ITO, Baddi V. M/s Lotus Foodstuff, Solan

ITA 537/CHANDI/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95608 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-09-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 10-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: PARIKSHIT AGGARWAL
• Keywords: Business expenditure; Income from undisclosed sources; Additional evidence; Royalty expenses
• Section: 68; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI H.L.KARWA, VICE PRESIDENT AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.537/CHD/2013 (ASSESSMENT YEAR : 2009-10) THE INCOME TAX OFFICER, VS. M/S LOTUS FOODSTUFF, BADDI, (H.P.). PLOT NO.38, BHATOLIKALAN, BADDI, DISTT. SOLAN. PAN: AACFL6740Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANJIT SINGH, DR RESPONDENT BY : SHRI PARIKSHIT AGGARWAL DATE OF HEARING : 21.09.2015 DATE OF PRONOUNCEMENT : 07.10.2015 O R D E R PER RANO JAIN, A.M . : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS), SHIMLA DATED 12.2.2013 FOR ASSESSMENT YE AR 2009-10. 2. THE ASSESSEE FIRM IS ENGAGED IN THE MANUFACTURI NG AND SALE OF CONFECTIONARY ITEMS. 3. THE GROUND NO.1 RAISED BY THE REVENUE IS RELATE D TO THE DISALLOWANCE OF RS.14,45,498/- MADE BY THE ASSE SSING 2 OFFICER ON ACCOUNT OF UNSECURED LOANS FROM SHRI PAN KAJ AGGARWAL. DURING THE COURSE OF ASSESSMENT PROCEED INGS, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE ASSES SEE HAD RAISED FRESH UNSECURED LOANS OF RS.17,50,498/-, OUT OF WHICH AN AMOUNT OF RS.14,45,498/- WAS RECEIVED FROM SHRI PANKAJ AGGARWAL. THE ASSESSING OFFICER TREATED THE SAID L OANS AS ASSESSEES OWN INCOME FROM UNDISCLOSED SOURCES AND MADE ADDITION UNDER SECTION 68 OF THE INCOME TAX ACT, 19 61 (IN SHORT THE ACT), ON THE GROUND THAT THE ASSESSEE HA D FAILED TO PROVE THE CREDITWORTHINESS OF THE CREDITORS AND THE GENUINENESS OF THE TRANSACTIONS. 4. BEFORE THE LEARNED CIT (APPEALS), THE ASSESSEE SOUGHT TO FURNISH CERTAIN FRESH EVIDENCES WITH REGA RD TO THE UNSECURED LOANS BASED ON THE FACT THAT THE ASSESSIN G OFFICER HAD NEVER CALLED FOR THE SAID DOCUMENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND, THEREFORE, THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FOR NOT FILING THE SA ME. THESE EVIDENCES WERE FORWARDED TO THE ASSESSING OFFICER B Y THE LEARNED CIT (APPEALS), WHO PREFERRED NOT TO COMMENT ON THE ISSUE OF ADMISSION OF ADDITIONAL EVIDENCE IN HIS RE MAND REPORT. THE LEARNED CIT (APPEALS) AFTER ADMITTING THE SAID ADDITIONAL EVIDENCES RECORDED HER FINDING AT PAGE 4 IN PARAS 3.5 AND 3.6 OF HER ORDER, WHICH READS AS UNDER : 3.5 