TaxTMI 
TaxTMI 
2015 (10) TMI 940
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....erred in 1) Not confirming addition of Rs. 21,31,836/- out of total addition of Rs. 65,46,817/- made u/s 68 of the I T Act on account of unexplained cash credits despite the fact that neither during the course of assessment proceedings nor during the course of remand proceedings, these alleged cash creditors appeared before the AO in response to the summons issued by her for verification of these credits. 2) Deleting trading addition of Rs. 11,24,838/- made by the AO on the ground of declaring better g.p. rate in comparison to earlier years ignoring the fact that the assessee produced books of accounts neither before the AO during assessment proceedings nor before the CIT (A) during appellate proceedings." 2. First ground of Revenu....
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....nd confirmed having given the loan to appellant. All the cash creditors were also assessed to tax and also submitted copies of their bank statement. In the case of Smt. Suman Goyal, the bank statement could not be submitted. However, she was assessed to tax and her PAN was stated to be AAZPG 5755 F. Similarly in the cases of Smt. Rachana Bhagrai, Shri Tara Chand Goyal and Shree Ram Tent House, copies of bank statements could not be submitted though they were assessed to tax and their PANs were stated to be AFBPB 7205 E, AAZPG 5754E and AALFS 5766 N respectively. The AO further observed that after lapse of 7-8 years these creditors could not have got the bank statement even from the bank. Further in five cases, the summons were returned unse....
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....ons issued by the AO had been duly served at the given addresses except 5 creditors. The AO had not contradicted any of the evidences submitted by the appellant nor given any finding in respect of the non-genuineness of the relevant loans. The appellant could not be blamed for non compliance of summons issued by the AO, on the part of the creditors, and the relevant loans could not be held as non genuine simply for the reason that the creditors had not complied with the summons issued by the AO. He relied upon the decision of Hon'ble Supreme Court in the case of CIT vs. Orissa Corporation Pvt. Ltd., 159 ITR 78), Hon'ble Gujarat High Court decision in the case of DCIT vs. Rohini Builers, 256 ITR 360 and held that the AO was not justified in ....
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.... order of the AO may please be confirmed. 5. At the outset, the ld. A/R of the assessee submitted that during the course of appellate proceedings furnished a detailed chart of the loans accepted during the relevant previous year from 63 parties containing names, address, PAN and confirmation letters of the relevant parties along with application under Rule 46A of the IT Rules, 1962. The ld. CIT (A) had admitted the additional evidences and forwarded the same to the AO with specific direction to make detailed enquiry and to submit report in respect of the same. The AO vide her remand report dated 16.3.2012 had held that the unsecured loans of Rs. 21,31,836/- received from 19 persons had been remained not verifiable and the same may please....
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....'s books had been confiscated by the Excise Department. The assessee even had not produced certified copy of books of account from the Excise Authorities. The other theory of not producing the books of account that there was a fire in the shop and claimed that books had been destroyed in fire. Therefore, assessee made contradictory submissions before the AO. The ld. CIT (A) had not given any finding on the regular books of account. There was a search and seizure operation under section 132(1) of the IT Act on 12.04.2005 in case of M/s. B.C. Purohit & Co. and Shri Kripa Shankar Sharma, one of the associates of M/s. B.C. Puirohit & Co. in Jaipur. These persons were engaged in providing bogus entries in the form of gifts, loans, share applicat....
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....edient to prove the cash creditors under section 68 i.e. creditworthiness has to be established. Therefore, we set aside the order of ld. CIT (A) to the AO. The assessee is directed to cooperate with the AO and furnish the requisite details. 7. Second ground in revenue's appeal is against deleting the trading addition of Rs. 11,24,838/- by ld. CIT (A). As discussed above, the assessee did not produce the books of account. In absence of books of account, the AO applied the GP rate of 20% on the declared turnover of Rs. 2,25,09,871/- against GP declared @ 15% in the preceding year. The ld. CIT (A) in summary manner had accepted the assessee's book results and also accepted that the assessee did not produce the books of account before the A....