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2015 (7) TMI 862 - ITAT AHMEDABAD

2015 (7) TMI 862 - ITAT AHMEDABAD - TMI - Addition under section 68 - CIT(A) deleted the addition - Held that:- The assessee has produced copies of income-tax returns as well as PAN of the investors. Therefore, as far as the creditworthiness is concerned there is no dispute. Similarly the amounts have been received through account payee cheques. It is to be assumed that transactions are genuine unless proved otherwise by the AO. The solitary grievance of the AO is that he has tried to serve the .....

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could not service notices upon these persons is specifically not discernible. According to the AO the process server has reported that addresses are in complete. In these situation we have two sets of evidences one the alleged assertions of the AO on the basis of alleged report of the process server which has not been placed on record by the Revenue nor reproduced by the AO in the assessment order. He has not even made reference to any particular witness in whose presence process server had tr .....

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service, gives a doubt to our mind also whether, practically the process server had actually made an attempt to effect the services on all the investors in different corners of the city in that short time. Therefore, on an overall analysis of the record we are satisfied that ld. first appellate authority has appreciated the facts and circumstances in right perspective and no interference is called for - Decided against revenue. - ITA Nos. 1471 & 1638 /hd/2011 - Dated:- 24-6-2015 - S/Shri N. S. .....

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are descriptive and argumentative. In brief its grievance revolves around a single issue i.e the ld. CIT(A) has erred in deleting the addition of ₹ 81 lacs and ₹ 1,62,50,000/- which were added by the AO with the aid of section 68 in AY 2007-08 & 2006-07 respectively. 3. The facts on all vital points are common in both the Assessment Years. The ld. CIT(A) has passed the order in AY 2007- 08 on 20th January, 2011 and this order has been followed in AY 2006-07. Therefore, for the f .....

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3(3) on 18.12.2008 whereby income of the assessee was determined at ₹ 1,05,52,580/-. On the basis of finding recorded in AY 2007-08 the ld. AO has reopened the assessment for AY 2006-07 by issuance of a notice under section 148. It is also pertinent to note that a survey under section 133A was carried out in the business premises of the assessee on 16.12.2005. The assessee firm was engaged in the business of land development and construction at the relevant time. Since the AO has also base .....

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ide order sheet dated 4.12.2009 the ld. AO has directed the assessee to produce following details - name, address, PAN of all the persons who have made advances to the assessee and also produce all these persons before him. This exercise was to be carried out by the assessee before 11.12.2009. The ld. AO further observed that upto 18.12.2009 no one had attended on behalf of the assessee, therefore, he issued summons under section 131 of the Income-tax Act to the investors. The summons could not .....

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s submitted confirmations from all the persons, copies of their PAN with the Income-tax Department, copies of their bank statements and copies of the income-tax returns for AY 2007-08. The assessee also submitted a list of 40 persons who have filed their returns for AY 2008-09. It was further contended that the persons who have booked the plots in the project of assessee are its prospective customers at the time of booking. The assessee used to note their addresses and PAN. The assessee did not .....

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alance amounting to ₹ 1,62,50,000/- received in accounting period relevant to AY 2006-07 has been added in AY 2006-07. 5. Dissatisfied with the addition, the assessee carried the matter in appeal in both the years. The ld. first appellate authority has decided the appeal for AY 2007-08 vide order dated 20th January, 2009 and this order has been followed in AY 2006-07. The findings recorded by the ld. first appellate authority in both the orders are verbatim. We deem it appropriate to take .....

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advances cannot be said to be loans taken by the appellant. Hence, restrict rules of cash credit as envisaged in the provision of sec. 68 of the Act cannot be applied (see the case law quoted by the appellant in his submissions). ii. The appellant had furnished all the customers' details like name, address, PAN, copy of IT. returns, bank statement etc. during the assessment proceeding and thus had discharged it primary onus as has been held in the case of CIT V/s. Orissa Corporation (P) Ltd. .....

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t be held to be non-genuine as has been held in the case of Rohini Builders V/s. Dy. CIT (2002) 76 TTJ (And. Trib.) 521 . At the most it can be said that the advances remained unproved but not disproved as has been held by the Honorable Jurisdictional High Court of Gujarat in the case of National Textiles Vs. CIT (2001) 249 ITR 125 in which it had been observed that "if an assessee gives an explanation which is unproved but not disproved, i.e. it is not accepted but circumstances do not lea .....

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ers are filing their return on regular basis. During the appellate proceedings the appellant has produced the copy of the returns of income for A.Y. 2009-10 for verification in its support. v. It is not the case of the revenue where any evidence has been brought on the record which even remotely indicates that the money originally belonged to the appellant and it had returned back to the appellant again. vi. Other case laws mentioned by the appellant are also not in support of the action taken b .....

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d be avoided by the Assessing Officer. In view of the above facts & position of law, the addition made by the AO is hereby deleted and the appeal is allowed. 7. In the result, the appeal is allowed. 6. The ld. DR relied upon the order of AO. He submitted that the summons issued by the AO could not be served upon the investors. Therefore, genuineness of the transactions could not be proved. 7. On the other hand, the ld. counsel for the assessee relied upon the order of CIT(A) and contended th .....

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e bank statement of Rander Peoples Co-0p. Bank Ltd. He also placed on record copy of the ledger account of all these parties and submitted that during the assessment proceedings these facts were brought to the notice of AO. The ledger account of all the parties has also been placed on page nos.246 to 297 of the Paper Book. The bank statement is available on pages 298 to 390. The list of booking amount is available on page 316. On the strength of Hon ble Gujarat High Court in the case of CIT vs. .....

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dia) Textiles vs. ITO in ITA No.125/Ahd/2012. 8. We have duly considered the rival contentions and gone through the record carefully. The additions have been made by the AO with the aid of section 68 of Income-tax Act. This section provides that where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the AO satisfactory, the .....

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ion 68 the Hon ble Supreme Court propounded that in order to discharge the onus put upon an assessee by virtue of the section, an assessee is required to prove the identity of the creditor, his creditworthiness and genuineness of the transaction. The amounts have been received by the assessee through account payee cheques. The assessee has produced copies of income-tax returns as well as PAN of the investors. Therefore, as far as the creditworthiness is concerned there is no dispute. Similarly t .....

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