TMI Blog2018 (12) TMI 686X X X X Extracts X X X X X X X X Extracts X X X X ..... entity, creditworthiness and genuineness of transaction were proved and the addition made thereon is to be deleted. Addition made on account of bogus sundry creditor - Held that:- AO issued notice u/s 133(6) of the Act to M/s. Nivedita Enterprises and the notice was returned unserved with an endorsement “Not known”. The AO held that an amount of ₹ 9,70,426/- is bogus and added to the total income of the assessee. Before the CIT(A), the assessee submitted copy of trade license, profession tax enrollment certificate and copy of PAN card relating to M/s. Nivedita Enterprises and the CIT(A) inturn sought remand report from AO. The CIT(A) considering the submissions of the assessee, and remand report deleted the addition made by the AO - no infirmity in the order of CIT(A) and it is justified. Thus, Ground raised by the Revenue is dismissed. - ITA No.2154/KOL/2013 - - - Dated:- 7-12-2018 - SH. M.BALAGANESH, ACCOUNTANT MEMBER AND SH. S.S.VISWANETHRA RAVI, JUDICIAL MEMBER For The Appellant : Sh. Saurabh Kumar, Addl.CIT, Sr. DR For The Respondent : Sh. Arvind Agarwal, Advocate And Sh. Rajat Agarwal, ACA ORDER PER S.S. VISWANETHRA RAVI, JUDICIAL MEMBER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of expenditure as noted by the Assessing officer in assessment order had been fully explained in paragraph 4.8 of the statement of facts duly supported by copy of Conveyance Deed, Architect Certificate, Municipal Completion Plan, Statutory Auditor's Certificate dated 2nd March, 2009 and Architect Clarification Certificate. The appellant company had apportioned the cost of sales at 45.19% of the construction cost as per Profit Loss Account which is ₹ 7,22,82,601.82. On the other hand, if the cost of sales would have been apportioned at 45.3% (as noted by the Assessing officer in the assessment order) the total cost would have been ₹ 7,24,56,912.99. On these count I agree with the submissions of the appellant and consider the cost of sales to be apportioned @ 45.19% which has been taken in the Profit Loss Account, based on which return has been declared by the appellant. b) The observations of the Assessing officer based on which it was held by him that the completeness and correctness of the accounts of the appellant were not satisfactory and the books of accounts were rejected have been responded by the appellant at paragraph - 4.10 of the Statement of Fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .O. had estimated the income based on a percentage of Sales considerations. ( e) The AO had not identified any Accounting Standard notified u/s.145(2) of the Act which was not followed by the assessee. Hon'ble Supreme Court had observed in CIT v Padamchand Ramgopal 76 ITR 719 (Se) that minor mistakes cannot be a ground for rejection of books of accounts. ( f) In view of the above and after consideration of A.O.'s Remand Report appellant's comments thereon, it cannot be said that the completeness and correctness of the accounts of the assessee are not satisfactory. And therefore, the books of accounts of the appellant cannot be rejected u/s. 145(3) of the IT. Act, 1961. Thus the contention of the appellant are found acceptable. The grounds of appeal succeeds. Accordingly, the addition of ₹ 36,75,000/- as made by the Assessing officer is hereby deleted. 6. In view of the discussion made herein above and respectably following the decision of Hon ble Supreme Court in the case of Realest Buildings Services Ltd. (supra), we find no infirmity in the order of CIT(A) and it is justified. Then, Ground No.1 2 raised by the Revenue are dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lders and their creditworthiness. On perusal of these documents the genuineness of transactions are also found established. Under these facts and circumstances since all the three factors requiring for share capital creditors have been established by the appellant, the addition of share capital amounting to ₹ 32,00,000/- stands explained. Now, there is no need to discuss the applicability of case decisions cited by the appellant in support of its contentions i.e. Sl. No. Name Citation 1. UT v. Value Capital Services Pvt.Ltd. (2008) 307 ITR 334 (Del.) 2. Sky High Properties Pvt. Ltd. v ITO (2002) 258 HR (A.T.) 98 (ITAT, Delhi) 3. Exoimp Resources (India) Ltd. V CIT(Cal.) (2006) 276 M? 87 (C31.) 4. CIT vs. Steller Investment Ltd. (2001) 251 ITR 263 (S.C.) Thus the contentions of the appellant are found acceptable. The ground of appeal succeeds. Accordingly, the addition of ₹ 32,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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