ITO, Bangalore V. Shri. G.T. Vishwanathan, Bangalore

ITA 3/BANG/2010

• Counselvise Citation: 321114 RSA 2010
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 11-05-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 04-01-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JACINTA ZIMIK VASHAI
• Assessee Lawyers: V SRINIVASAN
• Keywords: Additional evidence
• Section: 40A(3); 133A; 133(6); 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SMT. P. MADHAVI DEVI , JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO.3/BANG/2010 ASSESSMENT YEAR : 2004-05 THE INCOME TAX OFFICER, WARD 1(2), BANGALORE. : APPELLANT VS. SHRI G.T. VISHWANATHAN, NO.4, PARANJYOTHY ROAD, FRAZER TOWN, BANGALORE = 560005. PAN: ADMPV 1005B : RESPONDENT APPELLANT BY : SMT. JACINTA ZIMIK VASHAI, ADDL.CIT( DR) RESPONDENT BY : SHRI V. SRINIVASAN, C.A. DATE OF HEARING : 11.05.2011 DATE OF PRONOUNCEMENT : 26.08.2011 O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE IMPUGNED ORDER OF THE LD. CIT (A)-I, BANGALORE IN ITA NO.24/W 1(2) /A-I/06-07 DATED 13.10.2009 FOR THE ASSESSMENT YEAR 2004-05 IN THE C ASE OF SRI G. T. VISHWANATHAN OF BANGALORE . 2. THE REVENUE HAS RAISED NINE GROUNDS IN ITS GROU NDS OF APPEAL, OUT OF WHICH, GROUND NOS.1, 8 AND 9 BEING GENERAL AND NO SPECIFIC ISSUES INVOLVED, THEY HAVE NATURALLY BECOME INCONSE QUENTIAL. THE ITA NO.3/BANG/10 PAGE 2 OF 13 REMAINING GROUNDS, FOR THE SAKE OF CLARITY, THEY AR E REFORMULATED, IN A CONCISE MANNER, AS UNDER: (1) THE LD. CIT (A) HAD ERRED IN DELETING THE ADDITION OF RS.2.58 LAKHS BEING THE DIFFERENCE BETWEEN THE PAYMENTS ON ACCOUN T OF VEHICLE MAINTENANCE EXPENSES AND THE RECEIPTS SHOWN BY THE RECIPIENT; (2) THE CIT (A) WAS NOT JUSTIFIED IN RESTRICTING THE AD DITION MADE U/S 40A(3) WITHOUT CONSIDERING THE FACTS; (3) HE HAD FURTHER ERRED IN DELETING THE DISALLOWANCE O F RS.2.75 LAKHS BEING INTEREST AND BANK CHARGES; (4) THE CIT (A) ERRED IN DELETING THE ADDITION OF LOANS OF RS.14.12 LAKHS MADE U/S 69 OF THE ACT; & (5) HE HAD ERRED IN DELETING THE ADDITION OF RS.7.44 LA KHS ON ACCOUNT OF SUNDRY CREDITORS. 3. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE, AN INDIVIDUAL, BEING IN THE BUSINESS OF RUNNING VEHICLES ON HIRE, FURNIS HED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, CLAIMI NG A LOSS OF RS.66,490/- WHICH WAS INITIALLY PROCESSED U/S 143(1) OF THE ACT AND, SUBSEQUENTLY, TAKEN UP FOR SCRUTINY. AFTER VERIFYING THE DETAILS FURNISHED BY THE ASSESSEE AND FOR THE DETAILED REASONS RECORDED IN HIS IMPUGN ED ORDER, THE LD. AO MADE ADDITIONS TO THE TUNE OF RS.33.16 LAKHS UNDER VARIOUS HEADS, NAMELY, (I) VARIATION IN FUEL CHARGES, (II) DISALLOWANCE U/ S 40A(3), (III) LOANS U/S 69 OF THE ACT, (IV) INTEREST AND BANK CHARGES, (V) SUNDRY