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2022 (8) TMI 601 - AT - Income TaxAddition of Unexplained Credit - Addition as non genuine sundry creditors - HELD THAT:- We find that the Addition arises out of reconciliation difference in assessee’s capital account with CEM wherein the assessee is a partner. For the said reason, the assessee would not be figured as debtors in the books of that firm. Assessee was successful in reconciling the two differences and the allegation of AO regarding unexplained cash credit would have no legs to stand. It is undisputed finding that contract receipts pertaining to firm was wrongly credited in assessee’s account and the same has already been offered to tax by the firm. Therefore, this addition has rightly been deleted by Ld. CIT(A). Addition of unexplained investment - Assessee had adequate funds to meet the expenses and also to make investments. The same is further supported by the workings made by CIT(A) which has been extracted by us in preceding - Therefore, the action of CIT(A) in deleting the addition could not be faulted with. DR has pleaded that the drawings was not accounted for by the firm in the reconciliation statement given during the remand proceedings. We find that the same is also not factually correct. The assessee, in its reconciliation statement given to Ld. CIT(A), has reversed contract receipts of Rs.312.50 Lacs and added drawings - The net difference. In the statement given on 08.01.2020, the amount shown is Rs.275 Lacs and Rs.2 Lacs which totals to Rs.277 Lacs. Therefore, there is difference in presentation only but the net impact is the same.
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