KIARA JEWELLERY P. LTD, MUMBAI V. ACIT (OSD) 8(3), MUMBAI

ITA 4911/MUM/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2667 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2009
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 26-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DAYA SHANKAR
• Keywords: Share purchase agreement; Additional evidence; Set aside
• Section: 68; 69; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI R.V. EASWAR, SR. VP & SHRI R.K. PANDA, AM I.T.A. NO. 4911/MUM/09 (ASSESSMENT YEAR 2006-07) M/S. KIARA JEWELLERY PVT. LTD. UNIT NO. 180, 1 ST FLOOR, SDF-VI, SEEPZ, SEZ, ANDHERI (E), MUMBAI-400 096 PAN: AACCK 4789 M VS. ASST. CIT (OSD)-8(3), MUMBAI APPELLANT RESPONDENT APPELLANT BY: SHRI VIJAY MEHTA RESPONDENT BY: SHRI DAYA SHANKAR O R D E R DATE OF HEARING: 03.12.2009 DATE OF ORDER: 11.12.2009 PER R.K. PANDA, AM: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 16 TH JULY, 2009 OF THE CIT(A)-XXIX, MUMBAI RELATING TO ASSESSMENT YEAR 2006-07. 2. THE ASSESSEE IN ITS GROUNDS OF APPEAL HAS CHALLENGE D THE ORDER OF THE CIT(A) IN CONFIRMING THE ACTION OF THE ASSESSIN G OFFICER IN MAKING ADDITION OF RS.2,26,72,557 U/S. 68 OF THE INCOME-TA X ACT, 1961 (THE ACT). 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING OF JEWELLERY. THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS OBSERVE D FROM THE BALANCE SHEET AS ON 3.3.206 THAT THE ASSESSEE HAS SHOWN TO HAVE RECEIVED AN AMOUNT OF RS.2,26,72,557 AS SHARE APPLICATION MON EY RECEIVED PENDING ALLOTMENT. THE ASSESSING OFFICER ASKED THE ASSESS EE TO PROVIDE THE DETAILS OF PERSONS FROM WHOM SHARE APPLICATION MONE Y HAS BEEN RECEIVED ALONG WITH THE COPY OF BALANCE SHEET TO PROVE THEIR EXISTENCE, I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 2 CREDITWORTHINESS AND GENUINENESS OF SUCH TRANSACTIO N. IN RESPONSE TO THE SAME THE ASSESSEE SUBMITTED THE FOLLOWING DETAILS: 1. LETTER FROM SAPHIR PRODUCT SA, 846 RULE DE GEN EVE CASE POSTALE 75-1000 LAUSANNE 16 MALLEY CONFIRMING THE TOTAL INVESTMENT OF CHF 834442 ($654345) TOWARDS SUBSCRIPTION OF 2810000 EQUITY SHARES OF RS.10 EACH FULLY PAID UP TO THE COMPANY ANNEXURE 1. 2. COPY OF CREDIT REPORT OF SAPHIR PRODUCT SA FROM MIRA INFORMATION PVT. LTD. ANNEXURE II. 3. COPY OF RETURN OF ALLOTMENT (FORM 2) FILED WITH THE REGISTRAR OF COMPANIES ALONG WITH THE FILING RECEIP T FOR THE ALLOTMENT OF 2250000 EQUITY SHARES OF RS.10/- EACH FULLY PAID TO SAPHIR PRODUCT SA ANNEXURE III. 4. COPY OF SHARE CERTIFICATE NO. 9 FOR THE ALLOTME NT OF 2250000 EQUITY SHARES OF RS.10/- EACH FULLY PAID UP TO SAPHIR PRODUCT SA ANNEXURE IV. 5. COPY OF RETURN OF