2012 (2) TMI 31

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....round of in its appeal, is aggrieved against the confirmation of addition of Rs.75,30,000/-. The facts apropos this ground are that the assessee had shown credit balance in the name of M/s. Krishna Knitwear Technology Ltd. and Shree Ganesh Knitting & Manufacturing Mills Ltd. amounting to Rs.66,80,000/- and Rs.8,50,000/- respectively totalling Rs.75,30,000. Simultaneous with the crediting of accounts of these two parties, the assessee had also debited the bank account with the equal amount. The A.O. on verification of bank balance shown by the assessee in its books of accounts observed that there was a difference in such balance when compared with that coming from the bank statement. Whereas assessee's books of accounts depicted balance of R....

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....d crediting the bank accounts of these two parties. Subsequently, in a later year, the said entries have been reversed. Confirmation from these two parties stating that the cheques were issued by them and they further advised the assessee not to deposit such cheques in its bank account, are available on record. Thus it fairly indicates that the credit in these two accounts is nothing but neutralised by the debit in the bank account and there is no inflow of any money with the assessee either in cash or through banking channel. Further, the bank reconciliation statement has divulged that these cheques were not deposited in the bank account as on 31.03.2002. In that view of the matter, we are of the considered opinion that there is no basis w....