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TMI Blog2017 (1) TMI 1332X X X X Extracts X X X X X X X X Extracts X X X X ..... o reason to interfere in the CIT(A)’s order affirming Assessing Officer’s action making the impugned unexplained cash credits addition - Decided against assessee. - ITA No.815/Ahd/2014 - - - Dated:- 25-1-2017 - SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER For The Assessee : Shri Sunil Talati, A.R. For The Revenue : Shri James Kurian, Sr. D.R. ORDER PER S. S. GODARA, JUDICIAL MEMBER This assessee s appeal for assessment year 2009-10 arises against the CIT(A)-II, Ahmedabad s order dated 12.01.2014 in appeal no. CIT(A)- II/DCIT Ci-1/237/2013-14, upholding Assessing Officer s action adding two cash deposit sums of ₹ 1,34,70,822/- ₹ 6,00,000/- as unexplained cash credits u/s.68, in proceedings u/s. 143(3) of the Income Tax Act, 1961; in short the Act . 2. We come to assessee s former substantive ground challenging action of both the lower authorities in adding cash deposits of ₹ 1,34,70,822/- in its bank account as unexplained cash credits u/s.68 of the Act. This assessee is a company trading in ferrous and non ferrous metal. Its cash book revealed to have received cash amounts of ₹ 1,34,70,822/- i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id amount to Metal Enterprise Pvt Ltd. as and when received by appellant company. Moreover there are no charges being collected from Metal Enterprise Pvt Ltd by appellant company. Copy of Ledger Account of Accost Impex Pvt. Ltd. in books of Metal Enterprise Pvt Ltd is enclosed herewith as per Page no. 1 and 2 along with respective sale invoices(As per Exhibit-I). The said evidences clearly supports about the business transactions carried on between Accost Implex Pvt Ltd and Metal Enterprise Pvt. Ltd. Also confirmation from Metal Enterprises Pvt Ltd (hereby attached as per Page no. 3 and 4) confirming details of collection made by Appellant from Accost Implex Pvt Ltd. on behalf of Metal Enterprises Pvt Ltd Moreover the Ledger Account of Accost Impex Pvt. Ltd. in books of Appellant is also attached herewith as per Page no. 5 to 11 alongwith the Bank Statement copy showing complete details of the amount of remittance by appellant to its sister concern Metal Enterprise Pvt Ltd. on the same day of its receipt. Such explanations about the genuine business transactions in no circumstances be treated as unaccounted cash credits. The appellant therefore discharges its onus in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had severe disputed and had fight also. 6. Because of such disputes and fight, Accost Implex Pvt. Ltd., refused to pay anything to Metal Enterprise Pvt. Ltd. Therefore, Associated Tradecom Pvt. Ltd, used its good officers, negotiated and, convinced the said debtor Accost Implex Pvt. Ltd., to pay whatever it can slowly and gradually in cash. In other words, the appellant acted as mediator/arbitrator. 7. Therefore, on pursuance and consistent follow up the appellant company it recovered cash from Accost Impex Pvt. Ltd., depositing the same in its Bank and immediately issuing the cheque to Metal Enterprise Pvt. Ltd. It is because of this arrangement the appellant company received the cash in shape of slow recovery of, sale proceeds of Metal Enterprise Pvt. Ltd. As such this is not at all unaccounted cash credit or unexplained cash deposit. The A.O. has made the addition of such cash receipts as income of the assessee u/s. 68 of the Act which is totally incorrect in facts and on law. The assessee has proved the identity of the party giving cash. The assessee has proved capacity of the said company being Registered Company having filed its return and having its own establish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uced by assesses do not lead to proper, reasonable or acceptable explanation as regards receipts in books, the Assessing Officer is perfectly entitled to reproduce his non-satisfaction, provided he has applied his mind which is discernible from impugned order. The Assessing Officer cannot be burdened with onus of providing negative nor can there be an endless process of substantiation of materials by production of other materials. Where assessee only produced confirmation letters from creditors without any further material regarding identity, status or capacity of creditors or even dates on which impugned loans were given, addition made by Assessing Officer could not be faulted with. Thus, it is seen that the source of cash receipt of ₹ 1,34,70,822/- shown in the bank A/c of appellant co. has not been satisfactorily explained by the appellant co. and the Assessing Officer has rightly invoked the provision u/s.68 of the Act. Taking into account the fact circumstances of the case legal position as cited above, I am of the considered view, the Assessing Officer was justified in holding that since the source of cash receipt of ₹ 1,34,70,822/- was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plead that there was no need on its part to adopt such a tax evasion method. We find no merit in this plea as this alone cannot form a valid reason to delete the impugned addition wherein the assessee has failed in proving its above stated explanation to have collected consideration in lieu of sale of goods from the payee entity at its sister concern s behest. We accordingly conclude that all three relevant parameters of identity, genuineness and creditworthiness have not been discharged at assessee s behest in its endeavor to delete the impugned addition as held by hon ble apex court in (1995) 214 ITR 801 (SC) Sumati Dayal vs. CIT holding that such an explanation must satisfy the test of human probabilities. We thus find no reason to interfere in the CIT(A) s order affirming Assessing Officer s action making the impugned unexplained cash credits addition. This first substantive ground is accordingly rejected. 6. The assessee s latter substantive ground seeks to delete Section 68 unexplained cash deposits of ₹ 6lacs made in its UCO Bank account. It stated to have received the said sums as advances from customers for supply of material on 10.02.2009 which was thereafter ret ..... X X X X Extracts X X X X X X X X Extracts X X X X
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