TMI Blog2009 (9) TMI 1060X X X X Extracts X X X X X X X X Extracts X X X X ..... s not made out. 3. The Ld. Commissioner of Income-tax (Appeals)-XI, Ahmedabad has also erred in law and on facts in restricting the disallowance of interest from ₹ 5,49,000/- to ₹ 27,472/-. 4. The Ld. Commissioner of Income-tax(Appeals)-XI, Ahmedabad has also erred in law and on facts in restricting the interest and granting relief of ₹ 5,27,528/- without giving a finding that the assessee had interest free borrowings from which the assessee had advanced the amount from its own funds. 5. The Ld. Commissioner of Income-tax(Appeals)-XI, Ahmedabad has further erred in law and on facts in deleting the addition of ₹ 40,74,165/- made u/s.68 of the I.T.Act. 6. The Ld. Commissioner of Income-tax(Appeals)-XI, Ahmedabad has also erred in law in not appreciating the fact that in case of deposits in the name of AMP Investment and Victoria Capital ventures, the assessee had not discharged its primary onus of furnishing confirmation and in the case of other three creditors, the confirmations furnished were defective and incomplete. 7. On the facts and in the circumstances of the case, the Ld. Commissioner of Income-tax(Appeals)-XI, Ahmedabad ought to have u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Kaivanna Project for which fees was charged by the assessee as under:- Sl.No(s) Particulars Amount (Rs) 1. For Supervising the work of construction ₹ 30,000/- 2. For holding discussion with Airport Authority ₹ 2,500/- 3. For holding discussion with Architects ₹ 15,000/- 4. For holding discussion for persons who came for booking ₹ 5,000/- 5. Other matters ₹ 100/- Total ₹ 52,600/- 6. There was no justification found for charging the above fees. The Assessing Officer accordingly invoked the provisions of section 145(3) of the I.T. Act, 1961 and estimated the development fees at 2% of book amount of ₹ 12,08,34,010/-. It was worked out at ₹ 24,16,680/- resulting in an addition of ₹ 9,76,322/-. 7. The Learned CIT(Appeals) deleted the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r and above, what is recorded in the books. There is no basis of fixing the fees at 2%. The assessee is following mercantile system of accounting and no case is made out to reject the books. He relied on the decision in following cases:- Sl.No(s) In the case of . Reported in (1) CIT vs. Shoorji Vallabhdas and Co. (1962) 46 ITR 144 (2) CIT vs. Birla Gwalior (P) Ltd. (1972) 89 ITR 266 (3) Poona Electric Supply Co. Ltd. vs. CIT (1965) 57 ITR 521 (4) R.B. Jodha Mal Kuthiala vs. CIT (1971) 82 ITR 570 (5) CIT vs. U.P. State Industrial Development Corpn. 225 ITR 703 (SC) (6) Gujarat Electricity Board vs. CIT 226 ITR 746 9. Against this, ld.DR relied on the order of the Assessing Officer. 10. After hearing the rival submissions and carefully perusing the material on record, we are of the view that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relates to ground No.3 and, therefore, it does not require any separate adjudication. It is accordingly rejected. 18. Ground Nos.5 6 of Revenue s appeal relate to addition u/s.68 of the I.T. Act, 1961 amounting to ₹ 40,74,165/-. 19. During the course of assessment proceedings, the Assessing Officer noted that the assessee has shown new deposits from following two parties:- Name of the party Amount (Rs.) AMP investment 10,00,000 Victoria Capital Ventures Ltd. 25,00,000 35,00,000 20. In addition to above, the following deposits were also found:- Name of the party Amount (Rs.) As on 31-3-97 Yogesh Anubhai Shah (HUF) 1,83,790 Payal Yogeshkumar Shah 91,717 Nilay Yogeshkumar Shah 2,98,658 5,74,165 21. When the Assessing Officer required the assessee to file confirmatory letters, the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not deposit/loan but the same pertained to booking amount and the same was repaid by the appellant by account payee cheque on 03-04-1997 as it seen from the copy of account filed by the appellant. It is seen that the appellant has discharged its onus by giving details like confirmation of account, address of the party, details of payments, PANo and the present jurisdiction of the assessing officer by whom the above party is assessed to tax. With regard to the amount of ₹ 25,00,000/- received by the appellant from Victroya Capital Ventures Ltd., it is seen that the appellant has discharged its onus by giving details like confirmation of account, address of the party, PANo and the present jurisdiction of the assessing officer by whom the above party is assessed to tax. 8.2.2 It is to be stated that according to section 68 of the I. T. Act, 1961 where any sum is found credited in the books of an assesses maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as income of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Having considered the facts of the case carefully, submissions of the Authorised Representative of the appellant, observations of the Assessing Officer in the assessment order and also considering the decisions, referred to above, the addition made by the Assessing Officer office is uncalled for and not justifiable. The addition made by the Assessing Officer of ₹ 40,74,165/- is, therefore, deleted. 23. Against this, ld.DR submitted that is not correct to say that necessary details of the depositors were filed before the Assessing Officer. There is no conformity letters on the letter-head(s) of the concerned parties. Therefore, it is not possible to say that those parties have advanced the money to the assessee. The assessee has not discharged the primary onus lay on him u/s.68 of the I.T. Act, 1961. 24. On the other hand, the Learned Authorised Representative of the assessee drew our attention to page No.62 of its paper-book which is an account of AMP Investment on the letter-had of the assessee. It showed the address of AMP Investment as 502, Panchkuva, Ahmedabad-2 and PAN AABFA7464 P. Then, at page No.63 of the paper-book, there was information about Victoria Capit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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