CREDITORS ETC., 4. AGGRIEVED, THE ASSESSEE TOOK UP THE ISSUES WITH THE LD. CIT (A) FOR RELIEF. AFTER CONSIDERATION OF THE ASSESSE ES SUBMISSIONS, PERUSAL OF REMAND REPORT AND COUNTER SUBMISSION OF ASSESSEE ON THE REMAND REPORT, THE LD. CIT (A) ALLOWED RELIEF TO THE ASSESSEE FOR THE REASONS RECORDED IN HIS FINDINGS WHICH ARE UNDER DISPUTE. ITA NO.3/BANG/10 PAGE 3 OF 13 5. AGITATED, THE REVENUE HAS COME UP WITH THE PRES ENT APPEAL. AFTER HEARING THE RIVAL PARTIES, PERUSAL OF THE REL EVANT RECORDS AND THE DOCUMENTARY EVIDENCES PRODUCED BY THE LD. A R DURIN G THE COURSE OF HEARING IN THE SHAPE OF A PAPER BOOK, WE VENTURE TO DEAL WITH THE ISSUES RAISED BY THE REVENUE UNDER VARIOUS HEADS AS UNDER: I. VARIATION IN FUEL CHARGES: (I) THE ASSESSEES PREMISE W AS SUBJECTED TO SURVEY U/S 133A 1) OF THE ACT. DURING THE COURSE OF SURVEY, IT WAS CLAIMED BY THE ASSESSEE THAT THE ENTIRE EXPENDITURE OF RS.46,02,03 6/- WAS CLAIMED AS VEHICLE MAINTENANCE PERTAINING TO THE PAYMENTS MADE TO M/S. EAST END SERVICE STATION, HOWEVER, ON VERIFICATION, THE RECI PIENTS ACCOUNT SHOWN THE RECEIPT OF ONLY RS.43,44,002/- IN THE F.Y. 2003-04 FROM THE ASSESSEE. THUS, THE AO ADDED THE DIFFERENCE OF RS.2,58,038/- TO THE ASSESSEES INCOME. (II) IT WAS CONTENDED BEFORE THE CIT (A) THAT THE AMOUNTS DEBITED UNDER THE HEAD FUEL CHARGES INCLUDED SUNDRY EXPENSES OF RS.2,58,038/- WHICH WERE INCURRED TOWARDS REPAIRS A ND MAINTENANCE OF AS MANY AS 14 VEHICLES OWNED BY THE ASSESSEE. IT WAS, FURTHER, EXPLAINED THAT THIS EXPENDITURE WAS EXPENDED FOR VARIOUS PURP OSES SUCH AS WHEEL ALIGNMENT, MINOR REPAIRS ETC., AS THESE EXPENSES WE RE UNAVOIDABLE IN THE LINE OF BUSINESS AND THE EXPENSE CLAIMED WAS BEING REASONABLE HAVING REGARD TO THE NATURE AND SIZE OF THE ASSESSEES BUS INESS. ITA NO.3/BANG/10 PAGE 4 OF 13 (III) CONSIDERING THE ASSES SEES EXPLANATION AS REASONABLE AND JUSTIFIABLE, THE CIT (A) HAD DELETED THE SAME. (IV) IT WAS CONTENDED BEFOR E THIS BENCH BY THE REVENUE THAT THE CIT (A) HAD, WITHOUT APPRECIATING THE FACTS STA TED IN THE RELEVANT ASSESSMENT ORDER AND ALSO WITHOUT ANY EVIDENCE HAVI NG FILED BY THE ASSESSEE IN SUPPORT OF THE DIFFERENCE WHICH HAS BEE N CLAIMED TO BE ON ACCOUNT OF EXPENSES FOR SUNDRY VEHICLE REPAIRS AND MAINTENANCE, ERRED IN DELETING THE ADDITION. (V) AT THE OUTSET, WE WOUL D LIKE TO RECALL THE FINDING OF THE EARLIER BENCH IN AN IDENTICAL ISSUE IN THE ASSESSEE S OWN CASE FOR THE AY 2005-06 IN ITA NO.1103/BANG/2009 DATED 27.7.2010 WH EREIN THE HONBLE BENCH HAD OBSERVED THUS 20. REGARDING DISALLOWANCE IN RESPECT OF VEHICLE MAINTENANCE, THE CIT (A) HAS RIGHTLY HELD THAT IT IS NOT POSSIBLE TO OBT AIN FORMAL VOUCHERS AND BILLS EVERY TIME THE ASSESSEE INCURS SUCH EXPENSES. IN THE NATURE OF VEHICLE REPAIR ACTIVITIES, WE