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TMI Blog2022 (3) TMI 174X X X X Extracts X X X X X X X X Extracts X X X X ..... f applicability of section 68 is not satisfied in the case of the assessee. If that be so, insistence by the Ld. AO/CIT(A) upon production of confirmatory letters by the creditors is irrelevant. No doubt, the onus of proving the identity, creditworthiness and genuineness of transaction lies upon the assessee but only if the provision of section 68 applies to him. In the case at hand, the provision of section 68 itself is inapplicable to him. We, therefore, hold that the impugned addition is not based on solid legal ground and is deleted. - Decided in favour of assessee. Disallowance u/s 37 and disallowance u/s 32 - AO made the impugned disallowances out of telephone, internet, travelling, car maintenance, car insurance and depreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961 (the Act ). In response to the notice under section 143(2) and 142(1) along with questionnaire, the assessee furnished written submissions and required details called for which were examined by the Ld. Assessing Officer ( AO ). The Ld. AO completed the assessment under section 143(3) on total income of ₹ 88,24,470/- including therein addition of ₹ 19,98,352/- under section 68, disallowance of ₹ 44,967/- under section 14A, disallowance of ₹ 33,956/- under section 37 and disallowance of ₹ 65,099/- under section 32 against which the assessee filed appeal before the Ld. CIT(A) but without success. This has brought the assessee before us challenging the order of the Ld. CIT(A) confirming the impugned addition/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of enquiries conducted and facts of the case, it is evident that the assessee failed to provide authentic documentary evidence to support his claim in respect of the below mentioned outstanding sundry creditors so as to establish their identity, genuineness and creditworthiness: Mughal Art Palace : ₹ 1,97,600/- Prajapati Arts : ₹ 1,38,610/- Singhal Exports : ₹ 2,88,670/- Mithila Art and Crafts : ₹ 1,30,250/- Madan Traders : ₹ 1,13,630/- Bharat Mughal Handicrafts : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Debit Credit Closing Balance 1. Mughal Art Palace 1,97,600 - - 1,97,600 2. Prajapati Arts 1,77,110 38,500 - 1,38,610 3. Singhal Exports 3,32,170 43,500 - 2,88,670 4. Mithla Arts Crafts 1,82,250 52,000 - 1,30,250 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AO/CIT(A) ledger account of the creditors, copy of relevant bank statements and copy of audited balance sheet for Financial Year 2009-10 and Financial Year 2010-11 showing the opening and closing balances of the creditors to prove that there is no credit entry in the name of any of the ten sundry creditors in the previous year relevant to the AY 2011-12. He, therefore, submitted that the impugned addition under section 68 is not justified and cited judicial precedents in support of his arguments. The Ld. DR could not controvert the submissions of the Ld. AR. 6. We have carefully considered the arguments of the rival parties and perused the records. In our opinion the assessee deserves to succeed. Section 68 reads as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arding disallowance of ₹ 33,956/- under section 37 and disallowance of ₹ 65,099/- under section 32 of the Act, the Ld. AO made the impugned disallowances out of telephone, internet, travelling, car maintenance, car insurance and depreciation on car expenses claimed by the assessee on account of possible element of personal use. The Ld. CIT(A) confirmed the disallowances. 9. Before us the Ld. AR submitted that all the expenses have been incurred only for business purposes of the assessee. It was stressed that the assessee had provided the Ld. AO the copy of ledger account and also relevant vouchers/invoices towards incurring of such expenses. The Ld. AO did not question the genuineness of the expenses. After hearing the Ld. Re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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