2015 (1) TMI 959
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....all the ingredients of cash credits viz. identity of creditors, credit worthiness of creditors and genuineness of transactions were proved. 3. That the Worthy CIT(A), Karnal has also erred in confirming the addition of Rs. 3,60,199/- made by the Assessing Officer as additional income from Tanker not shown. 4. That while sustaining addition of Rs. 3,60,199/- made by the Assessing Officer as additional income from Tanker, the Worthy CIT(A), Karnal has not considered the fact properly that entire diesel expenses made for plying of tanker are fully vouched and accounted for in the books and no defect was found in it. 5. That the Worthy CIT(A), Karnal has also not appreciated that income from Tanker shown is assessable as per provision of section 44AE of the Income Tax Act, 1961 and income shown by the assessee from the Tanker is on higher side than what is assessable as per section 44AE. 6. That, the appellant, craves leave to add or amend the grounds of appeals before the appeal is finally heard or disposed off. " 3. Ground No. 6 is general in nature while the Ground No. 5 was not pressed, therefore, these grounds do not require any adjudication on our part. Grievance of the asse....
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....reditors. i) Affidavits of the persons duly sworn in. ii) Such persons were produced before the Assessing Officer wherein all such persons claimed having advanced loans to the assessee and they also answered to various queries as raised by the Assessing Officer. iii) For the identification proof, such persons produced evidences of their identification vis-a-vis Ration Card/ Election Commission identity Card, Driving License etc. and the Assessing Officer has not doubted about the bonafides of the statements and the proof as advanced before him. iv) Some of the persons who are agriculturists, they had submitted the proof of their land holdings and not doubted by the Assessing Officer. v) Some of the persons who had advanced the loans are advocates, service class employees and they had given their sources of income. b) Copies of such details alongwith their relevant proof as stated above are being produced herewith for your goodself's ready reference. c) The Assessing Officer has discussed these aspects at pages 1, 2 & 3 of his order, but then in para-5, he has made the addition on account of such amounts lent by those persons by stating that such persons have not confirme....
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....cally prove that the amount as advanced by them is not genuine. f) With regard to the fact that such persons 'are not being assessed to Income tax, it may be stated that even if a person is not being assessed to Income tax, that would not automatically mean that the amount advanced by such persons is not genuine. g) Thus, from the above said facts, it is very clear that the onus which has been placed on the assessee to prove the genuineness of cash credits has been discharged and, now, the onus would be on the revenue to prove that why under such circumstances, such evidences can't be accepted Merely, on the basis of some general statements that the persons are not assessed to Income tax or no interest has been charged, the addition can't be sustained Even the Assessing Officer has not stated anything about the onus which have 'been discharged. Then again, it is a settled law that the assessee should not be placed upon the rack, should not be called upon to explain not merely the origin and the source of contribution, but the origin of origin and source of source as well. This view have been taken by the Hon'ble Supreme Court in the case of Hasti Mal Vs. CIT as re....
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....ar that the people from whom cash credits were alleged to have been taken were people of small means and they did not have the capacity to lend amount of about Rs. 20,000/- each to the assessee. The ld. CIT(A) further observed that no interest had been charged despite the fact that the alleged creditors were of small means and there was no repayment of those cash credits till date, whereas, the assessee had merely claimed that those were adjusted on account of purchase of petroleum products by such persons but without any evidence, therefore, the transaction were not genuine. The ld. CIT(A) held that the assessee had failed to establish the creditworthiness of the creditors and genuineness of the transaction, therefore, he confirmed the addition made by the AO. 8. Now the assessee is in appeal. The ld. Counsel for the assessee reiterated the submissions made before the authorities below and further submitted that the confirmation and the affidavits of the creditors for advancement of loans were furnished during the course of assessment proceedings and all the persons were produced before the AO with identity proof and they had confirmed about the deposits of amount alongwith sourc....
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....ial available on the record. In the present case it is noticed that the assessee received the deposits from 62 persons in cash, those persons were produced before the AO and their statements were recorded wherein they confirmed the deposits with the assessee. The depositors also explained the source of their deposits which was the agricultural income and the income from salary or profession/business etc. The AO however did not accept the explanation of the assessee and also doubted the confirmation by presuming that the persons having the land holding of 2 to 3 acres each were not in a position to advance the deposits of less than Rs. 20,000/-. The other reason given by the AO was that the deposits were received in cash and not by cheque. In the instant case, it was explained that the assessee was dealing in Petroleum Products and the persons who were mainly agriculturists deposited the amount in cash to ensure the regular supplies of the Petroleum Products like diesel etc. which was required for the purpose of harvesting and sowing, the said explanation of the assessee was not rebutted at any stage. It, therefore, appears that the impugned addition has been made merely on the basi....
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....wable. 13. The ld. CIT(A) after considering the submissions of the assessee observed that the assessee's tanker had made 304 trips during the year for transportation of Petroleum Products from Panipat Refinery to assessee's Petrol Pump. He further observed that the distance between Panipat Refinery and the assessee's Petrol Pump was 254 km, one way, therefore, 508 km per trip was distance covered. The ld. CIT(A) also observed that the consumption of diesel of the assessee tanker gives the average of 2.5 to 3.00 km per liter of diesel and the average cost of diesel during the year under consideration was Rs. 20/- per liter. The ld. CIT(A) estimated the consumption average, lowest at 2.5 km per liter and the total cost of the diesel consumption was worked out at Rs. 12,35,456/-. He was of the view that the assessee had shown excess consumption of diesel to the extent of Rs. 3,60,199/- and sustained the disallowance to that extent. 14. Being aggrieved the assessee is in appeal. The ld. Counsel for the assessee reiterated the submissions made before the authorities below and further submitted that the assessee was incurring the expenditure on account of salary to the driver and clean....