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TMI Blog2016 (8) TMI 904X X X X Extracts X X X X X X X X Extracts X X X X ..... iled with Election Commission of India, indicate the name and address of donor details. Therefore, we are of the view that the A.O. was erred in disallowing deduction claimed u/s 80GGC of the Act. Hence, we set aside the CIT(A) order and direct the A.O. to delete the addition. - Decided in favour of assessee Addition of unexplained creditor’s - A.O. made additions towards sundry creditors for the reason that the assessee has failed to furnish confirmation letters - Held that:- A plain reading of section 68 of the Act, makes it clear that any sum found credited in the books of accounts of the assessee is not explained to the satisfaction of the A.O., then sum found credited shall be treated as income of the assessee of that previous year. In other words, addition can be made for fresh credits of the year and no addition can be made for the amounts brought forwarded from the previous year. In the present case on hand, on perusal of facts, we find that all creditors are brought forward from last years and paid during the current financial year. Therefore, we are of the view that the A.O. was erred in treated sundry creditors brought forward from last year as unexplained creditors. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . - Decided in favour of assessee - I.T.A. Nos. 393/Vizag/2014, I.T.A.Nos.394/Vizag/2014, I.T.A.Nos.425-426 /Vizag/2014 - - - Dated:- 15-7-2016 - Shri V. Durga Rao, Judicial Member And Shri G. Manjunatha, Accountant Member Appellant by : Shri A.S.R.S.S. Siva Prasad Respondent by : Shri Aravindakshan, DR ORDER Per G. Manjunatha, Accountant Member These cross appeals filed by the assessee, as well as revenue are directed against separate, but identical orders of the Commissioner of Income Tax (Appeals), Vijayawada dated 28-03-2014 for the Asst. Year 2009-10. Since, the facts are identical and issues are common, they are heard together and disposed off, by this common order for the sake of convenience. 2. The brief facts of the case as stated in ITA.No. 393/Vizag/2014 are that the assessee is an individual engaged in the business of trading in industrial spare parts, filed his return of income for the A.Y. 2009-10 on 30-09-2009 declaring total income of ₹ 4,62,930/-. The case has been selected for scrutiny assessment and accordingly, notices u/s 143(2) and 142(1) of the Act, were issued. In response to notices, the authorized representative of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll as revenue are appeal before us. 4. The first issue that came up for our consideration from the assessee appeal is disallowance of deduction towards donation paid to political party u/s 80GGC of the Act. The facts relates to addition are that the assessee has paid donation to JOGO party, a unrecognized political party registered with Election Commission of India u/s 29A of the Representation of People Act, 1951 and claimed deduction u/s 80GGC of the Act. During the course of assessment proceedings, the A.O. called upon assessee to furnish details of donation paid along with confirmation letters. The assessee furnished photo copies of receipts given by the political party, however failed to furnish confirmation letter, therefore, the A.O. disallowed donation paid to JOGO party as unexplained deduction. The A.O. was of the opinion that donation to any political party which is recognized by the Election Commission of India is deductible u/s 80GGC of The Act. The assessee has failed to furnish required details so as to prove genuineness of donation paid to JOGO party along with particulars of recognition and also confirmation letter from the party, therefore disallowed the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d details of registration with Election Commission of India is furnished to the CIT(A). The assessee also furnished report filed by the JOGO party with Election Commission of India in Form No. 24A, which contained the particulars of name and address of donor. Therefore, the lower authorities were erred in disallowing deduction claimed u/s 80GGC despite furnished all the required details. 7. The A.O. disallowed deduction for the reason that donation to JOGO party is not proved with necessary evidences. The A.O. further held that JOGO party is unrecognized political party, therefore, any donation to a unrecognized political party is ineligible for deduction. It is the contention of the assessee that, to be qualified for deduction u/s 80GGC, registration u/s 29A of the Representation of People Act, 1951 is must, but not recognition by Election Commission of India. We find force in the arguments of the assessee for the reason that, any contribution given by any person to a political party registered u/s 29A of the Representation of People Act, 1951 whether or not recognized by the Election Commission of India is deductible u/s 80GGC of the Act. The only requirement is that the polit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rade creditors. 10. We have heard both the parties and perused the materials available record. The A.O. made additions towards sundry creditors for the reason that the assessee has failed to furnish confirmation letters. The A.O. was of the opinion that the assessee failed to discharge initial burden cast upon him by proving identity, genuineness and creditworthiness of the parties. It is the contention of the assessee that creditors are brought forward from last financial years and the same are fully or partly squared up during the financial year. The assessee further contended that all the creditors are payable towards purchase of materials from the parties and all the accounts are running current account with suppliers. The assessee had filed confirmation letter along with ledger extract of creditors to prove the identity, genuineness and creditworthiness of the parties. We find force in the arguments of the assessee. The assessee has filed paper book. On perusal of paper book filed by the assessee, we find that he had furnished ledger extracts of creditors along with confirmation letters. On further verification of confirmation letters and ledger extracts, we find that all t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and this fact was not disputed by the revenue. The assessee, on the other hand furnished copy of Axis bank account which was recorded in the regular books of accounts. On perusal of bank statement of Axis bank, we find that there are only two cash deposits of ₹ 1600 on 8-7- 2008 and ₹ 8900/- on 18-11-2008 for which sources has been explained. Therefore, we are of the view that the A.O. has made additions without any base. The CIT(A) after considering relevant details filed by the assessee and also taken into account remand report of A.O. deleted additions. The facts remain same even before us. The Revenue has failed to counter the contention of assessee that he does not operate any bank account with ICICI Bank. Therefore, we upheld the CIT(A) order and delete the addition made by the Assessing Officer. 13. The next issue emanates from Revenue appeal is disallowance of expenditure. The A.O. disallowed expenditure debited to profit and loss account of Labelle Slimming and Beauty Clinic for the reason that the assessee has not explained the nature and source of income earned from the business. The A.O. further observed that the assessee has failed to prove the nature of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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