FIND THAT THE VIEW OF THE CIT (A) CANNOT BE HELD AS PERVERSE. IT IS NOT POSSIBLE TO OBTAIN FORMAL BILL S AND VOUCHERS IN THE CASE OF REPAIR AND MAINTENANCE WORK. IN SUCH CIRCUMSTAN CES, THE CIT (A) HAS JUSTIFIED IN GIVING CERTAIN MODIFICATIONS.. (VI) IN CONFORMITY WITH THE F INDING OF THE EARLIER BENCH CITED ABOVE, WE ARE IN AGREEMENT WITH THE FINDING OF THE CIT (A) ON THIS SCORE. THIS ISSUE IS DECIDED AGAINST THE REVENUE. II. RESTRICTION OF THE DISALLOWANCE U/S 40A(3 ): (I) THE AO HAD INVOKED T HE PROVISIONS OF S. 40A(3) TO DISALLOW RS.2.35 LAKHS ON THE BASIS OF THE CONSOLID ATED SINGLE ENTRY PASSED ITA NO.3/BANG/10 PAGE 5 OF 13 FOR THE CLUSTER OF PAYMENTS MADE IN A SINGLE DAY IN RESPECT OF SEVERAL CASH MEMOS GIVEN BY THE SERVICE STATION. (II) AFTER PERUSING THE COPY OF THE CASH BOOK FURNISHED BY THE ASSESSEE TO SUPPORT HIS CLAIM, THE CIT (A) H AD RESTRICTED THE ADDITION TO RS.25,443/- I.E., 20% OF RS.1.27 LAKHS AND SUSTA INED (SIC) DELETED THE BALANCE ADDITION OF RS.2.10 LAKHS. (III) IT WAS ARGUED BEF ORE US BY THE LD. D.R THAT THE CIT (A) WAS NOT JUSTIFIED IN GIVING RELIEF OF RS.2.10 L AKHS BY RESTRICTING THE ADDITION TO ONLY RS.25,443/- WITHOUT CONSIDERING TH E STATEMENT RECORDED BY THE AO OF THE PROPRIETOR OF THE CONCERN TO WHICH SU CH PAYMENTS WERE MADE. (IV) WE HAVE DULY CONSID ERED THE REASONS RECORDED BY THE AO IN HIS IMPUGNED ORDER ON THE ISSUE. AT THIS JUN CTURE, IT IS MORE APPROPRIATE TO MENTION THE FINDING OF THE EARLIER B ENCH IN THE ASSESSEES CASE (SUPRA) THAT 25.IN FACT, THE CIT(A) HAS AGREED THAT THE C ASH PAYMENT IN EXCESS OF RS.20,000/- MADE TO A PERSON IN A PARTICU LAR DAY, EVEN IF MULTIPLE SMALL AMOUNTS WOULD BE COVERED BY SEC.40A(3). BUT, HE HAS RIGHTLY OBSERVED THAT THIS POSITION WAS BROUGHT IN BY THE A MENDMENT CARRIED THROUGH BY FINANCE ACT 2008 WHICH IS NEITHER RETROS PECTIVE NOR CLARIFICATORY. THEREFORE, THE EXTENDED POSITION WI LL NOT APPLY TO THE IMPUGNED ASSESSMENT YEAR 2005-06 (V) IN CONFORMITY WITH TH E FINDING OF THE EARLIER BENCH CITED ABOVE, WE ARE IN AGREEMENT WITH THE FINDING OF THE CIT (A) ON THIS SCORE. THIS ISSUE IS ALSO DECIDED AGAINST THE REVENUE. ITA NO.3/BANG/10 PAGE 6 OF 13 III. DELETION OF ADDITION ON ACCOUNT OF INTEREST AN D BANK CHARGES OF RS.2.75 LAKHS: (I) IN THE ABSENCE OF EV IDENCE IN RESPECT OF INTEREST PAYMENTS CLAIM AND ALSO COLLECTING SOME DETAILS FR OM KATARIA FINANCE & CANARA BANK, THE AO DISALLOWED RS.2.75 LAKHS. (II) IT WAS CONTENDED B Y THE ASSESSEE BEFORE THE CIT (A) THAT THE PERUSAL OF THE REMAND REPORT OF THE AO AND THE STATEMENT , THE STAND OF THE AO WAS NOT JUSTIFIED IN DISALLOWING RS .2.75 LAKHS FROM OUT OF THE INTEREST AND BANK CHARGES AS THE COMPUTERIZED S TATEMENT ENCLOSED THEREIN MAKE IT CLEAR THAT THE AO HAD