Smt. Suman Gupta, Prop. M/s Roop Ram Khyali Ram Enterprises, Aligarh V. ITO, Aligarh

ITA 454/AGR/2009

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 56918 (ITAT-AGRA)
• Duration Of Justice: 2 year(s) 3 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 13-03-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 25-11-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A K SHARMA
• Assessee Lawyers: RAJENDRA PRASAD
• Keywords: Unexplained cash credit; Income from undisclosed sources; Accommodation entries; Onus to prove
• Section: 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER & SHRI A. L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 454/AGRA/2009 ASST. YEAR : 2007-08 SMT. SUMAN GUPTA, VS. INCOME-TAX OFFICER, PROP. M/S. ROOP RAM KHYALI RAM ENTERPRISES, WARD 1 , ALIGARH. DEVENDRA MARKET, RAMGHAT ROAD, ALIGARH. (PAN : ADRPG 1422 A) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAJENDRA PRASAD, ADVOCATE RESPONDENT BY : SHRI A.K. SHARMA, JR. D.R. DATE OF HEARING : 13.03.2012 DATE OF PRONOUNCEMENT : 16.03.2012 ORDER PER BHAVNESH SAINI, J.M. : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A), GHAZIABAD DATED 24.09.2009 FOR THE ASSESSMENT YEAR 2005-06. 2. THE ASSESSEE RAISED SEVERAL GROUNDS OF APPEAL. T HE ASSESSEE HAS ALSO FILED CONCISE GROUNDS OF APPEAL IN WHICH HE HAS CHALLENGE D THE ADDITION OF RS.13,00,000/- ON ACCOUNT OF UNEXPLAINED CASH CREDI TS/LOANS U/S. 68 OF THE IT ACT AND DISALLOWANCE OF 20% EXPENDITURE OUT OF CONVEYAN CE AND MOBILE PHONE EXPENSES. ITA NO. 454/AGRA/2009 2 3. WE HAVE HEARD THE LD. REPRESENTATIVES OF BOTH TH E PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIES BELOW AND CONSIDERED TH E MATERIAL AVAILABLE ON RECORD. 4. ON ISSUE NO. 1, I.E., UNEXPLAINED CASH CREDITS O F RS.13,00,000/-, FROM THE COPIES OF BANK ACCOUNT OF THE LENDERS, THE AO NOTIC ED THAT IN THE CASE OF FOLLOWING LENDERS, THERE WERE CASH DEPOSITS OF IDENTICAL AMOU NTS (I.E. EQUIVALENT TO THE AMOUNTS STATED TO HAVE BEEN GIVEN TO THE ASSESSEE A S LOAN) JUST BEFORE ADVANCING THE AMOUNTS TO THE ASSESSEE : (I). SHRI ABHAY MAHESHWARI RS.2,00,000/- (II). SHRI AMIT MAHESHWARI RS.2,00,000/- (III). SMT. KIRTI MAHESHWARI RS.1,50,000/- (IV). SMT. MITHILESH MAHESHWARI RS.2,50,000/- (V). SHRI RAM PAL SINGH RS.2,50,000/- (VI). SHRI SHARIQ ALI KHAN RS.2,50,000/- ------------------- RS.13,00,000/- ------------------- 4.1 SINCE THE SOURCES OF THE ABOVE DEPOSITS IN THE BANK ACCOUNTS OF THE LENDERS WERE NOT KNOWN AND SUCH CASH DEPOSITS WERE MADE JUS T BEFORE ADVANCING THE AMOUNT TO THE ASSESSEE AND HENCE, TO VERIFY THE GEN UINENESS OF SAID TRANSACTIONS, THE AO REQUIRED THE ASSESSEE TO PRODUCE ALL THE ABO VE SIX PERSONS FOR EXAMINATION BEFORE HIM. DESPITE PROVIDING OPPORTUNITY TO THE AS SESSEE, THE ASSESSEE PRODUCED ONLY ONE PERSON, NAMELY, SHRI ABHAY MAHESHWARI FOR EXAMINATION AND REMAINING FIVE PERSONS WERE NOT PRODUCED BEFORE THE AO FOR EX AMINATION. ON EXAMINATION OF ITA NO. 454/AGRA/2009 3 SHRI ABHAY MAHESHWARI AND ALSO FROM THE DETAILS FUR NISHED IN RESPECT OF THIS PERSON, THE AO NOTED THAT SHRI ABHAY MAHESHWARI HAS NO CREDITWORTHINESS TO GIVE UNSECURED LOAN OF RS.2,00,000/-. IN THE CASE OF REM AINING FIVE LENDERS, WHO WERE NOT PRODUCED BEFORE THE AO FOR EXAMINATION, FROM TH E DETAILS FURNISHED BY THE ASSESSEE IN RESPECT OF THESE LENDERS, THE AO HAS OB SERVED THAT THEY HAVE ALSO NO CREDITWORTHINESS TO ADVANCE SUCH BIG SUMS AS UNSECU RED LOAN TO THE ASSESSEE AND HENCE, GENUINENESS OF THESE TRANSACTIONS HAS NOT BE EN ESTABLISHED. THE AO, ACCORDINGLY, MADE THE ADDITION U/S. 68 OF THE IT AC T AND ALSO RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SU MATI DAYAL VS. CIT, 214 ITR 801 (SC). 