TaxTMI 
TaxTMI 
2015 (1) TMI 1342
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....erred in deleting the addition of Rs. 18,90,653/- made on account of unexplained credit u/s.68. [2] On the facts and in the circumstances of the case and in Law, the Ld.CIT(A), Surat has erred in deleting the addition of Rs. 1,14,777/- made on account of disallowance of interest. [3] On the facts and in the circumstances of the case, and in Law, the Ld.CIT(A), Surat ought to have upheld the order of the Assessing Officer." 2. The main component of addition is Rs. 13,08,000/- as unexplained cash credits u/s. 68 of the Act. Assessing Officer while making addition mentioned that assessee did not furnish any information regarding the following unsecured loans: i) Shri Hirenkumar S. Shah Rs.1,00,000/- ii) Ronak Moto....
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.... given and PAN mentioned, the confirmation itself does not inspire confidence. PAN on confirmation is mentioned as applied, then one PAN has been written and scratched out and another PAN written. The transaction of loan is proceeded by deposit of cash and the source of said cash has not been explained. This transaction of loan does not seem to be justified. Under the facts and circumstances, cash credit in the name of Hirenkumar S. Shah was held to be unexplained. However, Assessing Officer has by mistake considered this amount to be Rs. 1,00,000/- when it was only Rs. 50,000/- and along with interest the total outstanding against his name is Rs. 54,981/-. Therefore, addition was confirmed to the extent of Rs. 54,981/-. Assessee got relief....
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.... on record, we find that CIT(A) in appeal observed that evidences have been provided to Assessing Officer during assessment proceeding who instead of carrying further investigation into the source of funds with the lenders, issued show cause on the basis of doubts and suspicion. Even during course of remand proceedings, Assessing Officer did no investigations, which is not justified. Both the lenders are Income Tax assessee and confirmations were given. Source of funds with creditors were also provided to Assessing Officer. Assessing Officer instead of taking action, made addition for the reason that cash was deposited before the loan transactions. The deposit of cash proceeding transactions can give rise to doubt and be a starting point fo....
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....he same. 4. Next addition is with regards to addition of Rs. 3,43,634/- as unexplained income on the basis of interest non receipt of reply from parties u/s. 133(6) of the Act. It was explained by assessee that these were regular business parties. While making the addition, Assessing Officer mentioned that notices were issued u/s. 133(6) of the Act but either they could not be served or no reply was received in following cases :- 1. Victor Casket 2. Haresh Motors 3. Shri Ram Automotive 4. Surod Engineering 5. Putchraj Auto Services He therefore treated the outstanding balances as unexplained and added them to the income of assessee. 4.1 Matter was carried before the First Appellate Autho....