TaxTMI 
TaxTMI 
2021 (7) TMI 405
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....Y-2010-11 and in the absence of which the claim of the Introduction of additional capital during the year could not be considered genuine/ substantiated. (2) On the facts and in the circumstance of the case and in law, the Ld. CIT(A) erred in deleting the disallowance on account of unproved sundry creditor of Rs. 4,40,156/- by failing to discuss the matter in the order passed, though confirmation was not received in this case and also this matter was discussed/reported in remand report. [ iii) It is therefore, prayed that the order of the CIT(A), may be set-aside and that the order of the Assessing Officer may be restored. iv) The assessee craves to add, modify or alter any grounds during the course of appeal proceedings." 3. In addition to the above two grounds, later on, the Revenue has submitted before the Bench the revised ground of appeal, which pertains to ground no.2, originally raised by Revenue, wherein the Revenue has aggrieved by the disallowance on account of unproved sundry creditors of Rs. 4,40,160/-. The Revenue has revised this second original ground and filed the additional ground wherein the Revenue has challenged the disallowance on ....
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....l that all the money was received from the sister concern M/s Twins E Power in which they are the partners. The requisite information was filed on 24.03.2014. The new capital contribution by Santoshkumar was Rs. 11,41,500/- and by Sureshkumar Rs. 13,14,500/- which were received through cheque from M/s Twins E Power. 8. During the appellate proceedings, the ld CIT(A) had referred this matter to the assessing officer to verify the contention of the assessee. The assessing officer vide remand report dated 20.05.2016, submitted the following observations: "The assessee has furnished details and evidences of capital account of Shri Santoshkumar Nayar & Shri Sureshkumar Nayar in respect of their capital investment in the firm for Rs. 1,67,24,489/-. Break up of capital is as under: Name of Partner Opening Balance Capital Introduction Merest on Capital Remune ration Share of Proflt Withdra wals Closing Balance Santoshkumar Nayar 65,39,305 11,41,500 7,84,716 1,00,000 11,30,823 11,63,214 85,33,130 Sureshkumar Nayar 62,10,756 13,14,500 7,45,291 1,00,000 11,30,823 13,10,011 81,91,359 Total 1,27,50,061 ....
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....rt, ld CIT(A) observed that all the capital introduced by the partners has been received from the sister concern through cheques. The sister concern M/s Twin E Power files its return of income. But the assessing officer has commented that the partners has not filed the return for this year so addition of Rs. 1,67,24,489/- be made.The undisputed facts are that whatever capital introduced by the partners in their capital account, stands explained. The opening balance does not suffer from any infirmity. Similarly, additions on account of interest, remuneration, profit and entries of withdrawals have also not been disputed. In view of all this, no addition can be made in the hand of the assessee of the total outstanding capital balance at the end of the year in the capital accounts of the partners simply because the partners have not filed their return of income. As the entries of credit and debit in the capital accounts of [ the partners has been admitted as genuine so the addition of Rs. 1,67,24,489/- being the total of outstanding capital balance of the partners in the books of the assessee was deleted by ld CIT(A). We note that Hon`ble High Court of Madras in the case of Smt. B. Ja....
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....ughts to the rival submissions as well as through the remand report and counter comments of the AR of the assessee. As the assessing officer has not specifically pointed out any defect in the unsecured loans so no addition in regard to unsecured loans of Rs. 40,73,500/- was asked. In view of this, the addition made of Rs. 40,73,500/- of outstanding unsecured loans in the balance sheet is deleted. In regard to the sundry creditors of Rs. 1,73,80,759/-, the assessing officer made this addition for want of response from the assessee during the assessment proceedings. However, during the appellate proceedings, the AR of the assessee submitted that the requisite reply was filed on 24.03.2014. In the interest of nature justice a remand report was called for from the assessing officer. In the remand report 20.05.2016, the assessing officer has dealt with this issue at length. Enquiries u./s 133(6) of the Act were made and as a result, the assessing officer observes that in a number of cases either the notices were received back unserved or no reply was received. Similarly, in some cases there were differences in the amount outstanding. A detailed chart was prepa....
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.... this party, it is stated that the difference is on account of opening balance and there is no transactions in the year under assessment. The assesses himself has confirmed that in case of M/s. Ambica Steel Supplier, no payment of Rs. 7,30,000/- was made, however, the party has confirmed such payment u/s. 133(6) of the Act. Further, in the cases of Sandipkumar jaykumar shah & co., sai suppliers, shree Bhagvati Traders, Monica Roofing, Scaff roofing, shy engineering, the assessee did not give any reply and hence the same could not be verified. In sitaram chauhan & super flooring there is a discrepancy noted in the figures between assessee and the party and no reconciliation has been offered by the assessee in this regard. Also in the case of M/s. Bhakti Sales Agency, the account is differ by Rs. 10,150/-. The other cases of M/s Kheteshwar hardware electricals, Hasanali bhai and sons and Vijay Builders there is no discrepancy noted. On the basis of above facts and observations, it is amply clear that in many cases creditors account balances are differ from that of assessee's account. Therefore, legal inference can be drawn that the assessee has....
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....omments of the AR of the assessee, the following position emerges: a) Accounts where no discrepancy was found. i) Padmani Enterprise ii) Padmani Transport b) Accounts where no transactions took place during the year and the opening balances are the closing balances. i) M/s Maruti Steels ii) M/s National Electricals c) Accounts where discrepancies were found and explanation given/no explanation given. i) M/s Ambika Steel Suplliers - The difference in balance is Rs. 7,30,000/-. Which the assessee claims that the other party has suo moto credited the amount without receiving any amount from the assessee. ii) M/s Sandeep Kumar Jay Kumar - Closing Balance Rs. 4,95,172/- iii) Sai Suppliers - Closing Balance is Rs. 3,22,100/- iv) Shri Bhagwati Traders - Closing Balance is Rs. 8,22,477/- v) Monica Roofing - Closing Balance is Rs. 2,53,325/- vi) Scaff World - Closing Balance is Rs. 3,40,029/- vii) Shy Engineering - Closing Balance is Rs. 1,83,478/- viii) Bhakti Sales Agencies - Difference Balance is Rs. 10,150/- In respect of all these sundry credit....