ALLOTMENT (FORM 2) FILED WITH THE REGISTRAR OF COMPANIES ALONG WITH THE FILING RECEIP T FOR THE ALLOTMENT OF 560000 EQUITY SHARES OF RS.10/- EACH F ULLY PAID TO SAPHIR PRODUCT SA ANNEXURE V. 6. COPY OF SHARE CERTIFICATE NO. 12 FOR THE ALLOTM ENT OF 560000 EQUITY SHARES OF RS.10 EACH FULLY PAID UP TO SAPHIR PRODUCT SA ANNEXURE VI. 7. COPY OF APPLICATION TO RESERVE BANK OF INDIA FO R THE ISSUE OF SHARES TO SAPHIR PRODUCT SA ANNEXURE VII . 4. THE ASSESSEE ALSO FILED THE COPY OF FOREIGN INWARD REMITTANCE CERTIFICATE FOR RECEIPT OF USD 5,11,363 ON 7 TH MARCH, 2006. HOWEVER, THE BALANCE SHEET OF SAPHIR PRODUCTS, SA (FOR SHORT SPS A) FROM WHOM THE ASSESSEE CLAIMS TO HAVE RECEIVED THE SHARE APPLICAT ION MONEY WAS NOT PROVIDED IN SPITE OF BEING ASKED FOR. ACCORDINGLY THE ASSESSING OFFICER ISSUED A SHOW-CAUSE NOTICE TO THE ASSESSEE TO THE E FFECT THAT FAILURE TO PRODUCE THE BALANCE SHEET WILL RESULT INTO SHARE AP PLICATION MONEY BEING TREATED AS INCOME OF THE ASSESSEE U/S. 68 OF THE AC T. IN RESPONSE TO THE SAME IT WAS INFORMED BY THE VICE PRESIDENT OF THE A SSESSEE COMPANY THAT THE BOARD OF DIRECTORS OF SPSA HAVE TAKEN AN IN PRI NCIPLE DECISION OF NOT TO PROVIDE THE BALANCE SHEET DUE TO BUSINESS SECREC Y. I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 3 5. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE, WHO CLAIMS TO HAVE GOT FUNDS OF RS.2.27 CRORES FROM THE COMPANY WHICH HAS CONTRIBUTED ALMOST 98% OF SHARE CAPITAL I.E. RS.2.27 CRORES OUT OF SHARE CAPITAL OF RS.2.31 CRORES COULD NOT OBTAIN THE COPY OF THE BAL ANCE SHEET OF THE ALLEGED INVESTOR DESPITE THE SHOW CAUSE NOTICE THAT THE AMOUNT WILL BE ADDED TO THE INCOME OF THE ASSESSEE U/S. 68 OF THE ACT IF THE DETAILS ARE NOT FURNISHED. SPSA WERE MADE FULLY AWARE OF THE CONSE QUENCES OF NOT PROVIDING THE BALANCE SHEET BY WAY OF SHOW CAUSE NO TICE ISSUED TO THE ASSESSEE. THEREFORE NON SUBMISSION OF BALANCE SHEE T CASTS A SERIOUS DOUBT ON THE GENUINENESS OF THE TRANSACTION. HE OB SERVED THAT THE FOREIGN INWARD REMITTANCE CERTIFICATE PROVIDED BY THE ASSES SEE MAY BE PROOF FOR THE TRANSACTION THAT HAS TAKEN PLACE BUT IT CANNOT BE TAKEN AS A PROOF FOR THE CREDITWORTHINESS OF THE ASSESSEE. HE REJECTED THE LETTER FROM SPSA CONFIRMING THE REMITTANCE OF MONEY TO THE ASSESSEE ON THE GROUND THAT THE SAME CANNOT BE ADMITTED AS A PROOF OF ITS OWN C REDITWORTHINESS. HE OBSERVED THAT THE CONTENTS IN THE LETTER CANNOT ITS ELF BE HELD AS TRUE AND CORRECT UNLESS THE SAME STOOD CORROBORATED BY ATTEN DANT EVIDENCES AND CIRCUMSTANCES. HE ALSO REJECTED THE COPY OF THE CR EDIT REPORT OF SPSA FROM MIRA INFORMATION PVT. LTD. ON THE GROUND THAT