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2014 (5) TMI 654 - AT - Income TaxAdmission of additional evidence - Unexplained credits in the books of accounts – Held that:- CIT(A) rightly examined the facts on remand and has given detailed reasons deleting the amount in his order - the AO noticed that the assessee had transferred balances standing in the names of persons to the share capital account - there were no sufficient balances in the accounts to transfer to the share capital account - The AO made the addition only on account of the fact that the assessee did not furnish any information as to why it transferred amounts from the accounts of Sainath Trading to shareholders account - the information furnished during the assessee proceedings cannot be considered as additional evidence, as even during the proceedings only account copies of the shareholders in the books of M/s. Srinadh Trading Co. have been produced - Revenue has not brought anything on record to controvert the findings of the CIT(A) – Decided against Revenue. Restriction of disallowance of depreciation – Held that:- Most of the payments were made through bank accounts and relevant invoice of the assets were also filed before the CIT(A) - AO and CIT(A) erred in restricting the depreciation as claimed - As the assessment was completed ex-parte u/s 144, AO should have examined the additional evidence furnished in the course of remand proceedings – the assessee was put to unnecessary inconvenience in the regard by restricting genuine claim - there is no need for restricting the depreciation and the AO is directed to allow depreciation – Decided in favour of Assessee. Validity of notice u/s 143(2) of the Act – Defective notice - Held that:- There is indeed mistake in mentioning the date of posting as 02.09.2008 - the mistake should not be considered as making the notice as invalid one, as the assessee got the notice u/s 143(2) before 31.10.2008 and the assessment was reopened by issuing a notice - The distinction between an invalid notice and a defective notice is difficult to draw – the notice is only a defective and does not invalidate the proceedings – the assessment cannot be considered as bad in law only by reason of mistake in the notice – Decided against Assessee.
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