5. THE ASSESSEE CHALLENGED THE ADDITION BEFORE THE LD. CIT(A) AND IT WAS SUBMITTED THAT THE ASSESSEE HAD FURNISHED CONFIRMAT ORY LETTERS REGARDING NEW LOANS TAKEN AND FILED COPIES OF BANK PASSBOOKS OF THE LEN DERS AND ALSO PROVED THAT TRANSACTIONS WERE ENTERED INTO THROUGH ACCOUNT PAYE E CHEQUES ONLY. THEREFORE, INITIAL BURDEN UPON THE ASSESSEE TO PROVE THE IDENT ITY & CREDITWORTHINESS OF CREDITORS AND GENUINENESS OF THE TRANSACTION HAS BE EN DISCHARGED. THE ASSESSEE FURTHER EXPLAINED THAT ALL THE AMOUNTS HAVE BEEN RE CEIVED THROUGH ACCOUNT PAYEE CHEQUES AND ALL THE CREDITORS ARE ASSESSED TO TAX. IN ADDITION TO THAT, COPIES OF THEIR FILING OF RETURNS OF INCOME, BALANCE SHEETS, CASH F LOW STATEMENTS AND EXTRACT OF CASH ITA NO. 454/AGRA/2009 4 BOOKS HAVE BEEN FURNISHED TO PROVE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS. AFFIDAVITS OF THE CREDITORS WERE ALSO FILED, IN WHICH THEY HAVE CONFIRMED GIVING OF LOAN TO THE ASS ESSEE. IT WAS ALSO EXPLAINED THAT SOME OF THE CREDITORS COULD NOT BE PRODUCED BE CAUSE THEY HAVE SHOWN THEIR INABILITY TO APPEAR BEFORE THE AO BECAUSE EITHER TH EIR CLOSE RELATIONS WERE ILL OR THE CREDITORS WERE SUFFERING FROM CHRONIC DISEASE. IT W AS, THEREFORE, SUBMITTED THAT THE ASSESSEE HAS DISCHARGED THE INITIAL ONUS TO PROVE G ENUINE CREDIT IN THE MATTER. THE COUNSEL FOR THE ASSESSEE ALSO RELIED UPON SEVERAL D ECISIONS IN SUPPORT OF THE CONTENTIONS. THE SUBMISSIONS OF THE ASSESSEE REGARD ING EACH CREDITOR ARE REPRODUCED IN THE IMPUGNED ORDER. THE SUBMISSIONS O F THE ASSESSEE WERE FORWARDED TO THE AO FOR FILING THE REMAND REPORT, I N WHICH THE AO, MORE OR LESS REPEATED THE SAME FINDINGS AND FURTHER SUBMITTED TH AT SO CALLED BALANCE SHEETS, CASH BOOKS AND CASH FLOW STATEMENTS HAVE NO EVIDENTIARY VALUE, AS THOSE PAPERS HAD NOT BEEN FILED WITH THE RETURN OF INCOME. IT WAS ALSO E XPLAINED THAT THE CREDITORS ARE NOT PERSONS OF MEANS. THEREFORE, THE ASSESSEE FAILED TO PROVE THEIR CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION IN THE MATTER. THE L D. CIT(A) CONSIDERING THE EXPLANATION OF THE ASSESSEE IN THE LIGHT OF FINDING S OF THE AO, MATERIAL ON RECORD AND THE REMAND REPORT OF THE AO, CONFIRMED THE ADDI TION AND DISMISSED THIS GROUND OF APPEAL OF THE ASSESSEE. THE FINDINGS OF THE LD. CIT(A) IN PARA 8 AND 9 OF THE APPELLATE ORDER ARE REPRODUCED AS UNDER : ITA NO. 454/AGRA/2009 5 8. THE NEXT ISSUE PERTAINS TO THE ADDITION OF RS.1 4,00,000/- MADE U/S. 68 OF I.T. ACT BEING UNEXPLAINED CREDIT A PPEARING IN THE NAME OF 6 PERSONS. 8.2 THE LEARNED AR HAS FIRST CONTENDED THAT THE AO HAS WRONGLY TAKEN THE TOTAL OF THESE CREDITS AT RS.14,0 0,000/- INSTEAD OF RS.13,00,000/-. IT HAS BEEN FURTHER SUBMITTED THAT THE LEARNED AR HAS ALSO ERRED IN TAKING THE TOTAL FIGURE OF CREDITS AP PEARING IN THE NAME OF SMT. KEERTI MAHESHWARI AND SMT. MITHILESH MAHESH WARI AT RS.4,50,000/- INSTEAD OF RS.4,00,000/-. IT WAS THUS PLEADED THAT THE CORRECT FIGURES SHOULD BE TAKEN. 8.3 I HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNE D AR WITH REFERENCE TO THE MATERIAL AVAILABLE ON RECORD. AT P AGE 2 OF THE ASSESSMENT ORDER, THE AO HAS REPRODUCED THE LOANS A PPEARING IN THE NAME OF ABOVE 6 PERSONS AS FOLLOWS : (I). SHRI ABHAY MAHESHWARI RS.2,00,000/- (II). SHRI AMIT MAHESHWARI RS.2,00,000/- (III). SMT. KEERTI MAHESHWARI RS.1,50,000/- (IV). SMT. MITHILESH MAHESHWARI RS.2,50,000/- (V). SHRI RAM PAL SINGH RS.2,50,000/- (VI). SHRI SHARIQ ALI KHAN RS.2,50,000/- ------------------- RS.14,00,000/- ------------------- FROM THE ABOVE IT CLEARLY SHOWS THAT THE TOTAL OF C REDITS APPEARING IN THE NAMES OF ABOVE 6 PERSONS COMES TO RS.13,00,000/ - ONLY WHILE THE AO HAS WRONGLY MENTIONED THE TOTAL AT RS.14,00,000/ -. THE AO IS ACCORDINGLY TAKE THE CORRECT TOTAL AT RS.13,00,000/ - INSTEAD OF RS.14,00,000/-. AS REGARDS THE DISCREPANCY IN MENTIONING THE FIGUR ES OF CREDITS APPEARING IN THE NAME OF (1) SMT. KEERTI MAHESHWARI (2) SMT. MITHILESH MAHESHWARI, IT WAS SUBMITTED BY THE LEARN ED AR THAT THE TAX AUDITOR WHILE MENTIONING THE FIGURES OF CREDITS HAS WRONGLY MENTIONED THE AMOUNT CREDIT BY SMT. KEERTI MAHESHWA RI AGAINST THE NAME OF SMT. MITHILESH MAHESHWARI AND VICE VERSA AN D THIS WAS A TYPOGRAPHICAL MISTAKE BY THE AUDITOR. IT WAS FURTHE R SUBMITTED THAT THE ITA NO. 454/AGRA/2009 6 AO WHILE TAKING THESE FIGURES HAS FURTHER MADE AN E RROR BY TAKING THESE FIGURES AT RS.4,50,000/- INSTEAD OF RS.4,00,0 00/-. THE LEARNED AR HAS CLARIFIED THE POSITION AS UNDER: NAME OF THE LOAN AMOUNTS AS PER TAX AUDIT ADDITIO N LENDERS ACTUAL FIGURES REPORT(WRONGLY