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2020 (1) TMI 652 - HC - Income TaxAddition u/s 68 - unproved trade / sundry creditors - ITAT deleted the addition - HELD THAT:- Tribunal noted as follows: - ‘In the instant case, the advances were received through cheques, but not in cash. The assesse submitted that the said outstanding was adjusted out the sale of potatoes, tamarind etc. in the subsequent assessment year and also produced the invoices before the Ld.CIT(A) for the period 14.04.2011to 10.12.2011. No evidence was brought on record to show that the sales for the subsequent assessment year were not accepted by the AO or false.’ The reasons for the Tribunal recording a finding in favour of the respondent herein are as under: - ‘For a query from the bench the Ld.AR submitted that the sales were accepted by the AO in the subsequent year and there was no addition or relief was given to the extent of the sales made to the trade creditor. The receipt of advances from customers is a starting point and conclusion of transaction is the relevant sales. Therefore, receipt of advances required to be examined along with sales made by the assesse with stock register. Advances from customers, purchases, stock register and sales account are required to be examined together to verify the genuineness of the advances. No transaction can be isolated since all the transactions are interlinked and depending on each other. The AO isolated the transaction of the advances received against the sales and at the same time, did not examine the genuineness of the sales made to the trade creditor which is part and parcel of the total turnover. There is no justification for making the addition of advances received from the customers without taking into consideration the respective sales. Having accepted the sales account, there is no case for making the addition of the same amount representing advances from the customers.’ In support of the said findings, reliance was placed on the applicable decisions. On such careful examination, we do not find any infirmity in the findings of the Tribunal warranting interference.
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