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of <h1>Tribunal upholds deletion of unproved trade creditors addition, finding transactions genuine.</h1> <h3>The Income Tax Officer Ward I(3), Erode Versus Smt. Rolex Sugunamary, Propx. M/s GR. Leathers</h3> The Income Tax Officer Ward I(3), Erode Versus Smt. Rolex Sugunamary, Propx. M/s GR. Leathers - TMI Issues:- Disallowance of Rs. 13,84,500/- on account of unproved trade creditors.Analysis:1. The appeal filed by the Revenue and the cross-objection filed by the assessee were against the order of the CIT(A)-I, Coimbatore, dated 25.08.2011.2. The main issue in this appeal was the disallowance of Rs. 13,84,500/- on account of unproved trade creditors.3. The assessee initially admitted an income of Rs. 3,98,290/- for assessment year 2007-08, but the assessment later determined the income at Rs. 79,24,328/-.4. The CIT(A) deleted the additions made by the Assessing Officer, leading to an appeal by the Revenue to the Tribunal.5. The Tribunal confirmed the CIT(A)'s order and dismissed the appeal of the Revenue.6. Subsequently, the assessment was set aside by the CIT-II, Coimbatore, and a new assessment was made, determining the income of the assessee at Rs. 93,08,828.7. The dispute revolved around the addition of Rs. 13,84,500/- on account of a trade creditor, M/s Jai Hind Leathers, in the revised assessment.8. The assessee cited a previous Tribunal decision in a similar case to support their argument against the addition.9. The Assessing Officer contended that the trade creditor was not genuine and attempted to add back the credit standing against the name of M/s Jai Hind Leathers.10. The Assessing Officer believed that the assessee created forged materials to support the claim and failed to provide sufficient evidence for the transactions.11. The CIT(A) noted discrepancies in the Assessing Officer's investigation and found the evidence provided by the assessee regarding the transactions with M/s Jai Hind Leathers to be satisfactory.12. The Tribunal referenced a previous case where similar issues were resolved in favor of the assessee, emphasizing the genuine nature of the transactions and the lack of concrete evidence to support the addition.13. The Tribunal upheld the CIT(A)'s decision to delete the addition of Rs. 13,84,500/-, as the transactions were found to be genuine and conducted through banking channels.14. The cross objection filed by the assessee was dismissed, aligning with the decision in the Revenue's appeal.15. Ultimately, both the appeal by the Revenue and the cross objection by the assessee were dismissed, affirming the deletion of the addition on account of unproved trade creditors.
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