ADDL CIT 12(1), MUMBAI V. RAJESHWAR PRASAD DUBEY, MUMBAI

ITA 5132/MUM/2010

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3210 (ITAT-MUMBAI)
• Duration Of Justice: 5 year(s) 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2016
• Appeal Filed By: Department
• Bench Allotted: J
• Next Hearing Date: 29-01-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 21-06-2010
• Court: TRIBUNAL
• Assessee Lawyers: KISHORE K PODDAR
• Keywords: Unexplained cash credit; Business expenditure; Corroborative evidences
• Section: 143(3); 133A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J , MUMBAI BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN , JUDICIAL MEMBER ITA NO. 3854/MUM/2010 : (A.Y : 20 06 - 07 ) RAJESHWAR PRASAD DUBEY 2, SETHI MANSION, 12, KUMPTHA STREET, BALLARD ESTATE, MUMBAI - 1. PAN : ACZPD9533G VS. ASST. COMMISSIONER OF INCOME TAX - 12(1), MUMBAI. ITA NO. 5132/MUM/2010 : (A.Y : 20 06 - 07 ) ASST. COMMISSIONER OF INCOME TAX - 12(1), MUMBAI. VS. RAJESHWAR PRASAD DUBEY 2, SETHI MANSION, 12, KUMPTHA STREET, BALLARD ESTATE, MUMBAI - 1. PAN : ACZPD9533G (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KISHORE K. PODDAR REVENUE BY : SHRI M.M. CHATE (DR) DATE OF HEARING : 18 / 03 /201 6 DATE OF PRONOUNCEMENT : 27/05 /201 6 O R D E R PER R.C. SHARMA, AM : THESE ARE CROSS - APPEALS FILED BY THE ASSESSEE AND THE REVENUE AGAINST ORDER OF CIT(A) FOR A.Y 2006 - 07, IN THE MATTER OF ORDER PASSED U/S. 143(3) OF THE INCOME TAX ACT, 1961. 2 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED . FACTS IN BRIEF ARE THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF CUSTOM HOUSE AGENT AND TRANSPORT OPERATOR. DURING THE YEAR UNDER CONSIDERATION RETURN WAS FILED AT INCOME OF RS.1.01 CRORES WHICH WAS ASSESSED BY THE AO AT RS. 6.62 CRORES, WHEREIN VARI OUS ADDITIONS WERE MADE ON ACCOUNT OF DISALLOWANCE OF VEHICLE REPAIR, DIESEL AND FUEL, TRAVELLING AND TELEPHONE. ADDITION WAS ALSO MADE U/S 68 IN RESPECT OF UNACCOUNTED CASH CREDIT. SUNDRY CREDITORS WERE ALSO ADDED ON THE PLEA OF BOGUS EXPENSES LEADING TO BOGUS LIABILITY AMOUNTING TO RS. 92.91 LACS AND CESSATION OF LIABILITY U/S. 41(1). INTEREST EXPENSE WAS ALSO DISALLOWED ON THE PLEA THAT THERE WAS DIVERSION OF INTEREST BEARING FUNDS TO SISTER CONCERNS. THE AO ALSO TREATED LONG TERM CAPITAL GAINS AS INCOME FROM OTHER SOURCES. 3. BY THE IMPUGNED ORDER, CIT(A) ALLOWED ASSESSEES CLAIM OF LONG TERM CAPITAL GAINS AND UNEXPLAINED CASH CREDIT U/S 68. HOWEVER, CIT(A) CONFIRMED THE DISALLOWANCE OF EXPENDITURE UNDER THE HEAD VEHICLE REPAIRS AND MAINTENAN CE, TRAVELLING AND CONVEYANCE, TELEPHONE & MOBILE CHARGES, COOLIE CHARGES, SALES PROMOTION, SUNDRY EXPENSES, STAFF WELFARE EXPENSES, REPAIRS AND MAINTENANCE. THE CIT(A) HAS ALSO CONFIRMED DISALLOWANCE OF RS.13,41,516/ - OUT OF REIMBURSABLE E XPENSES IN LINE WITH THE STAND TAKEN BY THE TRIBUNAL IN EARLIER YEARS. ADDITION OF RS.32,27,360/ - WAS UPHELD ON ACCOUNT OF SUNLAND ALLOYS ON THE PRESUMPTION THAT THIS PARTY WAS ASSESSEES SUPPLIER ON WHOSE ACCOUNT BOGUS EXPENDITURE ARE BOOKED. ADDITION O F RS.7,84,219/ - WAS UPHELD ON ACCOUNT OF RADHA KRISHNA SHIPPING PVT. LTD. ON THE PRESUMPTION THAT 3 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 THIS PARTY WAS ASSESSEES SUPPLIER ON WHOSE ACCOUNT BOGUS EXPENDITURE ARE BOOKED BY THE ASSESSEE. THE CIT(A) ALSO CONFIRMED ADDITION OF RS.17,54,540/ - ON ACC OUNT OF CESSATION OF LIABILITY OF DATTA TYRE RETREADING SERVICES U/S. 41(1) ON THE PLEA THAT THIS LIABILITY NO MORE EXISTS. THIS ADDITION WAS ON PROTECTIVE BASIS. SIMILARLY, ADDITION OF RS.7,28,434/ - WAS MADE ON ACCOUNT OF CESSATION OF LIABILITY OF M/S. NISHU TRANSPORT ON PROTECTIVE BASIS. SIMILARLY, PROTECTIVE ADDITION WAS MADE ON ACCOUNT OF CESSATION OF LIABILITY OF M/S. SUMAN AUTOMOBILE, M/S. S.S. TRANSPORT, M/S. S.R. ROADLINES, M/S. TRAVANCORE TYRES, M/S. ROYAL TRANSPORT, M/S. M.S. TRANSPORT, M/S. NA NDI TRANSPORT, M/S. JAYEM RETREADS PVT. LTD., M/S. K.K. TRANSPORT, M/S. JOSHI TRANSPORT, M/S. PINGLE TRANSPORT, M/S. SANJAY METAL CORPORATION, M/S. SHAKTI ENTERPRISES, M/S. SWILL LTD., M/S. VIMAL TRANSPORT, M/S. BHAGWATI NARESH SETHIA AND M/S. INTERNATIONA L EXPRESS CO. DISALLOWANCE WAS ALSO UPHELD BY CIT(A) OUT OF EXPENSES CLAIMED UNDER THE HEAD INTEREST AMOUNTING TO RS.10,75,846/ - . 4. AGAINST THE ABOVE ORDER OF CIT(A), BOTH THE ASSESSEE AND THE REVENUE ARE IN APPEAL BEFORE US. IT WAS ARGUED BY THE LD. AR THAT THE ACTUAL BILLS AND VOUCHERS COULD NOT BE PRESENTED BEFORE THE AO AS THEY WERE LYING UNDER SEIZURE WITH VARIOUS AUTHORITIES SUCH AS DGCEI, ZONAL UNIT, MUMBAI, CBI, MUMBAI UNIT, ETC. AND THE APPELLANT HAD BROUGHT THIS FACT BEFORE THE AO. THIS FACT WAS ALSO RECORDED BY THE OFFICIALS OF INCOME TAX DEPARTMENT DURING THE SURVEY ACTION U/S 133A CARRIED OUT ON THE APPELLANT ON 23 RD JANUARY, 2007. THE INABILITY OF THE APPELLANT TO PRODUCE THE ACTUAL BILLS AND VOUCHERS BEFORE THE AO UNDER THE GIVEN CIRCUMS TANCES SHOULD NOT BE TAKEN AS AN EXCUSE FOR DISALLOWANCE OF 4 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 GENUINE EXPENSES WHICH ARE INCURRED IN THE NORMAL COURSE OF BUSINESS. THIS POINT BECOMES ALL THE MORE SIGNIFICANT IN THIS CASE GIVEN THE FACT THAT THE TOTAL INCOME EARNED AND NET PROFIT DECLARED B Y THE APPELLANT FOR THE YEAR UNDER CONSIDERATION IS THE HIGHEST EVER DECLARED BY HIM. THE APPELLANT HAS A FLEET OF 56 COMMERCIAL VEHICLES AND THE TOTAL EXPENSES UNDER THE HEAD 'VEHICLE REPAIRS & MAINTENANCE' INCURRED IN CASH IS RS. 13,91,088/ - ONLY. ON AVE RAGE BASIS THE CASH EXPENSES WILL WORK OUT TO HARDLY RS. 2,000/ - PER MONTH / PER VEHICLE WHICH CANNOT BE HELD TO BE EXCESSIVE. 5. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM THE RE CORD THAT THE AO HAS BASICALLY MADE DISALLOWANCE ON THE PLEA THAT EXPENSES WERE INCURRED IN CASH AND THERE IS PERSONAL ELEMENT IN THE EXPENDITURE SO INCURRED. BY THE IMPUGNED ORDER, CIT(A) RESTRICTED THE DISALLOWANCE TO THE EXTENT OF 10% OF THE EXPENSES. KEEPING IN VIEW THE TOTALITY OF THE FACTS WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) FOR RESTRICTING THE DISALLOWANCE TO 10%. THUS, WITH REGARD TO THE DISALLOWANCE UNDER THE HEAD VEHICLE REPAIRS AND MAINTENANCE, TRAVELLING EXPENSES, TEL EPHONE AND MOBILE EXPENSES, COOLIE & CARTAGE, REIMBURSABLE EXPENSE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A). ACCORDINGLY, WE UPHOLD THE ADDITIONS SO SUSTAINED BY THE CIT(A). 6. THE AO HAS ALSO MADE ADDITION ON ACCOUNT OF SOME OF THE SUPPLIERS OF THE ASSESSEE ON THE PLEA THAT THE EXPENDITURE SO BOOKED WERE BOGUS, WHEREAS THE CONTENTION OF THE LD. AR WAS THAT ALL THESE 5 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 PARTIES WERE ASSESSEES DEBTORS TO WHOM SERVICES HAVE BEEN PROV IDED AND INCOME HAS BEEN EARNED. WE HAVE VERIFIED DOCUMENTS PLACED ON RECORD. IN THE INTEREST OF JUSTICE, WE RESTORE GROUND NOS. 6 TO 9 WHICH PERTAINS TO ADDITION MADE BY AO ON ACCOUNT OF BOGUS EXPENDITURE TO THE FILE OF THE AO FOR DECIDING AFRESH AFTER VERIFYING CORRECT NATURE OF THE TRANSACTION AS TO WHETHER THESE WERE DEBTORS OR CREDITORS. THE CONTENTION OF THE ASSESSEE IS THAT THESE ARE DEBTORS FROM WHOM ASSESSEE HAS EARNED INCOME. THE AO IS DIRECTED TO DECIDE AFRESH AFTER GIVING DUE OPPORTUNITY TO THE ASSESSEE. 7. THE CIT(A) HAS ALSO UPHELD THE ADDITION ON ACCOUNT OF CASH PAYMENT MADE TO M/S. KGN AUTO ELECTRICALS AND M/S. DATTA TYRE RETREADING SERVICES. THE MERE FACT OF MAKING CASH PAYMENT CANNOT BE MADE THE REASON FOR DISALLOWANCE, MORE PARTICULA RLY WHEN THE INCOME OFFERED BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION WAS THE HIGHEST AS COMPARED TO THE EXPENDITURE INCURRED IN SUCCEEDING AND EARLIER YEARS. IN THE INTEREST OF JUSTICE, BOTH THESE GROUNDS ARE ALSO RESTORED TO THE FILE OF THE AO FOR DECIDING AFRESH THE GENUINENESS OF THE EXPENDITURE AND TO FIND OUT WHETHER THE EXPENDITURE WERE ACTUALLY INCURRED FOR THE PURPOSE OF BUSINESS OR OTHERWISE. WE DIRECT ACCORDINGLY. 8. IN GROUND NOS. 12 TO 30, THE ASSESSEE HAS AGITATED ADDITION S MADE B Y THE AO U/S 41(1) ON PROTECTIVE BASIS BY HOLDING THAT LIABILIT Y NO MORE EXISTS. 