THE C ORRECT RATING CANNOT BE DECIDED WITHOUT THE FINANCIAL STATEMENT BEING PROVI DED TO THE CREDIT RATING AGENCY. AS REGARDS THE DOCUMENTS SUBMITTED IN THE SHAPE OF COPIES OF RETURN OF ALLOTMENT, VALUATION OF SHARES AND SHA RE CERTIFICATES, HE OBSERVED THAT THESE DOCUMENTS ARE REQUIRED TO COMPL ETE THE PROCEDURAL FORMALITY OF ALLOTMENT OF SHARES AND DOES NOT PROVE THE CREDITWORTHINESS OF SPSA. RELYING ON A NUMBER OF DECISIONS INCLUDIN G THE DECISION OF THE APEX COURT IN THE CASE OF CIT VS. DURGA PRASAD MORE REPORTED IN 82 ITR 540 HE MADE AN ADDITION OF RS.2,26,72,557 U/S. 68 O F THE ACT. 6. BEFORE CIT(A) IT WAS SUBMITTED THAT M/S. SPSA IS A TAX PAYER IN SWITZERLAND HOLDING IDENTIFICATION, HAS BEEN IN EXI STENCE SINCE 1979 AND HAS CONTRIBUTED MONEY THROUGH REGULAR BANKING CHANN ELS WITH THE KNOWLEDGE OF RBI. IT WAS SUBMITTED THAT SPSA EXPRE SSED ITS INABILITY TO FURNISH ITS BALANCE SHEET IN VIEW OF ITS BUSINESS S ECRECY. THE EVIDENCE I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 4 BEING CERTIFICATE FROM THE AUDITOR OF SPSA AND LETT ER FROM SPSA EXPRESSING ITS INABILITY TO PART WITH ITS BALANCE SHEET WERE F URNISHED BEFORE THE ASSESSING OFFICER. THE ASSESSEE ALSO FILED CERTAIN ADDITIONAL EVIDENCES BEFORE THE CIT(A). 7. THE CIT(A) CALLED FOR A REMAND REPORT FROM THE ASSE SSING OFFICER IN VIEW OF THE ADDITIONAL EVIDENCES FILED BEFORE HIM W HICH WERE NOT FILED BEFORE THE ASSESSING OFFICER. AFTER OBTAINING THE REMAND REPORT FROM THE ASSESSING OFFICER AND THE REPLY OF THE ASSESSEE TO THE SAME, THE CIT(A) UPHELD THE ADDITION MADE BY THE ASSESSING OFFICER. WHILE DOING SO HE OBSERVED THAT THE VARIOUS DECISIONS RELIED ON BY TH E COUNSEL FOR THE ASSESSEE BEFORE HIM ARE NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. IN THE VARIOUS DECISIONS IT WAS HELD THAT SHARE APPLIC ATION MONEY RECEIVED BY THE ASSESSEE FROM ALLEGED BOGUS SHAREHOLDERS, WH OSE NAMES ARE GIVEN TO THE ASSESSING OFFICER, CANNOT BE REGARDED AS UND ISCLOSED INCOME OF THE ASSESSEE. HOWEVER, THE SAME WAS QUALIFIED WITH THE CONDITION THAT THE DEPARTMENT WILL BE FREE TO PROCEED TO REOPEN THE IN DIVIDUAL ASSESSMENTS OF BOGUS SHAREHOLDERS. HOWEVER, IN THE INSTANT CAS E THE FACTS ARE DIFFERENT IN THE SENSE THAT THE DEPARTMENT CANNOT TAX THE CAP ITAL INTRODUCED IN THE HANDS OF THE SHAREHOLDER I.E., M/S. SPSA AS THE SAM E IS NOT ASSESSED TO TAX IN INDIA. AS REGARDS THE DISCHARGING OF ONUS BY TH E ASSESSEE HE OBSERVED THAT DESPITE OPPORTUNITIES GIVEN BY THE ASSESSING O FFICER AND THE CIT(A) THE ASSESSEE HAS FAILED TO PRODUCE THE COPY OF THE BALANCE SHEET WHICH COULD BE CRUCIAL AND FINAL EVIDENCE IN SUPPORT OF T