9911796707
TMI Blog2014 (10) TMI 496X X X X Extracts X X X X X X X X Extracts X X X X ..... ormation u/s. 133(6) from the vendor M/s. Jai Traders, Indore and on comparison found some differences in the copy of ledger account for making addition without appreciating the fact that as against debit entry of Rs. 55,870/- in the books of Jai Traders, there was a credit entry of Rs. 53,900/- in the books of account of the assessee and debit entry of Rs. 3,16,130/- is a contra entry due to cheque return on first instance by the bank and the same is verified from the bank statement filed on record. The AO considered only debit entry of Rs. 3,16,130/- without considering the contra entry. The ld. CIT(A) perused the record and information u/s. 133(6) and also gone through the statement of account of assessee in the books of M/s. Jai Traders as obtained by the AO on 25.11.2010 is reproduced at page 5 & 6 of the appellate order as well as assessee's books of account showing the account of Jai Traders, which is also reproduced at page 6 of the appellate order and it was found that difference of Rs. 3,72,000/- is explained which arise because of the contra entry of Rs. 3,16,130/- on account of return of cheques. The addition was accordingly deleted. 4. On consideration of the rival su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Rs. 2,99,970/- and rest was deleted. 6. On consideration of the rival submissions, we do not find any merit in this ground of appeal of the Revenue. The information u/s. 133(6) receipted by the AO is reproduced at page 7 & 8 of the appellate order and the details noted by the assessee in the books of account are noted at page 8 & 9 of the appellate order. All the entries are reconciled and supported by the bills and invoices except for Rs. 24,570/-. The assessee filed reconciliation of accounts as suggested by the ld. DR, in which no discrepancy has been pointed out. We, therefore, do not find any merit in this ground of appeal because accounts were got verified and as such no interference is called for in the matter. 7. On ground No. 3, the Revenue challenged the deletion of addition of Rs. 39,45,359/- on account of unexplained creditor M/s. Oom Murga Oil Mills. The AO considered the entries in the books of account of the assessee and in the books of M/s. Oom Murga Oil Mills and found difference and accordingly made the above addition. It was submitted before the ld. CIT(A) that the assessee did business with this company as its consignment commission agent and the accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so declared total commission of Rs. 12,85,696/- as per his P&L account. Similar commission has also been earned and declared in his returns for earlier years at Rs. 31,366/- (A.Y. 2005-06), Rs. 6,06,484/- (A.Y. 06-07) and Rs. 8,13,069/- (A.Y. 07-08). Comparative analysis of statement obtained by the A.O. vis-a-vis entries made in books of accounts of the appellant, no difference is found either in respect of quantity or the amounts. The difference pointed out by the A.O. is mainly on account of contra entries made at different points of time by the appellant and his principal. Accordingly, addition of Rs. 39,45,359/- is, hereby, deleted." 9. On consideration of the rival submissions, we do not find any merit in this ground of appeal of the Revenue. The ld. DR pointed out PB (C-81) and from the papers filed by the ld. DR at page 5 to show that there is difference which is not reconciled or tallied. However, the assessee has filed reconciliation statement of accounts as suggested by the ld. DR in which all the entries were got reconciled and no difference has been pointed out by the ld. DR. Therefore, on this reason itself this ground is liable to be dismissed. It is admitted fact t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the appellant has been informed of cash payments made to M/s. Mohit Traders by the A.O. No copy of accounts, as received by the A.O. directly from M/s. Mohit Traders has been shown or made available to the appellant. Vide letter dtd 22.12.2010, the appellant has submitted before the A.O. that there are differences found in respect of 3-4 parties relating to some of the entries which have been noted by the A.O. and given to the appellant for comments. He has categorically submitted in respect of M/s. Mohit Traders that the appellant has transacted on earlier occasions for which payment has been made through cheques. No purchases have been made nor any payment made in respect of Rs. 6,24,000/- which has been incorrectly debited and credited by M/s. Mohit Traders in its books of accounts. The appellant has further requested the A.O. that copy of statement of concerned parties be made available to him giving an opportunity to give detailed and complete explanation for each party and each entry, since only the difference is found to have been provided to him by the A.O. The appellant has further requested to give an opportunity for cross examination of the parties concerned where diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nue. The AO made addition for cash payments noted by this party in their accounts. The bill No. 3014 was not brought on record. No copy of accounts of M/s. Mohit Traders received directly by the AO has been made available to the assessee. The assessee denied to enter into any transaction with this party of Rs. 6,24,000/- and also sought opportunity from the AO to cross examine this party for making the aforesaid entry of cash payments in the books of account, but the AO did not supply copy of statement of M/s. Mohit Traders to the assessee and gave no opportunity to cross examine this party. Therefore, principles of natural justice have been clearly violated in the matter. Since no incriminating material is confronted to the assessee and no cross examination of the party is allowed to the assessee, therefore, such entries in the books of account of M/s. Mohit traders cannot be read as evidence against the assessee. We rely upon the decision of Hon'ble Supreme Court in the case of Kishan Chand Chelaram vs. CIT, 125 ITR 713. The ld. CIT(A) on proper appreciation of facts and law correctly deleted the addition. This ground is accordingly dismissed. 12. On ground No. 5, the Revenue ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... squarely prove that all the transaction with the trade creditors are relevant to business of the assessee and both of them in their own capacity are ascertainable, genuine entities, hence action of the learned assessing authority in making addition of total purchases of Rs. 4292706/- of Ruchi Soys Refiner and Rs. 25215149/- of Marble Tea Estate India Ltd. is wholly unjustified and irrational. The AO before making such huge addition of Rs. 29507855/- ought to have logically concluded his observation, but just by saying - "On dt. 27.12.10 assessee submitted his compliance but that is not satisfactory, so the transaction with above parties is considered bogus," he did not perform his quasi-judicial functions in judicious manner. Without prejudice to the above it is further submitted in the facts of the case that Trade Creditors per se cannot be equated with Cash Creditors and by making non compliance for furnishing of information asked u/s. 133(6) of the Act by the third party, assessee cannot be penalized, when he has furnished all the details of creditors as required by learned A.O. and proved the transaction beyond doubt with the help of other supporting evidences like purchases vo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the appellant for the year under consideration have been accepted by the A.O. Payments made to both the creditors are found duly reflected in the bank accounts of the appellant in HDFC bank and S.B.I. In fact, M/s. Ruchi Soya Refiners has faxed copy of account of the appellant in its books of accounts on 20.12.2010 at 2.52 p.m. addressed to the A.O. No cognizance has been taken of the same by the A.O. who for the reasons best known to him, has proceeded to treat the said party as bogus. No further effort has been made by the A.O. to reject the evidence given by the appellant and the third party before making the impugned addition. 5.3 In respect of Marvel Tea Estate, Jabalpur, as per copy of account submitted by the appellant, total purchases of Rs. 2,68,43,059/- have been made during the year and closing balance of Rs. 1,07,79,352/- has been shown. All the payments have been made through its bank accounts in OBC. Purchases include VAT sales by Marvel Tea Estates besides Central accounts sales. As per invoices, complete details like TIN No., phone No., address, vehicle No. for delivery etc. giving the quantitative details of sales made by it during the year to the appellant h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iners, there is debit balance, for which no addition could be made against the assessee and in the case of M/s. Marvel Tea Estate India Ltd., the credit balance is of Rs. 1.07 crores only (PB C-197). He has submitted that since the purchases have been made by the assessee and accounts have not been disputed by the AO and accounts of the assessee have been accepted by VAT department and purchases have been accepted, therefore, whole addition is unjustified on account of unexplained credits. 16. We have considered the rival submissions and perused the material on record and did not find any merit in this ground of appeal of the Revenue. The ld. counsel for the assessee during the course of arguments took us through various statements of both the parties in their books of accounts and books of account of the assessee to show that the purchases are properly entered in the accounts which are supported by vouchers and payments have been made through banking channel. The address of M/s. Marvel Tea Estate India Ltd. is of Jabalpur (MP), but the AO is stated to have issued the summon at Jaipur (Raj.). The AO accepted the books of account and no discrepancies have been pointed out in the pu ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