AS REGARDS THE LOAN OF RS. 1445498/- RECEI VED BY THE ASSESSEE FROM SH.PANKAJ AGGARWAL, THE SOURCES OF THE SAID LOAN HAVE BEEN EXPLAINED AS FOLLOWS:- 3 PAYMENTS MADE ON BEHALF OF THE ASSESSEE FIRM DIRECTLY TO THREE ACES THROUGH CHEQUE NO. 326072 RS.69,000/- AMOUNT TRANSFERRED FROM OD A/C WITH PNB AFTER CLOSING FD OF RS.50 LACS RS. 343333/- AMOUNT TRANSFERRED FROM OD A/C WITH RS. 90285/- PNB AFTER CLOSING FD OF RS. 10 LACS BALANCE BROUGHT FORWARD FROM THE PRECEDING YEAR RS. 650 000/- ROYALTY CREDITED TO THE BOOKS OF ACCOUNT OF THE ASSESSEE FIRM RS. 292880/- 3.6 THE EXPLANATION FURNISHED BY THE ASSESSEE HAS B EEN EXAMINED WITH REFERENCE TO THE RELEVANT BANK ACCOUNTS AND THE BOO KS OF ACCOUNT OF THE ASSESSEE AND IS FOUND TO BE CORRECT AND COMPLETE. I T IS NOTED THAT THE FDS OF RS.50 LACS AND RS. 10 LACS GOT MATURED ON 19.5.2008 A ND SH. PANKAJ AGGARWAL RECEIVED AN AMOUNT OF RS. 54,39,761/- AND RS. 10,87,951/- RESPECTIVELY AGAINST THE SAME. AFTER THE ADJUSTMENT OF HIS DEBIT BALANCE IN THE GIVEN TWO ACCOUNTS, HE WAS LEFT WITH THE BALANCE OF RS.3,43,333/- AND RS.90,285/- RESPECTIVELY WHICH WAS TRANSFERRED TO T HE ASSESSES FIRM. HE IS ALSO FOUND TO HAVE MADE THE PAYMENT OF RS.69,000/- FROM HIS ACCOUNT WITH PNB TO THREE ACES GLOBAL ON 2/4/2008. IT IS ALSO NOTED FRO M THE BOOKS OF ACCOUNT THAT THE AMOUNT OF RS. 6,50, OOO/- WAS ALREADY EXISTING IN THE BOOKS OF ACCOUNT OF THE ASSESSEE FIRM IN THE PRECEDING YEAR. THE SAID AMOUN T WAS EARLIER RECORDED IN A SEPARATE HEAD UNDER THE NARRATION 'PNB - OD A/C (PA NKAJ AGGARWAL)'. BUT AFTER THE CLOSURE OF THE OD A/C OF SH. PANKAJ AGGARWAL AF TER THE MATURITY OF HIS FDS, THE SAID ENTRY OF RS. 6,50,000/-WAS TRANSFERRED IN THE B OOKS OF ACCOUNT OF THE ASSESSEE FIRM TO THE ACCOUNT OF UNSECURED LOANS IN THE NAME OF SH. PANKAJ AGGARWAL. THUS THE SAID AMOUNT OF RS.6,50,000/- WAS NOT ACTUALLY RECEIVED IN THE YEAR UNDER CONSIDERATION. THE REMAINING AMOUNT OF RS.292880/- WAS BOOKED IN THE NAME OF SH. PANKAJ AGGARWAL ON ACCOUNT OF TH E ROYALTY WHICH WAS PAYABLE TO HIM AND WHICH HAS BEEN DULY REFLECTED IN THE PROFI T AND LOSS ACCOUNT. IN FACT, THE ASSESSEE HAS ALSO ADDED BACK THE SAID ROYALTY TO ITS INCOME SINCE NO TAX WAS DEDUCTED AT SOURCE IN RESPECT THEREOF. THUS THE UNS ECURED LOAN OF RS.14,45,498/- STANDS FULLY EXPLAINED AS REGARDS ITS SOURCE, THE I DENTITY OF THE LENDERS AND THE GENUINENESS OF THE TRANSACTIONS. 