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TMI Blog1995 (2) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee was an old man aged 63 years who could not drive the car himself. It was stated that the car had been "mostly used" for business purposes and, in any case, the disallowance at 1/3rd was excessive taking note of the fact that in the subsequent assessment year, viz., 1989-90, the same had been restricted to 1/5th by the Assessing Officer himself. Taking note of the aforesaid submission, the CIT(A) reduced the disallowance under the aforesaid three heads to 1/5th of the expenditure claimed. 4. After considering the rival submissions, we find no good ground to interfere with the decision taken by the CIT(A) to restrict the claim to 1/5th. The arguments advanced before us by the learned counsel were absolutely identical to those raised before the tax authorities. The CIT(A), in our opinion, had considered the submissions in their proper perspective and restricted the disallowance to 1/5th and such action on his part is approved by us. The first ground is accordingly rejected. 5. The second ground of appeal pertains to an addition of Rs. 10,000, that being the amount credited in the capital account of the assessee on7th May, 1987. It was explained before the Assessing Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 29th Sept., 1986. If the explanation of the appellant regarding the source of amount deposited on 7th May, 1987 is to be believed, then the question arises as to why the appellant had withdrawn from his capital account Rs. 10,000 on 2nd Feb., 1987 to meet the marriage expenses of his son, when the appellant already had available to him Rs. 10,000 withdrawn on 29th Sept., 1986. It is evident from the circumstantial evidence put forth by the learned counsel for the appellant, that the amount withdrawn on29th Sept., 1986Rs. 10,000 had already been spent by the appellant. In other words, this amount was not available on2nd Feb., 1987then, how the appellant deposited the said amount on7th May, 1987. It is apparent that the amount of Rs. 10,000 deposited on7th May, 1987represents his undisclosed income of the appellant as the source of the same stands explained. Accordingly, the addition of Rs. 10,000 on account of credit to the capital account of the appellant on7th May, 1987is confirmed." 7. Before us the learned counsel for the assessee reiterated the arguments advanced before the lower authorities and also referred to the material appended on the paper book filed by him during the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pertains to the disallowance out of the salary of Rs. 18,250 paid by the assessee to his son, Shri Naresh Chander. The Assessing Officer recorded the statement of Shri Naresh Chander and also examined relevant facts of the case. He found that the said person had become an employee of the assessee for the first time and had been paid salary at the rate of Rs. 1,500 per month from April, 1987 to October, 1987 and at the rate of Rs. 1,550 per month from November, 1987. Taking note of the educational qualifications, the status, and the duty as also the further fact that on being specifically asked, he did not remember the names of the other employees, the Assessing Officer opined that a salary of Rs. 1,000 p.m. would be reasonable viz., Rs. 12,000 per annum. He accordingly added back the balance of Rs. 6,250. In taking the aforesaid decision, the Assessing Officer also referred to the salaries being paid to other employees of the assessee and further observed that the salary was "more the outcome of extra commercial consideration rather than that of competence and ability". 10. Before the CIT(A) it was submitted on behalf of the assessee that prior to joining the assessee Shri Naresh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the alleged depositors did not have the capacity to advance any money to the assessee. This conclusion the ITO arrived at after considering the agricultural holdings of these persons, size of the family, annual agricultural income and the expenditure both in respect of agricultural activities and household expenditure. As regards Smt. Kaushalya Devi, the submission of the assessee was that she had advanced money for purchase of goods but which he could not substantiate from the record. In the final analysis the ITO added the aforesaid credits and which on further appeal came to be confirmed by the CIT(A) on identical grounds and line of reasoning. 14. After hearing both the parties, we are of the view that no interference is warranted in the order passed by the CIT(A), whereby he has confirmed the addition of Rs. 22,500 made by the ITO on account of unproved cash credits. The learned counsel, other than referring to the written submissions addressed to the CIT(A), has not brought forth any material or arguments to justify a view to the contrary on our part. We, accordingly, uphold the order passed by the CIT(A) confirming the addition of Rs. 22,500. 15. Taking up for considera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of asst. yr. 1988-89). 20. The CIT(A) perused the material on record with reference to the surrender of Rs. 3,70,000 on account of the difference in the valuation of the stock. Being of the view that the addition of Rs. 49,105 merged with the aforesaid surrender he deleted the addition. He, however, directed relief to the tune of Rs. 26,605 only on the ground that cash credits aggregating Rs. 22,500 had not been accepted by the Assessing Officer but no separate addition was made as these were covered by the trading addition of Rs. 49,105. He, therefore, limited the relief to Rs. 26,605 (Rs. 49,105 minus Rs. 22,500). 21. After hearing both the parties and perusing the material on record, we are of the view that no interference is warranted in the order passed by the CIT(A) to hold that the separate addition of Rs. 49,105 was not justified, the same having merged in the amount of Rs. 3,70,000 surrendered by the assessee, viz., the undervaluation of stock. It is not the case of the Department before us that the amount surrendered has not been subjected to tax or that it does not form a part of the trading results. As the aforesaid position has been accepted by the Revenue, it would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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