ITAT upholds CIT(A) decisions on bank balances & interest claim, dismisses assessee's appeals.

The ITAT dismissed the appeals filed by the assessee, upholding the decisions of the CIT(A) and the Assessing Officer in both issues of the discrepancy in bank balances and the disallowance of the interest claim. The judgments were delivered on July 17, 2019.

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Issues:
- Discrepancy in bank balances
- Disallowance of interest claim

Discrepancy in Bank Balances:
The assessee's appeal was against the orders of the Commissioner of Income Tax for two assessment years. The Assessing Officer had noted a discrepancy in the bank balances declared by the assessee and the actual credit balances available in the bank statements. The difference was added to the total income of the assessee. The CIT(A) confirmed this addition as the assessee failed to provide a reconciliation statement. The ITAT upheld the decision, stating that without proper documentation, there was no reason to interfere with the CIT(A)'s order.

Disallowance of Interest Claim:
Regarding the interest claim issue, the Assessing Officer disallowed an interest expenditure claimed by the assessee as it was not paid in cash but credited to a creditor's account on an accrual basis. The CIT(A) upheld this disallowance, noting that the assessee had initially stated following a mercantile system of accounting but later claimed to follow a cash basis. The ITAT found that the interest paid was related to the pawn broking business, not the jewellery business as claimed by the assessee. As the assessee failed to provide evidence supporting this claim, the ITAT dismissed the appeal, upholding the CIT(A)'s decision.

Conclusion:
The ITAT dismissed the appeals filed by the assessee, upholding the decisions of the CIT(A) and the Assessing Officer in both issues of the discrepancy in bank balances and the disallowance of the interest claim. The judgments were delivered on July 17, 2019.

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