4 5. AGGRIEVED BY THE SAID ORDER OF THE LEARNED CIT (APPEALS), THE DEPARTMENT HAS COME UP IN APPEAL BEF ORE US. THE LEARNED D.R. WHILE ARGUING THE CASE MADE MOST O F HIS SUBMISSIONS ON THE ISSUE OF ADMISSION OF ADDITIONAL EVIDENCES BY THE LEARNED CIT (APPEALS). HE ARGUED THAT THERE WAS NO REASON WITH THE ASSESSEE FOR NOT FILING THE SAID EV IDENCES BEFORE THE ASSESSING OFFICER. THEREFORE, THE LEARN ED CIT (APPEALS) SHOULD NOT HAVE ADMITTED THESE FRESH EVID ENCES. HE WAS OF THE VIEW THAT SUFFICIENT OPPORTUNITY WAS PRO VIDED BY THE ASSESSING OFFICER TO THE ASSESSEE TO PRODUCE TH ESE DOCUMENTS. THEREFORE, IT WAS PRAYED THAT THE ADMIS SION OF ADDITIONAL EVIDENCES MADE BY THE LEARNED CIT (APPEA LS) BE HELD AS AGAINST THE LAW AND THE ADDITION MADE BY TH E ASSESSING OFFICER BE CONFIRMED. 6. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED BEFORE US THAT THE REVENUE HAS NOT TAKEN ANY SPECIF IC GROUND AGAINST ADMISSION OF ADDITIONAL EVIDENCES BY THE LE ARNED CIT (APPEALS). FURTHER, THE ASSESSING OFFICER HIMSELF HAS NOT OBJECTED TO THE ADMISSION OF THESE EVIDENCES IN HIS REMAND REPORT. ON THE MERITS OF THE CASE, THE LEARNED CO UNSEL FOR THE ASSESSEE TOOK US TO VARIOUS PAGES ANNEXED WITH THE PAPER BOOK FILED BY THE ASSESSEE TO PROVE THAT THERE WAS NO REASON TO MAKE ADDITION OF THIS AMOUNT AS UNDISCLOSED INC OME OF THE ASSESSEE. 5 7. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIE S BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECORD. ON P ERUSAL OF THE PAPER BOOK, WE SEE THAT SHRI PANKANJ AGGARWALL IS THE SPOUSE OF ONE OF THE PARTNERS OF THE ASSESSEE FIRM AND IS ALSO AN INCOME TAX ASSESSEE. ALL AMOUNTS RECEIVED BY TH E ASSESSEE WERE THROUGH BANKING CHANNELS. SHRI PANKAJ AGARWAL HAS MADE PAYMENT OF RS.69,000/- FROM HIS ACCOUNT WITH P NB TO THREE ACES GLOBAL AS ON 2.4.2008, ON BEHALF OF THE ASSESSEE FIRM. FURTHER IT IS SEEN THAT AMOUNT OF RS.3,43,33 3/- AND AMOUNT OF RS.90,285/- WERE CREDITED AS ON 11.5.2008 AND 19.5.2008 RESPECTIVELY TO THE ACCOUNT OF THE ASSESS EE FROM OD ACCOUNT OF SHRI PANKAJ AGGARWAL MAINTAINED WITH THE PNB. THIS IS QUITE EVIDENT FROM THE PERUSAL OF THE COPY OF BANK STATEMENT OF SHRI PANKAJ AGGARWAL ANNEXED AT PAPER BOOK PAGES 14 TO 17. AN AMOUNT OF RS.6,50,000/- WAS CR EDITED AS ON 19.5.2008. THIS AMOUNT WAS RECEIVED THROUGH TWO CHEQUES AMOUNTING TO RS.3,50,000/- AND RS.3 LACS ON 23.5.2 007 AND 26.5.2007 RESPECTIVELY I.E. IN THE EARLIER ASSESSME NT YEAR. ON PERUSAL OF THE LEDGER ACCOUNT IN THE NAME OF SHRI P ANKAJ AGGARWAL PNB OD ACCOUNT FILED BY THE ASSESSEE, IT I S SEEN THAT THIS AMOUNT HAS COME FROM THE PRECEDING YEAR AND TH IS YEAR THIS AMOUNT HAS BEEN TRANSFERRED TO THE MAIN LOAN A CCOUNT OF SHRI PANKAJ AGGARWAL. FURTHER, AN AMOUNT OF RS.2, 92,880/- WAS CREDITED AS ON 31.3.2009, WHICH IS SAID