2018 (6) TMI 1322

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ur consideration: "A. Whether the Appellate Tribunal is justified in law in upholding the action of Respondent No.1 in treating advance of Rs. 36,26,468/received by the Appellant from purchasers as unexplained cash credit under Section 68 of the Act which were subsequently returned ? B. Whether in the facts and the circumstances of the case, and in law, the order of the Tribunal is perverse as it is based on irrelevant and erroneous considerations while ignoring material and relevant considerations and, as such, is liable to be quashed ?" 3 The Assessee firm works as commission agent for sale of yarn manufactured by M/s. Reliance Industries Ltd. It procures yarn from Reliance Industries Ltd. and sells it out to various ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ppeals) [CIT(A)]. Remand report was called by the CIT(A). Thereafter, on consideration of the remand report as well as explanation of the AppellantAssessee, the CIT(A) confirmed the order of the Assessing Officer while dismissing the appeal. 5 On further appeal, the Tribunal noted the fact that the assessee's explanation regarding amount of Rs. 36.77 Lakhs is only that parties from whom they received advances for supply of yarn, refused to take the amounts back even when no yarn was being supplied. Therefore, they were compelled to transfer the deposits before the end of March, 2003 to its sister concerns and the same were encashed by them only after further lapse of almost six months. Moreover , it is noteworthy that the Tribunal ha....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... finds as a fact that the cheques were issued by the appellant not in favour of the creditors but were issued in favour of sister concerns. This again is unexplained. Further, the Tribunal finds as a fact that amount credited to sister concerns were transferred to its partners and/or family members of its partners. The Tribunal notes that confirmations were received from some of the Bhiwandi parties were all similar in nature. It also finds as a fact that in some of the cases the acknowledgement of the return filed along with confirmation letters from the parties indicated income less than the minimum taxable income. Thus, it found on the above facts the genuineness and creditworthiness of the creditors was not proved. In these facts, the T....