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2018 (3) TMI 896

Held that:- In the instant case, the Pattadar Pass Book, name and address of the creditors, agreement of sale and cancellation agreement and also the account copies were placed before the A.O. as well as the Ld. CIT(A). This fact is not controverted by the Learned Departmental Representative. - Assessing Officer has issued summons to the creditor but when the creditor has not responded, the A.O. neither called upon assessee to produce the creditor nor gave further opportunity to the creditor to appear in person and assessment was made in a hurry on 28.03.2013. The fact remains that assessee represented before A.O. on 19.03.2013 whereas the assessee called Sri K. Chandra Sekhar Rao on 25.03.2013 and completed the assessment on 28.03.201 .....

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tatement of the assessee, held with Axis Bank, wherein the assessee is having cash deposits to the tune of ₹ 1,10,82,600/-. During the proceedings the assessee was asked to furnish the explanation for the sources of cash deposits. In response thereto the assessee submitted that she had entered into an agreement for sale of property with Sri K. Chandra Sekhar Rao for a consideration of ₹ 30 lakhs and received an amount of ₹ 10 lakhs on 02.04.2009 and another sum of ₹ 10 lakhs on 11.09.2009. The amount received on 02.04.2009 was deposited into bank account and subsequently the amount was withdrawn and redeposited into the bank account. Similarly the amount received on 11.09.2009 was withdrawn and redeposited into bank .....

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t the Assessing Officer issued summons to Sri K. Chandra Sekhar Rao, calling upon him to appear on 25.03.3013 and when he did not appear, no further opportunity was given to the assessee but proceeded to complete the assessment on 28.03.2013 without informing the assessee about the non-appearance of Sri K. Chandra Sekhar Rao. 6. Before the Ld. CIT(A) assessee contended that a sum of ₹ 20 lakhs was received as advance from Sri K. Chandra Sekhar Rao in two instalments towards proposed sale of property but since the sale agreement was cancelled by the proposed purchaser, the assessee agreed to return this amount in two instalments and accordingly refunded the same on 13.04.2010 and 24.04.2010. It was also contended that the assessee full .....

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andra Sekhar Rao was mentioned, wherein there is a reference with regard to the instalments paid / payable. Thereafter the agreement was cancelled and accordingly they have entered into a cancellation agreement and the assessee agreed to return an amount of ₹ 20 lakhs, which was received earlier. Learned Counsel for the Assessee submitted that in order to prove veracity it is not necessary that the agreement should be registered, so long as the parties have faith in each other. He also placed before the Tribunal a copy of PAN of Sri K. Chandra Sekhar Rao along with Pattadar Pass Book to indicate that he has got sufficient land holding and capable of advancing ₹ 20 lakhs. Learned Counsel for the Assessee also placed a copy of the .....

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the amount of cash credits is the income of the assessee. The Hon ble Court observed that the assessee has to discharge its burden that lay upon him and the Tax Authorities were not justified in taking an adverse inference merely because the creditor did not appear in response to the notice u/s 131 of the Act. Learned Counsel for the Assessee strongly submits that in the instant case also the details of agricultural holding of Sri K. Chandra Sekhar Rao and the proof that the amount was paid as advance and returned to the creditor was placed before the Tax Authorities and in fact summons were issued u/s 131 of the Act to the creditor but without giving sufficient time to the creditor and without informing the assessee, the assessment was mad .....

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onal Authority in the case of improper enquiry by the A.O., concerning creditworthiness of a loan creditor, and in this regard the Court observed that the Assessing Officer was required to make proper investigation to determine whether the money was really lent by the third party or it has come out of the resources of the assessee himself. Learned Counsel for the Assessee submits that in the case of the assessee, the A.O. having not examined further, the order was found to be erroneous. However, second appellate proceedings cannot be equated to revisionary proceedings if an addition is made without proper verification and the same requires to be quashed / deleted. 11. I have carefully considered the rival submissions and perused the record. .....

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