TO BE T HE CREDIT OF ROYALTY @ 1% ON SALE OF RS.2,92,88,040/- PAID TO SH RI PANKAJ 6 AGGARWAL. FROM THE PERUSAL OF THE PROFIT & LOSS A CCOUNT, IT IS SEEN THAT THE SAID ROYALTY EXPENSES HAVE BEEN DU LY DEBITED TO THE PROFIT & LOSS ACCOUNT AND THE ASSESSING OFFI CER HAS NOT RAISED ANY ISSUE AGAINST THE SAME. IN VIEW OF THE SE PLETHORA OF REASONS AS DULY EXPLAINED TO US, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (APPEALS) AS SHRI PANKAJ AGGARWAL IS THE SPOUSE OF ONE OF THE PARTNER S AND REGULAR INCOME TAX ASSESSEE. HIS PAN NUMBER AND BA NK STATEMENTS ALL ARE ON RECORD. THE IDENTITY OF SHR I PANKAJ AGGARWAL CANNOT BE DOUBTED. FURTHER, AS REGARDS TH E CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION S AS EXPLAINED EARLIER, THE SOURCE OF MONEY FROMWHERE SH RI PANKAJ AGGARWAL HAS GIVEN THE AMOUNTS TO THE ASSESSEE HAS BEEN ELABORATELY DISCLOSED BY THE ASSESSEE. THEREFORE, THE IDENTITY, CREDITWORTHINESS AND GENUINENESS HAVING B EEN PROVED, WE CONFIRM THE ORDER OF THE LEARNED CIT (AP PEALS) IN THIS REGARD. AS REGARDS THE LEARNED D.R.S CONTEN TION THAT THE LEARNED CIT (APPEALS) SHOULD NOT HAVE ADMITTED THE ADDITIONAL EVIDENCES, WE SEE THAT NO SPECIFIC GROUN D IN THIS REGARD HAS BEEN RAISED BY THE DEPARTMENT AND THE LE ARNED CIT (APPEALS) WAS QUITE SATISFIED WITH THE EXPLANATION OF THE ASSESSEE TO THE EFFECT THAT IT WAS PREVENTED BY SUF FICIENT CAUSE FOR FILING THESE EVIDENCES BEFORE THE ASSESSING OFF ICER. THE FACT THAT THE ASSESSING OFFICER HAD NOT COMMENTED A GAINST THE ADMISSION OF ADDITIONAL EVIDENCES IN HIS REMAND REP ORT IS ALSO IMPORTANT IN THIS REGARD. IT IS QUITE EVIDENT THAT THE LEARNED CIT (APPEALS) HAS GIVEN SUFFICIENT OPPORTUN ITY TO THE ASSESSING OFFICER TO CHECK THE ADDITIONAL EVIDENCES FILED BY 7 THE ASSESSEE. THEREFORE, WE DO NOT INTERFERE IN TH E ACTION OF THE LEARNED CIT (APPEALS) IN ADMITTING THE ADDITION AL EVIDENCES. THIS GROUND OF APPEAL RAISED BY THE REV ENUE IS DISMISSED. 8. THE GROUND NO.2 RAISED BY THE REVENUE RELATES T O DELETION OF DISALLOWANCE OF RS.4,40,070/- MADE BY T HE ASSESSING OFFICER ON ACCOUNT OF EXPENSES SHOWN PAYA BLE IN THE BALANCE SHEET. 9. THE FACTS OF THE CASE ARE THAT THE ASSESSEE HAD SHOWN ELECTRICITY CHARGES, WATER CHARGES, FBT, AUDI T FEE AND FREIGHT INWARD AMOUNTING TO RS.4,40,070/- AS PAYABL E UNDER THE HEAD CURRENT LIABILITY. THE ASSESSING OFFIC ER MADE THE ADDITION ON ACCOUNT OF THESE LIABILITIES HOLDING TH AT THE ASSESSEE HAD NOT BEEN ABLE TO FURNISH ANY EVIDENCE REGARDING THE PAYMENT OF THESE EXPENSES. 