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TMI Blog2014 (11) TMI 654X X X X Extracts X X X X X X X X Extracts X X X X ..... enses debited through internally prepaid vouchers and supporting evidences not furnished – Held that:- CIT(A) rightly was of the view that the expenses cannot be said as excessive or unreasonable – it is comparable from the preceding years - AO made the disallowance without providing opportunity of hearing to the assessee and it was not the case of the AO that the commission payment made in the preceding assessment years were also disallowed – the order of the CIT(A) is upheld – Decided against revenue. Unexplained cash credits u/s 68 - creditworthiness of the creditors and genuineness of transactions not proved – Held that:- CIT(A) was rightly of the view that the assessee had filed the confirmation and affidavits of the creditors in w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of ₹ 50,000/- without appreciating the fact that these expenses have been debited through internally prepaid vouchers and no supporting evidences have been furnished as to for what purpose of commission has been paid. 3. deleting the addition made on account of unexplained cash credit of ₹ 72,600/- u/s. 68 of the I.T. Act without appreciating the fact that the creditworthiness of the creditors and genuineness of transactions have not been proved by the assessee. 2 Vide Ground No.1, the grievance of the Department relates to the deletion of addition of ₹ 11,89,000/- made by the Assessing Officer u/s. 40(a)(ia) of the I.T. Act, 1961 (hereinafter referred to as 'the Act' in short). 3. Facts relating to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Now the Department is in appeal. 5. Learned D.R. strongly supported the order of the Assessing Officer while learned counsel for the assessee reiterated the submissions made before the authorities below and relied the observations made by the Ld. CIT(A). 6. We have considered the submissions of both the parties and carefully gone through the material available on record. In the present case, it is noticed that no TDS was outstanding and payable at the time of the due date of filing the return u/s. 139(1) of the Act. It is also noticed that a proviso to sub-clause (ia) of clause (a) to section 40 of the Act has been substituted by the Finance Act, 2010 and read as under:- (ia) any interest, commission or brokerage, [rent, royalty, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erit in the appeal of the Department on this issue. 7. Next issue vide Ground No. 2 relates to the deletion of addition of ₹ 50,000/- made by the Assessing Officer out of commission expenses. 8. Facts relating to this issue, in brief, are that the assessee claimed expenses of ₹ 89,300/- under the head 'commission'. The Assessing Officer was of the view that those expenses were incurred in cash on the basis of internal vouchers. He therefore, disallowed ₹ 50,000/- out of those expenses. 9. Being aggrieved, the assessee carried the matter to the ld. CIT(A) and submitted as under:- In this connection, it is submitted that the expenses claimed are very nominal and reasonable looking to the size and nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Ld. CIT(A). We do not see any merit in this ground of the Departmental appeal. 12. Next issue vide Ground No.3 relates to the deletion of addition of ₹ 72,600/- made by the Assessing Officer u/s. 68 of the Act. 13. Facts relating to this issue, in brief, are that the Assessing Officer during the course of assessment proceedings, noticed that the assessee had introduced unsecured loan of ₹ 6,32,300/-. In support of this, the assessee filed the confirmations and affidavits of the creditors to prove the identity. The Assessing Officer asked the assessee to produce all the 12 creditors. The assessee produced 8 creditors and failed to produce the remaining 4 creditors namely Shri Sahabuddin S/o Shri Bannyakh ₹ 19,8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the creditors before the Id. AO could not be detrimental to the assessee s claim, which is a settled proposition of law, especially when the assessee was able to furnish full identity of the creditors. 04. Since the repayment was made from the known sources, there is no question of any unexplained credits. 05. It is further submitted that as per the Indian Evidence Act, the transactions appearing in regular books of account should be treated as genuine unless and until there are corroborative material or other evidences to rebut the same. In light of the above, addition made u/s 68 deserves to be deleted. 15. The learned CIT(A), after considering the submissions of the assessee, observed that the assessee had filed the confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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