9. THE LIABILITY WAS PERTAINING TO THE FOLLOWING PARTIES : 6 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 1 . M/S DATTA TYRE RETREADING SER. : RS. 17,54,540/ - 2 . M/S SUMAN AUTOMOBILES : RS. 32,27,360/ - 3 . M/S S.S. TRANSPORT : RS. 14,18,502/ - 4 . M/S S.R. ROADLINES : RS. 1,65,386/ - 5 . M/S TRAVANCORE TYRE : RS. 8,10,080/ - 6 . M/S ROYAL TRANSPORT : RS. 15,89,583/ - 7 . M/S M.S. TRANSPORT : RS. 12,56,656/ - 8 . M/S NANDI TRANSPORT : RS. 15,18,160/ - 9 . M/S JAYEM RETREADS PVT. LTD. : RS. 52,330/ - 10 . M/S K.K. TRANSPORT : RS. 13,54,403/ - 11 . M/S JOSHI TRANSPORT : RS. 13,22,620/ - 12 . M/S PINGLE TRANSPORT : RS. 14,659/ - 13 . M/S SANJAY METAL CORPORATION : RS. 26,815/ - 14 . M/S SHAKTI ENTERPRISES : RS. 19,898/ - 15 . M/S SWIL LTD. : RS. 13,354/ - 16 . M/S VIMAL TRANSPORT CO. : RS. 7,100/ - 17 . M/S BHAGWATI NARESH SETHIA : RS. 24,010/ - TOTAL RS. RS.145,75,456/ - THE AO NOTED IN THE CASES OF 10 PARTIES, THE NOTICES U/S.133(6) ISSUED TO THE ADDRESSES GIVEN BY THE ASSESSEE HAVE COME BACK UN - SERVED. THE ASSESSEE WAS UNABLE TO PRODUCE THE PARTY OR THE BILLS RAISED ON THOSE PARTY OR THE RECEIPTS TOWARDS PAYMENT OF CASH TO THEM. THE LEDGER ACCOUNT SHOWS THAT ONLY C ASH PAYMENTS WERE MADE BY THE ASSESSEE IN SUBSEQUENT FINANCIAL YEAR I.E. 2007 - 08. THE AO OBSERVED THAT THIS FINANCIAL YEAR HAS JUST LAPSED NINE MONTHS BACK AND THE AUDIT WAS COMPLETED ONLY SIX MONTHS BACK. BUT STILL THE ASSESSEE IS UNABLE TO PRODUCE ANY RE CEIPTS WITH REGARD TO THE PAYMENTS TO ALL THESE PARTIES. AS PER THE ASSESSEE'S CLAIM THESE LIABILITIES RELATE TO EARLIER ASSESSMENT YEAR. AS ON 31.03.2006, THE ASSESSEE IS UNABLE TO PROVE THE SUSTENANCE OF LIABILITY. 2 SUMAN AUTOMOBILES 32,27,360 5 S.S. TRANSPORT 14,18,502 7 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 6 S.R. ROADLINES 1,65,386 7 TRAVANCORE TYRE 8,10,080 10 ROYAL TRANSPORT 15,89,583 11 M.S. TRANSPORT 12,56,656 12 NANDI TRANSPORT 15,18,160 17 JAYEM RETREADS PVT. LTD. 52,330 19 K.K. TRANSPORT 13,54,403 21 JOSHI TRANSPORT 13,22,620 TOTAL 1,27,15,080 ADDITION WAS MADE ON PROTECTIVE BASIS ON ACCOUNT OF CESSATION OF LIABILITY U/S.41(1) OF THE INCOME TAX ACT IN THE CASE OF BALANCE 10 PARTIES TO THE TUNE OF RS.1,27,15,080/ - . FURTHER, IN RESPECT OF SUNDRY CREDITORS OF BELOW RS.50,000/ - , THE ASSESSEE HAD SHOWN DIFFERENT AMOUNTS PAYABLE TO DIFFERENT PARTIES IN EACH CASE TOTALING TO RS.50,000/ - . THE DETAILS WERE AS UNDER: 1 PINGLE TRANSPORT 14,659.00 2 SANJAY METALS CORPORATION 26,815.00 3 SHAKTI ENTERPRISES 19,898.00 4 SWIL LTD. 13,354.10 5 VIMAL TRANSPORT CO. 7,100.00 6 BHAGWATI NARESH SETHIA 24,010.00 TOTAL 1,05,836.1 10. IT WAS ARGUED BY THE LD. DR THAT T HE ASSESSEE HAS BEEN GIVEN VARIOUS OPPORTUNITIES TO EXPLAIN THE SUSTENANCE OF LIABILITY IN ALL THESE CASES. HE COULD NOT PROVE THE SAME. HE ALSO FAILED TO PRODUCE THE COPIES OF BILL/VOUCHERS FOR THE ASSESSMENT YEAR IN WHICH THESE LIABILITIES HAVE ARISEN. REGARDING REPAYMENT ALSO THE ASSESSEE COULD NOT FURNISH ANY DETAILS. HENCE ALL THESE LIABILITIES WERE TREATED AS NON - EXISTING AND THE SAME WERE ADDED U/S.41(1) TOWARDS CESSATION OF LIABILITY. 