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TMI Blog2004 (10) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... e clear and cogent evidence produced. The matter is purely one of fact and does not give rise to any substantial question of law. Hence this revenue appeal is dismissed – tribunal was justified in holding that there was no basis for the Commissioner of Income-tax to hold that the order of the Assessing Officer was erroneous or prejudicial to the interests of the Revenue - - - - - Dated:- 26-10-2004 - Judge(s) : R. V. RAVEENDRAN., SHANTANU KEMKAR. JUDGMENT The judgment of the court was delivered by R.V. Raveendran C.J.- This appeal by the Revenue under section 260A of the Income-tax Act, 1961 ("the Act" for short), is against the order of the Income-tax Appellate Tribunal, Indore Bench, dated March 26, 2004, in I.T.A. No. 502/Ind o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee before him and after giving proper opportunity make disallowances only after giving proper opportunity made disallowance only in respect of those creditors which do not fulfil the criteria for the genuineness of the creditors, debtors and share applications money. The Assessing Officer should ask the assessee to produce creditors/debtors and share money applicants in his office for enabling him to examine the genuineness. Further in respect of the creditors the Assessing Officer has reported that the same pertains to the remaining unpaid amount to the suppliers of the cotton, i.e., the agriculturists, and that the amount was paid' at the time of the transactions effected through Mandi Samiti. In view thereof, the remaining bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax, Bhopal, being of the view that the said order of assessment was erroneous and prejudicial to the Revenue, after issuing notice, passed an order dated March 28, 2003, under section 263 of the Act setting aside the order of assessment dated March 30, 2001, and directing the Assessing Officer to make a fresh assessment after making proper enquiries and investigation. The Commissioner of Income-tax was of the view that the Assessing Officer has accepted the following credits without proper enquiry and investigation resulting in under assessment of income with consequential revenue loss: (a) Rs. 13,93,800 (credits of share capital and share application money); (b) Rs. 33,43,286 (unsecured loans); (c) Rs. 41,42,606 as (trade creditors- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the M.P. Krishi Upaj Mandi Act, 1972? We have gone through the orders of the Assessing Officer, the Commissioner of Income-tax and the Tribunal. The position in regard to each of the three heads is as follows: Re: Share application money: The Tribunal found that the persons who had paid the share application money were all regular income-tax assessees and their PAN numbers were disclosed and money had been received through account payee cheques. The Tribunal also found that the persons who had paid share application money were produced before the Assessing Officer and their statements were recorded. The Tribunal also referred to the decisions of the Supreme Court in CIT v. Steller Investment Ltd. [2001] 251 ITR 263 confirming the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 lakhs), their affidavits were filed and they were also produced and examined by the Assessing Officer and their statements recorded. Therefore, the Tribunal found that there was no need to further investigate into the matter. Re.: Rs. 41,42,606 (suppliers-agriculturists): These were trade creditors, i.e., the farmers who had supplied the cotton. Here again the Tribunal found that all the trade creditors who had supplied cotton and to whom the amounts were due, were produced before the Assessing Officer and were examined. The Tribunal also found that where there was doubt about the genuineness of such farmers, the Assessing Officer had rejected the claim of the assessee. The Tribunal found that the trade credits were accepted only wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the farmers should be paid on the day of sale and, therefore, it was inconceivable that the credits to an extent of more than Rs. 40 lakhs could be permitted to exist in the case of the asses-see. The assessee had just started the business and therefore could have requested for time for payment for supplies. The Tribunal has referred to the newspaper reports and other documents which showed that the farmers were not being paid on the dates of sale. It was also found that the assessee had in fact obtained the produce in respect of which payments were due by it, as mentioned in the books of account. Even assuming there was any technical violation of the provisions of the Agricultural Produce Marketing Act, in not paying the amount on the dat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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