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2015 (12) TMI 129 - ITAT MUMBAI

2015 (12) TMI 129 - ITAT MUMBAI - TMI - Unexplained cash credit under section 68 - CIT(A) confirmed addition for two parties - Held that:- The inquiry with regard to the creditors have taken place during the course of appellate proceedings before the ld. CIT(A) in the year 2011. Admittedly, these loans were taken in the year 2000, hence, we find merits in the submissions of the ld. AR that the creditors did not co-operate with the assessee and hence they did not appear before the AO, since the a .....

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ot enforce the attendance of these creditors by issuing summons to them and he did not verify their income tax returns also, even though the assessee has filed necessary details. Under these set of facts, we are of the view that tax authorities could not draw adverse inference in respect of inability of the assessee to produce the creditors.In the peculiar facts and circumstances of the case, we are of the view that the assessee should not be punished for his inability to enforce the attendance .....

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find any merit in the appeal filed by the Revenue. - Decided against revenue - ITA No. 3950/Mum/2011, ITA No.4490/Mum/2011 - Dated:- 23-9-2015 - B. R. Baskaran, AM And Amarjit Singh, JM For the Petitioner : Shri J P Bairagra For the Respondent : Shri Jayant Kumar ORDER Per B. R. Baskaran (AM) The assessee has filed this appeal for the assessment year 2000-01 and the Revenue has filed the appeal for the assessment year 2005-06 against the orders passed by the ld. CIT(A)-39, Mumbai. Both the appea .....

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During the course of assessment proceedings, the AO noticed that the assessee did not file balance-sheet along with the return of income filed u/s 139(1) and also under section 153A of the Act. On being called by the AO, the assessee filed the balance sheet wherein unsecured loans was shown to the tune of ₹ 1,37,36,115/- and hence the AO called for the details relating thereto. Since the details were not forthcoming, the AO assessed the entire amount of unsecured loans as unexplained cash .....

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the explanation of the assessee and the remand report of the AO, confirmed the addition to the extent of ₹ 16 lakhs relating to the above said two parties. It is pertinent to note the Ld CIT(A) deleted the additions relating to opening balance of sundry creditors and also the addition relating to creditors who had appeared before the AO in the remand proceedings. Aggrieved by the order of the ld. CIT(A), the assessee has filed this appeal before us. 4. The ld.AR submitted that the assesse .....

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ion letters containing the address of the creditor along with PAN and he has requested the parties to appear before the AO. However, they have failed to appear before the AO despite the request made by assessee. The ld. AR also submitted that the assessee has discharged these loans in the subsequent years through account payee cheques. Since the matter was very old and since the assessee had already repaid the loan, they did not cooperate with the assessee. The ld. Counsel for the assessee furth .....

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n ble High Courts, besides placing reliance on the decision of Hon ble Supreme Court rendered in the case of CIT Vs. Orissa Corporation Pvt Ltd reported in 159 ITR 78 (SC). He also placed reliance on the decision rendered by Hon ble High Court of Bombay in the case of CIT Vs. Creative World Telefilms Ltd.(2011) 333 ITR 100 (Bom). 5. On the contrary, the ld. DR submitted that the assessee has failed to prove the creditworthiness of the above said two creditors and hence the ld.CIT(A) was justifie .....

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e that the assessee has filed copies of cheque/pay-in-slips and confirmation letters obtained from these creditors. The confirmation letters contained the address of the creditors and also their respective PAN. Thus, we notice that the creditors having received back the loans from the assessee did not mind to co-operate with the assessee by way of appearing before the AO, since the transactions were 10 years old. We also notice that the AO also did not enforce the attendance of these creditors b .....

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ression may is used in sec. 68 of the Act. In the peculiar facts and circumstances of the case, we are of the view that the assessee should not be punished for his inability to enforce the attendance of the creditors. We have already noticed that there is failure on the part of the AO also in not enforcing the attendance of the creditors by issuing summons to them. Under these set of facts and by respectfully following the decision of the Hon ble Supreme Court in the case of s Orissa Corporation .....

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