TMI Blog2003 (9) TMI 321X X X X Extracts X X X X X X X X Extracts X X X X ..... the place of contract has also changed. But the AO did not accept the explanation of the assessee. On further examination of the books of accounts, the AO noticed that the assessee has shown acceptance of new credits to the extent of Rs. 4 lakhs from 20 persons. The AO wanted these creditors to be produced before him in his office. The AO was of the opinion that out of 20, 17 cash credits to the extent of Rs. 3.45 lakhs were not genuine. The AO gave a detailed description of all these credits as to why the credits were not genuine. The AO rejected the books of accounts and applied N.P. rate of 12.5 per cent and thereby made additions. 3. Feeling aggrieved, the assessee went in appeal before the learned CIT(A) who in turn, granted some relief to the assessee. The assessee is in appeal against the sustained additions and the Department is in appeal against the relief granted to the assessee. 4. We have heard the rival submissions, perused the relevant material on record and also the provisions and decisions relied upon before us. 5. Our following observations will dispose of the grounds taken by the assessee as well as by the Department simultaneously. The learned authorised r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credits and interest thereon. The Revenue has filed appeal against set off of addition of Rs. 1,83,698 against the addition on account of unexplained cash credits and interest thereon. 7. The learned authorised representative submitted that the AO was not justified on facts and in law in making the addition of Rs. 3,45,000 on account of alleged unexplained cash credits and of Rs. 31,497 on account of interest on these cash credits. He has further submitted that the CIT(A) was also not justified in confirming the said additions. According to the learned authorised representative, the assessee is a contractor, and the learned AO has rejected the books of account invoking the provisions of s. 145(2) of the Act and applied N.P. rate of 12.5 per cent subject to interest and depreciation, thereby making an addition of Rs. 1,83,698 to the returned income of Rs.1,48,760. The AO examined the books of account and found cash credits aggregating to Rs. 4 lakhs out of which he made addition of Rs. 3.45 lakhs holding the same as unexplained cash credits. 8. Likewise, he disallowed the interest of s. 31,947 as pertaining to these cash credits. The learned authorised representative has vehemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhanwarlal S/o Ramdhan Affidavit and assessment order for asst. yr. 1990-91 No B-1187/W-3/Jodhpur 8. Madan Singh S/o Jorawar Singh, Jodhpur Assessment order for asst. yr. 1990-91 No. As already demised Assessed at Ward 4, Jodhpur. 9. Om Prakash S/o Mohanlal, Balotra Affidavit No 10. Ramniwas S/o Daula, Jodhpur Balance sheet and capital account for the year ended on 31st March, 1992 alongwith assessment order for asst. yr. 1986-87 Yes. Examined by the AO. However, AO did not find any discrepancy with respect to his statement R-964/W5/ Jodhpur 11. Ramswarup S/o Daulal, Jodhpur Balance sheet and capital account for the year ended on 31st Mach, 1992 alongwith assessment order for asst. yr. 1989-90 Yes. Examined by the AO. However, AO did not find any discrepancy with respect to his statement R-965/W-5/Jodhpur 12. Chandrakant Ghanshyam Das, Jodhpur Balance sheet and capital account for the year ended on 31st March, 1992 Yes. Examined by the AO. However, AO did not find any discrepancy with respect to his s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hpur, Shri Ramniwas S/o Daulal, Jodhpur, Smt. Sumitra Devi W/o Pukhraj Barmer, IT assessee and her balance sheet was filed which confirms the deposits with the assessee. The other two creditors, namely, Laduram S/o Mohanlal, Jodhpur and Madan Singh S/o Jorawar Singh, Jodhpur had already died. So those could not be produced. The assessee was not aware of the addresses of Sher Singh S/o Guide Singh Jodhpur, Bhiyaram S/o Khangaram, Banshiram S/o Khangaram, Jodhpur and Bhanwar Lal S/o Ramdhan, which according to the learned authorised representative were introduced through his material uncle of the assessee namely, Shri Ladu Ram S/o Mohan Lal who died on 10th Dec., 1993. The learned authorised representative has submitted that these cash creditors were paid off in the lifetime of Shri Ladu Ram, so these cash creditors , addresses were not with the assessee immediately. Later on, the assessee enquired and got the person in question and therefore, filed their sworn affidavits. The learned authorised representative has drawn our attention to a letter dt. 24th March, 1995, which was written to the AO. The said letter is enclosed at pp. 67 to 68 of PB filed by the learned authorised represe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... making the addition. So, any such addition is not sustainable in the eyes of law. 15. We draw support from the following decisions relied by the learned authorised representative. (a) In Asstt. CIT vs. India Tyre House (2001) 72 TTJ (Gau) 316, it has been held that the addition made by the AO solely on the ground that the creditors were not produced before her and thus the onus of proving the genuineness of the loan was not proved, is legally tenable. (b) In CIT vs. Heeralal Chaganlal Tank (2002) 176 CTR (Raj) 495 : (2002) 257 ITR 281 (Raj) it has been held that once the identity of the creditor is established and he has confirmed that he had advanced the loan to the assessee the finding of the Tribunal accepting the genuineness of the loan and deleting the addition could not be said to be perverse. (c) In Shivam Synthetics (P) Ltd. vs. Asstt. CIT (2002) 76 TTJ (Jd) 164 it has been held that the depositors who are existing assessees having confirmed that they had given the amount to the assessee-company partly for acquiring shares and the balance as a deposit with the company, the burden of proving the said cash credits was discharged and the addition made by way of unexpla ..... X X X X Extracts X X X X X X X X Extracts X X X X
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