8 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 11. BY THE IMPUGNED ORDER, CIT(A) CONFIRMED THE ADDITION BY OBSERVING AS UNDER : 9.3 LN VIEW OF THE FACT THAT THE APPELLANT HAS NOT BEEN ABLE TO SUBMIT ANY SUPPORTING EVIDENCE TO PROVE THE LIABILITY AND SINCE THE LIABILITY PERTAINS TO EARLIER YEARS, THE ASSESSING OFFICER'S ACTION IN TREATING THE ADDITION U/S 41(1) IN THE PRESENT ASSESSMENT YEAR VIZ. AY 2006 - 07 ON PROTECTIVE BASIS, IS THUS SUSTAINED.. 12. IT WAS THE CONTENTION OF THE LD. AR THAT THESE LIABILITIES ACTUALLY EXISTED DURING THE YEAR AND WERE SUBSEQUENTLY PAID. THEREFORE, THERE IS NO REASON TO HOLD THAT THERE WAS CESSATION OF ANY LIABILITY. HE FURTHER SUBMITTED THAT SINCE THE RECORDS WERE SEIZED BY VARIO US DEPARTMENTS, ASSESSEE COULD NOT FULLY SUBSTANTIATE ITS CLAIM. IN THE INTEREST OF JUSTICE AND FAIR PLAY, WE SET - ASIDE THE PROTECTIVE ADDITION MADE ON ACCOUNT OF CESSATION OF LIABILITY AND THE MATTER IS RESTORED BACK TO THE FILE OF THE AO FOR DECIDING AF RESH. THE ASSESSEE IS ALSO DIRECTED TO PRODUCE DETAILS OF ACTUAL PAYMENT MADE TO THESE PARTIES IN SUBSEQUENT YEARS AND ALSO CONFIRMATION FROM THESE PARTIES AS TO WHETHER THE LIABILITY WAS CONTINUING OR CEASED. WE DIRECT ACCORDINGLY. 13. GROUND NO. 31 RE LATES TO DISALLOWANCE OF RS.10,75,846/ - OUT OF EXPENSES CLAIMED UNDER THE HEAD INTEREST. IT WAS THE CONTENTION OF THE LD. AR THAT INTEREST OF RS.8,25,545/ - WAS ON HIRE PURCHASE OF COMMERCIAL VEHICLES, RS. 2,18,909/ - WAS PAID ON OVERDRAFT FACILITY AND RS. 4,392/ - WAS FOR DELAYED PAYMENT MADE TO CREDITORS. AS PER THE LD. AR ALL ARE BUSINESS EXPENSES. OUR ATTENTION WAS ALSO INVITED TO THE CAPITAL AND 9 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 FREE FUNDS AVAILABLE TO THE ASSESSEE WHICH WAS ALLEGED TO BE USED FOR THESE PAYMENTS. RELYING ON THE DECISI ON OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF M/S. RELIANCE UTILITY IT WAS CONTENDED BY THE LD. AR THAT NO DISALLOWANCE SHOULD BE MADE. 14 . WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND FOUND THAT PRIMA FACIE INTEREST APPEARS TO BE INCURRED FOR THE PURPOSE OF BUSINESS. IN THE INTEREST OF JUSTICE, WE RESTORE THIS MATTER BACK TO THE FILE OF THE AO FOR VERIFYING THE ACTUAL TRANSACTION OF PAYMENT AND NATURE OF PAYMENT. THE AO IS ALSO TO VERIFY AVAILABILITY OF IN TEREST FREE FUNDS WITH THE ASSESSEE AND TO DECIDE THE ISSUE AFRESH AS PER THE PROPOSITION OF LAW LAID DOWN BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF M/S. RELIANCE UTILITY. WE DIRECT ACCORDINGLY. 1 5 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED IN PART. 1 6 . IN THE APPEAL SO FILED, REVENUE IS AGGRIEVED BY ACTION OF CIT(A) DIRECTING TO ALLOW EXEMPTION U/S 10(38) ON LONG TERM CAPITAL GAINS. 