TMI Blog2014 (12) TMI 1008X X X X Extracts X X X X X X X X Extracts X X X X ..... e Assessee to demonstrate that it has paid the creditors the amount in subsequent years nor there is any finding on the same of AO or CIT(A) - assessee should be granted one more opportunity and also to demonstrate the subsequent payments – thus, the matter is remitted back to AO – Decided in favour of assessee. - I.T.A. No. 2921 /AHD/2010 - - - Dated:- 21-11-2014 - Shri G. C. Gupta And Shri Anil Chaturvedi, A.M.,JJ. For the Appellant : Shri S. B. Vaidya, A.R. For the Respondent : Shri Roop Chand, Sr. D.R. ORDER Per Shri Anil Chaturvedi,A.M. 1. This appeal is filed by the Revenue against the order of CIT(A)-II, Surat dated 13.09.2010 for A.Y. 2007-08. 2. The facts as culled out from the material on record are as under. 3. Assessee is a partnership firm stated to be engaged in the business of construction. Assessee filed its return of income for A.Y. 07-08 on 25.03.2008 declaring total income at Rs. Nil. The case was selected for scrutiny and thereafter the assessment was framed under section 143(3) vide order dated 30.12.2009 and the total income was determined at ₹ 47,04,490/-. Aggrieved by the order of A.O., Assessee carried the matter be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that Assessee did not have any liability towards Bhikubhai Bhanjibhai Patel and therefore the liability was non existing and therefore made addition of ₹ 32,55,000/-. With respect to the liabilities shown against Krishnadevi Batra (Rs. 5 lacs), Ashok Vedprakash Goyal (Rs. 1,59,000/-) J.A. Zanuddin ₹ 3,75,000/-) aggregating to ₹ 10,34,166/-. A.O noted that Assessee had failed to provide confirmations, addresses of the party or any other evidence which could prove that the liability to pay exists and further in its absence, the A.O could not carry out verification. He therefore considered the aggregate liability of ₹ 10,34,166/- to be non existing as it had remained unverified and considered it to have ceased to exist. He accordingly made addition of ₹ 10,34,166/-. With respect to the liability on account of construction contribution payable to Indumati Kantilal (Rs. 2,25,000/-). A.O noted that notice issued u/s 133(6) to the creditor had remained un replied and further Assessee had also failed to provide the account confirmation. He therefore concluded that Assessee did not have any liability payable to Smt. Indumati Kantilal and therefore consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant has, however, not submitted or furnished any evidence to show as to which submission has not been appreciated by the assessing officer. On the contrary, from the written submission dated 13.09.2009 reproduced above, it is found that the appellant itself is admitting that some creditors were not available on their addresses and, therefore, it was not in a position to give the same to the assessing officer. The reason given for their non availability is that sufficient time has passed. This submission of the appellant is facile, as the 4assessment year relates to A.Y. 2007-08, that is relevant to F.Y. 2006-07 and the assessment has been completed on 30.12.2009. If this is accepted, it means the appellant is not aware of the whereabouts of its creditors to whom it had to make payment during the F.Y. 2006-07. This in turn also means the alleged creditors are also not interested in the recovery of their dues from the appellant, as they are not pursuing the same, which facts are enough to show that the liabilities to the above extent are no longer existing .The affidavit given by one the partners of the firm is also of no value vis-a-vis categorical denial made by Sh. Bhikubhai Bh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k wherein the amount payable to Bhikubhai Patel was shown in the balance sheet. He therefore submitted that no addition u/s 41(1) could be made in any of the case. The ld. A.R. further relied on the decisions of Gujarat High Court in the case of CIT vs. Nitin Garg (2012) 22 Taxman.com 59 (Guj), CIT vs. Bhogilal Atara (ITA No. 588 of 2013) (supra). Ld. D.R. on the other hand pointed to the findings of A.O wherein the A.O has noted that despite various opportunities, Assessee had failed to provide the details of the creditors nor had submitted any evidence about the amounts payable. The Assessee had also not furnished the current addresses of the creditors which prove that Assessee has no connection with the creditors. He further submitted that Assessee has not done any business in the year under consideration and even in earlier years and he pointed to the balance sheet of the Assessee for A.Y. 04-05,05-06, 06-07 07-08 which was placed in the paper book of the Assessee. He thus supported the order of A.O and CIT(A). 8. We have heard the rival submissions and perused the material on record. We find that out of the total addition made u/s 41(1), the major addition is with respect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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