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2015 (10) TMI 940 - ITAT JAIPUR

2015 (10) TMI 940 - ITAT JAIPUR - TMI - Unexplained cash credits - addition u/s 69 - CIT(A) deleted the addition - Held that:- CIT (A) only considered the confirmation along with the PAN numbers and held that the assessee’s burden had been discharged by relying on various decisions. Recently various High Courts including Hon’ble Delhi High Court in case of CIT vs. Youth Construction Pvt. Ltd. (2012 (11) TMI 595 - DELHI HIGH COURT) has held that the assessee has to establish the creditworthiness .....

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s to be established. Therefore, we set aside the order of ld. CIT (A) to the AO. The assessee is directed to cooperate with the AO and furnish the requisite details. - Decided in favour of revenue for statistical purposes..

Trading addition - assessee did not produce the books of account - CIT(A) deleted the addition on the ground that the GP rate shown during the year under consideration is better in comparison to preceding year and no addition is warranted - Held that:- Even the jus .....

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certified copy of the complete books of account from the Excise Authorities to verify the correctness and completeness of the books of account and take decision on this issue. Thus this issue is also set aside for denovo order. - Decided in favour of revenue for statistical purposes.. - ITA No. 592/JP/2012 - Dated:- 7-9-2015 - SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM For The Revenue : SHRI Kailash Mangal (JCIT) For The Assessee : Shri Anil Sharma, C.A. & Shri Arpit Vijay, C.A. ORDER PE .....

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ng the course of assessment proceedings nor during the course of remand proceedings, these alleged cash creditors appeared before the AO in response to the summons issued by her for verification of these credits. 2) Deleting trading addition of ₹ 11,24,838/- made by the AO on the ground of declaring better g.p. rate in comparison to earlier years ignoring the fact that the assessee produced books of accounts neither before the AO during assessment proceedings nor before the CIT (A) during .....

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nsideration. The assessee was asked to prove the genuineness of the credit, creditworthiness of the creditor and identity of the person vide various questionnaire issued to the assessee, and also asked to produce the confirmation from these creditors of unsecured loans of ₹ 1,97,53,075/-. The assessee did not furnish any information regarding the cash creditors. The assessee also had taken bogus entries similar to one of ₹ 1,50,000/- received by it from Shri Raj Kumar. Therefore, he .....

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of 63 cash creditors, 40 cash creditors had also appeared before the AO and confirmed having given the loan to appellant. All the cash creditors were also assessed to tax and also submitted copies of their bank statement. In the case of Smt. Suman Goyal, the bank statement could not be submitted. However, she was assessed to tax and her PAN was stated to be AAZPG 5755 F. Similarly in the cases of Smt. Rachana Bhagrai, Shri Tara Chand Goyal and Shree Ram Tent House, copies of bank statements coul .....

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₹ 21,31,836/- were not verifiable. The ld. Counsel of the appellant was provided copy of remand report. In response, the appellant vide its letter dated 21.3.2012 had argued that the AO vide his remand report dated 15.03.2012 held that the unsecured loans of ₹ 21,31,836/- received from 19 persons were not verifiable. The AO had simply concluded the above finding for the reason that about 19 creditors had not responded to the summons issued u/s 131 of the IT Act. However, the appella .....

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editors, their PAN and addresses had proved the identity of the creditors, their capacity and genuineness of the transactions, and thus discharged the primary burden lying under section 68 of the IT Act. The relevant amount had been received through account payee cheques as detailed in respective confirmation letters and the summons issued by the AO had been duly served at the given addresses except 5 creditors. The AO had not contradicted any of the evidences submitted by the appellant nor give .....

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f DCIT vs. Rohini Builers, 256 ITR 360 and held that the AO was not justified in holding that the unsecured loans of ₹ 21,31,836/- may be treated as non genuine. He further observed that he made enquiries from the computer center and verified the PANs in number of cases which has been narrated in his order on page 10. In case of non compliance of summons issued under section 131, after verification of PANs, he held that appellant had satisfactorily explained the identity, creditworthiness .....

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order of the AO and argued that assessee had not produced the books of account and no confirmation of cash creditors were submitted during the assessment proceedings. However, these were submitted at the appellate stage which had also remanded to the AO. But in case of 19 cash creditors, AO has categorically assigned the reasons that cash credits to the tune of ₹ 21,31,836/- were not genuine. In case of 5 cash creditors, summons were not served or returned unserved by the postal authoriti .....

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admitted the additional evidences and forwarded the same to the AO with specific direction to make detailed enquiry and to submit report in respect of the same. The AO vide her remand report dated 16.3.2012 had held that the unsecured loans of ₹ 21,31,836/- received from 19 persons had been remained not verifiable and the same may please be treated as non-genuine. The AO had concluded that the finding given simply for the reason that the relevant 19 creditors had not responded to the summo .....

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pellant cannot be blamed for non compliance of the summons issued by the AO, on the part of the creditors, and the relevant loans cannot be held as non genuine simply for the reason that the creditors had not complied with the summons issued by the AO. He further relied on the decisions in cases of CIT vs. Orissa Corporation Pvt. Ltd. (supra), CIT vs. Shree Barkha Synthetics Ltd. 270 ITR 477, DCIT vs. Rohini Builders (supra), Sreelekha Banerjee vs. CIT, 49 ITR 112 (SC), S. Hastmal vs. CIT, 49 IT .....

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other theory of not producing the books of account that there was a fire in the shop and claimed that books had been destroyed in fire. Therefore, assessee made contradictory submissions before the AO. The ld. CIT (A) had not given any finding on the regular books of account. There was a search and seizure operation under section 132(1) of the IT Act on 12.04.2005 in case of M/s. B.C. Purohit & Co. and Shri Kripa Shankar Sharma, one of the associates of M/s. B.C. Puirohit & Co. in Jaipu .....

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rs for verification. Therefore, burden has not been shifted on revenue in case of 5 cash creditors. In case of 14 cash creditors, assessee also filed confirmation but there was no reply before the AO. The ld. CIT (A) only considered the confirmation along with the PAN numbers and held that the assessee s burden had been discharged by relying on various decisions. Recently various High Courts including Hon ble Delhi High Court in case of CIT vs. Youth Construction Pvt. Ltd. (2013) 357 ITR 197 has .....

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g the appeal on the basis of genuineness of the transaction and identity of the persons only. The third ingredient to prove the cash creditors under section 68 i.e. creditworthiness has to be established. Therefore, we set aside the order of ld. CIT (A) to the AO. The assessee is directed to cooperate with the AO and furnish the requisite details. 7. Second ground in revenue s appeal is against deleting the trading addition of ₹ 11,24,838/- by ld. CIT (A). As discussed above, the assessee .....

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n the decision of Hon ble Rajasthan High Court in case of CIT vs. Gotton Lime Khaniz Udyog, 256 ITR 243 (Raj.). 8. Before us, the revenue has challenged the order of ld. CIT (A) and argued that ld. CIT (A) without any basis had accepted the book results of the assessee when books of account had not even produced before the AO or at the appellate stage by the assessee. The assessee has also not filed any certified copy of the books of account before the lower authorities as there is a confiscatio .....

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