2005 (10) TMI 265

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..... paid to the above three creditors. 3. Deleting the addition made on disallowance out of printing, stationery and telephone expenses amounting to Rs. 10,000 in each head." 2. In the first and second grounds of appeal, the Revenue has challenged the deletion of the addition of Rs. 10,50,000 made by the AO on account of unexplained cash credits and deletion of the addition made on account of interest paid to the creditors. The AO found that the assessee had shown cash credits totalling to Rs. 10,50,000 in the names of the following persons: 1. Shri Sadhuram Gupta Rs. 5,00,000 2. Smt. Lalita Gupta Rs. 5,00,000 3. Smt. Vimala Gupta Rs. 50,000 The assessee was called upon to establish the genuineness and creditworthiness of these loa .....

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..... ccounts were also filed. In view of the above, the learned CIT(A) treated the aforesaid credits as genuine and deleted the impugned addition. He also deleted the disallowance of interest. Aggrieved by the order of the learned. CIT(A), the Revenue has filed the present appeal before the Tribunal. 4. Before us, the learned Departmental Representative strongly relied on the order of the AO. On the other hand, the learned counsel for the assessee submitted that the assessee has filed all the details and, therefore, the creditworthiness should not have been doubted by the AO without bringing any material on record contrary to the facts submitted by the assessee. In this case, the initial onus has been discharged by the assessee by proving the .....

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..... n the basis of the records examined by the learned CIT(A). Nothing has been brought on record by the Departmental Representative to disprove the findings of the learned CIT(A). Once the credits are treated as explained, there is (no) reason for making the disallowance of interest payment to these creditors. Considering the totality of the facts and circumstances, we hold that the learned CIT(A) has rightly deleted the addition of Rs. 10,50,000 made under s. 68 and also the disallowance of interest payment made to these creditors. We do not find any reason to interfere in his order and the appeal of the Revenue on first and second grounds is dismissed. 6. In the third ground of appeal, the Revenue has challenged the deletion of disallowa .....

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