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2019 (5) TMI 1130 - HC - Income TaxAddition u/s 68 - unexplained cash credit - credit entries in capital account represented Trade Advances for purchase of goods - additional evidence u/r 46A - ITAT deleted the addition - HELD THAT:- Assessment Orders were passed by the Assessing Authority on 20.12.2016 after holding 3 hearings on 28.9.2016, 1.12.,2016 and 19.12.2016. The only evidence produced by the Assessees and having been examined by the Assessing Authority was a letter dated 8.12.2016 which has been quoted by CIT(A) in its order. Another letter filed by the Assessees dated 19.12.2016 is also quoted by the learned CIT(A) as the last submission made by the Assessees, wherein it is contended that those advances were made to the Assessees against the purchase of goods. Therefore, in our opinion, nothing prevented the Assessing Authority to examine the matter further even summoning the said creditor viz., Proprietor of M/s.Kannan Enterprises, Kollam. Unless the such credit entries were shown to be explained, merely based on assumptions that there were certain increase in the capital of the Assessees which was also explained to the Assessees, the Assessing Authority could not have made such an addition merely on assumptions. Assessing Authority and the Appellate Authority have the power of Civil Court u/s 131 including the power to enforce attendance of the witnesses and the parties. If a half-hearted enquiry was made by the Assessing Authority and additions were made as unexplained cash credits u/s 68 and such finding of facts were reversed by the Appellate Authority, it would not give rise to any substantial question of law for our consideration u/s 260A. The two Appellate Authorities have concurrently held that those credit entires represented Trade Advances for purchase of goods and Rule 46A does not apply in the present case. No substantial question of law .
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