HE PROOF OF CREDITWORTHINESS OF THE SHAREHOLDER. UNLESS THE CR EDITWORTHINESS OF THE SHAREHOLDERS IS PROVED THE ASSESSEE CANNOT CLAIM TH E ONUS HAVING BEEN DISCHARGED. NONE OF THE PAPERS FILED BY THE ASSESS EE GO TO PROVE THE CREDITWORTHINESS OF THE SHAREHOLDER. HE ACCORDINGL Y HELD THAT SINCE THE CREDITWORTHINESS OF M/S. SPSA HAS NOT BEEN PROVED T HE ASSESSING OFFICER WAS WELL WITHIN HIS RIGHT TO MAKE THE ADDITION OF R S.2,26,72,557 U/S. 68 OF THE ACT. AGGRIEVED WITH SUCH ORDER OF THE CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US. I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 5 8. THE LEARNED COUNSEL FOR THE ASSESSEE REFERRING TO V ARIOUS PAGES OF THE PAPER BOOK SUBMITTED THAT THE ASSESSEE HAS PROV ED THE CAPACITY OF THE PARTIES TO THE BEST OF ITS ABILITY. THE SHARE CAPI TAL MONEY HAS COME FROM THE JOINT VENTURE PARTNER OF THE ASSESSEE WHO BELON GS TO THE WELL KNOWN SWISS GROUP. THE AMOUNT HAS COME THROUGH NORMAL BA NKING CHANNELS WITH THE APPROVAL AND PERMISSION FROM THE RBI. THE JOINT PARTNER IS ALSO HAVING SUBSTANTIAL TRANSACTIONS OF EXPORT AS WELL A S IMPORT WITH THE ASSESSEE AND IT IS ALSO THE DEBTOR/CREDITOR OF THE ASSESSEE. THE ASSESSING OFFICER HAS ACCEPTED ALL OTHER TRANSACTIONS WITH TH E JOINT VENTURE PARTNER BUT HAS DISPUTED ONLY THE SHARE CAPITAL GIVEN BY IT ON THE GROUND THAT THE CREDITWORTHINESS OF THE SAID PARTY IS NOT PROVED IN ABSENCE OF FURNISHING OF THE BALANCE SHEET. HE SUBMITTED THAT TWO FOREIG N DIRECTORS FROM THE JOINT VENTURE PARTNER ARE IN THE BOARD OF DIRECTORS OF THE ASSESSEE COMPANY. THE CREDIT RATING REPORT IN RESPECT OF TH E JOINT VENTURE PARTNER WAS ALSO FURNISHED BEFORE THE ASSESSING OFFICER. A BOVE ALL THE ENTIRE INCOME OF THE ASSESSEE IS EXEMPT U/S.10AA OF THE AC T AND THE ASSESSEE DOES NOT HAVE ANY OTHER ACTIVITY. 9. REFERRING TO A NUMBER OF DECISIONS HE SUBMITTED THA T THE SHARE APPLICATION MONEY CANNOT BE ADDED U/S. 68 OF THE AC T. HE SUBMITTED THAT WHEN THE ASSESSEE INFORMED THE ASSESSING OFFICER RE GARDING ITS INABILITY TO PRODUCE THE BALANCE SHEET OF M/S. SPSA, THE ASS ESSING OFFICER DID NOT CONDUCT ANY INDEPENDENT ENQUIRY. REFERRING TO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. C.K. N OORJAHAN REPORTED IN 237 ITR 570 HE SUBMITTED THAT EVEN IF THE INGREDIEN TS OF SECTION 69 (SECTION 68 IN THE INSTANT CASE) ARE SATISFIED, ADD ITION CANNOT BE MADE IF THE ATTENDANT CIRCUMSTANCES SHOW OTHERWISE. 