2014 (5) TMI 392

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....of unproved sundry creditors. 2. On the facts and in the circumstances of the case and in law, the Ld, CIT(A) has erred in allowing the disallowance of Rs.1,20,368/- made by the AO out of salary and wages for want of proper check over the expenses. 3. On the facts and in the circumstances of the case and in law, the Ld, CIT(A) has erred in deleting the addition of Rs.50,000/- made by the AO on account of unexplained amount." 3. Ground no. 1 relates to addition of Rs. 55,90,682/- made by AO which has been deleted by Ld. CIT(A). 4. AO observed while verifying the books of account and extract of sundry creditors that the assessee has not executed any work through them during the year. Though, the parties were paid part of the outst....

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.... 2008-09 which clearly indicate that these sundry creditors were alive. This finding of Ld. CIT(A) rightly led him to hold that the credit amounts can neither be treated as cessation of liability u/s. 41(1) nor can be added u/s. 68 of the Act. We are therefore not inclined to interfere with the order passed by him and the same is hereby upheld. This ground of revenue is dismissed. 6. Ground no. 2 relates to disallowance of Rs. 1,20,368/- made by AO out of salary and wages which has been allowed by Ld. CIT(A). 7. AO observed that assessee in his proprietary concern M/s Deepti Engineering has claimed salary and wages expenditure of Rs. 8,02,450/-. All the expenses were paid in cash and supported by vouchers and muster register. It was n....