2015 (12) TMI 387

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....that CIT(A) deleted addition made by the AO for a claim of interest and salary dues. 3. Facts apropos are that the assessee a Pawn Broker had filed his return for the impugned assessment year declaring an income of Rs. 4,59,759/-. There was a survey u/s 133A of the IT Act, 1961 on 11- 02-2010 in the premises of the assessee. Assessee was carrying on the business of pawn broking along with his family members from the very same premises. A sworn statement of the assessee was recorded on 20- 12-2011 and 21-12-2011 in which the AO put questions to the assessee on various additions proposed by him. Thereafter, assessee was required to furnish documents in support of its claim. Since such documents were not forthcoming, the assessment was comp....

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....ystem of accounting followed by the assessee cannot be changed simply based on an oral statement. We are of the opinion, that once the books of accounts are maintained in mercantile system of accounting, claim of outstanding expenditure if its correct, cannot be disallowed. AO also had not doubted the genuineness of the claim. In the circumstances, we are of the opinion, that CIT(A) was justified in deleting the addition. Ground no.1 of the revenue stands dismissed. 8. In its ground no.2 grievance raised by the revenue is that an addition for difference in capital account was deleted by the CIT(A). Learned DR submitted that no evidence was produced by the assessee to show or reconcile the difference in capital. 9. Per contra, learned ....

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...., learned DR strongly assailing the order of the CIT(A) submitted that assessee had not given any confirmation or any other details during the course of assessment proceedings. The CIT(A), as per the learned DR ought to have verified the claim of the assessee before allowing the ground raised in this regard. 13. Per contra, learned AR strongly supported the order of the CIT(A). 14. We have perused the order and heard the rival contentions. Assesese in his reply to a question raised during the course of his examination had stated that he was not having any confirmation from the loan creditors. The CIT(A) had given relief to the assessee with a finding that the Pan Nos. of the creditors were available and they were assessed by the very ....