2015 (10) TMI 1894 - AT - Income Tax

Addition u/s 68 - CIT(A) deleted the addition - Held that - perusal of the CIT(A) s order as well as assessment order, there is a clear finding given by the CIT(A) that the assessee has given a detailed chart related to proceeds of sale of shares and repayment of loan during the assessment proceedings but the Assessing Officer has overlooked these evidences and made addition. We are of the view that the impugned addition was rightly deleted by the Ld. CIT(A). - Decided in favour of assessee.

Summary

Issues involved:
Appeal against deletion of addition made under section 68 of the Income Tax Act, 1961.

Analysis:
1. The appeal was filed by the Revenue against the order passed by CIT(A) New Delhi, challenging the deletion of an addition of Rs. 2,78,57,082 made by the Assessing Officer under section 68 of the Income Tax Act, 1961.
2. The Assessing Officer required the assessee to provide details of credit entries in its bank accounts for the financial year 2008-09 to establish the identity and creditworthiness of the creditor and the genuineness of the transactions.
3. The Assessing Officer noted that the assessee did not provide any explanation regarding the deposits in its bank accounts, failing to establish the identity and creditworthiness of the creditor as required under section 68 of the Act.
4. The assessee claimed that confirmations were furnished before the Assessing Officer during the assessment proceedings, which were allegedly overlooked. The assessee reiterated the submission during the first appellate proceedings.
5. The CIT(A) cited Rule 46A of the I.T. Rules, stating that fresh evidence need not be admitted as the assessee did not produce supporting documentary evidence to establish the creditworthiness of the creditors during the assessment proceedings.
6. The assessee contended that the addition made by the Assessing Officer represented either sale consideration of investments or repayment of loans, which are business receipts, not credit entries. The CIT(A) deleted the addition based on this argument.
7. The Department argued that the assessee did not submit proper evidence or detailed confirmations of the alleged creditors before the Assessing Officer, justifying the addition made by the AO.
8. The Tribunal referred to a similar case where necessary evidence was supplied by the assessee before the Assessing Officer, shifting the onus to the AO to rebut the explanations and evidence filed by the assessee. As the AO failed to do so, the CIT(A) rightly deleted the addition.
9. The CIT(A) found that the assessee provided detailed charts related to the proceeds of the sale of shares and repayment of loans during the assessment proceedings, which were overlooked by the Assessing Officer, leading to the deletion of the addition.
10. The Tribunal upheld the CIT(A)'s decision to delete the addition, emphasizing that the detailed charts provided by the assessee during the assessment proceedings were not considered by the Assessing Officer, leading to the dismissal of the appeal.

This detailed analysis covers the issues involved in the legal judgment comprehensively, highlighting the arguments presented by both parties and the reasoning behind the decision to delete the addition under section 68 of the Income Tax Act, 1961.