TMI Blog2004 (6) TMI 252X X X X Extracts X X X X X X X X Extracts X X X X ..... the Asstt. CIT to the tune of Rs. 1,23,750." 3. The Revenue in its appeal has taken following effective ground of appeal: "1(a) The learned CIT(A), on facts as well as in law, has erred in deleting the addition of Rs. 17,22,858 made by the AO under s. 41(1)(a) of the IT Act, 1961." 4. In the cross-objection the assessee has supported the order of the CIT(A) deleting the addition made by the AO under s. 41(1)(a) of the IT Act. 5. First we shall take up the issue involved in the ground of appeal taken by the assessee in its appeal. The relevant and material facts for the disposal of this ground of appeal are that the assessee has claimed depreciation of Rs. 1,23,750 on the machine purchased during the year. The AO noticed that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reiterated the submission before us which he made before the tax authorities below and submitted that they were not justified in disallowing the claim. 8. On the other hand, the learned Departmental Representative for the Revenue placing reliance on the reasoning given in the order of tax authorities below, submitted that the appeal filed by the assessee is liable to be rejected in the absence of evidence being produced by him for substantiating its claim that the machinery purchased on 20th March, 1996, entered the premises on the same day and was put to use in the assessment year under consideration. 9. The undisputed facts are that as per the purchase bill, the machinery was purchased on 20th March, 1996, and as per the gate-pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled by the Revenue and the cross-objection filed by the assessee. The relevant and material facts for the disposal of this ground of appeal and the cross-objection are that the AO made an addition of Rs. 17,22,858 on account of credits as appearing in the balance sheet of the appellant as on 31st March, 1996. Brief facts as per order of the AO are that the appellant has shown certain amounts as payable in respect of various parties as on 31st March, 1996. The appellant was asked to produce the parties against whom such credits had been shown and as the concerned persons were not produced, the AO added the following sums to the total income of the appellant under s. 41(1)(a) by relying on the decision of Calcutta High Court in the case of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at all relevant to the present case. In that judgment, the issue does not relate to s. 41(1)(a), rather it related to granting of approval for the purposes of s. 80-O. 12. After considering the submission of the assessee, the CIT(A) deleted the impugned addition while making following observation in her order: "The decisions of various High Courts are quite uniform on this issue. It has been held that addition under s. 41(1)(a) cannot take place as long as the assessee does not deny his liability to pay the amount. The basic requirement is that the assessee should accept the liability and should not act in a manner which suggests that the liability is denied or that the appellant does not accept it. The Bombay High Court in its decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ual observations made in the order of the CIT(A), nor was able to point out any case law wherein, in identical facts and circumstances, contrary view has been taken. 14. On the other hand, learned Authorised Representative for the assessee firstly placed reliance on the reasoning given in the order of CIT(A) and secondly placing reliance on the various decisions of the Tribunal and the Bombay High Court, submitted that in identical facts and circumstances, the issue, as arising in the instant ground of appeal taken by the Revenue, came up for consideration before these authorities and the same was decided in favour of the assessee and against the Revenue: (i) Paramount Machine Tools Corpn. vs. ITO (ITA No. 308/Chd/1990) (ii) Dy. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X
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