Sri Nelli Trmurthulu, Rajahmundry V. The ITO, Rajahmundry

ITA 86/VIZ/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 6651 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2011-2012
• Appeal Filed On: 23-02-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: T SATYANANDAM
• Keywords: Unexplained investment; Business income; Source of fund; Additional evidence; Corroborative evidences

Judgement Text

ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . . ' , % BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./I.T.A.NO.86/VIZAG/2017 ( / ASSESSMENT YEAR: 2011-12) SRI NELLI TRIMURTHULU RAJAHMUNDRY ITO, WARD - 1 , RAJAHMUNDRY [PAN NO. AWUPM0955E ] ( ' / APPELLANT) ( ()' / RESPONDENT) / APPELLANT BY : SHRI C. SUBRAHMANYAM, AR / RESPONDENT BY : SHRI T. SATYANANDAM, DR / DATE OF HEARING : 20.09.2017 / DATE OF PRONOUNCEMENT : 27.09.2017 / O R D E R PER D.S. SUNDER SINGH, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), {CIT(A)}, RAJ AHMUNDRY DATED 1.12.2016 FOR THE ASSESSMENT YEAR 2011-12. 2. GROUND NO1.0 & 1.6 ARE GENERAL IN NATURE, WHICH DO NOT REQUIRE ANY SPECIFIC ADJUDICATION. ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 2 3. GROUND NO.1.1 & 1.2 ARE RELATED TO THE ESTIMATIO N OF INCOME AT 10% OF THE PURCHASE PRICE AS AGAINST THE INCOME ADM ITTED BY THE ASSESSEE IN HIS BOOKS OF ACCOUNTS. THE ASSESSEE I S CARRYING ON BUSINESS OF INDIAN MADE FOREIGN LIQUOR (IMFL), HAD FILED THE RETURN OF INCOME DECLARING TOTAL INCOME OF 5,18,650/-. THE C ASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND THE A.O., DID NOT ACC EPT THE INCOME DECLARED BY THE ASSESSEE AND ESTIMATED THE PROFIT F ROM THE BUSINESS AT 20% OF THE STOCK PUT TO SALE AND ACCORDINGLY COMPUT ED THE BUSINESS INCOME FROM IMFL AT RS.27,12,473/-. ON APPEAL, THE CIT(A) HAS SCALED DOWN THE PERCENTAGE OF PROFIT FROM 20% TO 10% AND D IRECTED THE A.O. TO RE-COMPUTE THE INCOME AT 10% OF PURCHASE PRICE. 4. ON BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL. AT THE TIME OF HEARING, THE LD. COUN SEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ISSUE INVOLVED IN THIS APPEA L IS SQUARELY COVERED IN THE CASE OF SRI VYSYARAJU SATYANARAYANA RAJU, SR IKAKULAM DIST. IN ITA NO.2/VIZAG/2016, WHICH IS REPRODUCED AS UNDER: 3. ON BEING AGGRIEVED, ASSESSEE CARRIED MATTER IN A PPEAL BEFORE THE TRIBUNAL. AT THE TIME OF HEARING, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ISSUE INVOLVED IN THIS APPEAL IS SQUARELY COVERED BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL W HERE THE TRIBUNAL HAS SCALED DOWN THE ESTIMATION OF PROFIT FROM 10% TO 5% IN THE CASE OF TANGUDU JOGISETTY IN ITA NO.96/VIZAG/2016 BY ORDER DATED 2.6.2016. 4. ON THE OTHER HAND, THE LD. D.R. STRONGLY SUPPORT ED THE ORDER PASSED BY THE AUTHORITIES BELOW. ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 3 5. I HAVE HEARD BOTH THE PARTIES, PERUSED THE MATERI ALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS ESTIMATION OF PROF IT IN RESPECT OF IMFL BUSINESS CARRIED BY THE ASSESSEE. IN THIS RESPECT, THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF TANGUDU JOGISETTY (SUPR A) HAS CONSIDERED THE PROFIT LEVEL IN THE LINE OF BUSINESS AND DECIDED TH AT 5% OF PURCHASE PRICE IS REASONABLE PROFIT MARGIN IN THE LINE OF IMFL BUSI NESS AND DIRECTED THE A.O. TO RE-COMPUTE THE PROFIT OF THE ASSESSEE. THE RELEVANT PORTION OF THE ORDER IS EXTRACTED AS UNDER: 8. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATE RIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THE A.O. ESTIMATED NET PROFIT OF 20% ON STOCK PUT FOR SALE. THE A.O. WAS OF THE OPINION THAT THE ASSESSEE HAS NOT MAINTAINED PROPER BOOKS OF ACCOUNTS AND VOUCHERS IN SUPPORT OF PURCHASES AND SALES. TH E A.O. FURTHER OBSERVED THAT THE ASSESSEE HAS FAILED TO MAINTAIN S TOCK REGISTERS AND BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE ARE NO T SUSCEPTIBLE FOR VERIFICATION, THEREFORE REJECTED THE BOOKS OF ACCOU NTS AND ESTIMATED NET PROFIT OF 20% BY RELYING UPON THE DECISION OF HONB LE A.P. HIGH COURT. IT IS THE CONTENTION OF THE ASSESSEE THAT THE NET PROF IT ESTIMATED BY THE A.O. IS QUITE HIGH WHEN COMPARED TO THE NATURE OF B USINESS CARRIED ON BY THE ASSESSEE. IT IS FURTHER SUBMITTED THAT THE CASE LAW RELIED UPON BY THE ASSESSEE IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. THE CASE BEFORE THE HONBLE A.P. HIGH COURT WAS THAT THE ASS ESSEE IS INTO THE BUSINESS OF TRADING IN ARRACK, WHEREAS IT IS IN THE BUSINESS OF DEALING IN IMFL. THE ASSESSEE FURTHER CONTENDED THAT IMFL TRA DE WAS CONTROLLED BY THE STATE GOVERNMENT THROUGH A.P. STATE BEVERAGE S CORPORATION LTD. AND THE PRICES OF THE PRODUCTS ARE FIXED BY THE STA TE GOVERNMENT. THE ASSESSEE BEING A LICENSE HOLDER OF STATE GOVERNMENT CANNOT SELL THE PRODUCTS OVER AND ABOVE THE MRP FIXED BY THE STATE GOVERNMENT. WE FIND FORCE IN THE ARGUMENTS OF THE ASSESSEE FOR THE REASON THAT THE A.O. HAS ESTIMATED THE NET PROFIT BY RELYING UPON THE DE CISION OF A.P. HIGH COURT IN THE CASE OF CIT VS. R. NARAYANA RAO IN ITA NO.3 OF 2003 WHICH IS RENDERED UNDER DIFFERENT FACTS. THE A.P. HIGH C OURT HAS CONSIDERED THE CASE OF AN ARRACK DEALER, WHEREAS, THE ASSESSEE IS INTO THE BUSINESS OF DEALING IN IMFL. THEREFORE, WE ARE OF THE VIEW T HAT THE A.O. WAS NOT JUSTIFIED IN RELYING UPON THE JUDGEMENT, WHICH WAS RENDERED UNDER DIFFERENT FACTS TO ESTIMATE THE NET PROFIT. ON THE OTHER HAND, THE LD. A.R. FOR THE ASSESSEE, RELIED UPON THE DECISION OF ITAT, VISAKHAPATNAM BENCH IN THE CASE OF T. APPALASWAMY VS. ACIT IN ITA NO.65 & 66/VIZAG/2012. WE HAVE GONE THROUGH THE CASE LAWS RELIED UPON BY THE ASSESSEE IN THE LIGHT OF THE FACTS OF THE PRESENT C ASE AND FINDS THAT THE COORDINATE BENCH OF THIS TRIBUNAL, UNDER SIMILAR CI RCUMSTANCES HELD THAT ESTIMATION OF 5% NET PROFIT ON PURCHASES IS REASONA BLE. THE RELEVANT PORTION OF THE ORDER IS REPRODUCED HEREUNDER: 3. WE HAVE HEARD THE PARTIES, PERUSED THE ORDERS O F THE REVENUE AUTHORITIES AS WELL AS OTHER MATERIALS ON R ECORD. IT IS THE CONTENTION OF THE LD. A.R. THAT THE ESTIMATION OF P ROFIT AT 16% IS ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 4 HIGH AND EXCESSIVE CONSIDERING THE NORMAL RATE OF P ROFIT IN THIS LINE OF BUSINESS. WHEREAS, THE LD. D.R. SUPPORTED THE O RDER OF THE CIT(A). HAVING CONSIDERED THE SUBMISSIONS OF THE A SSESSEE, WE ARE OF THE VIEW THAT THE ISSUE IS NO MORE RES INTEG RA IN VIEW OF A SERIES OF DECISIONS OF THE ITAT HYDERABAD BENCH IN SIMILAR CASES. THE COORDINATE BENCH IN CASE