1 7 . WITH REGARD TO LONG TERM CAPITAL GAINS OFFERED BY THE ASSESSEE AS EXEMPT U/S. 10(38), T HE AO NOTED THAT IN THE COMPUTATION OF INCOME, THE ASSESSEE HAS STATED THAT HE HAD LONG TERM CAPITAL GAINS ON SALE OF SHARES EXEMPT U/S.10(38) (AS PER STATEMENT ATTACHED). BUT NO SUCH STATEMENT WAS ATTACHED AND EVEN ON THE RETURN OF INCOME AGAINST THE COLUMN PROFITS & GA INS FROM TRANSACTIONS CHARGEABLE TO STT THE AMOUNT WAS MENTIONED AS NIL. 10 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 1 8 . BY THE IMPUGNED ORDER, CIT(A) ALLOWED ASSESSEES CLAIM OF LONG TERM CAPITAL GAINS AFTER OBSERVING AS UNDER : 11.3 I HAVE CONSIDERED THE SUBMISSIONS MADE FOR THE APPELLANT AND THE ASSESSMENT ORDER. IN VIEW OF THE FACT THAT THE SALE AND PURCHASE OF SHARES ARE SUPPORTED BY THE CONTRACT NOTES AND ARE REFLECTED IN THE DEMAT ACCOUNT AND THE FORM 10DB, THE ASSESSING OFFICER IS DIRECTED TO TREAT THE INCOME FROM CAPITAL GAINS AND ALLOW EXEMPTION U/S 10(38) STRICTLY IN TERMS OF THE PROVISIONS OF I T ACT AFTER VERIFICATION OF FORM NO. 10DB. 1 9 . WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND FOUND THAT A CLEAR FINDING HAS BEEN RECORDED BY CIT(A) TO THE EFFECT THAT BOTH SALE AND PURCHASE OF SHARES WERE SUPPORTED BY CONTRACT NOTE AND ALSO REFLECTED IN THE DEMAT ACCOUNT AND FORM 10DB. ACCORDINGLY, THERE IS NO JUSTIFICATION FOR DECLINING ASSESSEES CLAIM OF LONG TERM CAPITAL GAINS. THE FINDINGS SO RECORDED BY CIT(A) HAS NOT BEE N CONTROVERTED BY THE LD. DR BY BRINGING ANY POSITIVE MATERIAL ON RECORD. ACCORDINGLY, WE DO NOT FIND ANY REASON TO INTERFERE IN THE FINDINGS OF CIT(A) DIRECTING TO ALLOW LONG TERM CAPITAL GAINS AFTER VERIFICATION OF FORM NO.10DB. 20 . THE REVENUE IS ALSO AGGRIEVED FOR DELETING THE ADDITION MADE BY THE AO IN RESPECT OF CASH RECEIVED FROM SISTER CONCERN AS UNEXPLAINED CREDIT U/S. 68. IN THIS RESPECT, T HE AO FOUND THAT M/S. SAINATH INDUSTRIES THE SISTER CONCERN OF THE ASSESSEE IS ENGAGED IN THE MANUFACTURIN G OF ALUMINUM INGOTS. THE ASSESSEE RENDERS TRANSPORTATION SERVICES FOR THE MATERIALS OF THE SISTER CONCERN. THE AO HELD THAT ASSESSEES VERSION THAT THE ACCOUNT COPY OF THE SAINATH INDUSTRIES FILED ON 7.11.2008 IS ONLY A ROUGH COPY CANNOT BE ACCEPTED BEC AUSE 11 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 THIS WAS THE ACCOUNT COPY GIVEN BY THE ASSESSEE ONLY BUT NOT BY ANY OTHER PERSON. BOTH THE CASH ENTRIES ON 31.03.2006 ARE ALSO SUPPORTED BY CASH RECEIPTS NO. 3/142 & 3/143. IF THE ASSESSEES VERSION IS TO BE ACCEPTED THE RECEIPTS SHOULD BE MANY MOR E BUT NOT TWO. BOTH THE PARTIES ARE HAVING BANK ACCOUNTS AND THERE IS NO NECESSITY FOR TRANSACTING IN CASH THAT ALSO IN LAKHS BETWEEN BOTH OF THEM. AS THE ACCOUNTS ARE COMPUTERIZED, THE ASSESSEE COULD ALTER THE DATES OF TRANSACTIONS AS IT SUITED TO HIM WHE N FOUND NOT TALLYING WITH THE BOOKS OF SISTER CONCERNS. HENCE, THE ASSESSEES VERSION WAS REJECTED AND THE CASH ENTRIES WERE TREATED AS UNEXPLAINED CASH CREDITS IN THE BOOKS OF ASSESSEE AND BROUGHT TO TAX U/S. 68 OF THE INCOME TAX ACT, 1961 AND ADDITION W AS MADE U/S. 68 OF RS.79,57,528/ - . 2 1 . BY THE IMPUGNED ORDER, CIT(A) DELETED THE ADDITION AFTER OBSERVING AS UNDER : 5.3 I HAVE CONSIDERED THE SUBMISSIONS MADE FOR THE APPELLANT AND THE ASSESSMENT ORDER. ALTHOUGH THE NECESSITY FOR CASH TRANSACTIONS HAS NOT BEEN DEMONSTRATED THE FACT REMAINS THAT THE ENTRIES IN THE ACCOUNT OF BOTH THE APPELLANT AND M/S. SAINATH INDUSTRIES DO NOT DIFFER. THE APPELLANTS EXPLANATION REGARDING THE CASTING DIFFERENCE ARISING OUT OF RS.36,000/ - READ AS RS. 3,600/ - AND THAT C ASH RECEIPT NUMBER REFLECTED AS TALLY SYSTEM OF ACCOUNTING THROWS UP CASH RECEIPT NUMBER AUTOMATICALLY ARE PLAUSIBLE. THE ASSESSING OFFICER HAS REJECTED THE APPELLANTS VERSION, IN EFFECT MERELY BECAUSE THE COPY OF 12 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 ACCOUNT OF SAINATH INDUSTRIES WAS FURNIS HED BY THE APPELLANT AND THAT ALTERATIONS IN ACCOUNT COULD BE MADE AT WILL AS ALL THE ACCOUNTS ARE COMPUTERIZED. THESE BY THEMSELVES CANNOT BE TREATED AS SUFFICIENT JUSTIFICATION FOR REJECTION, THE ASSESSING OFFICERS ACTION IN MAKING ADDITION ON THIS COU NT IS THUS DELETED. 2 2 . WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND FOUND THAT THE AMOUNTS SO RAISED BY ASSESSEE FROM SISTER CONCERN WAS DULY REFLECTED IN THE BOOKS OF SISTER CONCERN AS WELL AS IN THE BOOKS OF ASSESSEE. THE ADDITION WAS MADE BY THE AO ON THE PLEA THAT COPY OF ACCOUNT OF SISTER CONCERN, M/S. SAINATH INDUSTRIES WAS NOT FURNISHED BY ASSESSEE AND THAT ALTER ATION IN ACCOUNT COULD BE MADE AT WILL AS ALL ACCOUNTS WERE COMPUTERIZED. IN THE ABSENCE OF COPY OF ACCOUNT AND CONFIRMATION BY SISTER CONCERN REGARDING PAYMENT OF THESE AMOUNT, WE DO NOT FIND ANY JUSTIFICATION IN THE ORDER OF CIT(A) DELETING THE ADDITION MADE U/S.68 WITHOUT GIVING ANY FINDING ON GENUINENESS AND CREDITWORTHINESS. IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER OF CIT(A) ON THIS ISSUE AND RESTORE THE MATTER BACK TO THE FILE OF AO FOR DECIDING AFRESH AFTER GIVING DUE OPPORTUNITIES TO THE ASSESSEE. WE DIRECT ACCORDINGLY. 2 3 . IN THE RESULT, THE APPEAL OF REVENUE AS WELL AS APPEAL OF THE ASSESSEE IS ALLOWED IN PART FOR STATISTICAL PURPOSE S . ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH MAY , 2016. SD/ - SD/ - S SD/ D/ - SD/ - ( SANDEEP GOSAIN ) JUDICIAL MEMBER (R.C. SHARMA) ACCOUNTANT MEMBER MUMBAI, DATE : 27 TH MAY 2016 *SSL* 13 RAJESHWAR PRASAD DUBEY ITA NOS. 3854 & 5132/MUM/2010 COPY TO : 1) THE APPLICANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, J BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI