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2017 (11) TMI 387 - AT - Income TaxAddition of unsecured loans - proof of identity of creditors - Held that:- In the present case, the return of income of the creditors would show that they have declared small income and paid meagre tax. In their bank accounts, there was meagre bank balance prior to giving loan to the assessee and cash have been deposited immediately before giving loan to the assessee. Further, assessee failed to produce any of the creditor before A.O. for examination to verify genuineness of transaction. Therefore, assessee failed to prove identity of the creditors, their creditworthiness and genuineness of the transaction in the matter. - Decided against revenue. Bogus purchases - Held that:- Assessee has specifically explained the discrepancy in noting the purchases material into Kg or MT. Proper bills have been produced on record to justify the contention of the assessee. The A.O. and Ld. CIT(A) have however, not given any finding on the same. It would, therefore, show that the matter requires reconsideration at the level of the A.O. Accordingly, set aside the orders of the authorities below and restore this issue to the file of the A.O. with a direction to re-decide this issue by verifying the facts from the invoices by appreciating the explanation of assessee. In case, A.O. has any doubt, he could have verify the facts from the concerned parties as per Law. Difference in closing stock - Held that:- In view of the above findings and material available on record and same opening stock shown in next year clearly supports the explanation of assessee that there is no difference in the valuation of the closing stock. The addition is without any justification. Accordingly, set aside the orders of the authorities below and delete the addition of ₹ 2,02,466. This ground of appeal of assessee is allowed.
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