source for investment made by the assessee in M/s Sri Padmabalaji Steels Pvt. Ltd. and M/s Suryabalaji Steels Pvt. Ltd. Assessee’s claim that it was only book entry cannot be accepted since the amounts were correctly reflected in the balance sheet of the assessee as well as the balance sheets of M/s Sri Padmabalaji Steels Pvt. Ltd. and M/s Suryabalaji Steels Pvt. Ltd. We are of the opinion that the addition was rightly made by the A.O. and confirmed by the CIT(Appeals - Decided against assessee.
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