9911796707
TMI Blog2016 (9) TMI 1214X X X X Extracts X X X X X X X X Extracts X X X X ..... sed multiple Grounds of appeal in memo of appeal, but subsequently, it has filed revised Grounds of appeal, which read as under:- " 1. The learned CIT(A) failed to appreciate that increase in sundry creditors of Rs. 55,71,480/- being expenditure INCURRED in earlier years by tenants namely Mr. Suresh Chandra Taparia and Smt. Srikanta Devi Taparia on behalf of Assessee Company without appreciating that Assessee had discharged its onus u/s 68 and hence addition of Rs. 55,71,480/- u/s.68 may be deleted. 2. The Appellant craves leave to add, amend, alter or delete any or all the above grounds of appeal." 3. Apart therefrom, assessee has also filed an Additional Ground of appeal, which reads as under:- "1. The learned CIT(A) failed to ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit under section 68 of the Act. When such assessment was carried in appeal before CIT(A), the assessee submitted that the increased balance of sundry creditors represented amount due to two of its tenants, namely, Shri. Suresh Chandra Taparia and Smt. Srikanta Devi Taparia to whom assessee had given its flat at Benhor apartments, Mumbai on rent. The aforesaid increase reflected amount credited to Shri Suresh Chandra Taparia - Rs. 33,11,052/- and Smt. Srikanta Devi Taparia - Rs. 32,23,184/- for the expenses incurred by them on the civil renovation work of the flat rented out. Before CIT(A), assessee filed details like confirmations, Board resolutions, balance sheet and income returns of such sundry creditors, etc. in support of the credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itors appeared and confirmed the transactions. The CIT(A) has duly noted the submissions put forth by the assessee but he has ultimately observed that the impugned credit entries in the books of account could not be satisfactorily explained and hence, upheld the addition made under section 68 of the Act. As per the CIT(A), the copies of bank account of the creditors was not available which could prove the capacity of the two creditors. Against such a decision of the CIT(A), assessee is in further appeal before the Tribunal. 5. Before us, the Ld. Representative for the assessee vehemently pointed out that the details submitted by the assessee clearly established the identity and creditworthiness of the creditors as also the genuineness of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nta Devi Taparaia as on 31/3/1999. 6. On the other hand, the Ld. Departmental Representative pointed out that in the present case, the CIT(A) has clearly established that the clinching evidence in the shape of the bank accounts of the creditors through which the expenses have been incurred; and, the relevant bills of the repair expenses etc. were not produced and, therefore, the impugned credits could not be considered as explained within the meaning of section 68 of the Act. 7. We have carefully considered the rival submissions. In the present case, the controversy revolves around the provisions of section 68 of the Act, which has been invoked by the Assessing Officer to treat a sum of Rs. 55,71,480/- as an unexplained ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the lower authorities that in pursuance to such resolution, it capitalized the aforesaid amount incurred by the aforesaid two creditors by debiting it to the 'building account' and crediting the same to the accounts of the two creditors, Shri. Suresh Chandra Taparia and Smt. Srikanta Devi Taparia. In support, assessee furnished a copy of the communication of the two creditors, copies of which have been placed in the Paper Book at pages 41 - 42 and 55-56. In terms of such communication, the two creditors have explained to the Assessing Officer the details of expenditure incurred on civil renovation work on the tenanted property during the period 1/4/1993 to 31/3/1997. The said correspondence also details the payment made through chequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not a case where any of the evidence has been found to be false or untrue. Factually speaking, in the present case, the assessee company has completely discharged the initial burden cast on it to explain the nature and source of the credits. The arrangement between assessee and its tenants by way of the tenancy agreement, copy of which has been placed in the Paper Book pages 75 to 79 was also before the Assessing Officer. The onus that is cast under section 68 of the Act is not static, inasmuch as it shifts to the Revenue depending on the material and evidence led by the assessee at a given stage. The Assessing Officer had before him the averments of the sundry creditors, the income tax details of the sundry creditors, the balance sheet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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