NOT OBTAINED BANK STATEMENTS FROM ALL THE BANKS/FINANCIAL INSTITUTIONS FROM WHOM THE ASSE SSEE HAD SECURED CREDIT AND OTHER BANKING FACILITIES EXCEPT ONLY FROM CANAR A BANK AND KATARIA FINANCE. THUS, THE AO WAS NOT JUSTIFIED TO HOLD TH AT ONLY RS.63541/- WAS PAID BY THE ASSESSEE TOWARDS INTEREST AND BANK CHAR GES AGAINST THE ASSESSEES CLAIM AS PER THE AUDITED FINANCIAL STATE MENTS. (III) ACCORDING TO THE CI T (A), THE AO IN HIS REMAND REPORT ON THE ISSUE HAD CRYPTICALLY STATED AS THE SUBMISSION IS SAME AS IN RESPECT OF LOANS U/S 69. IN VIEW OF THE ABOVE, THE CIT (A) HAD JUSTIFIED IN DELETING THE ADDITION MADE BY THE AO. (IV) BEFORE US, IT WAS BR IEFLY SUBMITTED THAT THE CIT (A) ERRED IN DELETING THE ENTIRE ADDITION ON ACCOUNT OF DISALLOWANCE OF INTEREST AND BANK CHARGES OF RS.2,75,911/- IN THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO.3/BANG/10 PAGE 7 OF 13 THE AO IN HIS REMAND REPORT [SOURCE: P 1 3 15 OF PB AR] UNDER THE CAPTION LOAN U/S 69, HAD STATED THAT ON THIS GROUND ALSO THE ASSESSEE STATES THAT COPIES OF STATEMENTS OBTAINED HAS NOT BEEN GIVEN TO THE ASSESSEE. IN THIS REGARD, .IT IS SUBMITTED THAT TH E ASSESSEE WAS INFORMED THAT THERE WERE VARIATIONS IN THE QUANTUM OF LOANS CLAIM ED AND THE ACTUAL AMOUNT OUTSTANDING VIDE THIS OFFICE LETTER DT.16.10 .2006. AFTER THIS, DURING THE COURSE OF HEARING ON 30.11.2006, THE ASSESSEE N OTED DOWN VARIATIONS IN EACH CASE AND DURING THE COURSE OF HEARING ON 13.12 .2006, THE AUTHORIZED REPRESENTATIVE STATED THAT HE DID NOT HAVE SUBMISSI ON TO MAKE IN RESPECT OF EXPENSES CLAIMED AND LOAN OUTSTANDING ON A QUICK PERUSAL OF THE SAME, WE FIND THAT THERE WERE CONTRADICTIONS IN HIS STATE MENT, NAMELY, ON THE ONE HAND, HE AVERS THAT THE ASSESSEE WAS INFORMED THAT THERE WERE VARIATIONS IN THE QUANTUM OF LOANS. VIDE THIS OFFICE LETTER D ATED 16.10.2006 , BUT, AT THE SAME BREATH, HE STATES THAT ..DURING THE COURSE OF HEARING ON 30.L1.2006, THE ASSESSEE NOTED DOWN VARIATIONS IN E ACH CASE.. CONSIDERING THE ISSUE IN ITS TOTALITY, ONE COULD SAFELY ARRIVE AT A CONCLUSION THAT THE AO HAD NOT COLLECTED THE FULL INFORMATION WITH REGARD TO THE INTEREST AND BANK CHARGES CLAIMED BY THE ASS ESSEE FROM THE RECIPIENTS BANKS AND FINANCIAL INSTITUTIONS AND WHATEVER THE DETAILS ALLEGED TO HAVE BEEN COLLECTED, HAVE ALSO NOT PUT T HEM ACROSS BEFORE THE ASSESSEE TO VERIFY THE VERACITY OR OTHERWISE OF THE ASSESSEES CLAIM. IN SUCH A CIRCUMSTANCE LIKE THE PRESENT ONE, WE HAVE B EEN LEFT WITH NO OTHER ALTERNATIVE EXCEPT TO FALL IN LINE WITH THE FINDING OF THE CIT (A). IN ESSENCE, THIS ISSUE GOES IN FAVOUR OF THE ASSESSEE. ITA NO.3/BANG/10 PAGE 8 OF 13 IV. DELETION OF ADDITION ON LOANS OF RS.14.12 LA KHS : (I) THE ASSESSEE HAD SHOWN OUTSTANDING LOANS AGGREGATING TO