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TMI Blog2011 (1) TMI 1503X X X X Extracts X X X X X X X X Extracts X X X X ..... his balance sheet as investment. Confirmation of the party was also furnished to the A.O. during course of assessment proceedings. The A.O. observed that in the Tax Audit Report, the auditors have commented that the said loan & advance of ₹ 13,08,900/- could not have been verified by them in absence of any balance confirmation certificates from the party. Consequence upon this comment in the Tax Audit Report, the A.O. considered this investment towards loan & advances as unexplained investment and added the same u/s. 69 of the Act to the total income of the assessee. 2.1. On appeal before the ld. C.I.T.(A) it was contended on behalf of the assessee that during course of assessment proceedings, the assessee submitted the required certificate dated 03/11/2008 from M/s. Ashok Leyland Finance Ltd. confirming receipt of ₹ 13,08,900/- and the A.O. without considering this certificate as also appreciating the balance sheet properly treated the explained investment as unexplained and, therefore, addition made u/s. 69 of the Act was arbitrary and uncalled for. The ld. C.I.T.(A) after considering the submissions of the assessee and perusing the assessment order directed the A.O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant has made an investment which was not recorded in the books of accounts. Consequently, there would be no applicability of the provisions of section 69 in the case of appellant. It was submitted that a certificate dated 03.11.2008 issued by the Ashok Leyland Finance Ltd. was produced before the A.O., however, the assessment order is totally silent about that. The copy of said certificate was also produced during the appellate proceedings wherein Ashok Leyland Finance Ltd. has confirmed that it had received from the appellant for an amount of ₹ 13,08,900/- through Union Bank of India, Kidderpore Branch, Kolkata during F.Y. 2005-06. Thus, even the party concerned has also confirmed the amount. In view of above, the action of the A.O. of making addition of ₹ 13,08,900/- u/s. 69 of the Act cannot be sustained. It is a very general practice on the part of Tax Auditors that they give general remarks in the Tax Audit Report like "Debtors and Creditors balances are subjected to verification" or "the closing balance confirmation not produced for verification" etc. It does not mean that the entries made in the books of accounts and declared in the financial statements are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion on account of unexplained investment is called for when the investment made by the assessee is not recorded in the books of account, if any, maintained by him and the assessee offers no explanation about the nature and source of the investment or the explanation offered by the assessee is not found satisfactory by the A.O. Here in this case, as already stated above, the assessee has shown the investment by way of loan & advance to M/s. Ashok Leyland Finance Ltd. in his balance sheet. Balance confirmation certificate from the debtor was also produced during assessment proceedings. The assessee has explained the investment with all the possible evidences as mentioned above in support of his advancing loan to M/s. Ashok Leyland Finance Ltd. Therefore, when the assessee has submitted the evidences in support of his explanation regarding advancing of loan & advances, it was unfair on the part of the A.O. to treat the value of the same as assessee's undisclosed investment u/s. 69 of the Act. In this connection, we derive support from the decision of Hon'ble Apex Court in the case of C.I.T. Vs. Noorjahan (P.K.)(Smt.) reported in 237 ITR 570 wherein it has been held that mere rejectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... porting bills were not produced. The assessee's accounts are duly audited and he submitted evidences in support of the expenditure claimed. That being so, we decline to interfere with the order of ld. C.I.T.(A) deleting the aforesaid additions. His order on these three additions is, therefore, upheld and the grounds of appeal of the Revenue are dismissed. 4. The last two issues referred to in items (e) & (f) above relates to deletion of additions of ₹ 1,92,900/- and ₹ 15,780/- made in respect of fuel charges and repair & maintenance respectively. These additions were also made by the A.O. alleging that supporting bills to the above extent were not filed by the assessee. The ld. C.I.T.(A), however, found that the assessee during assessment proceeding vide its letters furnished various details in respect of the above expenditure along with supporting bills/vouchers and the A.O. did not allow any opportunity to the assessee pointing out specific instances of bills & vouchers which were not produced before him. In view of the above, he held the action of the A.O. in disallowing the expenditure unjustified with the following observation :- "12. I have considered the submi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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