2004 (8) TMI 318 - AT - Income Tax

Unexplained cash credits - creditworthiness of the creditor - Evidence - sale deed of agricultural land and bank statements - HELD THAT - After hearing both the sides and considering the material on record as well as documentary evidence, which were filed before the lower authorities and copies placed before this Bench to which my attention was drawn, I find that the CIT(A) has rightly appreciated the facts in the light of the material available on record. The assessee has not only filed confirmation letters, affidavits of the creditors and also produced all the creditors who have admitted to have given the loans to the assessee-company and also furnished necessary evidence to prove their capacity to advance such loans, and in view of fact and circumstances of the case it is immaterial whether some amount is kept at home and deposited the same before issuing cheques, etc. Since source of such deposits has been proved by the assessee and the AO has not objected to the assertion made by the creditors at the time of recording of the statements, therefore, in my considered opinion, the learned CIT(A) is fully justified in view of the facts and the circumstances of the case to delete all the additions. Since no fresh material or evidence has been adduced nor any infirmity or flaw in the order of the learned CIT(A) came to my notice, therefore, while concurring with the findings of the learned CIT(A), I uphold his order and dismiss the appeal of the Revenue. As a result, the appeal of the Revenue gets dismissed.

Issues Involved:
1. Deletion of addition of Rs. 2,79,218 on account of unexplained cash credits u/s 68.
2. Deletion of addition of Rs. 81,610 in the name of Shri Jangir Singh.
3. Deletion of addition of Rs. 88,590 in the names of Shri Baldev Singh and Shri Balkar Singh.
4. Deletion of addition of Rs. 53,410 in the name of Shri Rajinder Singh.
5. Deletion of addition of Rs. 55,608 in the name of Smt. Amritpal Kaur.

Summary of Judgment:

1. Deletion of addition of Rs. 2,79,218 on account of unexplained cash credits u/s 68:
The Revenue's appeal challenges the deletion of Rs. 2,79,218 made by the AO u/s 68. The learned CIT(A) deleted the addition, and the Tribunal upheld this decision, dismissing the Revenue's appeal.

2. Deletion of addition of Rs. 81,610 in the name of Shri Jangir Singh:
The AO added Rs. 81,610 as unexplained cash credits in the name of Shri Jangir Singh. The assessee provided evidence including an affidavit, a sale deed of agricultural land, and bank statements. The CIT(A) found that the creditor had proven the identity, source, and transaction, and deleted the addition. The Tribunal upheld this deletion, noting that the AO failed to disprove the creditor's explanation.

3. Deletion of addition of Rs. 88,590 in the names of Shri Baldev Singh and Shri Balkar Singh:
The AO added Rs. 88,590 as unexplained cash credits in the names of Shri Baldev Singh and Shri Balkar Singh. The assessee provided affidavits, sale deeds, and bank statements. The CIT(A) accepted the explanation and deleted the addition, finding that the creditors had proven their identity, source, and transaction. The Tribunal upheld this deletion, noting the AO's failure to disprove the creditors' explanations.

4. Deletion of addition of Rs. 53,410 in the name of Shri Rajinder Singh:
The AO added Rs. 53,410 as unexplained cash credits in the name of Shri Rajinder Singh. The assessee provided affidavits, land ownership documents, and bank statements. The CIT(A) accepted the explanation and deleted the addition, finding that the creditor had proven his identity, source, and transaction. The Tribunal upheld this deletion, noting the AO's incorrect factual findings and failure to disprove the creditor's explanation.

5. Deletion of addition of Rs. 55,608 in the name of Smt. Amritpal Kaur:
The AO added Rs. 55,608 as unexplained cash credits in the name of Smt. Amritpal Kaur. The assessee provided affidavits, gift deeds, and land ownership documents. The CIT(A) accepted the explanation and deleted the addition, finding that the creditor had proven her identity, source, and transaction. The Tribunal upheld this deletion, noting the AO's failure to disprove the creditor's explanation.

Conclusion:
The Tribunal, after considering the material on record and the arguments from both sides, found that the CIT(A) had rightly appreciated the facts and circumstances of the case. The assessee had provided sufficient evidence to prove the identity, capacity, and source of the creditors. The Tribunal upheld the CIT(A)'s order and dismissed the Revenue's appeal.

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