RS.10.11 LAKHS IN HIS BALANCE SHEET. CONSEQUENT TO SURVEY OPERATION, THE AO GATHERED INFORMATION U/S 133(6) OF THE ACT F ROM OTHER FINANCIAL INSTITUTIONS AND NOTICED THAT THE FOLLOWINGS LOANS WERE NOT SHOWN EITHER IN THE ASSESSEES BOOKS OR IN THE BALANCE SHEET: (I) SHARACHI SECURITIES RS.360979 (II) K.S.F.C. RS.183 860 (III) SRI RAM FINANCE RS. 32020 (IV) ICICI VEHICLE LOAN RS.835762 RS.14126 21 FOR THE REASONS RECORDED IN HIS IMPUGNED ORDER, THE AO RESORTED TO ADD THIS SUM OF RS.14.12 LAKHS AS NON-EXISTENT LIABILIT Y. (II) IT WAS ADVOCATED BEFO RE THE APPELLATE AUTHORITY BY THE ASSESSEE THAT WHEN THE AO QUERIED FOR THE DETAILS DURING THE COURSE OF ASSESSMENT PROCEEDINGS WITH REGARD TO THE LOAN AMOU NTS OF RS.32.68 LAKHS AS APPEARED IN THE BALANCE SHEET, THE ASSESSEE COUL D FURNISH THE DETAIL TO THE EXTENT WHICH WAS AVAILABLE WITH HIM SINCE THE B OOKS WERE IMPOUNDED DURING THE SURVEY. (III) WHEN THE AO WAS CALL ED UPON BY THE CIT (A) TO FURNISH HIS COMMENT ON THE DETAILS FURNISHED DURING THE APP ELLATE PROCEEDINGS AS ADDITIONAL EVIDENCE BY THE ASSESSEE, THE AO HAD COM MENTED, IN ESSENCE, THAT THERE WERE VARIATIONS IN THE QUANTUM OF LOANS CLAIMED AND THE ACTUAL AMOUNT OUTSTANDING AND WHEN THIS WAS PUT BEFORE THE A.R WHO, ACCORDING TO THE AO, CONCEDED FOR COMPLETION OF THE ASSESSMEN T BASED ON EVIDENCES AVAILABLE AS HE DID NOT HAVE SUBMISSION TO MAKE IN RESPECT OF EXPENSES ITA NO.3/BANG/10 PAGE 9 OF 13 CLAIMED. FURTHER, HE HAD STATED THAT IN RESPECT OF M/S. SARACHI SECURITIES, THE ASSESSEE HAD SHOWN TWO LOANS AND THE TOTAL AMOU NT OUTSTANDING WAS RS.7.86 LAKHS, BUT, AS PER THE STATEMENT, THE BALAN CE OUTSTANDING WAS ONLY RS.3.55 LAKHS AND HENCE, THE DIFFERENCE OF RS.4.3 L AKHS WAS TO BE TAXED AS AGAINST RS.3.6 LAKHS ADDED IN THE ASSESSMENT ORDER. IN RESPECT OF ICICI BANK, THE AO SUBMITTED THAT THE ADDITION WAS BASED ON THE STATEMENT RECEIVED AND SO FAR AS KSFC CONCERNED, NO STATEMENT WAS RECEIVED. (IV) THE VERSION OF THE AO S REMAND REPORT WAS COUNTERED BY THE ASSESSEE IN HIS REJOINDER WHICH HAS BEEN ELA BORATELY DETAILED IN THE IMPUGNED ORDER OF THE CIT (A) UNDER CHALLENGE. (V) DUE CONSIDERATION OF RIVAL SUBMISSIONS, THE LD. CIT (A) OBSERVED THUS 8.3. THE SUM AND SUBSTANCE OF THE ARGUMENT THAT D URING THE COURSE OF SURVEY, ALL FILES RELATING TO LOANS FROM FINANCIAL INSTITUTIONS WERE IMPOUNDED WHICH HINDERED THE APPELLANT TO PROVIDE T HE DESIRED CORRECT INFORMATION AND, THEREFORE, THE SAME WERE FURNISHED LATER ON AT APPELLATE STAGE AND FOUND CORRECT BY THE AO. THUS, THE BASIS OF ADDITION IS NOT THE COLLECTION OF INFORMATION U/S 133(6) BUT THE BOOKS IMPOUNDED DURING THE COURSE OF SURVEY. THEREFORE, THERE WAS NO DISCREPA NCY BETWEEN THE BOOKS AND THE STATEMENTS RECEIVED FROM THE FINANCIAL INST ITUTION. THEREFORE, THERE IS NO SCOPE FOR ADDITION. 