10. BEFORE THE LEARNED CIT (APPEALS), IT WAS SUBMI TTED THAT THE ASSESSEE WAS NEVER ASKED TO FURNISH THE EV IDENCE TO PROVE THE GENUINENESS OF THE EXPENSES PAYABLE. FU RTHER, IT WAS CONTENDED THAT ALL THESE EXPENSES HAVE BEEN PAI D IN THE SUCCEEDING YEAR. THE BALANCE SHEET OF THE NEXT YE AR AND THE COPIES OF ACCOUNT OF THESE EXPENSES WERE FILED BEFO RE THE ASSESSING OFFICER. AFTER PERUSING THE STATEMENT O F THE ASSESSEE, THE LEARNED CIT (APPEALS) ALLOWED THE APP EAL OF THE ASSESSEE IN THIS REGARD HOLDING AS UNDER : 4.2 IT WAS SUBMITTED BY THE APPELLANT THAT IT WAS NOT ASKED TO FURNISH THE EVIDENCE TO PROVE THE GENUIN ENESS OF THE 8 EXPENSES PAYABLE CLAIMED IN THE BALANCE SHEET AND TH AT IT HAD FURNISHED THE COPIES OF ACCOUNT OF THE NEXT YEAR BE FORE THE A.O. SHOWING THE DETAILS OF PAYMENTS/ADJUSTMENTS OF THE E XPENSES MADE IN THE NEXT YEAR. THE CONTENTION OF THE ASSES SEE IS FOUND TO BE FACTUALLY CORRECT FROM THE PERUSAL OF THE ASSESSMEN T RECORDS. IT IS NOTED THAT THE EXPENSES PAYABLE CLAIMED BY THE ASSESS EE DULY STAND ACCOUNTED FOR IN THE NEXT YEAR'S ACCOUNT STAT EMENTS RELATING TO THE GIVEN HEADS OF EXPENSES. IT IS ALSO PERTINENT T O NOTE THAT THE FBT WAS ALREADY ADDED BACK BY THE ASSESSEE IN ITS INCOME IN THE COMPUTATION OF TOTAL INCOME. THE A.O. DOES NOT APPEAR TO HAVE PAID ANY ATTENTION TO THE DOCUMENTS FURNISHED BY THE ASS ESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS EVIDENCING THE PAYM ENT OF EXPENSES IN THE SUCCEEDING YEAR. HENCE THE ADDITION MADE BY HIM IS NOT FOUND SUSTAINABLE AND IS DIRECTED TO BE DEL ETED. 11. THE LEARNED D.R. RELIED UPON THE ORDER OF THE ASSESSING OFFICER, WHILE THE LEARNED COUNSEL FOR TH E ASSESSEE RELIED UPON THE ORDER OF THE LEARNED CIT (APPEALS). 12. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF B OTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIE S BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECORD. FROM THE PERUSAL OF THE ORDER OF THE LEARNED CIT (APPEALS), WE SEE THAT SHE HAS VERY ACCURATELY WEIGHED THE EVIDENCES FILED BY THE ASSESSEE. THERE WERE CERTAIN EXPENSES WHICH WERE S HOWN AS PAYABLE AT THE END OF THE RELEVANT ASSESSMENT YEAR. HOWEVER, ALL THESE EXPENSES WERE PAID DURING THE SUCCEEDING ASSESSMENT YEAR. THEREFORE,, THE GENUINENESS OF TH ESE EXPENSES CANNOT BE DOUBTED. THE CONTENTION OF THE ASSESSING OFFICER IS THAT THE ASSESSEE HAS NOT FURNISHED ANY SUCH EVIDENCES. HOWEVER, FROM THE PERUSAL OF THE ASSES SMENT 9 RECORD, THE LEARNED CIT (APPEALS) HAS HELD THAT THE SE EVIDENCES WERE FILED BEFORE THE ASSESSING OFFICER A ND WE SEE FROM THE REMAND REPORT THAT THE ASSESSING OFFICER H AS NOT MADE ANY ADVERSE REMARKS IN THIS