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2019 (5) TMI 1696 - ITAT DELHIAddition u/s 68 - unexplained cash credit - Undisputedly, the assessee has not produced the books of account during the assessment proceedings - CIT (A) has called the remand report from the AO and after accepting the remand report has accepted the contention of the assessee that addition is not sustainable u/s 68 but confirmed the addition u/s 69 - HELD THAT:- When no specific entry in the SOA/cash flow statement has been disputed by the AO but based his finding on the fact that there is a difference in accounts before PNB Account filed before Department but has failed to appreciate that before PNB the statement of earlier year was filed as loan was disbursed in January 2008. So, in these circumstances, earlier year’s details with subsequent years cannot be tallied in any circumstance. Consequently, grounds no.2 & 3 are determined in favour of the assessee. Addition of sundry creditors - creditors have not appeared in person despite issuance of summons u/s 131 of the Act - HELD THAT:- So far as trade credits pertaining to Chaudhary Iron Traders is concerned, it is specifically explained by Chaudhary Iron Traders that the figures of debtors are deducted from creditors and accordingly, debtors not reflected separately in the ITR which has otherwise been confirmed by the AO with the bank account. Moreover, ledger account of Chaudhary Iron Traders, available at page 103 of the paper book, shows that all the purchases have been made through banking channel. Moreover, when purchases and sales have not been doubted by the AO/CIT(A) which are through banking channel then how the trade creditors can be doubted who have otherwise been accepted during subsequent years. When books of account have been produced by the assessee during the penalty proceedings, the adverse view cannot be taken by the AO for not producing the books of account. Merely because of the fact that creditors have failed to attend the remand proceedings in person, the addition is otherwise not sustainable. So, we are of the considered view that addition made by the AO and confirmed by the ld. CIT (A) on account of trade creditors is not sustainable. So, AO is directed to delete the same after duly verifying the documents already brought on record by the assessee, hence grounds no.4 & 5 are determined in favour of the assessee.
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