2018 (2) TMI 1645

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... "1) That the learned Commissioner of Income Tax (Appeals) has erred in making addition of Rs. 18,78,417.00 to the returned income in respect of parties whose credit balances could not be confirmed. 2) That the addition of the credit balance of parties for Rs. 18,78,417.00 by the learned Commissioner of Income Tax (Appeals) is based consumptions and surmises and ignoring the appellant's submissions in this regard. 3) That it is humbly prayed to delete the additions of Rs. 18,78,417.00 in respect of unconfirmed credit balances of parties as made by the learned Commissioner of Income Tax (Appeals). 4) That, even otherwise too, the order of the learned Commissioner of Income Tax (Appeals) making additions of Rs. ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... the present appeal. 4. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 5. From the facts and circumstances of the case, order passed by the Revenue authorities below and the grounds of appeal raised by the assessee company, the sole question arises for determination in this case is :- "as to whether CIT (A) has erred in confirming the addition of Rs. 18,78,417/- made by the AO by drawing adverse inference that the assessee company has failed to prove on record the confirmation made by the sundry creditors regarding purchases particularly when trading....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....file confirmation by the aforesaid parties. The reasons for not filing the confirmation from aforesaid parties as explained by the assessee company are that both the parties have closed their business/shifted to some new address which is not known to the assessee company. 10. During the assessment proceedings, the AO has disputed the purchase of raw material from aforesaid parties. However, the assessee company have filed purchase bills pertaining to the aforesaid two parties along with GR note of goods dispatched to Parwanoo and all the goods purchased and transferred to Parwanoo for manufacture were duly checked by the Excise Department at the Himachal Pradesh border who have passed the purchase bill and GR notes after being duly satis....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....unts were payable - Not being satisfied with reply given by assessee, Assessing Officer made addition under section 68 on ground that assessee failed to give postal address, whereabouts, creditworthiness of vendors and also could not prove genuineness of transaction - Whether mere nonverifiability of sundry creditors ipso facto would not lead to conclusion that sundry creditors were bogus - Held, yes - Whether since Assessing Officer had drawn an adverse conclusion only on account of non-verifiability of sundry creditors but there being no dispute as regards purchases and trading results having been accepted, addition made under section 68 was not sustainable - Held, yes [Paras 15.2 & 15.3] [In favour of assessee]" 12. In view of what ha....