TMI Blog2015 (10) TMI 2114X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the interest of justice, we deem it appropriate to remit this issue back to the Assessing Officer for fresh adjudication. The assessee shall furnish documentary evidence in support of the contentions. - Decided in favor of assessee for statistical purposes. Disallowance u/s. 68 - Held that:- The assessee had shown credit balances in respect of certain persons/farmers from whom the assessee has allegedly purchased raw cotton. During the course of assessment proceedings the assessee was directed to produce the said creditors. However, none of the persons (alleged creditors) appeared before the Assessing Officer. The assessee filed confirmation letters without any corroborative evidence. Before the Tribunal, the assessee has placed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al has been filed by the assessee against the order of Commissioner of Income Tax (Appeals)-II, Nashik dated 19-02-2013 for the assessment year 2009-10. 2. The brief facts of the case are : The assessee is engaged in the business of Ginning and Pressing of Cotton, manufacturing of Cotton Bales, manufacturing and trading of Cotton Seeds, Cotton Seed Cake, Cotton Seed Oil etc. The assessee filed his return of income for the assessment year 2009-10 on 30-09-2009 declaring total income of ₹ 27,51,680/-. The case of the assessee was selected for scrutiny. Accordingly, notice u/s. 143(2) was issued to the assessee on 18-08-2010. During the course of scrutiny assessment, the Assessing Officer observed that the assessee had made payments t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... None of the creditors or any supporting evidence was produced. The Assessing Officer invoked the provisions of section 68 and made addition of ₹ 7,39,089/-. Apart from the above, the Assessing Officer made addition of ₹ 12,74,825/- u/s. 40A(3) of the Act for making payments in excess of ₹ 20,000/- by bearer cheques. The cheques were presented in the bank by son of the assessee Shri Nirav Deepak Poldiya. The Assessing Officer held that the payments are not only hit by provisions of section 40A(3) but are to be regarded as fictions. Aggrieved by the assessment order dated 14-12-2011, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) partly accepted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns from whom the assessee had purchased cotton had filed their confirmations which were not accepted by the authorities below. One of the reasons for rejecting the confirmations letters is that the assessee has not produced corroborative evidence. The ld. AR placed on record photocopies of the invoices issued by Krishi Utpann Bazaar Samittee, Yawal, District, Jalgaon to show that the assessee had in fact purchased raw cotton from the aforesaid persons. The ld. AR further submitted that even in the past the assessee has been purchasing cotton from the aforesaid parties on credit and have been making payment after the period of 6-8 months. 3.2 With regard to disallowance u/s. 40A(3), the ld. AR submitted that the payments have been made to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ld. AR for not furnishing these documents either before the Assessing Officer or before the Commissioner of Income Tax (Appeals). At second appellate stage, fresh documents cannot be taken on record. In respect of disallowance u/s. 40A(3), the ld. DR submitted that the payments were made through bearer cheques issued by the assessee. During scrutiny assessment it was found that the cheques were withdrawn by the son of the assessee. The assessee has not brought on record any evidence that payments were actually made to the farmers. The ld. DR prayed for dismissing the appeal of the assessee. 5. We have heard the submissions made by the representatives of both the sides and have perused the orders of the authorities below. We have also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l of the assessee is allowed for statistical purpose. Disallowance u/s. 68 (ii). The second ground in appeal is with respect to disallowance of unexplained cash credit. The assessee had shown credit balances in respect of certain persons/farmers from whom the assessee has allegedly purchased raw cotton. During the course of assessment proceedings the assessee was directed to produce the said creditors. However, none of the persons (alleged creditors) appeared before the Assessing Officer. The assessee filed confirmation letters without any corroborative evidence. Before the Tribunal, the assessee has placed on record photocopies of the transaction receipts to show that the assessee had dealt with the aforestated persons. In view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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