MADE BY THE MADE AS PER CONFIRMA- TYPED AO TORY LETTER/BANK PASS-BOOK FILED 1.SMT. KERTI MAHESHWARI RS.1,50,000/- 2,50,000/- 2,50,000/- 2.SMT. MITHILESH RS.2,50,000/- 1,50,000/- 2,00,00 0/- MAHESHWARI THE ABOVE FACTS CLEARLY INDICATES THAT AS PER THE C OPY OF CONFIRMATIONS AND BANK PASS BOOK OF THE LENDERS, THE CREDIT APPEA RING IN THE NAME OF LENDER, SMT. KEERTI MAHESHWARI IS RS.1,50,000/- AND SMT. MITHILESH MAHESHWARI RS.2,50,000/- WHILE IN THE AUDIT REPORT IT WAS MENTIONED AS RS.2,50,000/- IN THE NAME OF KEERTI MAHESHWARI A ND RS.1,50,000/- IN THE NAME OF MITHILESH MAHESHWARI TOTALING TO RS. 4,00,000/- WHILE THE AO HAS MADE THE ADDITION AT RS.4,50,000/- AS ME NTIONED IN THE ABOVE TABLE. SINCE THE ASSESSEE HAS CLARIFIED THE P OSITION THAT THE CREDIT APPEARING IN THE NAME OF KEERTI MAHESHWARI A ND MITHILESH MAHESHWARI WAS RS.1,50,000/- AND RS.2,50,000/-, RES PECTIVELY AND THE FIGURES MENTIONED BY THE AUDITORS IN THEIR AUDIT RE PORT WAS A TYPOGRAPHICAL MISTAKE, THE AO IS DIRECTED TO ADOPT THE FIGURES, AS CLAIMED BY THE ASSESSEE. IT IS ALSO SEEN THAT THE A O HAS TAKEN THE TOTAL OF CREDITS APPEARING IN THE NAME OF THESE TWO LENDE RS AT RS.4,50,000/- INSTEAD OF RS.4,00,000/-. THE AO IS ACCORDINGLY DIR ECTED TO TAKE THE CORRECT FIGURE AT RS.4,00,000/-. 9. THE NEXT ISSUE PERTAINS TO THE ACTION OF THE AO IN MAKING ADDITION U/S 68 APPEARING IN THE NAME OF ABOVE LEND ERS AS UNEXPLAINED CASH CREDIT. DURING APPELLATE PROCEEDIN GS, IT WAS SUBMITTED THAT IN THE CASE OF ABOVE SIX LENDERS, TH E ASSESSEE DULY FURNISHED BEFORE THE AO THEIR CONFIRMATORY LETTERS, AFFIDAVITS, COPIES OF BANK PASS BOOK, COPIES OF RETURNS, BALANCE SHEET AND CASH FLOW ITA NO. 454/AGRA/2009 7 STATEMENTS. THE LEARNED AR HAS SUBMITTED THAT IN TH EIR CONFIRMATORY LETTERS AS WELL AS IN THE AFFIDAVITS, THE LENDERS H AVE CONFIRMED OF HAVING GIVING THE AMOUNT TO THE ASSESSEE AND BY FUR NISHING THE ABOVE EVIDENCES THE ASSESSEE HAS DISCHARGED ITS ONUS TO P ROVE THE IDENTITY, CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSAC TIONS. IT WAS ALSO SUBMITTED THAT IN ONE OF THE CASES, I.E., IN CASE O F SHRI ABHAY MAHESHWARI, THE ASSESSEE HAS DULY PRODUCED HIM BEFO RE THE AO FOR EXAMINATION. THE LEARNED AR HAS THUS ARGUED THAT TH E AO WAS NOT JUSTIFIED IN TREATING THE CREDITS APPEARING IN THE NAME OF ABOVE LENDERS AS UNEXPLAINED AND HENCE THE ADDITION MADE BY THE A O U/S. 68 ON THIS SCORE DESERVES TO BE DELETED. THE AO, IN THE REMAND REPORT HAS HOWEVER, STATED T HAT IN THE COPY OF BANK A/C OF THE ABOVE LENDERS THERE WAS CAS H DEPOSIT OF EQUIVALENT AMOUNT BEFORE ADVANCING THE SAME TO THE ASSESSEE AND THE SOURCE OF SUCH CASH DEPOSIT REMAIN UNEXPLAINED. THE AO HAS ALSO BROUGHT ON RECORD THAT IN SPITE OF REPEATED OPPORTU NITIES TO PRODUCE THE LENDERS FOR EXAMINATION, THE ASSESSEE PRODUCED ONLY OF THE 6 LENDERS AND THE REMAINING 5 LENDERS WERE NOT PRODUC ED FOR EXAMINATION. IN THE CASE OF SHRI ABHAY MAHESHWARI, WHO WAS PRODUCED FOR EXAMINATION, THE AO UPON EXAMINATION O F THIS LENDER HAS NOTICED THAT THIS PERSON HAS NO CREDITWORTHINES S TO GIVE AN UNSECURED LOAN OF RS.2,00,000/-. AS FAR AS THE COPI ES OF BALANCE SHEET, CASH BOOK AND CASH FLOW STATEMENT OF THE LENDERS FU RNISHED, THE AO HAS STATED THAT THESE DOCUMENTS WERE NOT FURNISHED BY THE LENDERS ALONG WITH THEIR RETURNS FILED AS SUCH THE SAME HAV E NO EVIDENTIAL VALUE. IT HAS BEEN BROUGHT ON RECORD BY THE AO THAT EVEN THE DETAILS FURNISHED BY THE ASSESSEE IN RESPECT OF THE ABOVE L ENDERS ALSO DO NOT ESTABLISH THE CREDITWORTHINESS AND GENUINENESS OF T HE TRANSACTIONS AND THUS THE ADDITION HAS BEEN RIGHTLY MADE U/S. 68 OF IT ACT. THE ISSUE HAS BEEN CONSIDERED. IN ALL THE ABOVE CA SES, THERE WAS CASH DEPOSIT OF EQUIVALENT AMOUNT JUST BEFORE ADVAN CING THE LOAN. ONE OF THE LENDERS, NAMELY SHRI ABHAY MAHESHWARI WAS PR ODUCED FOR EXAMINATION AND UPON EXAMINATION OF THIS LENDER, TH E AO HAS NOTICED THAT HE HAS NO CREDITWORTHINESS TO ADVANCE LOAN TO THE ASSESSEE AND MOREOVER, THE SOURCE OF CASH DEPOSIT IN HIS BANK A/ C WAS NOT EXPLAINED SATISFACTORILY. IN THE REMAINING 5 CASES, IN SPITE OF OPPORTUNITIES PROVIDED, THE ASSESSEE FAILED TO PROD UCE THESE LENDERS FOR EXAMINATION DURING ASSESSMENT PROCEEDINGS. EVEN DURING REMAND ITA NO. 454/AGRA/2009 8 PROCEEDINGS ALSO THE ASSESSEE FAILED TO PRODUCE THE M FOR EXAMINATION. AS REGARDS THE DETAILS FURNISHED BY THE ASSESSEE IN RESPECT OF THESE LENDERS SUCH AS THE BALANCE SHEET, CASH BOOK AND CA SH FLOW STATEMENT, AS HAS BEEN RIGHTLY STATED BY THE AO, THE SAME HAS NO EVIDENTIARY VALUE AS THE SAME WERE NOT FURNISHED ALONG WITH THE IR RETURNS OF INCOME. THE COPIES OF RETURN OF INCOME FILED BY THE ASSESSEE IN RESPECT OF THESE LENDERS SHOW THAT THEY HAVE SHOWN VERY MEA GER INCOME IN THEIR RETURN FILED WHICH CREATE DOUBT ABOUT THEIR C REDITWORTHINESS TO ADVANCE SUCH LOANS. THUS, AS HAS BEEN RIGHTLY OBSER VED BY THE AO, THE PREPONDERANCE OF PROBABILITIES IS THAT THESE LOANS WERE IN FACT ACCOMMODATION ENTRIES WHICH WERE PROVIDED TO THE AS SESSEE BY TAKING UNEXPLAINED CASH FROM HER AND ROUTING IT THROUGH TH E BANK ACCOUNTS TO GIVE IT THE COLOUR OF UNSECURED LOANS. CONSIDERI NG THE ENTIRE FACTS AND CIRCUMSTANCES OF THE CASE, IT IS HELD THAT THE AO HAS RIGHTLY ADDED THE CREDITS APPEARING IN THE NAMES OF ABOVE SIX PER SONS AS UNEXPLAINED CASH CREDIT U/S. 68 OF I.T. ACT. THE AD DITION MADE BY THE AO ON THIS SCORE IS ACCORDINGLY CONFIRMED. 6. THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND SUBMITTED THAT THE CONFIRMATI ON OF THE CREDITORS, THEIR BANK ACCOUNTS, THEIR BALANCE SHEETS AND CASH FLOW STATEM ENTS WERE FILED BEFORE THE AUTHORITIES BELOW. ALL THE CREDITORS ARE ASSESSED T O TAX AND COPIES OF THEIR ACKNOWLEDGMENT OF FILING OF RETURNS OF INCOME WERE ALSO FILED. THE DEPOSITS OF CASH IN THE BANK ACCOUNTS OF THE CREDITORS WERE EXP LAINED THROUGH THE ABOVE EVIDENCES. ONE OF THE CREDITORS WAS PRODUCED BEFORE THE AO WHOSE STATEMENT WAS RECORDED IN WHICH HE HAS CONFIRMED GIVING OF LOAN T O THE ASSESSEE. THE REST OF THE CREDITORS COULD NOT BE PRODUCED BECAUSE OF SHORTAGE OF TIME AND THAT THE CREDITORS HAVE SHOWN THEIR INABILITY TO APPEAR BEFORE THE AO BECAUSE EITHER ONE OF THEM WAS ILL OR CLOSE RELATIONS OF THE CREDITORS WERE UNDERG OING TREATMENT. HE HAS REFERRED TO ITA NO. 454/AGRA/2009 9 ALL THE CONFIRMATIONS, BANK ACCOUNTS, RETURNS OF IN COME, CASH FLOW STATEMENTS IN THE PAPER BOOK AND ALSO REFERRED TO PAPER BOOK PAGE 125 , WHICH IS THE ORDER SHEET TO SHOW THAT NO SUFFICIENT TIME WAS GIVEN BY THE AO TO PRODUCE THE PARTIES BEFORE HIM. THE LD. COUNSEL FOR THE ASSESSEE, THEREFORE, S UBMITTED THAT THE ASSESSEE PROVED THE GENUINE CREDITS IN THE MATTER BY SATISFYING ALL THE INGREDIENTS OF SECTION 68 OF THE IT ACT. THE LD. COUNSEL FOR THE ASSESSEE, HOWEV ER, ADMITTED THAT NO REQUEST WAS MADE BY THE ASSESSEE FOR EXAMINATION OF REST OF THE CREDITORS THROUGH THE COMMISSION AND NO WRITTEN REQUEST WAS MADE BEFORE T HE LD. CIT(A) TO PRODUCE REST OF THE CREDITORS AT THE APPELLATE STAGE. THE LD. CO UNSEL FOR THE ASSESSEE SUBMITTED THAT THE ADDITION COULD NOT BE MADE MERELY BECAUSE THE CASH WAS DEPOSITED PRIOR TO ISSUE OF CHEQUES TO THE ASSESSEE AND IN THE CASE OF CREDITOR SRI RAMPAL SINGH, PB- 45 IS BANK PASSBOOK, WHICH SHOWS TRANSFER ENTRY OF RS.2,50,000/- ON THE DATE OF CLEARING OF THE CHEQUE IN FAVOUR OF THE ASSESSEE AN D AS SUCH, IT WAS NOT A DEPOSIT OF CASH IN HIS BANK ACCOUNT. THE LD. COUNSEL FOR THE A SSESSEE RELIED UPON FOLLOWING DECISIONS :- (I). DCIT VS. ROHINI BUILDERS, 256 ITR 360 (GUJ.) (II). CIT VS. ORISSA CORPORATION P. LTD., 159 ITR 78 (SC) (III). ORIENT TRADING CO., 49 ITR 723 (BOM.) (IV). CIT VS. SMT. P.K. NOORJAHAN, 237 ITR 570 (SC ) (V). SAROGI CREDIT CORPORATION VS. CIT, 103 ITR 34 4 (PAT.) (VI). CIT VS. U.M. SHAH, PROPRIETOR, SHRENIK TRADIN G CO., 90 ITR 396 (BOM.) ITA NO. 454/AGRA/2009 10 7. ON THE OTHER HAND, THE LD. DR RELIED UPON THE OR DERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE CASH WAS DEPOSITED EITHER ON THE DATE OF ISSUE OF CHEQUES IN FAVOUR OF THE ASSESSEE OR JUST PRIOR TO IT OF THE E QUIVALENT AMOUNT, THE SOURCE OF WHICH IS NOT EXPLAINED. THE CREDITORS HAVE NO SOURC E OF INCOME TO ADVANCE LOAN TO THE ASSESSEE. CREDITWORTHINESS OF THE CREDITORS HAS NOT BEEN PROVED. THE CREDITORS WERE FILING RETURN OF INCOME AT MEAGER INCOME AND H AVE NO SOURCE TO ADVANCE ANY MONEY TO THE ASSESSEE. THEREFORE, THE ADDITION WAS RIGHTLY MADE IN THE MATTER. 8. THE LD. COUNSEL FOR THE ASSESSEE IN THE REJOINDE R ALSO SUBMITTED THAT THE INTEREST PAID BY THE ASSESSEE ON THE LOANS HAVE NOT BEEN DISPUTED BY THE AO. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND THE MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT THERE WERE CASH D EPOSITS OF THE EQUIVALENT AMOUNTS IN THE BANK ACCOUNTS OF THE CREDITORS JUST BEFORE A DVANCING LOAN TO THE ASSESSEE OR ON THE DATE OF ISSUING CHEQUES TO THE ASSESSEE. IN THE CASE OF THE CREDITOR, SHRI RAMPAL SINGH, HIS BANK STATEMENT IS FILED AT PAGE 4 5 OF THE PAPER BOOK, IN WHICH RS.2,50,000/- HAS BEEN DEPOSITED, BUT NEITHER IT IS MENTIONED THAT IT WAS CASH NOR IT IS MENTIONED HOW THE AMOUNT SIMILAR TO THE CREDIT W AS CREDITED IN HIS BANK ACCOUNT. NO EXPLANATION IS GIVEN BEFORE THE AUTHORITIES BELO W AND EVEN DURING THE COURSE OF ARGUMENTS BEFORE US. NOTHING IS CLARIFIED AS TO HOW EQUIVALENT AMOUNT OF CASH ITA NO. 454/AGRA/2009 11 CREDIT WAS DEPOSITED IN HIS BANK ACCOUNT. IN THE CA SE OF REMAINING CREDITORS, IT IS NOT A DENYING FACT THAT EQUIVALENT AMOUNTS OF CASH CREDIT WAS DEPOSITED IN THEIR BANK ACCOUNTS IN CASH FOR ISSUING CHEQUES IN FAVOUR OF THE ASSESSEE. THIS CREATED SERIOUS DOUBT IN THE EXPLANATION OF THE ASSESSEE RE GARDING GENUINENESS OF THE TRANSACTION IN THE MATTER. THE AO ASKED THE ASSESSE E TO PRODUCE ALL THE CREDITORS FOR EXAMINATION ON OATH IN ORDER TO FIND OUT TRUTH IN T HE MATTER. THE ASSESSEE PRODUCED ONE OF THE CREDITORS BEFORE THE AO FOR EXAMINATION, BUT SHOWED HIS INABILITY TO PRODUCE OTHER CREDITORS, WHICH IS ALSO CLEAR FROM T HE ORDER SHEET DATED 18.12.2007 (PB-126). PRIOR TO THAT, THE ASSESSEE SOUGHT TIME F ROM THE AO TO PRODUCE REMAINING CREDITORS FOR EXAMINATION, BUT LATER ON DID NOT PRO DUCE THEM. THE LD. COUNSEL FOR THE ASSESSEE EXPLAINED THAT DUE TO ONE OR OTHER PRO BLEM OF THE REMAINING CREDITORS ON ACCOUNT OF MEDICAL ADVICE, THE DEPOSITORS HAVE S HOWN THEIR INABILITY TO APPEAR BEFORE THE AO FOR EXAMINATION, BUT IT IS ADMITTED F ACT THAT THE ASSESSEE DID NOT MAKE ANY REQUEST BEFORE THE AO FOR EXAMINATION OF T HE REMAINING CREDITORS THROUGH THE COMMISSION AND NO WILLINGNESS WAS SHOWN BEFORE THE CIT(A) FOR PRODUCTION OF THE REMAINING CREDITORS FOR EXAMINATI ON EVEN AT THE REMAND STAGE IN THE APPELLATE PROCEEDINGS. EVEN DURING THE COURSE O F ARGUMENTS BEFORE THE TRIBUNAL, THE LD. COUNSEL FOR THE ASSESSEE DID NOT SHOW HIS WILLINGNESS TO PRODUCE REMAINING CREDITORS FOR EXAMINATION BEFORE THE AO. IT IS, THEREFORE, CLEAR THAT THE ITA NO. 454/AGRA/2009 12 ASSESSEE HAS FAILED TO PRODUCE THE REMAINING CREDIT ORS FOR EXAMINATION BY THE REVENUE DEPARTMENT IN ORDER TO FIND OUT TRUTH IN TH E MATTER. 9.1 THE AO DISCUSSED EACH AND EVERY CREDITOR IN THE ASSESSMENT ORDER AND THE CRUX OF THE FINDINGS OF THE AO HAD BEEN THAT THERE WERE VERY SMALL BANK BALANCES IN THE BANK ACCOUNTS OF THE CREDITORS AND THEY WERE HAVING MEAGER INCOME AND AS SUCH, THEY WERE NOT MEN OF MEANS TO ADVANCE ANY LOA N TO THE ASSESSEE. IN THE CASE OF ABHAY MAHESHWARI, THERE WAS VERY SMALL BALANCE O F RS.3528/- IN HIS BANK ACCOUNT. HE WAS EXAMINED ON OATH AND HE WAS NOT ABL E TO GIVE SOURCE OF CASH DEPOSIT TO THE SATISFACTION OF THE AO. HE WAS EARNI NG HARDLY ONE LAC RUPEES AND SPENT 40,000/- TO 50,000/- FOR HOUSEHOLD PURPOSES. DURING HIS EXAMINATION ON OATH, HE WAS NOT ABLE TO SATISFACTORILY EXPLAIN THE AVAIL ABILITY OF FUNDS WITH HIM FOR GIVING LOAN TO THE ASSESSEE. IN HIS CASE, HE HAS FI LED RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER APPEAL AT RS.1,02,850/- (PB-6 0). IN THE CASE OF SHRI AMIT MAHESHWARI, HE WAS ALSO HAVING SMALL BANK BALANCE O F RS.2429/- BEFORE ISSUE OF CHEQUE TO THE ASSESSEE AND EQUAL AMOUNT OF THE CASH CREDIT WAS DEPOSITED IN THE BANK ACCOUNT. HE HAS FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER APPEAL AT RS.44972/- (PB-71). IN THE CASE OF SMT. KEERTI M AHESHWARI, IN HER BANK ACCOUNT, THERE WAS BALANCE OF RS.4688/- ONLY PRIOR TO ISSUE OF CHEQUE TO THE