REGARD. IN THE PA PER BOOK FILED BEFORE US, ALL LEDGER ACCOUNTS OF THESE EXPEN SES HAVE BEEN FILED FROM PAGES 20 ONWARDS. FROM THE PERUSAL OF THESE, IT IS QUITE CLEAR THAT THE PAYMENT OR ADJUSTMENT OF THESE EXPENSES HAVE BEEN DULY MADE IN THE NEXT YEAR. FU RTHER, THE AMOUNT OF FBT PAYABLE HAS ALREADY BEEN ADDED BACK B Y THE ASSESSEE IN ITS RETURN OF INCOME, THE SAME CANNOT B E ADDED AGAIN BY THE ASSESSING OFFICER. IN VIEW OF THIS, W E DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (APPE ALS). THE GROUND RAISED BY THE REVENUE IS DISMISSED. 13. THE GROUND NO.3 RAISED BY THE REVENUE IS WITH REGARD TO DISALLOWANCE OF RS.5,75,017/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF CURRENT LIABILITY S HOWN IN THE BALANCE SHEET. THE FACTS OF THE CASE ARE THAT CERT AIN CURRENT LIABILITIES AMOUNTING TO RS.5,75,017/- WERE SHOWN I N THE BALANCE SHEET OF THE ASSESSEE. THE ASSESSING OFFI CER MADE THE ADDITION UNDER SECTION 68 OF THE ACT WITH REGAR D TO THESE LIABILITIES STATING THAT THESE ARE PETTY LOANS AND THE ASSESSEE HAS NOT BEEN ABLE TO PROVE THE CREDITWORTHINESS OF THE PERSONS CONCERNED IN RESPECT OF THESE PETTY LOANS. 14. BEFORE THE LEARNED CIT (APPEALS), THE CONTENTI ON OF THE ASSESSEE WAS THAT THESE LIABILITIES WERE PAID O R ADJUSTED IN THE SUCCEEDING FINANCIAL YEAR AS THESE WERE IN T HE NATURE OF OUTSTANDING PAYMENTS WHICH WERE TO BE MADE TO VARIO US 10 WORKERS. THESE LIABILITIES ALSO INCLUDED CERTAIN PETTY PAYMENTS PERTAINING TO THE PETTY BUSINESS EXPENSES. FURTHER, IT WAS SUBMITTED THAT AN AMOUNT OF RS.1,39 ,592/- WAS PAYABLE TO ONE SHRI SHEESH KUMAR AND RS.2,40,73 5/- WAS PAYABLE TO ONE SHRI RAVI PANDIT AND THE SAID PAYMEN TS WERE DUE ON ACCOUNT OF THE CONSTRUCTION WORK OF THE FACT ORY BUILDING. SINCE THESE EXPENSES WERE IN THE NATURE OF CAPITAL EXPENSES AND WERE NOT DEBITED TO PROFIT & LOSS ACCO UNT. 15. AFTER CONSIDERING THE SUBMISSIONS OF THE ASSES SEE, THE LEARNED CIT (APPEALS) NOTED THAT THIS AMOUNT OF RS.5,75,017/- WAS BOOKED BY THE ASSESSEE IN THE NAM ES OF 55 PERSONS, MOST OF WHOM WERE WORKERS, PEONS, CARPENTE RS, ETC. SINCE THE ASSESSING OFFICER HAS MADE THIS ADDITION ARBITRARILY, SHE DELETED THE ADDITION RECORDING HER FINDING IN PARA 5.6 OF HIS ORDER, WHICH READS AS UNDER : 5.6 THE APPELLANT'S SUBMISSIONS HAVE BEEN CAREFULLY CONSIDERED WITH REFERENCE TO ITS BOOKS OF ACCOUNT AND SUPPORTING DOCUMENTS. IT IS NOTED THAT THE AMOUNT OF RS.5,75,0 17.88 HAS BEEN BOOKED BY THE ASSESSEE IN THE NAME OF 55 PERSONS, M OST OF WHOM ARE WORKERS, PEON, CARPENTERS ETC. THE A. 0. AT NO STAGE OF THE ASSESSMENT PROCEEDINGS SEEMS