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TMI Blog2012 (7) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... th creditors, thus the addition made by the AO is not justified and is deleted - against revenue. - ITA No. 3210/Del/2011 - - - Dated:- 8-6-2012 - SHRI SHAMIM YAHYA, AND SHRI CHANDRA MOHAN GARG, JJ. Appellant by: Shri Satpal Singh, Sr. DR Respondent by : Shri K. Sampath O R D E R PER CHANDRA MOHAN GARG, JUDICIAL MEMBER This appeal has been preferred by the Revenue against the order dated 15.3.2011 of the CIT(A)-XXVIII, New Delhi, for AY 2006-07. 2. The main grounds of appeal read as under:- 1. On the facts and circumstances of the case and in law, the ld. CIT(A) has erred in deleting the addition of Rs.1,34,86,495/- on account of undisclosed income made by the AO. 2. On the facts and circumstances of the case and in law, the ld. CIT(A) has erred by accepting additional evidences u/s 46A filed by the assessee during the appellate proceedings which were not produced before the AO during the assessment proceeding. 3. Briefly stated the facts of the case are that the return of the assessee was processed u/s 143(1) of the Income Tax Act, 1961 and subsequently, this case was selected for scrutiny under CASS. On service of notices, assessee s repre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various parties were taken as income from undisclosed sources and were on account of supply of goods and services for which the payments were made in the subsequent years and these amounts were not undisclosed income of the assessee. The AR supported the impugned order and vehemently made a submission that during the course of previous year relevant to the assessment year under consideration, the assessee made purchases aggregating to Rs. 10,47,66,656.78 and at the end of previous year, the total amount due to sundry creditors was Rs.2,28,38,350.58 and audited accounts for the year ended on 31.3.2006 were also submitted by the assessee. The AR also submitted that despite sincere and honest efforts, the assessee could not get their response well in time as the proceedings of assessment were closed before the assessee could get the required confirmation. The AR further submitted that the assessee had no control over the creditors which also included the large public sector companies/organizations such as Steel Authority of India Ltd., Hindustan Zinc Ltd. and Hindustan Dorr Oliver Ltd. etc. 7. The AR concluded with this final submission that as the AO closed the proceedings prior ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer called upon the appellant to produce confirmations from various creditors. The appellant took immediate action and sent out letters addressed to various creditors requesting them to confirm the balance. However, the creditors did not respond before the hearing proceedings were closed. The appellant had no control over the creditors which also included large organizations such as Steel Authority of India Ltd., Hindustan Zinc Ltd., Hindustan Dorr Oliver Ltd. etc. The appellant explained this to the learned Assessing Officer. Considering the facts, the additional evidence filed by the appellant is admitted as the conditions laid down in Rule 46A are satisfied in this case. As discussed above, the AO has been given an opportunity in terms of Rule 46A(3) and his remand report has been duly considered. 3.7 The appellant ahs pointed out that its accounts are audited under the Companies Act by its Statutory Auditors who have verified the transactions of purchases, undertaken ledger scrutiny and have certified the profit and loss and the balance sheet including the closing balance of the sundry creditors. There is no qualification by the auditors in this respect. It was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uments filed in regard to accounts with M/s Hindustan Zinc Ltd. and M/s Hindustan Dorr Oliver. 3.10 The submissions of the appellant and the facts have been carefully considered. The appellant has filed the necessary documents and reconciliation in respect of his accounts with creditors where certain discrepancies were pointed out in the assessment order. In his remand report, the AO has not brought any material on record to show that these discrepancies have remained unreconciled even after considering the documents filed in appellate proceedings. The AO has not pointed out any discrepancy which has remained reconciled in respect of the appellant s accounts with his creditors including M/s Hindustan Dorr Oliver and M/s Hindustan Zinc Ltd. It is therefore clear that the appellant has discharged his burden of proof in respect of his transactions with creditors. In view of these facts, the addition made by the AO is not justified and is deleted. The ground is allowed. 10. On bare reading of above operating part of impugned order, we observe that the ld. CIT(A) considered relevant documentary evidence and reconciliation of accounts with the creditors and held that in the remand r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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