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2015 (6) TMI 515 - AT - Income TaxAddition u/s.68 - CIT(A) deleted the addition - Held that - There is no dispute with regard to the fact that the identity of the depositors is not doubted. The genuineness of the transaction also established as the same effected through banking channel. The assessee has furnished evidences of the creditworthiness of the persons from whom he has obtained loans. The Revenue has not rebutted the evidences placed by the assessee by placing any contrary material on record. Therefore, we do not see any reason to interfere with the order of the ld.CIT(A), same is hereby upheld. - Decided against revenue. Disallowance of shop rent & godown rent - CIT(A) deleted the addition - Held that - The shop rent and godown rent were disallowed on the ground that no PAN or confirmation of the parties were furnished to whom these payments of rent were made. The books of account of the appellant were audited. The shops and godown were not taken on rent during the year under consideration but the same were taken on rent in A.Y. 2003-04. No such disallowance were made in earlier year. The Ld. Counsel has furnished sufficient evidence for the tenancy of the shop and godown. Such evidences were also independently filed before the Assessing Officer during remand proceedings vide letter dated 11.08.2011. After considering the evidences so filed, there is no justification for disallowing the shop and godown rent - Decided against revenue.
Issues involved:
1. Addition of unsecured loan and interest paid thereon 2. Disallowance of shop rent and godown rent 3. Disallowance of depreciation, travelling expenses, and other expenses 4. Confirmation of deposits in the bank account 5. Disallowance of telephone, petrol expenses, and depreciation on car Issue 1: Addition of unsecured loan and interest paid thereon: The Revenue challenged the deletion of the addition of Rs. 8,00,000 under section 68 of the Income Tax Act and Rs. 41,900 as interest paid. The Assessing Officer made these additions during the scrutiny assessment. The CIT(A) partly allowed the appeal by deleting the addition made on account of unexplained cash credit and interest. The CIT(A) observed that the appellant had established the genuineness of the cash credits and fulfilled the requirements under section 68 of the Act. The identity of the depositors was established, transactions were through banking channels, and creditworthiness was proven. The Tribunal upheld the CIT(A)'s decision, noting that the Revenue did not provide contrary evidence to challenge the appellant's submissions. Issue 2: Disallowance of shop rent and godown rent: The Revenue contested the deletion of disallowance of shop rent and godown rent. The CIT(A) found that the appellant had furnished adequate evidence to prove the tenancy of the shop and godown. The rent payments were audited, and no adverse findings were reported in the remand proceedings. The CIT(A) concluded that there was no justification for disallowing the rent amounts, and thus, the disallowance was deleted. The Tribunal upheld the CIT(A)'s decision, as the Revenue failed to provide any contrary material to challenge the findings. Issue 3: Disallowance of depreciation, travelling expenses, and other expenses: The Assessee raised cross-objections regarding the confirmation of depreciation, disallowance of traveling expenses, credit in the bank account, and other expenses. However, during the hearing, the Assessee's counsel decided not to press the cross-objection. The Tribunal dismissed the cross-objection as not pressed. Final Decision: The Tribunal dismissed the Revenue's appeal and the Assessee's cross-objection. The Revenue's appeal challenging the deletion of additions and disallowances was rejected. The Tribunal upheld the CIT(A)'s decisions based on the evidence presented and the lack of contrary material from the Revenue. The cross-objection filed by the Assessee was dismissed as not pressed during the hearing. This detailed analysis of the legal judgment addresses all the issues involved, providing a comprehensive overview of the case and the Tribunal's decisions on each matter.
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