AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (2) TMI 615
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....the business of manufacturing of polythene liners bags. It filed its return of income on 27/11/2014, disclosing Nil income for the Assessment Year 2013-14. The only issue that arises for our consideration in this appeal is the addition made u/s 68 of the Act. 3. We have heard rival contentions. On careful consideration of the facts and circumstances of the case, perusal of the papers on record, orders of the authorities below as well as case law cited, we hold as follows:- The facts leading to the addition are brought out by the Assessing Officer as follows:- "On examination of books of accounts and other details and documents available on record and furnished by the during the course of assessment proceedings following discrepancies ha....
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....d back unserved on 26/02/2016 by postal department with the remarks "insufficient address". However, Contship Commodities (P) Ltd. and Angad Chemicals (P) Ltd. have submitted the reply in response to the summons issued u/s 131 of the I.T. Act on 29/02/2016. Further, show cause letter along with summons u/s 131 was issued on 10/03/2016 to the Managing Director of M/s C K Plastics (PJ Ltd. asking him to produce the loan creditors as identity and creditworthiness of the loan creditors could not be verified. In response to the said show cause the AIR of the assessee company submitted explanations 021/03/2016 citing various case laws. The A/R also furnished details/ documents of the loan creditors except the M/s B R Trading Co and M/s S N V ....
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....e correct address. He submitted that, documents from these two creditors were given before the ld. CIT(A). 6. The ld. D/R, relied on the order of the Assessing Officer and submitted that they were credits in the accounts of the creditors, immediately prior to giving of loan to the assessee which points that these creditors did not have creditworthiness. He submitted that the assessee was bound to produce the creditors before the Assessing Officer for examination and having failed to do so, the addition was rightly made. In reply, the ld. Counsel for the assessee, submitted that there were no cash deposits in the hand of the creditors' accounts and transfer of funds through banking channels was done in the normal course of business and the....
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....reasonable or perverse or based on no evidence. If the conclusion was based on some evidence on which a conclusion could be arrived at, no question of law as such could arise." (emphasis ours) 8. The other ground on which the Assessing Officer made the addition was that certain funds were transferred into the accounts of the loan creditors from third parties, prior to the loan being given to the assessee. 8.1. No addition can be made based on such inference as held by the Hon'ble Jurisdictional High Court in the case of CIT vs. Jamna Dass Gupta, in ITAT No. 20 of 2011, G.A. No. 289 of 2011, judgement dt.15th February, 2011. 9. The Hon'ble Jurisdictional High Court in the case of CIT vs. Dataware Pvt. Ltd. 2011 (9) TMI 175, held as follow....
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....neness of transaction through account payee cheque has been established." 10. Applying the propositions of law laid down in each of these cases to the facts of this case, we now examine each of the loan creditors. The assessee furnished the following details in the case of each of these creditors:- 1) Angad Chemical (P) Ltd. - (i) ITR Acknowledgement and Final Accounts for the AY.: 20l3-14 (ii) Copy of Confirmation Certificate (iii) Copy of Ledger Account of the assessee in the books of Angad Chemical (P) Ltd. (iv) Copy of Bank Statement (v) Reply of the notice u/s. 131 2) Contship Commodities (P) Ltd. - (i) ITR Acknowledgement and Final Accounts for the AY.: 2013-14 (ii) Copy of Confirmation Certificate alongwith typed c....