Tribunal dismisses Revenue's appeal on tax due to CBDT Circular; Section 68 addition upheld.

The Tribunal dismissed the Revenue's appeal due to the tax effect being below Rs. 10 lakhs as per CBDT Circular No.21 of 2015. The addition under Section 68 of the Income Tax Act was upheld at Rs. 23,00,000, as the assessee failed to prove the creditworthiness of Shri Prakash Basrani. The CIT(A) upheld this decision, requiring verification of Shri Prakash Basrani's financial position. The Tribunal directed the assessee to produce Shri Prakash Basrani for examination by the Assessing Officer. The appeal was partly allowed for statistical purposes, setting aside the levy of interest and dismissing the Revenue's appeal.

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Issues:
1. Maintainability of Revenue's appeal due to tax effect below Rs. 10 lakhs.
2. Addition made under Section 68 of the Income Tax Act.
3. CIT(A)'s decision regarding the addition made by the Assessing Officer.
4. Production of Shri Prakash Basrani before the Assessing Officer.
5. Levy of interest under sections 234B and 234D of the Income Tax Act.

Issue 1: Maintainability of Revenue's appeal
The Revenue's appeal was dismissed as the tax effect was below Rs. 10 lakhs, following the CBDT Circular No.21 of 2015. The LD. DR acknowledged the tax effect being less than Rs. 10 lakhs, leading to the dismissal of the Revenue's appeal.

Issue 2: Addition under Section 68
The Assessing Officer made an addition of Rs. 35,00,000 under Section 68 as the assessee failed to prove the creditworthiness of Shri Prakash Basrani. The CIT(A) upheld an addition of Rs. 23,00,000 as the assessee couldn't prove the net credit balance. The CIT(A) noted discrepancies regarding Shri Prakash Basrani's financial position and the genuineness of transactions.

Issue 3: CIT(A)'s decision
The CIT(A) upheld the Assessing Officer's decision due to the assessee's failure to prove the net credit balance. The CIT(A) required confirmation letters or affidavits from Shri Prakash Basrani and his production for verification, which the assessee failed to provide.

Issue 4: Production of Shri Prakash Basrani
The assessee requested to set aside the matter for Shri Prakash Basrani's production before the Assessing Officer. The LD. DR supported this request, leading the Tribunal to direct the assessee to produce Shri Prakash Basrani for examination by the Assessing Officer.

Issue 5: Levy of interest
The Tribunal found the levy of interest under sections 234B and 234D to be mandatory and consequential, resulting in the dismissal of the appeal on this ground.

In conclusion, the Tribunal allowed the assessee's appeal partly for statistical purposes, directing the matter back to the Assessing Officer for further examination and setting aside the levy of interest. The Revenue's appeal was dismissed.

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