9911796707
TMI Blog2012 (4) TMI 243X X X X Extracts X X X X X X X X Extracts X X X X ..... case, learned Income Tax Appellate Tribunal was justified in holding that the original as well as set aside assessment order became invalid as per their earlier order dated 15.10.1999? (ii) Whether on the facts and in the circumstances of the case, learned Income Tax Appellate Tribunal was justified in upholding CIT(A)'s order whereby the CIT(A) deleted the additions of Rs. 4,93,500/- made u/s. 68 in the Assessment Year 1990-91, when the creditors have no creditworthiness to advance the loans". 2. The brief facts, as projected by the appellant, are that the original assessment of the assessee was completed under Section 143 (3)/147 of the I.T. Act on a total income of Rs.2,36,130/- on 31.03.1995 with an addition of unexplained cash ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aside the order, vide order dated 25.8.1999. 7. The CIT(A) observed that all the creditors appeared before the Assessing Officer (for short "the A.O."), their statements were recorded on oath and all of them have affirmed the fact of giving the said loans to the assessee. They had also indicated their source and financial capacity for making the impugned deposits with the assessee. They further explained the details of repayment of the deposits or interest to them by the assessee. Their complete addresses were also disclosed to the Assessing Officer. It was further observed that the A.O. had sufficient time at his credit to verify the verifiable facts but then neither the deponents have been cross-examined nor was there any evidence broug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income and file confirmation and affidavits, therefore, the assessee has discharged the onus of proving the capacity of lender, transactions and source of income of lenders. The explanation and statement not found acceptable to the A.O. does not lead to the conclusion that there is undisclosed income in the hands of the assessee. The A.O. has also not brought on record the cogent reasons to falsify the statements and affidavits submitted before the A.O. The A.O. also not rejected the statements and affidavits on valid reasons. Therefore, it was concluded that the A.O. has not applied judicious mind while resorting to addition in passing the order as per direction of CIT u/s. 263 of the Act. The addition made by the A.O. deserves to be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese creditors, who had advanced loans to the assessee. The assessee has produced all the creditors for examination before the A.O. on 24.01.1999. The finding of A.O. was not just and proper in view of the observation made by the High Court of Madras in S. Hastimal v. CIT [1963] 49 ITR 273 (Mad.). All the credits have been shown in the balance sheet, though the books of a/c. was not maintained. 13. Learned counsel appearing for the assessee in support of his submission relied on CIT v. Shiv Shakti Timbers, [1997] 90 Taxman 349 [1998] 229 ITR 505 (Mad.), CIT v. P. Mohanakala [2007] 161 Taxman 169/291 ITR 278 (SC), Santosh Hazari v. Purshottam Tiwari and CIT v. Smt. Anita Chouhan [2006] 155 Taxman 136/[2008] 296 ITR 691 (MP). 14. Reliance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty is entitled to interfere with the finding of facts. 19. In the case on hand, the CIT(A) has examined all the statements and depositions made by the creditors including their source of income and it was found that the A.O. without having any material on record, contrary to the statements and affidavits filed by the creditors taken a stand that the creditors have failed to prove their creditworthiness and, as such, the transaction was not genuine. The A.O. has not made any other independent enquiry to disprove the creditworthiness of the creditors, as established by affidavits, statements of the creditors disclosing source of income. Thus, the finding of the CIT(A) that the observation of the A.O. with regard to dissatisfaction was on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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