8.4. I FIND THE ABOVE ARGUMENT OF A.R REASONABLE. I FEEL THAT THE AO SHOULD HAVE CONFRONTED THE INFORMATION COLLECTED U/ S 133(6) OF THE I.T. ACT FROM THE FINANCIAL INSTITUTION BEFORE MAKING THE AD DITION TREATING THE SAME AS DISCREPANCY BETWEEN THE BOOKS IN ONE HAND AND TH E INFORMATION COLLECTED ON THE OTHER HAND. SINCE PRINCIPLES OF N ATURAL JUSTICE HAVE BEEN VIOLATED, I DO NOT HESITATE TO DELETE THE ADDITION .. (VI) BEFORE US, IT WAS SU BMITTED BY THE REVENUE THAT THE CIT (A), BEING AN AUTHORITY WHOSE POWERS ARE CO-TER MINUS WITH THAT OF THE AO, HAD ERRED IN DELETING THE ADDITION OF LOANS OF RS.14.12 LAKHS MADE U/S ITA NO.3/BANG/10 PAGE 10 OF 13 69 OF THE ACT ONLY ON THE GROUND THAT RELIANCE PLAC ED BY THE AO ON INFORMATION GATHERED U/S 133(6) WAS NOT CONFRONTED TO THE ASSESSEE AND WITHOUT APPRECIATING THE FACTS AND CIRCUMSTANCES UN DER WHICH THE ADDITION WAS MADE ETC. . THIS WAS FORCEFULLY COUNTERE D BY THE LD. A R THAT ALL THE RELEVANT PARTICULARS HAVE BEEN PLACED BEFORE THE CI T(A) WHO AFTER DUE DELIBERATION ONLY DELETED THE ADDITION JUDICIOUSLY AND, THEREFORE, IT WAS PLEADED THAT NO INTERVENTION BY THIS BENCH WAS CALL ED FOR AT THIS JUNCTURE. (VII) WE HAVE DULY EXAMIN ED THE RIVAL SUBMISSIONS, PERUSED THE RELEVANT RECORDS AND ALSO THE REASONING OF THE LD. CIT (A) IN DELETING THE ADDITION MADE BY THE AO. BASICALLY, THE AO HAD RESORTED TO MAKE THE ADDITION ON THE BASIS OF THE INFORMATION COLLECTED FOR U/S 133(6) OF THE ACT AND ALSO IN THE ABSENCE OF DETAILS FURNISHED BY THE ASSESSEE . ON THE OTHER HAND, THE ASSESSEE CONTENDED, DURING THE APPELLATE STAGE, THAT HE WAS PREVENTED BY FURNISHING MORE DETAILS ON THE ISSUE S INCE HIS BOOKS OF ACCOUNT WERE IMPOUNDED BY THE REVENUE. HOWEVER, HE HAD FURNISHED CERTAIN DETAILS ON THE BASIS OF WHICH, HE PLEADED W ITH THE CIT (A) TO DELETE THE ADDITION SO MADE. THE LD. CIT (A) HA D, ON HIS PART, OBSERVED THAT [ AT THE COST OF REPETITION ] 8.3. THE SUM AND SUBSTANCE OF THE ARGUMENT THAT DU RING THE COURSE OF SURVEY, ALL FILES RELATING TO LOANS F ROM FINANCIAL INSTITUTIONS WERE IMPOUNDED WHICH HINDERED THE APPELLANT TO PROV IDE THE DESIRED ITA NO.3/BANG/10 PAGE 11 OF 13 CORRECT INFORMATION AND, THEREFORE, THE SAME WERE F URNISHED LATER ON AT APPELLATE STAGE AND FOUND CORRECT BY THE AO HOWEVER, THE AO IN HIS REMAND REPORT HAD AFFIRMED THAT (ON PAGE 2 UND ER THE CAPTION LOAN U/S 69 THAT . HENCE, THE DIFFERENCE OF RS.4,30,945/- IS TO BE BROUGHT TO TAX AS AGAINST AMOUNT ADDED IN ASSESSMEN T ORDER OF RS.3,60,979/-. THIS AFFIRMATION OF THE AO IS QUITE DISPARITY TO THE CIT(A)S OBSERVATION REFERRED ABOVE. AS A MATTER O F FACT, THE CIT (A) HAD NOT EXAMINED THE VERACITY OF THE ASSESSEES CLAIM V ICE VERSA THE AOS STAND ON THE ISSUE. MOREOVER, THE REVENUE HAD FAIR LY CONCEDED THAT THE AO HAD NOT CONFRONTED THE ASSESSEE WITH THE INFORMA TION GATHERED U/S 133(6) OF THE ACT BEFORE MAKING THE ADDITION. IN VIEW OF THE ABOV E FACTS AND ALSO IN CONFORMITY WITH THE INTERESTS OF NATURAL FAIRNESS THIS ISSUE IS REM ITTED BACK ON THE FILE OF THE AO WITH A SPECIFIC DIRECTION TO EXAMINE THE DETAILS , ACCORDING TO THE ASSESSEE, IN HIS POSSESSION WITH REFERENCE TO THE I NFORMATION COLLECTED U/S 133(6) OF THE ACT AND TO TAKE APPROPRIATE ACTION IN ACCORDING WITH THE PROVISIONS OF THE ACT. IT IS ORDERED ACCORDINGLY. V. DELETION OF ADDITION ON ACCOUNT OF SUNDRY CREDIT ORS OF RS.7.44 LAK HS: (I) THE AO HAD AD DED A SUM OF RS.7.44 LAKHS ON THE GROUND THAT SRI BALAJI (RS.3.15 LAKHS) AND SMT. NIR MALA (RS.3.92 LAKHS) HAVE NEITHER MAINTAINED ANY BOOKS OF ACCOUNTS NOR A SSESSED TO TAX. ITA NO.3/BANG/10 PAGE 12 OF 13 (II) THIS ASSERTION OF THE AO WAS CHALLENGED BY THE ASSESSEE BEFORE THE CIT (A) THAT THE ABOVE NAMED PE RSONS HAVE DULY FURNISHED THEIR RETURNS OF INCOME FOR THE AY 2004-0 5 WHEREIN THEY HAVE CLEARLY REFLECTED THE SUMS OF RS.3.15 LAKHS AND RS. 3.92 LAKHS RESPECTIVELY WHICH WERE DUE FROM M/S.AISHWARYA TRAVELS AND, THER EFORE, PRAYED THAT THE ADDITION MADE ON THIS COUNT REQUIRES TO BE DELETED. ON THE BASIS OF THE ASSESSEES STATEMENT, THE CIT (A) DELETED THE ADDIT ION. (III) HOWEVER, IT WAS ARGUED BY THE REVENUE THAT THE CIT (A) HAD DELETED THE IMPUGNED ADDITION MERELY BECAUS E THE ALLEGED CREDITORS HAVE FILED THEIR RETURNS OF INCOME WHEREI N THE SUMS HAVE BEEN REFLECTED , BUT, WITHOUT TAKING INTO ACCOUNT THE RE LEVANT FACTS RELATING TO THE DATE OF FILING OF THEIR RETURNS AND ALSO THE ASSESS EE HAD FAILED TO FURNISH ANY EVIDENCE BEFORE THE AO IN SUPPORT OF THE CREDITS ET C. THE LD. A R PRESENT WAS ALSO HEAR D ON THE ISSUE. (IV) WE HAVE CAREFULL Y CONSIDERED THE RIVAL SUBMISSIONS AND ALSO DILIGENTLY PERUSED THE DOCUMENTARY EVIDENC E PRODUCED BY THE LD. A R IN THE PAPER BOOK WHEREIN IT WAS NOTICED THAT T HE ABOVE NAMED SUNDRY CREDITORS HAVE FURNISHED THEIR RETURNS OF INCOME ON LY ON 29.4.2008 FOR THE AY 2004-05 WHEREIN, OF COURSE, THEY HAVE REFLECTED THE AMOUNTS AS DUE FROM M/S. AISHWARYA TRAVELS [REFERENCE: P 58 69 P B AR]. IN VIEW OF THE SAME, WE HEREBY CONFIRM THE ORDER OF THE LD. CIT(A) ON THIS COUNT. ITA NO.3/BANG/10 PAGE 13 OF 13 6. IN THE RESULT , THE REVENUES APPEAL IS PARTLY ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 26 TH DAY OF AUGUST, 2011. SD/- SD/- ( SMT. P. MADHAVI DEVI ) (A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 26 TH AUGUST, 2011. DS/- COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE (1+1) BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE.