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2017 (4) TMI 111 - ITAT DELHIAddition u/s 68 - amount was deposited by creditors in their accounts on the same date viz. 14.05.2010 on which date they issued the cheque in favour of the assessee - Held that:- No doubt whenever there is proximity of deposit of cash and issuance of cheque then the Assessing Officer rightly gets prompted to examine the genuineness of transactions. However, this fact per se does not lead to any adverse inference and Assessing Officer is required to examine all the attendant circumstances and take a holistic view of the entire transaction with reference to the evidences furnished by assessee before coming to any conclusion. If the assessee furnishes sufficient evidences which prima-facie establish the creditworthiness of the creditor vis-à-vis the amount advanced by creditors, then, merely on account of deposit of cash in the bank on the same date on which the cheque was issued, no adverse inference can be drawn because the primary onus of the assessee stands duly discharged. In the present case from detailed submissions of ld. counsel, it is evident that returned income of both the creditors fully justified the small sums advanced by them. Both the creditors had current account with the assessee inasmuch as they had received rent from assessee. Under such circumstances, all the three ingredients for establishing the genuineness of transactions u/s 68 were fully met. Assessee failed to produce the creditors before Assessing Officer - Held that:- Merely on this count, the addition cannot be made u/s 68. Thus direct for deleting the addition made by Assessing Officer u/s 68 - Decided in favour of assessee Disallowing the interest paid to the unsecured loans not considered as genuine - Held that:- As noted earlier, both the creditors had paid interest to assessee which has duly been credited in the account statement filed by the assessee and, therefore, fail to understand as to how the disallowance could be made on account of interest payment of ₹ 25,300/-. The entire basis on which the findings of Assessing Officer are based misconceived. Thus, this addition is also directed to be deleted. Disallowing 1/6th of expenses out of shop expenses and expenses out of car and telephone expenses on account of personal user - Held that:- Disallowance out of shop expenses are concerned the same has been made because complete vouchers could not be produced. Therefore, do not find any basis for interfering with the order of the lower authorities on this count. Similarly, as regards disallowances out of car and telephone expenses are concerned, it cannot be denied that there was personal user of both these facilities and, therefore, disallowance on account of personal user was called for. The disallowance was quite reasonable and no interference is called for on this count. In the result, grounds are dismissed. Addition on account of low house hold expenses - Held that:- Assessing Officer has observed that assessee is having family of two members. He estimated the overall expenditure on various house hold items at ₹ 8,000/- per month and, since, the assessee had shown ₹ 60,000/- towards house hold expenses, therefore, addition of ₹ 36,000/- was made which was confirmed by ld. CIT(A). Assessing Officer did not consider the withdrawals made by assessee’s wife of ₹ 30,000/-. In this regard, he referred to page 18 wherein the copy of return of income of Smt. Santosh Devi wife of assessee is contained along with statement of total income, capital account and Balance Sheet. These papers were also filed before ld. CIT(A) but he has also not considered on this count. Thus, there was total withdrawal of ₹ 90,000/- and not ₹ 60,000/- of husband and wife together. Having heard both the parties, I find considerable force in the submissions of ld. counsel for the assessee because the total withdrawals towards house hold expenses were ₹ 90,000/- and, therefore, no addition was called for. Thus, this ground is allowed.
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