TMI Blog2016 (5) TMI 243X X X X Extracts X X X X X X X X Extracts X X X X ..... ntant Member For The Appellant Shri Tanuj Neogi, JCIT-SR-DR For The Respondent : Shri Manss Roy, Advocate ORDER PER Waseem Ahmed, Accountant Member:- This appeal by the Revenue is against the order of Commissioner of Income Tax (Appeals)-XXXV, Kolkata dated 14.06.2007. Assessment was framed by ITO Ward-2(2), Kolkata u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) vide his order dated 27.03.2006 for assessment year 2003-04. Grounds raised by Revenue as under:- 1) For that the Ld. CIT(A) erred in facts and in law in deleting the addition made by AO u/s 68 of the IT act as Unexplained Cash Credit amounting to ₹ 60 lakhs by admitting additional evidence in contravention of Rule 46 of the IT Rules. 2) That the Ld. CIT(A) erred in fact and in law in deleting the addition of ₹ 2,889/- under the head Bank commission. 3) That the Ld. CIT(A) erred in fact and in law in deleting the addition of ₹ 9,960/- being commission received on sale of cement. 4) That the Ld. CIT(A) erred in fact and in law in deleting the addition of ₹ 82,582/- being reimbursement of Freight Bills not shown as income d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sum of ₹ 60 lacs as the unexplained cash u/s 68 of the act. 2.1 The assessee went to the ld. CIT (A) for the justice. The Ld. AR submitted that the assessee and its sister concern has ten employees who collect the money from the market on behalf of them. This money was handed over to the accountant in a common pool for recording the transactions. Later the collection was identified and recorded to the respective concern in their books of accounts. The unsecured loan was basically an inter-firm transfer from Suman Trading Company assessed in ward-1, at Midnapur with GIR No. M-635/S. This was a mistake by the newly appointed accountant which was later identified at the time of auditing and reported in FORM 3 CD. The accountant inadvertently wrote the said transfer in the appellant cash book as unsecured loan receipt and payment. The Ld AR submitted copies of the statements of seven persons as well as cash book and the ledger of its sister concern M/s Suman Trading Co. The records were showing the impugned transactions as payments/ receipts to/ from the appellant s firm. Accordingly the CIT (A) has disregarded the additions made by the A.O of ₹ 60 Lakhs as unexplaine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amounting to ₹ 82,582/- and on which TDS amounting to ₹ 1734/- has been deducted. But the assessee-firm had not shown the freight receipt amounting to ₹ 82,582/-. Thus, you are asked to explain why the amount of ₹ 82,582/- will not be added to the total income of the assessee-firm as undisclosed income. d) Shiva Cement Ltd. has clearly stated that they have received security deposit of ₹ 1,50,000/- from the assessee-firm vide Cheque No.934491 dated 25/06/02 vide MR no.5753 which has been adjusted with the debtors a/c in respect of sales made to the assessee-firm as on 13/03/03. Shiva Cement Ltd also confirmed that no interest was paid on security deposit during the financial year 2002-03. But the assessee-firm had not shown security deposit amounting to ₹ 1,50,000/- in the books of a/cs. Therefore, you are asked to explain why the amount of ₹ 1,50,000/- will not be added to the total income of the se-firm as undisclosed investment u/s 69B. e) Shiva Cement Ltd has clearly stated that the assessee-firm did not record the purchases amounting to ₹ 10,87,817=71 in respect of which the company has sent the details of the bills a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the representatives of the appellant-firm. This statement of accounts shows the debit balance in the account of the appellant of ₹ 1,38,628/- as on 5.4.2003 after giving credit for cheque of ₹ 27,000/- on that date. The earlier intimation of Shiva Cements Ltd that there was a debit balance of the matching amount on 3.1.3.2003 (supra) to close business and settle the accounts with the appellant. As per the said letter the appellant s account showed balance payable at ₹ 245,049/- as on 13.3.2003 which Shiva Cements Ltd demanded for immediate remittance. The statement of accounts said to be confirmed by appellant s representative shows this debit balance at ₹ 2,45,049/- as on 17.3.03. 4.7 In course of the remand proceedings the Assessing Officer has sent copies of three letters submitted by the AR of the appellant firm which are letters 29.11.03, 103.06 and 19.8.06 of Shiva Cements Ltd addressed to the appellant firm. The letter dated 29.11.03 refers to the minutes of meeting held on 04.9.2003 during the visit of the representatives of the appellant firm during which the aforesaid statement of account as on 04.9.2003 was said to have been confirmed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the appellant (supra) wherein it has acknowledged receipt of cheques worth ₹ 67,000/- from two of such dealers, namely Maa Enterprise and Manoj Goswami stating that they were not credited to the appellant s account pending clearance. The contradiction only shows that various versions of Shiva Cement Ltd lack credibility. The infirmities and inconsistencies in accounts maintained by Shsiva Cement Ltd as pointed out earlier also question the credibility of the disputed debits and credits made in the account which led to the impugned additions. These entries cannot, therefore, be relied upon and utmost they can be treated as only unilateral actions on the part of the Shiva Cements Ltd without their confirmation by the appellant firm. The contradiction in versions of Shiva Cement Ltd and the infirmities and inconsistence is accounts maintained by them only support the case of the appellant. 4.10 It is settled that the burden of showing that a receipt or item is income of the assessee is son the Assessing Officer. Reliance is placed on Parimisetti Seetharamannmani vs. CIT 57 ITR 532 (SC). The Assessing Officer has failed to establish that the impugned additions made li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ral in character and not a mere unilateral action which is all that occurs when a coperson throws his self-acquisition in hotchpot of the joint family. Reliance is placed on Subramaniam Iyer vs. Commissioner of Gift Tax, 67 ITR 612 (Kerala). The acts brought out above clearly show that the Assessing Officer has not been able to discharge his onus of establish these transactions with cogent and reliable materials. Under the circumstances additions made of variu9s amounts listed in para-1 above in relation to transactions with Shiva Cements Ltd do not stand. They are, therefore, deleted. Being aggrieved by this order of Ld. CIT(A) Revenue is in appeal before us. 6. The Ld. DR before us relied on the order of AO whereas Ld. AR relied on the order of Ld. CIT(A). We have heard the rival contentions of both the parties and perused the materials available before us. We find from above discussion that the AO has made the several additions on the information collected under section 133(6) of the Act from SCL. As per the information received the AO observed several discrepancies which invoked him to make the additions to the total income of the assessee. However the ld. CITA deleted ..... 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