ASSESSEE AND EQUIVALENT AMOUNT OF CASH CREDIT WAS DEPOSITED FOR THE PURPOSE OF ISSUE OF CHEQUE ITA NO. 454/AGRA/2009 13 IN FAVOUR OF THE ASSESSEE. FOR THE ASSESSMENT YEAR UNDER APPEAL, SHE HAS FILED RETURN OF INCOME AT RS.1,01,000/- ONLY. IN THE CASE OF SMT . MITHLESH MAHESHWARI, THE BANK BALANCE BEFORE ISSUE OF CHEQUE WAS RS.10,794/- AND EQUIVALENT AMOUNT OF CASH CREDIT WAS DEPOSITED IN HER BANK ACCOUNT FOR I SSUE OF CHEQUE IN FAVOUR OF ASSESSEE. FOR ASSESSMENT YEAR UNDER APPEAL, SHE FIL ED RETURN OF INCOME AT RS.1,02,476/- ONLY. IN THE CASE OF SH. RAMPAL SING, IT IS ALREADY NOTED ABOVE THAT THE DEPOSIT ENTRY IN HIS CASE IS NOT EXPLAINED AND PRIOR TO ISSUE OF CHEQUE, THERE WAS BANK BALANCE OF RS.3708/- ONLY. HE HAS FILED THE RE TURN OF INCOME FOR THE ASSESSMENT YEAR UNDER APPEAL AT LOSS WITH AGRICULTU RAL INCOME (PB-102). IN THE CASE OF SHRI SHARIQ ALI KHAN, THE BANK BALANCE IS HIS AC COUNT WAS RS.1055/- PRIOR TO ISSUE OF CHEQUE AND EQUIVALENT CASH AMOUNT WAS DEPO SITED FOR ISSUING CHEQUE IN FAVOUR OF THE ASSESSEE. HE HAS FILED RETURN OF INCO ME AT RS.70,373/- PLUS AGRICULTURAL INCOME (PB-116). THESE DETAILS NOTED I N THE ASSESSMENT ORDER AND THE DETAILS VERIFIED FROM THE PAPER BOOK WOULD CLEARLY SUPPORT THE FINDINGS OF THE AO THAT NONE OF THE CREDITORS WERE PERSONS OF SUFFICIE NT MEANS TO ADVANCE ANY LOAN TO THE ASSESSEE. FILING OF BALANCE SHEETS, CASH FLOW S TATEMENTS, CASH BOOKS ETC. HAVE NO EVIDENTIARY VALUE BECAUSE ACCORDING TO THE REMAN D REPORT FILED BY THE AO, THOSE DOCUMENTS WERE NOT FILED WITH THE RETURN OF INCOME. MOREOVER, NO REGULAR BOOKS OF ACCOUNT HAVE BEEN MAINTAINED BY ANY OF THE CREDITOR S AND MAJORITY OF THEM HAVE SHOWN ESTIMATED INCOME IN THEIR RETURNS OF INCOME. THEREFORE, SUCH BALANCE SHEET, ITA NO. 454/AGRA/2009 14 CASH FLOW STATEMENTS ETC. WOULD NOT SUPPORT THE CON TENTION OF THE ASSESSEE THAT GENUINE CREDITS HAVE BEEN RECEIVED. THE ORDER SHEET NOTED BY THE AO WOULD ALSO SHOW THAT THE ASSESSEE HAS MADE NO EFFORTS TO PRODU CE THE REMAINING CREDITORS BEFORE THE AO. EVEN IN THE STATEMENT OF ONE OF THE CREDITORS RECORDED BY THE AO, SHRI AMBHAY MAHESHWARI, HE WAS NOT ABLE TO EXPLAIN HIS SOURCE OF DEPOSIT OR ADVANCING LOAN TO THE ASSESSEE THROUGH GENUINE SOUR CE. IT IS WELL SETTLED LAW THAT BURDEN IS UPON THE ASSESSEE TO PROVE INGREDIENTS OF SECTION 68 OF THE ACT BY PROVING IDENTITY AND CREDITWORTHINESS OF THE CREDIT ORS AND GENUINENESS OF THE TRANSACTIONS. THE ASSESSEE HAS, HOWEVER, FAILED TO PROVE THE CREDITWORTHINESS OF THE CREDITORS WHO WERE HAVING ONLY MEAGER INCOME. NO DE TAILS OF THEIR SAVINGS HAVE BEEN FILED. THE ASSESSEE HAS NEVER SHOWN HIS WILLIN GNESS TO PRODUCE THE REMAINING CREDITORS FOR EXAMINATION BEFORE THE AO. THEREFORE, THE GENUINENESS OF THE TRANSACTION COULD NOT HAVE BEEN EXAMINED BY THE AO. THE SMALLNESS OF THE BANK BALANCE IN THE BANK ACCOUNTS OF THE CREDITORS PRIOR TO ISSUE OF CHEQUES WOULD CLEARLY REVEAL THAT THEY WERE NOT HAVING ANY SOURCE AND IT WAS THE MONEY OF THE ASSESSEE WHICH WAS ROUTED THROUGH THE BANK ACCOUNTS OF THE CREDITORS FOR THE PURPOSE OF GIVING CREDITS TO THE ASSESSEE. THESE WE RE, THEREFORE, ACCOMMODATION ENTRIES ONLY AND AS SUCH, COULD NOT BE CONSIDERED A S GENUINE TRANSACTIONS. MERELY BECAUSE THE LOANS HAVE BEEN RECEIVED THROUGH BANKIN G CHANNEL, IS NOT SACROSANCT TO MAKE A NON-GENUINE TRANSACTION AS GENUINE TRANSACTI ON. ITA NO. 454/AGRA/2009 15 10. HONBLE CALCUTTA HIGH COURT IN THE CASE OF BHAR ATI PVT. LTD. VS. CIT, 111 ITR 951 HELD AS UNDER : IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE INCOM E-TAX OFFICER FOUND THAT THE ASSESSEE HAD SHOWN RS.20,000 AS LOAN IN ITS BOOKS TAKEN FROM TWO PARTIES. THE ASSESSEE PRODUCED THE ALLEGED CONFIRMATORY LETTERS FROM THOSE PARTIES BEFORE THE INCOME-TAX OFFICER IN SUPPORT OF THE TWO LOANS. THE INCOME-TAX OFFICER SERVED NOTICES UNDER SECTION 131 OF THE INCOME TAX ACT, 1961, ON THE ALLEGED CREDITORS AND SINCE THOSE NOTICES CAME BACK UNSERVE D, THE INCOME-TAX OFFICER TREATED THE LOAN AS ASSESSEES INCOME FROM UNDISCLOSED SOURCES. THE APPELLATE ASSISTANT COMMISSIONER DISMI SSED THE ASSESSEES APPEAL ON THE GROUND THAT THE ASSESSEE C OULD NOT EVEN ESTABLISH THE IDENTITY OF THE PARTIES. ON FURTHER A PPEAL BY THE ASSESSEE, THE APPELLATE TRIBUNAL HELD THAT MERE FILING OF CON FIRMATORY LETTERS DID NOT DISCHARGE THE ONUS THAT LAY ON THE ASSESSEE AND THERE WAS NO MATERIAL ON THE RECORD TO ESTABLISH THE IDENTITY OF THE CREDITORS: HELD, THAT THE TRIBUNAL HAD TAKEN ALL THE RELEVANT FACTS INTO CONSIDERATION AND THE CONCLUSION ARRIVED AT BY THE TRIBUNAL THAT THE LOANS REPRESENTED THE ASSESSEES INCOME FROM UNDISC LOSED SOURCES WAS NOT PERVERSE OR UNREASONABLE. 