AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (5) TMI 1706
X X X X Extracts X X X X
X X X X Extracts X X X X
.... felt satisfied with the formal verification u/s 133(6) of the Act without examining these details critically, in absence of this exercise, no conclusive and logical findings can be arrived at. Thus the findings so arrived at on the basis of such formal enquiries were factually and legally incorrect and illogical so the same deserved to be quashed summarily. 2. On the facts and in the circumstances of the case, the ld. AO has factually and legally erred in appreciating the facts of the case in right perspective to conduct the discreet enquiries to find out the Truth. Thus the assessment order so passed is devoid of merits and deserved to be quashed summarily. 3. On the facts and in the circumstances of the case, the ld. Hon'ble Faceless Appeal Centre have factually and legally erred in not taking note of such deficiencies in the Assessment Order and had decided the appeal on the basis of the invalid assessment order as pointed out above. Thus the Authorities below have legally and factually erred in not passing a well reasoned order after addressing the various contentions as made by the appellant in the Assessment and Appeal Proceedings. Thus the orders so passed....
X X X X Extracts X X X X
X X X X Extracts X X X X
....audio-visual medium on account of Government guidelines on account of prevalent situation of Covid-19 Pandemic, both the parties have placed their written as well as oral arguments during this online hearing process. 3. The concise fact related to this appeal as culled out from the folder are as under: "Assessment in the case was completed under sec. 143(3) of the Income-tax Act, 1961 on 27.03.2015 at a total assessed income of Rs. 8,18,770/- against income of Rs. 4,99,390/- declared by the assessee in his return of income for the year under consideration filed on 27.09.2012. While completing the assessment in the case it was found that no payments were made by M/s Vijay Laxmi Agro Implements during the year under consideration. As such, the amount of Rs.3,19,380/- credited by the assessee in the name of M/s Vijay Laxmi Agro Implements was nothing but unaccounted money of the assessee himself which was credited in the name of M/s Vijay Laxmi Agro Implements. Accordingly, the addition of Rs.3,19,380/- was made to the total income of the assessee treating it as undisclosed income of the assessee. 2. Against the above order the, assessee filed an appeal before the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... sec. 133(6) of the Income-tax Act, 1961 was issued to M/s Vijay Laxmi Agro Implements, Rampura. Dabari along with 'a copy the material furnished by the assessee thereby requiring to clarify Inc details furnished by the assessee. 7. In response thereto M/s Vijay Laxmi Agro Implements, Rampura Dabari filed letter dated 12.12.2018 wherein it has been stating as under:- निवेदन है कि आपके द्वारा दिनांक 26.11.2018 को दिये गये नोटिस में जो सूचना चाही गई है। वो हम हमारे जवाब दिनांक 24.03.2015 को प्रस्तुत कर चुके है। जिसमें हमने म&#....
X X X X Extracts X X X X
X X X X Extracts X X X X
....has failed to discharge his onus. Therefore, the aforesaid cash amount of Rs. 3,19,380/- credited by the assessee in the name of M/s Vijay Laxmi Agro Implements is treated as unaccounted money of the assessee himself which he credited in the name of M/s Vijay Laxmi Agro Implement, Rampura (Chomu). Accordingly, the above cash amount of Rs. 3,19,380/- is hereby treated as income of the assessee from undisclosed sources and added to the total income of the assessee." 4. In the second round of litigation against the confirmation of addition by the ld. AO, assessee preferred an appeal against the set-a side assessment order and the relevant finding of the ld. CIT(A) in this case is as under: "4.2 DECISION: - The observations of the AO, submissions of the appellant and the material on record have been considered. The issue under dispute is in respect of a single addition of Rs. 3,19,380/- made by the AO. In the original assessment u/s. 143(3) of the Act the AO found that the appellant was unable to explain the source of the cash credit of Rs. 3,19,380/- satisfactorily. The contention of the appellant was that, the deposition of cash of Rs. 3,19,380/-was on account of payments....
X X X X Extracts X X X X
X X X X Extracts X X X X
....epresented the payments received from M/s. Vijayalaxmi Agro Implements, it was incumbent on the appellant to prove that the said payment were made by M/s. Vijayalaxmi Agro Implements. Though, the appellant submitted copies of cash ledger showing the payments from M/s. Vijayalaxmi Agro Implements, it was also incumbent on the appellant to substantiate these entries with confirmation from M/s. Vijayalaxmi Agro Implements in that regard. The AO made necessary efforts in this regard by seeking information from M/s. Vijayalaxmi Agro Implements. Since, the witness, M/s. Vijayalaxmi Agro Implements reaffirmed its stand of not making such cash payments, the onus was on the appellant to prove to the contrary. The AO gave necessary opportunity to the appellant to produce M/s. Vijayalaxmi Agro Implements as his witness to prove his point, however, the appellant failed to make use of this opportunity. The appellant instead, has argued that, it was the responsibility of the AO to gather evidences supporting the claims made by the appellant, which were already refuted by the only witness provided by the appellant. 4.5 In view of the facts mentioned in the above paragraphs and the circum....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ijay Laxmi Agro Implements against the outstanding trade credits of Rs. 5,62,820/- as per account of M/s Vijay Laxmi Agro appearing in the 'Audited Books' of the appellant (Copy enclosed for ready reference - Placed at page No.1 to 3 of PB). The department did not dispute such trade credits of Rs. 5,62,820/- as shown by the appellant in his Regular Books. The purchaser M/s Vijay Laxmi Agro had however denied to have made such cash payments of Rs. 3,19,380/-, though the purchases of Rs. 4,98,820/- from the appellant were found recorded in their books. The opening balance of Rs.92,000/- and the purchase of Rs. 74,000/- through sale voucher Bill No. 3743 dated 9.2.2012 was denied by the purchaser, for which no explanation what-so-ever was offered by the purchaser. Thus the denial made by the purchaser was apparently incorrect as they (purchaser) had failed to explain as to how the out-standing credits appearing in their books were finally settled and squared up in absence of the cash payments towards such purchases. Thus the addition was made without verifying and examining the above facts. Accordingly, the appeal was filed against the addition so made, which was summarily dismissed b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t the denial made by the purchaser. In support of such findings, the ld. AO had misinterpreted the provisions of the Evidence Act on the basis of a Latin quotation that it was onus of the appellant to negate the 'denial' of the purchaser. In support of such findings, the ld. AO had also incorrectly relied upon the view of honorable Supreme Court in the case of M/s M. Ganapathi Mudaliar (1964) 53 ITR 623 without appreciating the fact that such view of the honorable Supreme Court was having no bearing on the facts of the present case. Accordingly, the claim of the appellant was turned down and addition as made originally was maintained in the setaside proceedings also. Obviously, such findings were devoid of merits and were contrary to the 'Principles of Evidence Act', 'Accountancy', 'Provisions of section 68 of the Act' and the 'directions of the honorable Bench'. While deciding this point, the ld. AO had failed to address the fact as to how the opening balance of Rs.92,200/- and the purchase of Rs.74,000/- on 3743 dated 9.2.2012 (duly acknowledged by the purchaser as evident from the sale voucher itself submitted during the course of set-aside proceedings) could be reconciled. The ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rder so passed was a lop-sided order which deserved to be quashed summarily. 4. In appeal also, the honorable National Faceless Appeal Centre (herein after referred as NFAC) did not take note of these vital facts and had focused their attention on one point only that in the set aside proceedings, the appellant had failed to discharge his onus to rebut the 'denial' of the purchaser as per Evidence Act. Thus the NFAC had also failed to address the vital facts of the case in right perspective and did not pass a well reasoned and logical order in respect of the above vital facts. The honorable NFAC had been solely guided by the mis-conceived findings of the ld. AO regarding 'ONUS' as discussed in the fore-gone paras. The findings of honorable NFAC are restricted in defining the scope of 'Onus' as per Evidence Act only; without dwelling upon the other vital facts of the case as elaborated hereinabove. For ready reference, the findings of honorable NAFC recorded in para 4.5 of the appeal order are re-produced hereunder for ready reference: 'In view of the facts mentioned in the above paragraphs and the circumstances of the case it is clear that the appellant has failed ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ad adduced the sale vouchers duly signed by the purchaser. Thus as per Evidence Act, it was for the purchaser M/s Vijay Laxmi Agro Implements to negate such evidence i.e. Sale Vouchers and cash payments etc. The ld. AO had however shifted such onus to the appellant incorrectly by misconceiving the provisions of the Evidence Act. The NAFC had also been guided by such misinterpretation of the provisions of Evidence Act and did not find fault with such faulty findings of the ld. AO to reverse the view taken by the ld. AO. (h) The provisions of section 68 of IT Act do not come into play in respect of the 'Out-standing Debtors'. In the present case, the Authorities Below have incorrectly invoked the provisions of section 68 of the Act to make addition on account of the alleged 'Out-standing Debtors' which is patently and legally incorrect. 6. In the absence of the discreet enquiries as discussed above, no fair and logical conclusion could have been arrived at by the Authorities Below and the addition as made and confirmed by them on the basis of such illogical and lopsided enquiries is bad in law and the same deserves to be deleted summarily. 7. In addition to the a....