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TMI Blog2021 (2) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... details were made available to the AO with ledger extracts and no difference was found in the outstanding balance of the debtors. There were no sales outside the books of accounts, there were no purchases found to have been made outside the books of accounts and not even a single defect was found by the AO in the books of accounts. Therefore, there is no reason to suspect the correctness of the balances outstanding as per the books of accounts. We cannot appreciate the attitude of the assessee to submit the inflated balances to the bank to obtain the better credit facilities, the same cannot be treated as undisclosed income as provided u/s 69B of the Act without the supporting evidence. In the instant case there is no dispute that the assessing officer has made the addition purely on the information obtained from the bank and balances of sundry debtors were never verified independently by the AO causing necessary enquiries. There was no other corroborative evidence to support the sundry debtors balances list given to the bank. The sundry debtors balances in balance sheet are in agreement with the books of accounts. No reason to interfere with the order of the Ld.CIT(A) and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank was inflated and incorrect, therefore, requested to accept the book balances. However, the AO, not being impressed with the explanation of the assessee, treated the difference amount in the bank statement and the book balance as income u/s 69B of the Income Tax Act, 1961 (in short Act ) and accordingly made the addition of ₹ 2,39,17,297/- to the returned income. 3. Against the order of the AO, the assessee went on appeal before the CIT(A) and reiterated the submissions made before the AO. The assessee further stated before the Ld.CIT(A) that it is a prevalent practice among all the business community to inflate the stock and debtors to get additional loan limits. He, therefore, requested to delete the addition. The Ld.CIT(A) deleted the addition made by the AO placing reliance on the order of this Tribunal in the case of ACIT Vs. Thatvarthi Ramesh Babu vide Appeal No.28/Viz/2015, dt.08.12.2017, wherein, similar issue of unaccounted stock was involved. 4. Against the order of the CIT(A), the revenue is in appeal before this Tribunal. During the appeal hearing, the Ld.DR submitted that the Ld.CIT(A) without making any enquiries allowed the appeal, though there were d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6.1. On the other hand, Ld.AR submitted that the Ld.CIT(A) has not considered the additional evidence, while disposing the appeal, hence argued that there is no case for remitting the matter back to the Ld.CIT(A). 6.2. We have heard both the parties and find that the Ld.CIT(A) has not decided the appeal on the basis of additional evidences furnished by the assessee, hence, we find no reason to remit the matter back to the file of the AO. Accordingly the proposition made by the Ld.DR to remit the matter back to the AO is untenable, hence, rejected. 7. In the instant case, the addition was made on account of difference between the debtors statement obtained from the Karur Vysya bank by the AO and the debtors balances outstanding as per balance sheet. The assessee is maintaining regular books of accounts which were duly audited by an Accountant and the debtors balance shown in the balance sheet was in synch with the books of accounts. The books of accounts were produced before the AO, verified by him and no defects were found. There is no dispute that the debit balances of the debtors outstanding in the books of accounts are in agreement with the Leger accounts. The assessing o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 69B of the Act without the supporting evidence. Thus, we hold that the assessee s case is squarely covered by the decision of this Tribunal relied upon by the Ld.CIT(A) in the case of Thatvarthi Ramesh Babu (supra). Similar issue of addition on account of difference in stock was considered by the Hon ble Madras high court in [2002] 125 Taxman 233 (Madras)Commissioner of Income-tax. v.N. Swamy and observed as under: 4. We find it a little difficult to agree with those observations. The assessee's income is to be assessed by the ITO on the basis of the material which is required to be considered for the purpose of assessment and ordinarily not on the basis of the statement which the assessee may have given to a third party unless there is material to corroborate that statement of the assessee given to a third party, even if it be a bank. The mere fact that the assessee had made such a statement by itself cannot be treated as having resulted in an irrebuttable presumption against the assessee. The burden of showing that the assessee had undisclosed income is on the revenue. That burden cannot be said to be discharged by merely referring to the statement given by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty and taking into account the actual non verification of stock, we find no reason to interfere with the order of the Tribunal. Accordingly, the question is answered in the affirmative i.e. against the appellant - revenue and in favour of the assessee. We hold that the Tribunal was right in law in deleting the addition made on account of difference in stock statement as furnished before the bank as compared to shown in books of account. 7.2. In the instant case there is no dispute that the assessing officer has made the addition purely on the information obtained from the bank and balances of sundry debtors were never verified independently by the AO causing necessary enquiries. There was no other corroborative evidence to support the sundry debtors balances list given to the bank. The sundry debtors balances in balance sheet are in agreement with the books of accounts. Thus the case of the assessee is squarely covered by the decisions cited supra and we find no reason to interfere with the order of the Ld.CIT(A) and the same is upheld. Accordingly, the appeal of the revenue is dismissed. 8. The assessee filed cross objections supporting the order of the Ld.CIT(A). Since th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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