9911796707
TMI Blog2022 (10) TMI 395X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary to the assessee's submissions, where the assessee himself accepted them as sundry creditors in para No. 05 of Page 04 of CIT(A) order and directing to delete the addition made by AO. 3. The ld. CIT(A) erred in considering the dual stance taken by the assessee in submissions of the assessee wherein the assessee at one point of time claims the sundry creditors as business associates at para No. 05 of Page 04 of CIT(A) order and in the next para of the CIT(A) order( para No. 05 of page 04 ) claims them as sundry creditors and speaks of restrictions on AO to accept the creditworthiness of the creditor as soon as the sundry creditor accepts money lent to the assessee. 4. The ld. CIT(A) erred in not taking cognizance of the int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vouchers or a certificate from Horticulture Officer/Agriculture Officer or any equivalent authority, hence have failed to prove their credit worthiness". 3. Facts of the case, in brief, are that the assessee is an individual and derives income from hiring of Hitachi vehicle in addition to real estate business during the financial year relevant to the A.Y 2015-16. He filed his return of income on 31.3.2017 declaring taxable income of Rs.7,00,930/-. The case was selected for limited scrutiny through CASS to verify "Whether Sundry Creditors are genuine and whether the cash deposit has been made from disclosed sources". Statutory notices u/s 143(2) & 142(1) were issued to which the assessee filed the requisite details called for from time to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... genuineness and creditworthiness of the creditors, the Assessing Officer issued summons and recorded statement u/s 131 of the I.T. Act, 1961. During their sworn statements, he noticed that all are non-filers and all the above seven persons are stated to be agriculturists. Some of them have stated that they have taken cash loans from others i.e., one of the sources for investment in purchase of properties. During the course of recording statement of the above sundry creditors, he noted that they have not produced any documentary evidences in support of their claim of lending such huge amounts of money to invest along with the assessee to purchase property which shows that they are not creditworthy. He, therefore, again asked the assessee to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r observed that assessee's claim of taking loans from the above mentioned creditors to the tune of Rs.4,21,54,560/- is not tanable. He also observed that all the transactions were only cash transactions and attract provisions of section 269 SS of the I.T. Act, 1961. The Assessing Officer accordingly held the above investment as unexplained investment in purchase of property u/s 69 of the I.T. Act, 1961 and added back the same to the total income of the assessee. 6. In appeal, the learned CIT (A) directed the Assessing Officer to delete the addition of Rs.4,21,54,560/-by observing as under: "7. The assessment order, statement of facts, grounds of appeal, written submissions the contents of the appellant, copies of sworn statements, eviden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 91,38,640/-, he submitted that Mr. Naidu in his reply to Question No.6 has explained his source to the tune of Rs.19.00 lakhs only and the remaining amount has not been properly explained. 10. Similarly in the case of Mr. M. Krishnamanaidu who has given loan of Rs.91,38,640/- his source is explained to be from agricultural income. Similarly, in the case of P. Rajasekhar who has given a loan of Rs.91,38,640/-, he has also not fully explained the source of income and is said to have borrowed Rs.20.00 lakhs from Shri Idali Ramaiah and Chit of Rs.15.00 lakhs as well as gold loan of Rs.30.00 lakhs. He submitted that the entire amount has been paid in cash and therefore, it raises doubt. Merely because the persons have appeared and stated before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used the orders of the AO and the learned CIT (A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us by both sides. We find the AO in the instant case made addition of Rs.4,21,54,560/- on the ground that the assessee could not substantiate with evidence to his satisfaction regarding the creditworthiness of the seven parties from whom the assessee has taken money as business associate members for purchase of the property at Vizag. We find the learned CIT (A) deleted the addition, the reasons of which have already been reproduced in the preceding paragraph. The order of the learned CIT (A), in our opinion, is a very cryptic one and does not give sound reasons for deleting the addi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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