10. FINALLY HE REFERRED TO THE COPY OF THE BALANCE SHEE T OF M/S. SPSA FOR FINANCIAL YEAR 2006 AND FINANCIAL YEAR 2007 PLA CED AT PAPER BOOK PAGES 8 TO 33. REFERRING TO THE CORRESPONDENCE BET WEEN THE COUNSEL AND MR. JEROME BURRIER OF SPSA HE SUBMITTED THAT AFTER MUCH PERSUASION M/S. SPSA HAS PROVIDED THE COPIES OF THE BALANCE SHEET A S ON 31 ST MARCH, 2006 I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 6 AND 31 ST MARCH, 2007 TO SHRI PINAKIN DESAI, CA AND COUNSEL OF THE ASSESSEE WITH A RIDER THAT THE SAME COULD BE PRODUCED BEFORE THE TAX DEPARTMENT ONLY AND SHOULD BE KEPT CONFIDENTIAL. HE SUBMITTED THAT THOUGH THESE DOCUMENTS WERE GIVEN BY SPSA TO ITS COUNSEL ON THE AFORESAID CONDITION THEY HAVE NOT BEEN MADE AVAILABLE TO THE ASSESSEE. HE ACCORDINGLY SUBMITTED THAT THE AFORESAID DOCUMENTS WHICH ARE BE ING FILED AS ADDITIONAL EVIDENCES BEFORE THE TRIBUNAL FOR THE FI RST TIME MAY BE ADMITTED AS IT WOULD UNDOUBTEDLY ESTABLISH THE CRED ITWORTHINESS OF SPSA BOTH DURING THE RELEVANT PREVIOUS YEAR AND EVEN THE REAFTER. HE SUBMITTED THAT PROPER COMPLIANCE WITH THE DIRECTIONS OF THE A SSESSING OFFICER COULD NOT BE MADE DUE TO CIRCUMSTANCES BEYOND THE CONTROL OF THE ASSESSEE AND NOT DUE TO ANY LAPSE OR NEGLIGENCE. REFERRING TO A NUMBER OF DECISIONS HE SUBMITTED THAT THE ADDITIONAL EVIDENCE IN THE SHAPE OF AUDITED BALANCE SHEET AS ON 31 ST DECEMBER, 2006 AND 31 ST DECEMBER, 2007 MAY BE ADMITTED AND THE MATTER MAY BE DECIDED ACCORDINGLY. 11. THE LEARNED DR, ON THE OTHER HAND, WHILE SUPPORTING THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) SUBMITTED THAT SINCE THE ASSESSEE COULD NOT FILE THE BALANCE SHEET OF SPSA TO PROVE T HE CREDITWORTHINESS OF THE SAID PARTY, THE ADDITION WAS MADE U/S. 68 OF TH E ACT. NOW THAT THE ASSESSEE HAS FILED THE BALANCE SHEET OF SPSA THE MA TTER MAY BE REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS MADE BY BO TH THE SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALS O CONSIDERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE ONLY ISSUE IN THE INSTANT CASE IS REGARDING THE ALLOWABILITY OR OTHERWISE OF SHARE AP PLICATION MONEY OF RS.2,26,72,557 MADE BY THE ASSESSING OFFICER U/S. 6 8 OF THE ACT WHICH HAS BEEN UPHELD BY THE CIT(A). WE FIND THERE IS NO DIS PUTE TO THE FACT THAT THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDING S HAS FURNISHED ALL DETAILS RELATING TO THE RECEIPT OF SHARE APPLICATIO N MONEY EXCEPT THE BALANCE SHEET OF SPSA FOR WHICH THE ASSESSING OFFIC ER DISBELIEVED THE I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 7 CREDITWORTHINESS OF THE SAID PARTY AND RELYING ON A HOST OF DECISIONS MADE THE ADDITION U/S. 68 OF THE ACT. WE FIND THE ASSES SEE HAS EXPRESSED ITS INABILITY TO PRODUCE THE BALANCE SHEET OF M/S. SPSA BEFORE THE ASSESSING OFFICER ON THE GROUND THAT THE SWISS PARTNER WAS NO T READY TO