TO HAVE RAISED ANY QUE RY ABOUT THE DETAILS PERTAINING TO THE SAID CURRENT LIABILITIES. BUT SURPRISINGLY ENOUGH, THROUGH NOTING SHEET ENTRY DATED 14/12/2011 , HE HAS RECORDED THAT THE ASSESSEE HAS SHOWN 'HIS INABILITY TO PROVE GENUINENESS /CREDITWORTHINESS OF CREDITORS OF RS.5,7 5,017/- SHOWN AS CREDITS UNDER HEAD OTHER WORK.' THUS THE ASSESSING OFFICER HAS MADE THE ADDITION IN A TOTALLY ARBITRARY MANNER WITHOUT E VEN TRYING TO UNDERSTAND THE TRUE CHARACTER OF THE ENTRIES IN THE BALANCE SHEET AND, IN THE PROCESS, BY TREATING THE EXPENSES PAYABLE AS CASH CREDITS WITHIN THE MEANING OF SECTION 68 OF THE ACT. THE ADDITION 11 MADE IN SUCH A CASUAL MANNER WITHOUT ANY BASIS IS NOT F OUND TO BE SUSTAINABLE AND IS DIRECTED TO BE DELETED. 16. THE LEARNED D.R. RELIED UPON THE ORDER OF THE ASSESSING OFFICER WHILE THE LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON THE ORDER OF THE LEARNED CIT (APPEALS). 17. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF B OTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHORITIE S BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECORD. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (APPE ALS) IN THIS REGARD AS SHE HAS RECORDED A FINDING THAT THE ASSES SING OFFICER AT NO STAGE OF THE ASSESSMENT PROCEEDINGS S EEMS TO HAVE RAISED ANY QUERY ABOUT THE DETAILS PERTAINING TO THE SAID CURRENT LIABILITIES BUT FROM NOTING SHEET ENTRY DAT ED 14.12.2011, HE HAS RECORDED THAT THE ASSESSEE HAS S HOWN HIS INABILITY TO PROVE THE GENUINENESS/CREDITWORTHINESS OF THESE CREDITORS SHOWN AS CREDITS UNDER THE HEAD OTHER WO RKS. THUS, THE ADDITION SO MADE BY THE ASSESSING OFFICER WAS QUITE ARBITRARY. WE HAVE ALSO PERUSED THE PAPER BOOK PAG ES 38 AND 39, WHEREBY THE DETAILS OF ALL THESE CURRENT LIABIL ITIES AMOUNTING TO RS.5,75,017/- HAS BEEN FILED. FROM TH E PERUSAL OF THESE DOCUMENTS, IT IS SEEN THAT ALL THESE LIABI LITIES HAVE BEEN PAID OR ADJUSTED IN THE SUCCEEDING YEAR. THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER HAS NOT COMMENTED A DVERSELY ON ANY OF THESE PAYMENTS. EVEN BEFORE US, THE LEAR NED D.R. COULD NOT BRING ON RECORD ANYTHING AGAINST THESE SU BMISSIONS. IN VIEW OF THESE, THE FINDING GIVEN BY THE LEARNED CIT 12 (APPEALS) IS CONFIRMED. THE GROUND OF APPEAL RAIS ED BY THE REVENUE IS DISMISSED. 18. THE GROUND NOS.4 AND 5 ARE GENERAL IN NATURE A ND NEEDS NO ADJUDICATION. 19. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF OCTOBER, 2015. SD/- SD/- (H.L.KARWA) (RANO JAIN) VICE PRESIDENT ACOUNTANT MEMBER DATED : 7 TH OCTOBER, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH