Shri Gunvant Vitthaldas Shah, Sangli V. ITO, Ward 2(1), Sangli

ITA 2006/PUN/2012

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 0915 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 02-11-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 16-10-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B; MANISH KUMAR SINGH HEERAJ JAIN
• Keywords: Unexplained cash credit; Unexplained investment; Unexplained expenditure; Business income; Opportunity of being heard; Source of fund
• Section: 68

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE . . , , ' # BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NOS.2004 TO 2006/PN/2012 '% % / ASSESSMENT YEARS : 2005-06 TO 2007-08 SHRI GUNVANT VITTHALDAS SHAH, SWASTIK OIL AGENCIES, BEHIND OLD PADMA THEATRE, SANGLI. PAN NO.ADFPS4664Q . / APPELLANT V/S ITO, WARD-2(1), SANGLI . / RESPONDENT . / ITA NO.2100/PN/2012 '% % / ASSESSMENT YEAR : 2008-09 ITO, WARD-2(1), SANGLI . / APPELLANT V/S SHRI GUNVANT VITTHALDAS SHAH, PROP. OF M/S. SWASTIK OIL AGENCY, PATEL CHOWK, BEHIND PADMA THEATRE, SANGLI-416 416 PAN NO.ADFPS4664Q . / RESPONDENT / APPELLANT BY : SHRI KISHORE PHADKE / DEPARTMENT BY : SHRI MANISH KUMAR SINGH HEERAJ JAIN & B / DATE OF HEARING :02.11.2015 / DATE OF PRONOUNCEMENT:06.11.2015 2 ITA NO.2004 TO 2006 & 2100/PN/2012 / ORDER PER R.K. PANDA, AM : ITA NOS. 2004 TO 2006/PN/2012 FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS DATED 23-08-2012 OF THE CIT(A), KOLHAPUR RELATING TO ASSESSMENT YEARS 2005-06 AND 2007- 08 RESPECTIVELY. ITA NO. 2100/PN/2012 FILED BY THE REVENU E IS DIRECTED AGAINST THE ORDER DATED 23-08-2012 OF THE CIT(A), KOLHAPU R RELATING TO ASSESSMENT YEAR 2008-09. FOR THE SAKE OF CONVENIENCE, ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISP OSED OF BY THIS COMMON ORDER. ITA NO.2004/PN/2012 (BY ASSESSEE) (A.Y. 2005-06) : 2. FACTS OF THE CASE, IN BRIEF ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND IS ENGAGED IN THE BUSINESS OF RETAIL TRADER IN LUBRICATION OILS. IN THIS CASE A SURVEY ACTION U/S.133A OF T HE ACT WAS CONDUCTED ON 15-11-2007 AND STATEMENT OF THE ASS ESSEE U/S.131 WAS RECORDED ON 19/20-11-2007. SIMILARLY, BOOKS AND A FILE CONTAINING DETAILS OF CONSTRUCTION OF RESIDENTIAL HOUSE WE RE ALSO IMPOUNDED U/S.131 ON 16-11-2007 AND 05-12-2007. ON VERIFICATION OF THESE MATERIALS IT WAS REVEALED THAT THE ASS ESSEE HAD MADE INVESTMENT IN CONSTRUCTION OF A RESIDENTIAL HOUSE AT SURVEY NO.116 PLOT NO.35 AMBAI NAGAR, SANGLI. HOWEVER, THIS EXPEND ITURE WAS NOT REFLECTED IN REGULAR RETURN OF INCOME FILED FOR THE IM PUGNED ASSESSMENT YEAR. THE AO FURTHER NOTED THAT IN HIS STAT EMENT RECORDED U/S.131 ON 20-11-2007, THE ASSESSEE IN HIS REP LY TO QUESTION NO.2 HAD CONFIRMED THAT HE HAS STARTED CONSTR UCTION OF A RESIDENTIAL HOUSE IN 2004 AND THE PART OF THE INVESTMENT MADE HAS NOT BEEN REFLECTED IN HIS REGULAR RETURN OF INCOME FILED. TH E AO 3 ITA NO.2004 TO 2006 & 2100/PN/2012 REFERRED THE ISSUE OF CONSTRUCTION OF THIS PROPERTY TO T HE DVO FOR ASCERTAINING THE COST OF CONSTRUCTION. THE DVO SUBMITTED HIS REPORT YEAR-WISE FOR THE YEARS ENDING 31-03-2005, 31-03 -2006 AND 31-03-2007. FOR THE YEAR UNDER CONSIDERATION, THE EXPE NDITURE WAS APPORTIONED BY THE DVO AT RS.2,95,597/-. THE AO ISSU ED NOTICE U/S.148 OF THE I.T. ACT IN RESPONSE TO WHICH THE A SSESSEE STATED THAT THE ORIGINAL RETURN OF INCOME FILED BY HIM MAY B E TREATED AS HIS RETURN IN RESPONSE TO NOTICE U/S.148. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO NOTED THAT THE ASSESSEE HAS OPTED FOR DECLARATION OF HIS BUSINE SS INCOME U/S.44AF. ON A GROSS RECEIPT OF RS.6,93,751/- THE PROFIT WAS ESTIMATED AT 6% AT RS.41,625/- WHICH THE AO ACCEPTED. SO FAR AS THE INVESTMENT IN CONSTRUCTION OF THE HOUSE PROPERTY IS CONCERNED, THE AO CONFRONTED THE SAME TO THE ASSESSEE REGARDING THE SOURCE OF INVESTMENT. IT WAS SUBMITTED BY THE ASSESSEE THAT THE INVESTMENT IN CONSTRUCTION OF THE HOUSE PROPERTY WAS SHOWN IN THE BOOKS OF HIS HUF. THE INVESTMENT WAS REFLECTED IN THE RETURN OF INCOME OF THE HUF FILED ON 27-10-2005 VIDE ACKNOWLEDGEMENT NO.3830 FOR A.Y. 2005-06. 4. HOWEVER, THE AO NOTED THAT NO SUCH RETURN WAS FILED VIDE THE SAID ACKNOWLEDGEMENT. REJECTING THE VARIOUS EXPLANATIONS GIVEN BY THE ASSESSEE THE AO MADE ADDITION OF RS.2,93,597/- BEING UNEXPLAINED INVESTMENT IN CONSTRUCTION OF THE HOUSE PROPE RTY U/S.69A OF THE I.T. ACT. 5. BEFORE THE CIT(A) THE ASSESSEE MORE OR LESS REITERATE D THE SAME CONTENTIONS AS MADE BEFORE THE AO. IT WAS STRESS ED THAT THE ASSESSEE HAD FILED A CASH FLOW STATEMENT PREPARED IN HIS IN DIVIDUAL 4 ITA NO.2004 TO 2006 & 2100/PN/2012 CAPACITY FOR A.Y. 2005-06 WHEREIN WITHDRAWALS OF CASH TO TH E EXTENT OF RS.2,90,000/- WAS SHOWN TO HAVE BEEN UTILIZED FOR CONSTR UCTION OF THE HOUSE PROPERTY. HOWEVER, THE AO HAD IGNORED ALL T HESE FACTS. IT WAS SUBMITTED THAT THE ASSESSEE IN HIS INDIVIDUAL CAPAC ITY HAD SUFFICIENT FUNDS TO MEET THE CONSTRUCTION EXPENDITURE. IT WAS ACCORDINGLY ARGUED THAT THE ADDITION MADE BY THE AO SH OULD BE DELETED. 6. HOWEVER, THE CIT(A) WAS ALSO NOT SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE AND CONFIRMED THE ADDIT ION MADE BY THE AO. 7. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE IS IN APPEAL BEFORE US WITH THE FOLLOWING GROUNDS : 1. LEARNED CIT (A) HAS ERRED IN FACT IN CONFIRMING ADDITION OF RS. 293597/- WITHOUT APPRECIATING. A) THAT APPELLANT HAS SHOWN CONSTRUCTION IN THE HUF'S R ETURN. B) THAT ALL THE NECESSARY EVIDENCES WERE FURNISHED TO C IT (A). C) THAT THERE IS NO CONTRARY EVIDENCE BROUGHT ON REC ORD BY EITHER AO.. OR CIT (A). 2. LEARNED CIT(A) ERRED IN FACT IN CONFIRMING ADDIT ION WITHOUT APPRECIATING THE FACT THAT RS 290000 ARE GIVEN FROM INDIVIDUAL ACCOUNT TO HUF FOR CONSTRUCTION & ALL THE NECESSARY PROOFS E.G. BALANCE SHEET, ITR RECEIPT OF HUF, CASH FLOW OF INDIVIDUAL FURNISHE D BEFORE CIT (A) AS WELL & HENCE EVEN THOUGH RETURNS OF HUF ARE DISBELIEV ED THEN ALSO FACT REMAINS THAT INDIVIDUAL FUNDS ARE USED FOR CONSTRUCTIO N. 3. LEARNED CIT(A) HAS ERRED IN FACT IN CONFIRMING AD DITION OF RS.2,93,597/- WITHOUT APPRECIATING. A. THAT INDIVIDUAL FUNDS OF THE APPELLANT OF RS. 2,90,0 00/- ARE TRANSFERRED TO HUF WHICH FURTHER UTILIZED FOR CONSTRU CTION & ADDITION IS MADE WITHOUT VERIFYING CASH FLOW STATEMENT OF THE APPELLANT. B. THAT IF CIT(A) IS NOT ACCEPTING HUF' S RETURN THEN STI LL THE FACT REMAINS THAT INDIVIDUAL FUNDS ARE USED FOR CONSTRUCTION & HENCE ADDITION WAS UNWARRANTED. 5 ITA NO.2004 TO 2006 & 2100/PN/2012 C. THAT CIT(A) HAS ALLOWED THE APPEAL FOR A.Y. 07-08 BY DELETING DISALLOWANCE MADE BY A.O. OF RS. 18,00,000/- AS ADVANC E GIVEN TO HUF BY APPELLANT, & THUS THEREBY APPROVING STATUS OF H UF. D. THE RETURN OF HUF OF A.Y. 2007-2008 IS NOT DOUBTED O R DISBELIEVED BY A.O. & CIT(A). 4. APPELLANT CRAVES TO LEAVE ADD 1 AMEND OR ALTER AN Y OTHER GROUNDS OF APPEAL. 8. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSES SEE DID NOT PRESS GROUNDS OF APPEAL NO.1, 3C AND 3D FOR WHICH THE LD. DEPARTMENTAL REPRESENTATIVE HAS NO OBJECTION. ACCORDING LY, THE ABOVE GROUNDS ARE DISMISSED AS NOT PRESSED. GROUND OF APPEAL NO.4 BEING GENERAL IN NATURE IS DISMISSED. 9. SO FAR AS THE REMAINING GROUNDS ARE CONCERNED THE LD . COUNSEL FOR THE ASSESSEE REFERRING TO THE CASH FLOW STATE MENT FILED FOR THE PERIOD 01-04-2003 TO 31-03-2005, A COPY OF WHICH IS PLACED AT PAGE 4 OF THE PAPER BOOK, SUBMITTED THAT ALTHOUGH TH E CASH FLOW STATEMENT WAS FILED SHOWING THE WITHDRAWAL OF AN AMOUNT OF RS.2,90,000/- FOR CONSTRUCTION OF THE HOUSE PROPERTY, HOW EVER, THE SAME WAS NOT DEALT WITH BY THE LD.CIT(A). HE SUBMITTED TH AT IN THE INTEREST OF JUSTICE THE MATTER MAY BE RESTORED TO THE FILE OF EITHER THE AO OR THE CIT(A) WITH A DIRECTION TO GIVE A FINDING ON THIS ISSUE SINCE NONE OF THE AUTHORITIES BELOW HAVE CONSIDERED THE C ASH FLOW STATEMENT FILED BY THE ASSESSEE. 10. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HA ND HEAVILY RELIED ON THE ORDER OF THE CIT(A). HE SUBMITTED T HAT THE LD.CIT(A) HAS PASSED A REASONED ORDER, THEREFORE, THE SAM E SHOULD BE UPHELD. 11. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE P APER BOOK 6 ITA NO.2004 TO 2006 & 2100/PN/2012 FILED ON BEHALF OF THE ASSESSEE. WE FIND THE AO MADE AN A DDITION OF RS.2,93,597/- U/S.69A BEING UNEXPLAINED INVESTMENT IN CONSTRUCTION OF THE HOUSE PROPERTY ON THE GROUND THAT THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF FUNDS FOR MEETING THE CONS TRUCTION EXPENSES. WE FIND THE LD.CIT(A) UPHELD THE ADDITION MADE BY THE AO. IT IS THE SUBMISSION OF THE LD. COUNSEL FOR THE ASSES SEE THAT THE ASSESSEE HAD SUFFICIENT CASH BALANCE IN HIS HANDS TO M EET THE INVESTMENT FOR THE YEAR. CASH FLOW STATEMENT SHOWING TH E WITHDRAWAL OF AN AMOUNT OF RS.2,90,000/- TOWARDS CONSTRUCT ION OF THE HOUSE PROPERTY WAS NOT CONSIDERED EITHER BY THE A O OR THE CIT(A). FROM THE COPY OF THE CASH FLOW STATEMENT FILED AT P AGE 4 OF THE PAPER BOOK, WE FIND THE ASSESSEE HAS SHOWN WITHDRAW AL FOR HOUSE CONSTRUCTION AT RS.2,90,000/-. WE FIND ALTHOUGH THE SAID CASH FLOW STATEMENT WAS AVAILABLE BEFORE THE AO AND THE C IT(A), HOWEVER, NOBODY HAS TOUCHED THIS ISSUE. THEY HAVE NEITH ER ACCEPTED NOR REJECTED THE CASH FLOW STATEMENT. UNDER THESE CIRCUMSTANCES, WE DEEM IT PROPER TO RESTORE THIS ISSUE T O THE FILE OF THE AO WITH A DIRECTION TO EXAMINE THE SAME AND DECIDE T HE ISSUE AS PER FACT AND LAW AFTER GIVING DUE OPPORTUNITY OF BEING H EARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE ARE ACCORDINGLY ALLOWED FOR ST ATISTICAL PURPOSES. ITA NO.2005/PN/2012 (BY ASSESSEE) (A.Y. 2006-07) : 12. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSES SEE DID NOT PRESS GROUNDS OF APPEAL NO.1, 3(C) AND 3(D) FOR WHICH T HE LD. DEPARTMENTAL REPRESENTATIVE HAS NO OBJECTION. ACCORDING LY, THE ABOVE GROUNDS ARE DISMISSED AS NOT PRESSED. 7 ITA NO.2004 TO 2006 & 2100/PN/2012 13. OUT OF THE REMAINING GROUNDS, THE FIRST ISSUE THAT HAS TO BE ADJUDICATED IN THE GROUNDS OF APPEAL RELATES TO THE ADDIT ION ON ACCOUNT OF UNEXPLAINED EXPENDITURE IN THE HOUSE PROPERT Y U/S.69A. ACCORDING TO THE LD. COUNSEL FOR THE ASSESSEE AS PER CA SH FLOW STATEMENT, A COPY OF WHICH IS FILED AT PAGE 8 OF THE PAPER BOOK HE HAD SHOWN WITHDRAWAL OF RS.9 LAKHS FOR HOUSE CONSTRUCTION FOR THIS YEAR WHICH HAS NOT BEEN CONSIDERED BY THE AO OR CIT(A). SINCE THE FACTS ARE IDENTICAL TO THE GROUNDS DECIDED IN ITA NO.2004/ PN/2012 ON THIS ISSUE, THEREFORE, FOLLOWING THE SAME REASONING, WE RES TORE THIS ISSUE TO THE FILE OF THE AO WITH A DIRECTION TO ADJUDIC ATE THE SAME IN ACCORDANCE WITH LAW AND AFTER GIVING DUE OPPORTUN ITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCOR DINGLY. THE FIRST ISSUE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. 14. THE SECOND ISSUE THAT HAS BEEN RAISED BY THE ASSES SEE AS PER GROUND OF APPEAL NO.4 RELATES TO DENIAL OF TELESCOPING BENEFIT OF RS.45,029/- BY THE CIT(A). 15. AFTER HEARING BOTH THE SIDES, WE FIND THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS ESTIMATED THE BUSINESS INCOME A T RS.2 LAKHS AS AGAINST RS.1,54,971/- DECLARED BY THE ASSESS EE AND ACCORDINGLY MADE AN ADDITION OF RS.45,029/- WHICH HAS BEE N CONFIRMED BY THE CIT(A). IT IS THE GRIEVANCE OF THE ASSESSEE THAT THIS ADDITION OF RS.45,029/- SHOULD BE AVAILABLE TO THE ASSESSEE TO MEET THE COST OF CONSTRUCTION. NO SUCH GROUND WAS TAKEN EIT HER BEFORE THE AO OR THE CIT(A). FOR THE FIRST TIME THE ASSESSEE H AS TAKEN THIS GROUND. SINCE WE HAVE RESTORED THE ISSUE OF CASH FLOW TO THE FILE OF THE AO FOR HIS ADJUDICATION, THEREFORE, THE ISSUE OF TELESCOP ING BENEFIT IS ALSO BEING RESTORED TO THE FILE OF THE AO FOR H IS 8 ITA NO.2004 TO 2006 & 2100/PN/2012 ADJUDICATION SINCE THE ASSESSEE HAS NOT RAISED THE ISSUE BEFORE THE LOWER AUTHORITIES. THE AO SHALL DECIDE THE ISSUE AS PER FACT AND LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. WE HOLD AND DIRECT ACCORDINGLY. THE GROUND OF APPEAL NO.4 BY THE ASSESSEE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO.2006/PN/2012 (BY ASSESSEE) (A.Y. 2007-08) : 16. ALTHOUGH A NUMBER OF GROUNDS HAVE BEEN TAKEN BY TH E ASSESSSEE THE LD. COUNSEL FOR THE ASSESSEE ONLY PRESSE D GROUND RELATING TO NON-CONSIDERATION OF THE CASH FLOW STATEMENT W HEREIN AN AMOUNT OF RS.18 LAKHS HAS BEEN SHOWN AND TELESCOPING BEN EFIT OF RS.5,24,497/-. 17. SO FAR AS THE AMOUNT OF RS.18 LAKHS IS CONCERNED AS P ER THE CASH FLOW STATEMENT FILED BY THE ASSESSEE AT PAGE 13 OF T HE PAPER BOOK THE ASSESSEE HAS SHOWN TO HAVE GIVEN MONEY TO THE HUF TOWARDS CONSTRUCTION. ALTHOUGH THIS CASH FLOW STATEMENT WAS FILED BEFORE THE AO AND THE CIT(A), THE SAME HAS NOT BEEN CO NSIDERED BY EITHER OF THE AUTHORITIES BELOW. WE HAVE ALREADY DECIDED AN IDENTICAL ISSUE WHILE DECIDING ITA NO.2204/PN/2012 FOR A.Y. 200 5- 06. FOLLOWING THE SAME REASONING, THE FIRST ISSUE RAISED BY THE ASSESSEE IN THE GROUNDS OF APPEAL IS RESTORED TO THE FILE OF THE AO. 18. SO FAR AS THE SECOND ISSUE IS CONCERNED WE FIND THE A O ESTIMATED THE GP AT RS.7,15,287/- AS AGAINST GP OF RS.1,72,9 90/- DECLARED BY THE ASSESSEE IN THE RETURN OF INCOME AND C ONSEQUENTLY MADE AN ADDITION OF RS.5,42,297/- WHICH HAS BEEN UPHELD BY THE CIT(A). IT IS THE GRIEVANCE OF THE ASSESSEE THAT TELESC OPING BENEFIT SHOULD BE GIVEN TO THE EXTENT OF RS.5,42,297/- TO MEET T HE 9 ITA NO.2004 TO 2006 & 2100/PN/2012 EXPENSES REQUIRED FOR CONSTRUCTION OF THE HOUSE. IDENT ICAL GROUND (GROUND OF APPEAL NO.4) WAS TAKEN BY THE ASSESSEE IN ITA NO.2005/PN/2012 FOR A.Y. 2006-07 AND WE HAVE RESTORED T HE ISSUE TO THE FILE OF THE AO FOR ADJUDICATION AS PER FACT AND LAW A FTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. FACTS BEING SIMILAR, THEREFORE, FOLLOWING SAME REASONINGS WE RESTORE THE ISSUE TO THE FILE OF THE AO FOR HIS ADJUDICATION AS PER LAW AFTER GIVING DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. THIS GROUND BY THE ASSESSEE IS ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO.2100/PN/2012 (BY REVENUE) (A.Y. 2008-09) : 19. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, WHETHER THE LEARNED CIT(A) ERRED IN GRANTING RELIEF OF RS 12,34,710/- OUT OF THE ADDITIONS MADE U/S 68 OF THE I.T.ACT, 1961 ? 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, WHETHER THE LEARNED CIT(A) ERRED IN ADMITTING FRESH EXPLANATION GIVEN BY THE ASSESSEE IN RESPECT OF RELIEF OF RS 937,710/- WIT HOUT GIVING NOTICE TO THE AO UNDER RULE 46A OF THE I.T. RULES? 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, WHETHER THE LEARNED CIT(A) ERRED IN ACCEPTING THE CONFIRMATIONS OF SHRI KAUSHIKKUMAR N. SHAH, SHRI ANIL VASANTRAO BHISE AND SHRI SATISH S. CHAVAN, WHICH HAD BEEN EXAMINED BY THE AO AND SPECIFIC DEFECTS POINTED OUT BY HIM WERE NOT CONSIDERED BY THE CIT(A) WHILE GRANTING RELIEF? . 20. FACTS OF THE CASE, IN BRIEF, ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO ON PERUSAL OF THE IMPOUND ED MATERIAL, I.E. DAILY BOOKS (RED COLOUR) NOTED THAT THESE BOOK S CONTAIN VARIOUS BIG AMOUNTS CREDITED IN CASH. THE CASH D EPOSITS OTHER THAN THE CASH SALES TOTALLED TO RS.23,17,815/-. THE AO ASKED THE ASSESSEE TO GIVE SOURCE OF THESE CREDITS WITH DOCUM ENTARY 10 ITA NO.2004 TO 2006 & 2100/PN/2012 EVIDENCES. IN REPLY THE ASSESSEE SUBMITTED THAT THESE CREDITS INCLUDES THE FOLLOWING ITEMS : 1. WITHDRAWALS FROM BANK OF RS.4,05,000/- 2. HAND LOANS OF RS.3,89,400/- TAKEN FROM I. KAUSHIKKUMAR NATHALAL SHAH : 1,09,100 II. SHRI SATISH S. CHAVAN AND : 73,000 III. SHRI ANIL VASANTRAO BHISE : 1,60,800 IV. SHRI PARAMANANDA B. BANATWALA : 46,500 3. RECOVERY AGAINST SALE AND DEBTORS OF RS.5,81,605/- 21. AS REGARDS WITHDRAWALS FROM BANK OF RS.4,05,000/-, THE A . O. ACCEPTED THE CLAIM OF THE ASSESSEE AND AMOUNT OF RS. 4,05 ,000/- WAS REDUCED FROM THE TOTAL OF CASH CREDITS OF RS.23,17,815 /-. HOWEVER, IN RESPECT OF ASSESSEE'S CLAIM OF TAKING OF HAND LOA NS FROM (I) SHRI KAUSHIK N. SHAH, PROP. OF M/S MAHAVEER LUBRICANT, (II) S HRI PARMANAND BANATWALA AND (III) SHRI SATISH CHAVAN , THE A.O. DID NOT ACCEPT THE SAME FOR THE REASON THAT THE ENTRIES G IVEN IN THEIR STATEMENTS ARE NOT MATCHING WITH THE ENTRIES APPEARING IN THE IMPOUNDED DAILY BOOK. THE A.O. ACCEPTED THE CLAIM OF ASSESS EE IN RESPECT OF TAKING OF HAND LOAN RECEIVED FROM SHRI ANIL VASA NTRAO BHISE TO THE EXTENT OF RS. 50,000/- ONLY AND REDUCED TH E SAID AMOUNT FROM THE TOTAL CASH CREDITS OF RS. 23,17,815/ -. THE AO ALSO DID NOT ACCEPT THE ASSESSEE'S CLAIM OF RECOVERY OF AMOUN T OF RS.5,81,605/ - FROM DEBTORS AND SALES FOR THE REASON THAT THE ENTRIES OF CASH SALES AS WELL AS CASH CREDITS ARE SEPARAT ELY WRITTEN IN THE LEFT SIDE (JAMA SIDE) OF THE IMPOUNDED DAILY BOOKS AND THERE IS NO QUESTION OF DOUBLE TAXATION NOR GIVING BENEFIT OF TELES COPING AGAINST CASH SALES. IN THE RESULT, THE AO TREATED THE B ALANCE AMOUNT OF RS.18,62,815/- (RS.23,17,815/- LESS BANK ENTRIES OF RS.4,05,000/- PLUS ENTRIES IN RESPECT OF SHRI BHISE OF RS.50 ,000/-) AS UNEXPLAINED CASH CREDITS AND ADDED THE SAME U/S.68 O F THE I.T. ACT. 11 ITA NO.2004 TO 2006 & 2100/PN/2012 22. BEFORE CIT(A) THE ASSESSEE SUBMITTED THAT HE HAS TAK EN HAND LOAN OF RS.3,89,400/- FROM 4 DIFFERENT PARTIES WHICH ARE UNDER : SHRI KAUSHIK N. SHAH (PROP. MAHAVEER LUBRICANTS) : RS.1,09,100/- SHRI PARAMANAND B. BANATWALA : RS.46,500/- SHRI SATISH CHAVAN (PROP. SAI LUBRICANTS) : RS.73,000/- SHRI ANIL V. BHISE : RS.1,60,800/- ----------------- RS.3,89,400/- ---------------- 23. SIMILARLY, MR. GAURAV SHAH THE SON OF THE ASSESSEE HA S RETURNED AN AMOUNT OF RS.4,500/- ON 22-06-2007 WHICH WAS TAKE N BY HIM ON 16-06-2006. FURTHER, THE AO HAS ACCEPTED CR EDIT ENTRIES OF SHRI ANIL BHISE AMOUNTING TO RS.50,000/- ONLY. THE ASSE SSEE FURNISHED COPIES OF CONFIRMATION LETTERS WHICH WERE ALSO FILED B EFORE THE AO. IT WAS ACCORDINGLY SUBMITTED THAT THE DEPOSITS TO THE TUNE OF RS.3,43,900/- WERE FULLY EXPLAINED (I.E.3,89,400/- +4500 50,000 = 3,43,900/-). 24. THE ASSESSEE FURNISHED COPIES OF CONFIRMATION LETTERS WH ICH WAS ALSO FILED BEFORE THE AO. IT WAS ARGUED THAT SINCE ALL THE DEPOSITORS HAVE ALREADY CONFIRMED THE DATES AND AMOUNTS AND THERE IS NO DISPUTE ABOUT IDENTITY AND CREDIT WORTHINESS OF THE DEPOSITORS, THEREFORE, THE OBSERVATIONS OF THE AO THAT AM OUNTS AND DATES ARE NOT MATCHING IS TOTALLY ILL-FOUNDED AND WITHOUT ANY BASIS AND THEREFORE THE ADDITION MADE BY THE AO IS TOTALLY UNJ USTIFIED. THE ASSESSEE FURNISHED THE XEROX COPIES OF THE RELEVANT PAGES OF THE IMPOUNDED DAILY BOOK SHOWING REPAYMENT ENTRIES OF ALL THE DEPOSITORS. IT WAS ACCORDINGLY ARGUED THAT THE REPAYM ENT ASPECT WAS NOT AT ALL CONSIDERED BY THE AO. 12 ITA NO.2004 TO 2006 & 2100/PN/2012 25. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE THE LD.CIT(A) DELETED AN AMOUNT OF RS.2,97,400/- OUT OF RS.3,43,9 00/- ADDED BY THE AO ON ACCOUNT OF LOANS FROM THE 3 CREDITOR S. THE RELEVANT OBSERVATION OF THE CIT(A) AT PARA 16 TO 18 OF TH E ORDER READ AS UNDER : 16. THE SUBMISSION OF THE APPELLANT IS DULY CONSIDERED . UNDER SECTION 68 OF THE ACT, THE ASSESSEE HAS TO OFFER AND PROV E EXPLANATION AS TO THE NATURE AND SOURCE OF THE CREDIT ENTRY. THE ONUS IS, THEREFORE, ON THE ASSESSEE TO EXPLAIN THE CASH CREDIT ENTRIES IN HIS BOOKS OR ACCOUNT. THE BURDEN IS PLACED ON THE ASSESSEE TO PROVE A CREDIT APPEARING IN ITS BOCKS OF ACCOUNT AND THE BURDEN HAS T O BE DISCHARGED WITH POSITIVE MATERIAL. ONLY FURNISHING OF CONFIRMATI ON LETTERS DOES NOT AMOUNT TO SUFFICIENT PROOF, BUT THE ASSESSEE WAS REQU IRED TO PROVE SUCH CREDIT BY ESTABLISHING (I) THE IDENTITY OF CREDIT OR, (II) THE CAPACITY OF THE CREDITOR TO ADVANCE THE MONEY, AND (III) THE GENUINENESS OF THE TRANSACTION. AFTER THE ASSESSEE HAS ADDUCED EVIDENCE TO E STABLISH PRIMA FACIE THE AFORESAID, THE ONUS SHIFTS TO THE DEPAR TMENT. 17. IN THE CASE OF THE APPELLANT, THE APPELLANT HAS F URNISHED CONFIRMATION LETTERS FROM ALL THESE DEPOSITORS. THE AP PELLANT HAS ALSO FURNISHED FOLLOWING EVIDENCES IN ORDER TO ESTABLISH CRE DITWORTHINESS OF THE DEPOSITORS AND GENUINENESS OF TRANSACTIONS VIZ. PHOTOSTAT COPY OF ACKNOWLEDGEMENT OF RETURN OF INCOM E FILED BY SHRI KAUSHIKKUMAR N. SHAH FOR A.Y. 2008-09, AND PHOTOSTAT COPY OF CONFIRMATION LETTER IN WHICH HE HAS CONFIRMED THAT H E HAS GIVEN AMOUNT OF RS.1,09,100/- TO THE APPELLANT ON VARIOUS D ATES AS PER LIST ATTACHED TO THE CONFIRMATION LETTER. SHRI SHAH ALSO CONFIRMED THAT THE SAID AMOUNT OF RS.1,09,100/- WAS RECEIVED BACK BY HIM FROM THE APPELLANT ON THE VARIOUS DATES AS PER LIST ATTACHED TO THE SAID CONFIRMATION LETTER. (II) PHOTOSTAT COPY OF THE ACKNOWLEDGEMENT OF RETU RN OF INCOME FILED BY SHRI ANIL VASANTGRAO BHISE FOR A. Y. 2008-09 , AND PHOTOSTAT COPY OF CONFIRMATION LETTER IN WHICH HE HAS ACCEPTED THAT HE HAS GIVEN AMOUNT OF RS. 1,60,800/- TO THE APPELLANT ON VARIOUS DATES AS PER LIST ATTACHED TO THE CONFIRMATION LETTER. SHRI BHISE ALSO CONFIRMED THAT THE SAID AMOUNT WAS RECEIVED BACK BY HIM FROM THE APPELLA NT ON VARIOUS DATES AS PER LIST ATTACHED TO THE SAID CONFIRMATION LET TER. (III) PHOTOSTAT COPY OF CONFIRMATION LETTER OF SHR I SATISH S. CHAVAN, PROP. OF SHRI SAI LUBRICATING AGENCY, IN WHICH HE H AS GIVEN HIS PAN NUMBER AND ALSO CONFIRMED THAT HE HAS GIVEN AMOUN T OF RS.73,000/- TO THE APPELLANT ON VARIOUS DATES AS PER L IST ATTACHED TO THE CONFIRMATION LETTER. SHRI CHAVAN ALSO CONFIRMED THAT THE SAID AMOUNT WAS RECEIVED BACK BY HIM FROM THE APPELLANT ON VARIO US DATES AS PER THE LIST ATTACHED TO THE CONFIRMATION LETTER. (IV) PHOTOSTAT COPY OF CONFIRMATION LETTER OF SHRI PARMANAND K. BANATWALA IN WHICH HE HAS CONFIRMED THAT HE HAS GIVEN AMOUNT OF RS.46,500/- TO THE APPELLANT ON VARIOUS DATES AS PER L IST ATTACHED TO THE CONFIRMATION LETTER. SHRI BANATWALA ALSO CONFIRM ED THAT THE SAID AMOUNT WAS RECEIVED BACK BY HIM FROM THE APPELLANT O N VARIOUS DATES 13 ITA NO.2004 TO 2006 & 2100/PN/2012 AS PER THE LIST ATTACHED TO THE CONFIRMATION LETTER. IN THE CONFIRMATION LETTER, IT IS STATED BY HIM THAT HE IS WORKING IN GANE SH GENERAL STORES AS A MANAGER ON MONTHLY SALARY OF RS.6,000/-. AS HIS YEAR LY INCOME WAS BELOW THE TAXABLE LIMIT, HE STATED THAT HE IS NOT FI LING INCOME TAX RETURNS. 18. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE A PPELLANT ALSO URNISHED XEROX COPIES OF THE RELEVANT PAGES OF THE IMP OUNDED DAILY BOOK SHOWING REPAYMENT ENTRIES OF ALL THE DEPOSITORS. CONSIDERING ALL THE ABOVE EVIDENCES, I FIND THAT THE APPELLANT HAS DI SCHARGED THE ONUS CASTED UPON HIM TO PROVE THE IDENTITY OF THE DEPOSIT OR, CREDITWORTHINESS OF THE DEPOSITORS AND GENUINENESS OF THE TRANSACTIONS. HOWEVER, CREDITWORTHINESS OF SHRI PARMANA ND K. BANATWALA IS SUSPICIOUS. HE CLAIMS TO HAVE INCOME OF RS. 72,000/- PER ANNUM FOR WHICH PROOF HAS NOT BEEN FURNISHED. OUT OF THIS ALLEGED INCOME OF RS.72,000/- HE CLAIMS TO HAVE BEEN GIVEN RS. 46,500/- TO THE APPELLANT. THE APPELLANT HAS NOT INDICATED ANYTHING ABOUT THE SIZE OF FAMILY, PERSONAL WITHDRAWALS, OTHER EXPENSES ETC. OF SHRI BANATWALA. HENCE, THE EXPLANATION IS NOT ACCEPTED AND I HOLD TH AT THE CASH CREDIT PURPORTEDLY GIVEN BY SHRI BANATWALA AMOUNTING TO RS. 46,600/- REMAINS UNEXPLAINED. FURTHER, THE APPELLANT CAN BE MADE TO EXPLAIN THE SOURCE OF THE CREDITS IN THE BOOKS OF ACCOUNTS, BUT NOT THE 'SOURCE OF THE SOURCE' I.E. THE SOURCE OF THE CREDITOR. FURTHER , THE APPELLANT HAS SHOWN THAT HIS SON SHRI GOURAV SHAH HAD TAKEN AN AMOUN T OF RS. 4,500/- ON 16/06/2007, WHICH WAS RETURNED BACK BY HI M ON 22/06/2007. BOTH THESE ENTRIES ARE APPEARING IN THE I MPOUNDED DAILY BOOK. THIS ENTRY OF 22/06/2007 WAS ALSO TAKEN IN TO CO NSIDERATION BY THE A.O. VIDE SR. NO. 82 OF THE LIST UNDER THE NARRA TION 'GAURAV USAN PARAT'. THUS, THIS CREDIT ENTRY ALSO STANDS EXPLAINED SAT ISFACTORY BY THE APPELLANT. OUT OF TOTAL CASH CREDIT ENTRIES AMOUNTING TO RS.3,93,900/-, THE A. O. HAS ALREADY GIVEN CREDIT FOR RS.50,000/- IN RESPECT OF CREDIT ENTRY OF SHRI ANIL V. BHISE. OUT OF THE BALANCE AMOU NT OF RS. 3,43,900/- (RS. 3,93,900/- MINUS RS. 50,000/-). I HAVE ALREADY H ELD ABOVE THAT THE CREDITWORTHINESS OF SHRI BANATWALA IS SUSPICIOUS AND THIS CASH CREDIT REMAINED UNEXPLAINED. THEREFORE, I HOLD THAT THE B ALANCE AMOUNT OF RS.2,97,400/- (RS.3,43,900/- LESS RS.46,500/- ) STANDS EXP LAINED SATISFACTORILY BY THE APPELLANT. THE AO IS DIRECTED T O GIVE RELIEF OF RS.2,97,400/- ON THIS COUNT. IN THE RESULT, THE GROUN D NO.2 AND 3 IS PARTLY ALLOWED TO THE EXTENT OF RS.2,97,400/-ONLY. 26. SO FAR AS THE BALANCE AMOUNT OF RS.15,18,915/- (I.E. RS.18,62,815/- - RS.3,43,900) IS CONCERNED IT WAS ARGUED THA T AN AMOUNT OF RS.5,81,605/- PERTAINS TO RECOVERY OF CREDIT SALE S AND AN AMOUNT OF RS.9,37,310/- PERTAINS TO CUMULATIVE FIGURE OF CASH BALANCE. THE ASSESSEE ALSO SUBMITTED THAT THE FIGURES T AKEN BY THE AO FROM THE DAILY CASH BOOK IMPOUNDED CONSIST OF CASH IN HAND/DAILY CASH BALANCE WHICH THE ASSESSEE USED TO CA RRY TO HIM AT THE CLOSE OF BUSINESS HOURS IN THE EVENING EVERY DAY AND USED TO 14 ITA NO.2004 TO 2006 & 2100/PN/2012 BRING THAT CASH TO THE BUSINESS PREMISES ON THE NEXT D AY MORNING. THE NOTING OF THIS MOVEMENT OF CASH IS APPEARING IN THE C ASH BOOK AS CASH JAMA. HOWEVER, THE AO TOOK ALL THESE ENTRIES ALS O IN THE ACCOUNT FOR ARRIVING AT THE FIGURE OF RS.23,17,815/-. THE AS SESSEE FURNISHED THE COPIES OF PAGES OF IMPOUNDED DAILY BOOK SHO WING 10 EXAMPLES ACCORDING TO WHICH THE AO HAS INCORRECTLY TAKE N THE CASH BALANCE IN THE FIGURE OF RS.23,17,815/- AS UNEXPLAINED CASH C REDIT. RECONCILING HIS CASH POSITION, THE ASSESSEE SUBMITTED THAT THE UNEXPLAINED CASH CREDIT COMES TO ONLY RS.5,81,605/- WHICH IS AS UNDER : UNEXPLAINED CASH CREDIT AS PER AO : RS.18,62,815 LESS DEPOSITS : RS.3,43,900 LESS CUMULATIVE FIGURE OF CASH BALANCE : RS.9,37,310 UNEXPLAINED CREDIT : 5,81,605 27. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE THE LD.CIT(A) ALLOWED RELIEF OF RS.9,37,310/- BY OBSERVING AS UNDER : 20. I HAVE GONE THROUGH THE XEROX COPIES OF DAILY B OOK IMPOUNDED DURING THE COURSE OF SURVEY. THIS BOOK CONTAINS ENTRIE S OF EACH AND EVERY TRANSACTION MADE IN CASH, WHETHER IN THE NATURE OF EXPENSES OR IN THE NATURE OF RECEIPT. HOWEVER, THERE IS ONE STRIK ING FEATURE IN THE SAID DAY BOOK. IT IS SEEN THAT THE CLOSING CASH BALANCE OF A DAY IS NOT REFLECTED AS THE OPENING CASH BALANCE OF THE NEXT DAY . THE APPELLANT HAS POINTED OUT THAT ENTIRE AMOUNT OF CLOSING BALANCE IS NOT IMMEDIATELY TAKEN AS AN OPENING CASH BALANCE ON THE N EXT DAY, BUT A CERTAIN AMOUNT IS TAKEN WHICH IS SUFFICIENT FOR BUSINE SS REQUIREMENT OF THE NEXT DAY. IF ANY EXTRA AMOUNT IS REQUIRED IN A D AY, THEN THE SAME IS MADE GOOD FROM THE CASH BALANCE I.E. DIFFERENCE BETW EEN THE CLOSING CASH BALANCE OF THE PREVIOUS DAY AND THE OPENING CASH BALANCE OF THE SUBSEQUENT DAY, AND RECORDED AS CASH JAMA IN THE DAY BO OK. ACCORDINGLY, THE TOTAL OF SUCH CASH BALANCE WAS SHOWN T O BE OF RS.9,37,310/-. I HAVE GONE THROUGH THE DAY BOOK AND I FIND THAT IT RECORDS MINOR AND PERSONAL EXPENSES ALSO LIKE THOSE SPENT ON TV BOX, TEA, COFFEE, CIGARETTE, CHAPATTI ETC. THUS, ALL EXPE NSES EVEN OF PERSONAL NATURE HAVE BEEN RECORDED IN THE DAY BOOK. IT APPEA RS, THEREFORE, THAT THE APPELLANT IS FOLLOWING A METHOD WHEREBY CERTAIN AMOUNTS ARE KEPT AS RESERVES INSTEAD OF BEING SHOWN AS OPENING BALANCE OF THE DAY. IF WE TAKE IN TO ACCOUNT THE VARIATION IN CLOSING AND OPEN ING BALANCES AND COMPARE IT WITH THE CASH INTRODUCED IN A DAY, THEN A MOUNT OF RS.9,37,310/- STANDS EXPLAINED. THEREFORE, IN RESPECT O F ENTRIES OF 'CASH JAMA', I FIND THAT THE ABOVE ARGUMENT OF THE APPELLANT IS CONVINCING FOR THE REASON THAT THERE EXISTS A POSSIBILI TY THAT THE CASH IN 15 ITA NO.2004 TO 2006 & 2100/PN/2012 HAND OF REGULAR BUSINESS WAS ALSO ENTERED IN THE IMPOUND ED DAILY BOOK WHEN TAKEN HOME OR AWAY FROM THE BUSINESS PREMISES. IT IS NOT NECESSARY THAT CORRESPONDING ENTRIES SHOULD BE MADE IN R EGULAR BOOKS OF ACCOUNTS SHOWING THE WITHDRAWALS. HENCE, THE CONTEN TION OF THE APPELLANT THAT 'ENTRIES OF 'CASH JAMA' WERE TAKEN IN TO ACCOUNT BY THE A.0. FOR ARRIVING AT FIGURE OF RS.23,17,815/ IS FOUND TO BE TENABLE AND THE EXPLANATION IS ACCEPTED. AT THE SAME TIME, THE A PPELLANT HAS FAILED TO SHOW THE CORRESPONDING SALE BILLS AGAINST WHICH RECOV ERY OF CREDIT SALES CAN BE PROVED. SINCE NO CREDIBLE EVIDENCE WAS BR OUGHT ON RECORD BY THE APPELLANT, THE APPELLANT'S CLAIM THAT THE AMO UNT OF RS. 5,81,605/ - IS OF SALES RECOVERY IS NOT ACCEPTABLE AND HENCE REJE CTED. IN THE RESULT, THE GROUND OF APPEAL NO. 4 IS ALLOWED TO THE EXTENT OF RS. 9,37,310/. 28. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE REVENUE IS IN APPEAL BEFORE US. 29. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDERS OF THE AO AND LD.CIT(A) AND TH E PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDE RED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE AO IN THE ASSESSMENT ORDER MADE ADDITION OF RS.18,62,815/- BEING UNEXPLAINED CASH CREDIT U/S.68 OF THE I.T. ACT. THE ADDIT ION WAS MADE ON THE BASIS OF CERTAIN ENTRIES FOUND IN THE IMPOUNDED DIARIES WHICH ACCORDING TO THE AO THE ASSESSEE COULD NOT EXPLAIN . WE FIND THE ASSESSEE BEFORE THE CIT(A) GAVE THE DETAILS OF LOAN OB TAINED FROM 4 PERSONS AMOUNTING TO RS.3,89,400/- AND ANOTHER RS.4,5 00/- BEING RETURN BY THE SON OF THE ASSESSEE WHICH HE HAS T AKEN EARLIER. THUS, IT WAS SUBMITTED THAT OUT OF THE TOTAL SOURCE OF RS.3,93,900/- THE AO ACCEPTED ONLY RS.50,000/- BEING LOAN OBTAINED FROM SHRI ANIL V. BHISE AS AGAINST RS.1,60,800/- TAKEN FROM HIM AND MAD E ADDITION OF RS.3,43,900/-. WE FIND THE LD.CIT(A) AFTER CONSIDER ING THE CAPACITY OF THE PERSONS FROM WHOM THE ASSESSEE HAS TAKEN THE LOANS AND WHOSE CONFIRMATION WERE FILED BEFORE THE AO GIVEN RELIEF OF RS.2,97,400/-. THE REASONS WHILE GIVING SUCH RELIEF HAS ALREA DY BEEN GIVEN IN THE PRECEDING PARAGRAPHS. THE LD. DEPARTM ENTAL 16 ITA NO.2004 TO 2006 & 2100/PN/2012 REPRESENTATIVE COULD NOT CONTROVERT THE FACTUAL FINDINGS G IVEN BY THE LD.CIT(A). SINCE THE LD.CIT(A) HAS DELETED ONLY RS.2,97,40 0/- OUT OF RS.3,43,900/-MADE BY THE AO GIVING COGENT REASONS FOR THE DELETION AND SINCE THE LD. DEPARTMENTAL REPRESENTATIVE CO ULD NOT CONTROVERT THE FACTUAL FINDINGS AND COGENT REASONS GIVEN BY THE LD.CIT(A), THEREFORE, IN ABSENCE OF ANY CONTRARY MATERIAL BRO UGHT TO OUR NOTICE, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A) DELETING AN AMOUNT OF RS.2,97,400/- OUT OF RS.3,43,900/- ADDED BY THE AO. ACCORDINGLY, THE SAME IS UPHELD. 30. SO FAR AS THE REMAINING AMOUNT IS CONCERNED IT WAS TH E GRIEVANCE OF THE ASSESSEE THAT THE AMOUNT OF RS.15,18,915 /- CONSIST OF RS.5,81,605/- BEING RECOVERY OF CREDIT SALES AND AMOUNT OF RS.9,37,310/- PERTAINS TO CUMULATIVE FIGURE OF CASH BALANC E. THE ASSESSEE HAD POINTED OUT SHOWING EXAMPLES WHERE THE AO HAS INCORRECTLY TAKEN THE CASH BALANCE IN THE FIGURE OF RS.23,1 7,815/- WHILE COMPUTING THE UNEXPLAINED CASH CREDIT. THE LD.CIT(A) A FTER GOING THROUGH THE DETAILS FURNISHED BY THE ASSESSEE, VIS-A -VIA THE XEROX COPIES OF THE IMPOUNDED CASH BOOK HAD GIVEN A FIND ING THAT THE CASH IN HAND OF THE REGULAR BUSINESS WAS ALSO ENTER ED IN THE IMPOUNDED DAILY BOOK WHEN TAKEN HOME OR AWAY FROM THE BUSINESS PREMISES AND SUCH AMOUNT COMES TO RS.9,37,310/-. HE HAS HELD THE CONTENTION OF THE ASSESSEE THAT THE ENTRIES OF CASH JAMA WERE TAKEN INTO ACCOUNT BY THE AO FOR ARRIVING AT THE FIGURE O F RS.23,17,815/- AS ACCEPTABLE. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT POINT OUT ANY MISTAKE IN THE FA CTUAL FINDING GIVEN BY THE CIT(A) ON THE BASIS OF THE ARGUMENTS A DVANCED BY THE ASSESSEE BEFORE HIM ALONG WITH SUBMISSION OF XEROX COPIES OF THE IMPOUNDED DAY BOOKS. SINCE THE ORDER OF THE CIT(A ) IS BASED 17 ITA NO.2004 TO 2006 & 2100/PN/2012 ON FACTUAL FINDING AND THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT CONTROVERT THE FINDING GIVEN BY THE CIT(A), THEREFORE IN ABSENCE OF ANY CONTRARY MATERIAL BROUGHT TO OUR NOTICE WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A) GIVING RELIEF OR RS.9,37,310/-. FURT HER, THE IMPOUNDED BOOKS ARE ALREADY BEFORE THE AO. THEREFOR E, IN OUR OPINION, THERE IS NO VIOLATION OF PROVISIONS OF RULE 46A IN ACCE PTING ANY EXPLANATION ON THE BASIS OF ENTRIES IN SUCH IMPOUNDED BOOKS. THE GROUNDS RAISED BY THE REVENUE ARE THEREFORE DISMISSED. 31. IN THE RESULT, ALL THE 3 APPEALS FILED BY THE ASSESSEE A RE PARTLY ALLOWED FOR STATISTICAL PURPOSES AND THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06-11-2015. SD/- SD/- ( VIKAS AWASTHY ) ( R.K. PANDA ) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE ; DATED : 06 TH NOVEMBER, 2015. ( )'+ , / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. THE CIT(A), KOLHAPUR & / THE CIT, KOLHAPUR 5. 6. ' **+, +, / DR, ITAT, A PUNE; / / GUARD FILE. / BY ORDER , // TRUE COPY // ' * //TRUE COPY// 12 * + / SR. PRIVATE SECRETARY +, / ITAT, PUNE