PART WITH ITS BALANCE SHEET ON THE GROUND OF TRADE SECRECY AND CO NFIDENTIALITY. WHEN THE ASSESSING OFFICER WAS INFORMED OF ALL THIS, WE FIND THE ASSESSING OFFICER HAS NOT TAKEN ANY STEPS BY WRITING TO THE S WISS PARTNER OR ITS NOMINEES IN THE BOARD OF DIRECTORS OF THE ASSESSEE COMPANY. SINCE THE ASSESSEE DURING THE HEARING BEFORE US HAS ULTIMATEL Y BEEN ABLE TO FILE THE AUDITED BALANCE SHEET OF SPSA FOR THE YEAR ENDING 3 1 ST DECEMBER, 2006 AND 31 ST DECEMBER, 2007 IN THE SHAPE OF ADDITIONAL EVIDENCE THE SAME IS ADMITTED. 13. FROM THE ENGLISH TRANSLATION OF THE AUDITED BALANCE SHEET WE FIND THE TOTAL EQUITY AS ON 31 ST DECEMBER, 2005 IS 48,13,552.75 SWISS FRANKS AND THE TOTAL EQUITY AS ON 31 ST DECEMBER, 2006 IS 47,34,297.28 SF. SIMILARLY WE FIND THAT THE TOTAL EQUITY AS ON 31 ST DECEMBER, 2007 OF SPSA IS 47,97,558.76 SF. THE ABOVE FIGURE OF NET EQUITY OF 48,13,553 SF AS ON 31 ST DECEMBER, 2005 AND THE NET EQUITY OF 47,97,558 SF AS ON 31 ST DECEMBER 2007 TALLIES WITH THE LETTER ADDRESSED BY THE SPSA TO THE ASSESSEE COMPANY APPEARING AT PAPER BOOK PAGE 23 AN D THE COPY OF WHICH WAS FILED BEFORE THE ASSESSING OFFICER. 14. WE FIND ALTHOUGH THE VARIOUS DOCUMENTS TO PROVE THE CREDITWORTHINESS OF SPSA WERE FILED BEFORE THE ASSE SSING OFFICER, HE DISBELIEVED THE SAME ON THE GROUND THAT THE BALANCE SHEET OF SPSA WAS NOT MADE AVAILABLE TO HIM TO VERIFY ITS CREDITWORTH INESS. THE ASSESSEE HAS FILED THE BALANCE SHEET OF SPSA WHICH CONCLUSIVELY PROVES ITS NET WORTH THE FIGURES OF WHICH WERE EARLIER GIVEN TO THE ASSE SSING OFFICER BY THE ASSESSEE. UNDER THESE CIRCUMSTANCES THE CREDITWORT HINESS OF SPSA, IN OUR OPINION, IS SUBSTANTIATED. THE IDENTITY OF THE PAR TY WAS NEVER IN DOUBT. THE GENUINENESS OF THE TRANSACTION WAS ALSO NEVER I N DOUBT. NOW THAT THE ASSESSEE HAS PROVED ALL THE THREE CRITERIA I.E., TH E IDENTITY, I.T.A. NO. 4911/MUM/09 M/S. KIARA JEWELLERY PVT. LTD . ================== 8 CREDITWORTHINESS OF THE PARTY AS WELL AS THE GENUIN ENESS OF THE TRANSACTION, THEREFORE, THE ADDITION OF RS.2,26,72, 557 CANNOT BE ADDED U/S. 68 OF THE ACT. IN THIS VIEW OF THE MATTER WE SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE T HE ADDITION. THE GROUNDS RAISED BY THE ASSESSEE ARE ACCORDINGLY ALLO WED. 15. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 11 TH DECEMBER, 2009. SD/- (R.V. EASWAR) SR. VICE PRESIDENT SD/- (R.K. PANDA) ACCOUNTANT MEMBER MUMBAI, DATED 11 TH DECEMBER, 2009 COPY TO: (1) THE APPELLANT, (2) THE RESPONDENT, (3) THE CIT (A)-XXIX, MUMBAI, (4) THE CIT-8, MUMBAI, (5) THE DR, A BENCH, ITAT, MUMBAI. //TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI TPRAO