10.1 THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF CIT VS UNITED COMMERCIAL AND INDUSTRIAL CO. (P) LTD., 187 ITR 596 HELD AS UN DER: THE PRIMARY ONUS LIES ON THE ASSESSEE TO PROVE THE NATURE AND SOURCE OF CREDITS IN ITS ACCOUNT. IT IS NECESSARY F OR THE ASSESSEE TO PROVE PRIMA FACIE THE IDENTITY OF HIS CREDITORS, TH E CAPACITY OF SUCH CREDITORS TO ADVANCE THE MONEY AND LASTLY THE GENUI NENESS OF THE TRANSACTIONS. ONLY WHEN THESE THINGS ARE PROVED BY THE ASSESSEE PRIMA FACIE AND ONLY AFTER THE ASSESSEE HAS ADDUCED EVIDENCE TO ESTABLISH THE AFORESAID FACTS DOES THE ONUS SHIFT O N TO THE DEPARTMENT. IT IS NOT ENOUGH TO ESTABLISH THE IDENTITY OF THE C REDITORS. MERE PRODUCTION OF THE CONFIRMATION LETTERS BEFORE THE I NCOME-TAX OFFICER ITA NO. 454/AGRA/2009 16 WOULD NOT BY ITSELF PROVE THAT THE LOANS HAVE BEEN OBTAINED FROM THOSE LOAN CREDITORS OR THAT THEY HAVE CREDIT-WORTHINESS. HELD, THAT, IN THE INSTANT CASE, THE TRIBUNAL MISDI RECTED ITSELF IN HOLDING THAT THE TRANSACTIONS WERE GENUINE SIMPLY B ECAUSE SOME OF THE TRANSACTIONS WERE MADE BY CHEQUES. THE ASSESSEE HAD FAILED TO PROVE THE CREDIT-WORTHINESS OF THE ALLEGED LENDERS. A NUM BER OF OTHER ASSESSEES HAD ALSO ADMITTED THAT LOANS OBTAINED FRO M THESE BANKERS AGAINST HUNDIS WERE NOT GENUINE AND SUCH HUNDI LOAN S REALLY REPRESENTED THEIR OWN CONCEALED INCOME. THE ASSESSE E HAD NOT DISCHARGED ITS BURDEN OF PROVING THAT THE LOANS IN QUESTION WERE GENUINE. 10.2 HONBLE CALCUTTA HIGH COURT IN THE CASE OF M /S. PRECISION FINANCE PVT. LTD., 208 ITR 465 HELD THAT EVEN THE LOAN THROUGH BANK CANNOT BE ACCEPTED AS GENUINE UNLESS THE IDENTITY AND CREDITWORTHINESS OF THE CREDITORS ARE PROVED. MERE PAYMENT OF ACCOUNT PAYEE CHEQUE IS NOT SACROSANCT N OR CAN IT MAKE A NON-GENUINE TRANSACTION GENUINE. 10.3 THE HONBLE SUPREME COURT IN THE CASE OF DU RGA PRASAD MORE, 82 ITR 540 AND SUMATI DAYAL, 214 ITR 801 HELD THAT THE COURTS AND TRIBUNAL HAVE TO JUDGE THE EVIDENCES BEFORE THEM BY APPLYING THE TEST OF H UMAN PROBABILITIES AFTER CONSIDERING THE SURROUNDING CIRCUMSTANCES. 11. ON CONSIDERATION OF THE FACTS OF THE CASE IN TH E LIGHT OF ABOVE DISCUSSION AND DECISION, WE DO NOT FIND ANY JUSTIFICATION TO INTER FERE WITH THE ORDER OF THE LD. CIT(A). THE ASSESSEE HAS FAILED TO PROVE THE CREDIT WORTHINESS OF ALL THE CREDITORS AND NO SOURCE OF THEIR INCOME HAS BEEN FILED. AT TH E BEST THE ASSESSEE IS ABLE TO ITA NO. 454/AGRA/2009 17 PROVE IDENTITY OF THE CREDITORS, BUT THE ASSESSEE F AILED TO PROVE THE GENUINE CREDIT IN THE MATTER. ALL THE CREDITORS HAVE BEEN RIGHTLY FOU ND TO BE MEN OF MEAGER MEANS AND NO SOURCE OF INCOME HAVE BEEN FILED TO PROVE TH AT THEY WERE HAVING SUFFICIENT FUNDS OR SAVINGS IN ORDER TO GIVE LOANS TO THE ASSE SSEE. ON VERIFICATION OF THE BANK ACCOUNT OF THE DEPOSITORS, IT WAS SPECIFICALLY FOUN D THAT THERE WERE NO SUFFICIENT FUNDS AVAILABLE IN THEIR BANK ACCOUNT AND THEY WERE HAVING ONLY SMALL BANK BALANCE, WHICH WAS EVEN NOT SUFFICIENT TO MEET OUT THEIR HOUSEHOLD EXPENSES OR DAY-TO-DAY REQUIREMENTS. THEREFORE, IT IS UNBELIEVA BLE TO ACCEPT THE CONTENTION OF THE ASSESSEE THAT SAID PERSONS WERE HAVING CREDITWO RTHINESS TO ADVANCE ANY LOAN TO THE ASSESSEE. THE DOCUMENTS PRODUCED BY THE LD. COU NSEL FOR THE ASSESSEE IN THE PAPER BOOK MERELY PROVE THE CASE OF ASSESSEE SUPERF ICIALLY, WHICH IS FAR FROM REALITY OR TRUTH. WHEN THE TEST OF HUMAN PROBABILIT IES AFTER CONSIDERING THE SURROUNDING CIRCUMSTANCES AS IS PROPOUNDED BY HONB LE SUPREME COURT IN THE CASE OF DURGA PRASAD MORE (SUPRA) AND SUMATI DAYAL VS. C IT (SUPRA), IS APPLIED TO THE FACTS OF THE CASE, IT IS CLEAR THAT THE LD. CIT(A) WAS JUSTIFIED IN CONFIRMING THE ADDITION U/S. 68 OF THE IT ACT. IN THE PRESENT CASE , THE ASSESSEE HAS NOT ADDUCED ANY SUFFICIENT EVIDENCE BEFORE THE AUTHORITIES BELOW TO PROVE THE CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS I N THE MATTER. THEREFORE, THE ASSESSEE HAS NOT SATISFIED THE ESSENTIAL INGREDIENT S OF SECTION 68 OF THE IT ACT. ITA NO. 454/AGRA/2009 18 12. IN THE CASE OF ROHINI BUILDERS AND U.M. SHAH (S UPRA), THE DEPARTMENTAL APPEAL WAS DISMISSED FINDING NO SUBSTANTIAL QUESTIO N OF LAW BECAUSE THE FINDINGS OF THE TRIBUNAL WERE BASED ON APPRECIATION OF EVIDE NCE. 12.1 IN THE CASE OF CIT VS. ORISSA CORPORATION P. L TD (SUPRA), IT WAS ALSO HELD THAT THE REVENUE DID NOT EXAMINE SOURCE OF INCOME OF THE SAID ALLEGED CREDITORS WHEN THEY WERE ASSESSED TO TAX TO FIND OUT WHETHER THEY WERE CREDITWORTHY. HOWEVER, IN THE PRESENT CASE, THE AUTHORITIES BELOW HAVE SPECIF ICALLY FOUND THAT ALL THE CREDITORS WERE NOT MEN OF MEANS AND AS SUCH, THEIR CREDITWORT HINESS WAS NOT PROVED AT ALL. THEREFORE, THE DECISION CITED BY THE LD. COUNSEL FO R THE ASSESSEE WOULD NOT SUPPORT THE CASE OF THE ASSESSEE. 13. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE IN THE LIGHT OF FINDINGS OF THE AUTHORITIES BELOW, WE DO NOT FIND ANY IRREGU LARITY OR ILLEGALITY IN THE ORDERS OF THE AUTHORITIES BELOW. WE CONFIRM THEIR FINDINGS AND DISMISS THE APPEAL OF THE ASSESSEE ON THIS GROUND. CONCISE GROUNDS NOS. 1 & 2 ARE, ACCORDINGLY, DISMISSED. 14. ON GROUND NO.3 & 4, THE ASSESSEE CHALLENGED THE DISALLOWANCE OF 20% EXPENSE OUT OF CONVEYANCE AND MOBILE PHONE EXPENSES . THE AO OBSERVED THAT THE ASSESSEE CLAIMED SEVERAL EXPENDITURES AND IT WAS AL SO FOUND THAT MOST OF THE ITA NO. 454/AGRA/2009 19 EXPENSES HAVE BEEN INCURRED IN CASH AND APPEAR EXCE SSIVE LOOKING TO THE VOLUME OF BUSINESS AND ALSO NOT FULLY VERIFIABLE. 20% OF THE EXPENSES WERE, ACCORDINGLY, DISALLOWED. THE LD. CIT(A) CONFIRMED THE DISALLOWAN CE OUT OF CONVEYANCE AND MOBILE EXPENSE. 15. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT NO OPPORTUNITY HAS BEEN GRANTED TO EXPLAIN THESE GROUNDS AT THE ASSESSMENT STAGE AND NO QUERY HAS BEEN RAISED AS PER THE ORDER SHEET, COPY OF WHICH IS FIL ED IN THE PAPER BOOK. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDERS OF THE AUTH ORITIES BELOW. 16. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE A O NOTED IN THE ASSESSMENT ORDER THAT MOST OF THE EXPENSES HAVE BEEN INCURRED IN CASH AND ARE EXCESSIVE AND NOT SUBJECTED TO VERIFICATION. SIMILARLY, IT WAS FO UND THAT THE USE OF PHONE AND CAR FOR PERSONAL PURPOSES CANNOT BE DENIED. SINCE NO LO G BOOK IS PRODUCED TO SHOW THAT THESE EXPENSES WERE USED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS, NO INTERFERENCE IS REQUIRED IN THE MATTER. THE ASSESSE E FILED LIST OF EXPENSES IN THE PAPER BOOK, WHICH SUPPORTS THE FINDING OF AO THAT M OST OF THE EXPENDITURE HAVE BEEN INCURRED IN CASH AND AS SUCH, THESE CANNOT BE SUBJECTED FOR VERIFICATION. FURTHER USE OF MOBILE PHONE AND CONVEYANCE FOR PERS ONAL PURPOSES CANNOT BE RULED OUT. THE LD. COUNSEL FOR THE ASSESSEE REFERRED TO T HE ORDER SHEET (PB-126-127) TO ITA NO. 454/AGRA/2009 20 SHOW THAT NO QUERY WAS RAISED ON THIS ISSUE BEFORE MAKING DISALLOWANCE. HOWEVER, NO SUCH ISSUE WAS RAISED BEFORE THE LD. CIT(A) BECA USE SUCH SUBMISSIONS OF THE ASSESSEE DID NOT FIND MENTION IN THE IMPUGNED ORDER . THE AO IN THE LAST ORDER SHEET HAS SPECIFICALLY MENTIONED THAT REPLY OF THE ASSESSEE IS PLACED ON RECORD AND CASE HAS BEEN DISCUSSED. BEFORE US, NO DETAILS HAVE BEEN FURNISHED TO CONTRADICT THE FINDINGS OF THE AUTHORITIES BELOW. ONLY COPIES OF T HE LEDGER ACCOUNT HAVE BEEN FILED, BUT NOTHING IS PROVED WHETHER THESE EXPENSES WERE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS. THEREFORE, IT IS DIFFICULT TO INTERFERE IN THE ORDERS OF THE LD. AUTHORITIES BELOW. WE, ACCORDINGL Y, CONFIRM THE FINDING OF THE AUTHORITIES BELOW AND DISMISS THESE GROUNDS OF APPE AL OF THE ASSESSEE. 17. NO OTHER POINT IS ARGUED. 18. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE ASSISTANT REGISTRAR TRUE COPY