TMI Blog2016 (4) TMI 354X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act, nor made any spot inquiries on the addresses of the creditors. He thus held that Assessee had discharged the initial onus cast upon it and the evidences and explanations furnished by the Assessee have not been found to be untrue and while deleting the addition he also placed reliance on the various decisions cited in the order. Before us, Revenue has not brought any material on record to controvert the findings of ld. CIT(A) nor has pointed any fallacy in his findings - Decided in favour of assessee - ITA No. 322/AHD/2013 - - - Dated:- 13-1-2016 - S. K. Yadav, JM And Anil Chaturvedi, AM For the Appellant : Shri Dinesh Singh, DR For the Respondent : Shri B T Thakkar, AR ORDER Per Anil Chaturvedi, Accountant Member 1. This appeal filed by the Revenue is against the order of CIT(A)-IV, Ahmedabad dated 19.11.2012 for A.Y. 2009-10. 2. The relevant facts as culled out from the material on record are as under. 3. Assessee is an HUF and stated to be engaged in the business of Shroff in the name and style of Shree Ambica Shroff. Assessee electronically filed its return of income for A.Y. 2009-10 on 30-03-2009 declaring total income at ₹ 1,62 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant has submitted the documents relating to P.A. No., copy of ledger account and copy of confirmation. Out of 27 creditors, in the cases of 20 creditors, the copy of return acknowledgement and computation of total income have also been furnished. These details have already been given in the assessment order by the AO in a tabular form. This clearly establishes the fact that all the creditors are assessed to tax. Further, on perusal of the ledger account, it is evident that all the deposits and withdrawals have been received by way of account payee cheques only. The details of cheque No. and the bank are clearly recorded in the copy of ledger account in respect of each of the depositors. Since the appellant is a shroffs, it obtains loan deposits from various parties. On perusal of accounts of all these creditors, it clearly shows that they all have current accounts with the appellant wherein the deposits and withdrawals are made on regular basis. All the creditors, except one creditor i.e. S. C. Patel Co. which is at St. No.23 in the tabie given in the assessment order, have opening balance as on 01-04-2008 with the appellant company. However, in the case of S C, Patel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us year, if the explanation offered by the assessees, about the nature and source of such sums found credited in the books of the assessees, is in the opinion of the Assessing Officer not satisfactory. It has been held by the Hon'ble Supreme Court in the case of CIT vs. Mohanakala [2007] 291 ITR 278 (SC) as under: A bare reading of section 68 suggests that there has to be credit of amounts in the books maintained by assessees; that such credit has to be of a sum during the previous year; and that the assessees offer no explanation about the nature and source of such credit found in the books or the explanation offered by the assessees in the opinion of the Assessing Officer is not satisfactory. It is only then the sum so credited may be charged to income-tax as the income of the assessees of that previous year The expression 'the assessees offer no explanation' means where the assessees offer no proper, reasonable and acceptable explanation as regards the sums found credited in the books maintained by the assessees. It is true that the opinion of the Assessing Officer for not accepting the explanation offered by the assessees as not satisfactory is required to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cerned creditors or could have called those creditors for further verification of the transactions of the appellant. No such exercise has been conducted by the AO as is evident from the records. The AO could have issued summons u/s. 131 of the I.T. Act to the creditors or inquiries could have been made from the assessment records of these creditors as well as spot inquiries could have been made on the given addresses of the creditors. Once the appellant has furnished all the necessary details and documents, as in the present case, it has discharged the initial burden which lay on him u/s 68 of the Act. Once the appellant produces the basic records of the creditors which show the identity of the creditors, copy of accounts of the creditors, details of cheque Nos., bank accounts through which money was transferred to the appellant and evidence that all of them are income tax assessees, it cannot be said that assessee has still to discharge the onus. Once the assessee has discharged the primary onus, addition u/s 68 cannot be made unless explanation and evidence furnished by the appellant are found to be untrue. From the materials available on record, it is clearly established that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o some of the creditors could not be served or they failed to appear before the AO, the loans taken from those creditors could not be treated as non genuine. In the case of Pragati Co-operative Bank Ltd. [2005] 278 ITR 170 (GUJ.) the Hon'ble High Court of Gujarat has held that Assessing Officer made addition in assessee's hand as income from undisclosed sources on ground that there were various discrepancies in records maintained by assessee, regarding issuance of various fixed deposit receipts. Since assessee had discharged primary onus which was on it by offering explanation that deposits were made by third parties, viz., customers of bank, and said explanation had not been found to be incorrect or false in any manner, addition was to be deleted. (iv) In the case of CIT vs. Ranchod Jivabhai Nakhava in Tax Appeal No.50 of 2011the Hon'ble High Court of Gujarat has held as under: Once the assessee has established that he has taken money by way of accounts payee cheques from the lenders who are all income tax assessees whose PAN have been disclosed, the initial burden under Section 68 of the Act was discharged. It further appears that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... real in nature in view of the surrounding circumstances which were based on the material available on record and not on any conjectures and surmises. (ii) So far as the reliance on the case of ITO vs. Diza Holdings (P.) Ltd. [2002] 255 ITR 573 (KER.) is concerned, the facts of the case are that the Assessing Officer found that deposits for various amounts in name of 11 persons were credited in books of assessee. Not satisfied with the assessee's explanation and source of these credit entries or deposits, the Assessing Officer conducted enquiry and pointed out infirmities and improbabilities surrounding transactions in details along with proper evidences in support of his conclusion. He concluded that these amounts were never been advanced and the creditors had no connection with the money. Therefore, the addition made by the AO was justified as held by the Court. (iii) So far as the case of Mangilal Jain vs. ITO [2009] 315 ITR 105 (MAD.) is concerned, it is held by the Court that Even the bank transactions clearly indicated that the transactions were done after deposits were made only on the previous dates and on the next date it was given as bearer cheque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, these decisions are not relevant for the present case. In the present case, the appellant has discharged its initial onus by producing the relevant documents in respect of all the creditors who are maintaining current accounts with the appellant. The AO has not made any further inquiry or verification subsequent to the discharge of initial onus by the appellant. The opening deposit available with the appellant in respect of the creditors is duly accepted as genuine in earlier years. 6.9 Considering the entire facts and circumstances of the case, I am of the considered opinion that there is no justification for making any addition u/s 68 of the Act in respect of any of the creditors. Accordingly, the addition made by the AO of ₹ 3,25,85,682/- is. hereby deleted. 5. Aggrieved by the order of ld. CIT(A), Revenue is now in appeal before us. 6. Before us, ld. D.R. pointed to the various observations of A.O and further pointed to the table of depositors at page 7 to 13 and from that he pointed out various instances which have been analyzed by the A.O to demonstrate the income of the depositors to be far less than the amount that has been claimed to have been gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been treated as genuine. Ld. CIT(A) has further given a finding that Assessee had furnished the copy of ledger account with confirmation, full address, copy of PAN number, income tax acknowledgement receipt etc. before the A.O but A.O did not made any further inquiry of the concerned creditor nor had issued summons u/s. 131 of the Act, nor made any spot inquiries on the addresses of the creditors. He thus held that Assessee had discharged the initial onus cast upon it and the evidences and explanations furnished by the Assessee have not been found to be untrue and while deleting the addition he also placed reliance on the various decisions cited in the order. Before us, Revenue has not brought any material on record to controvert the findings of ld. CIT(A) nor has pointed any fallacy in his findings. Before us, Revenue has relied on the decision cited hereinabove but we find that the ratio of those decisions are not applicable to the facts of the present case. In view of the of the aforesaid facts, we find no reason to interfere with the order of ld. CIT(A) and thus the ground of Revenue is dismissed. 8. In the result, the appeal of Revenue is dismissed. Order pronounced in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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