2012 (4) TMI 620

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..... of the transaction is also established. In the light of these undisputed facts of this case, the addition made by the AO and sustained by the learned CIT(A) is hereby deleted Disallowance of Telephone, Mobile, Petrol, Motor Vehicle expenses and Depreciation expenses - CIT(A) restricted the disallowance to 10% - Held that:- We feel that even 10% disallowance is on higher side keeping in view the fact that the assessee is a small retailer engaged in the business of distribution of cordless phones, etc. and, therefore, we deem it proper that the disallowance should be reduced to 5% of the total expenses Addition pertaining to Sales Promotion, Staff Welfare and Repair Charges - Held that:- Keeping in view the fact that the assessee has in .....

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..... enuineness of the transaction and creditworthiness of the depositor, the AO considered this deposit as unexplained and added the same to the income of the assessee u/s 68 of the Act. 3 Before the learned CIT(A), the assessee s contention was that the assessee had taken loan of ₹ 4,00,000/- from Shri N I Vyas by cheque 469225 drawn on Central Bank of India on 01- 06-2007 and the same was appearing in their bank statement. Mr. Vyas is a retired State Government Class I Officer and close relative of the assessee. In support of his submission, the assessee also filed a copy of letter of confirmation, PA Number Card of Mr. Vyas along with bank passbook. It was also contended that the AO did not utilize his powers to collect information .....

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..... hearing both the parties and perusing the record, we find that there is no dispute about the fact that the assessee received the sum of ₹ 4,00,000/- from Shri N I Vyas through banking channel. In support of his claim, bank passbook of the depositor along with PAN Card and letter of confirmation from Shri Vyas are already on record. Thus, the identity and creditworthiness of the depositor is established. We further find that the sum has already been repaid by the assessee to Mr. Vyas through the banking channel in instalments in support of which necessary evidence is also on record. Therefore, the genuineness of the transaction is also established. In the light of these undisputed facts of this case, the addition made by the AO and sus .....

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