OF ITA NO.127/HYD/12 A ND OTHERS DATED 18.05.2012 AS WELL AS A NUMBER OF OTHER CASES HAVE HELD THAT PROFIT IN CASE OF BUSINESS IN INDIAN MADE FOREI GN LIQUOR HAS TO BE ESTIMATED AT 5% OF THE PURCHASES MADE BY THE ASS ESSEE. THEREFORE, FOLLOWING THE DECISION OF THE ITAT HYDER ABAD BENCH, WE SET ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE AS SESSING OFFICER TO ESTIMATE THE PROFIT FROM THE WINE BUSINESS OF THE A SSESSEE BY APPLYING THE RATE OF 5% OF THE PURCHASES MADE NET O F ALL OTHER DEDUCTIONS. THE ASSESSING OFFICER SHOULD ALSO BEAR IN MIND THAT IN NO CASE THE INCOME DETERMINED SHOULD BE BELOW THE I NCOME RETURNED. 9. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THIS CASE AND ALSO RESPECTFULLY FOLLOWING THE RATIOS OF COORDINATE BEN CH, WE ARE OF THE VIEW THAT THE NET PROFIT ESTIMATED BY THE A.O. BY RELYIN G UPON THE DECISION OF HONBLE A.P. HIGH COURT (SUPRA), WHICH WAS RENDERED UNDER DIFFERENT FACTS IS QUITE HIGH. ON THE OTHER HAND, THE ASSESS EE RELIED UPON THE DECISION OF COORDINATE BENCH AND THE COORDINATE BEN CH UNDER SIMILAR CIRCUMSTANCES ESTIMATED THE NET PROFIT OF 5% ON TOT AL PURCHASES NET OF ALL DEDUCTIONS. NO CONTRARY DECISION IS PLACED ON RECORD BY THE REVENUE TO TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY THE COORDINATE BENCH. THEREFORE, WE DIRECT THE A.O. TO ESTIMATE THE NET PROFIT OF 5% ON TOTAL PURCHASES NET OF ALL DEDUCTIO NS. ORDERED ACCORDINGLY. 5. IN VIEW OF THE ABOVE DECISION OF THE COORDINATE BENCH OF THE TRIBUNAL, WE DIRECT THE A.O. TO RE-COMPUTE THE INCO ME OF THE ASSESSEE AT 5% OF PURCHASE PRICE. ACCORDINGLY, THIS GROUND OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED. 6. GROUND NOS.1.3 TO 1.5 ARE RELATED TO THE ADDITIO N WITH REGARD TO UNEXPLAINED INVESTMENT OF ` 6.00 LAKHS AND UNSECURED LOANS OF ` 19,15,000/-. DURING THE ASSESSMENT PROCEEDINGS, TH E A.O. FOUND THAT ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 5 THE ASSESSEE HAS INTRODUCED THE ADDITION TO THE CAP ITAL ACCOUNT TO THE EXTENT OF ` 6.00 LAKHS. THE ASSESSEE EXPLAINED THAT HE HAS WO RKED IN VARIOUS WINE SHOPS AND HIS SON IS WORKING AS TEACHE R AND THE SOURCES WERE ACCUMULATED SAVINGS OUT OF THEIR PERSONAL INCO ME. HOWEVER, NO EVIDENCE WAS BROUGHT ON RECORD TO SHOW THAT THE ASS ESSEE HAS SAVED THE SUM OF ` 6.00 LAKHS AND BROUGHT INTO THE CAPITAL ACCOUNT. THEREFORE, THE A.O. DISBELIEVING THE SOURCE FOR INT RODUCTION OF CAPITAL THE SAME WAS ADDED BACK TO THE INCOME. AGGRIEVED BY THE ORDER OF THE A.O., THE A SSESSEE WENT ON APPEAL BEFORE THE CIT(A) AND THE LD. CIT(A) CONFIRMED THE ADDITION. AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE ASSESSEE FILED APPEAL BEFORE THIS TRIBUNAL. DURING THE APPEAL HEARING, THE LD. A.R. AR GUED THAT IN THIS CASE THE THE AO HAS ESTIMATED THE INCOME AND ONCE THE IN COME IS ESTIMATED. NO FURTHER ADDITION REQUIRED TO BE MADE. HOWEVER, I T IS OBSERVED THE ABOVE ARGUMENT APPEARS TO BE CORRECT IF THE INTRODU CTION OF CAPITAL IS GENERATED OUT OF THE BUSINESS INCOME. IN THE INSTAN T CASE, CAPITAL WAS INTRODUCED IN THE BEGINNING OF THE YEAR AND THERE W AS NO NEXUS FOR INTRODUCTION OF CAPITAL AND THE BUSINESS INCOME. T HE ASSESSEE FILED RETURN OF INCOME FOR THE FIRST TIME FOR THE FINANCI AL YEAR 2010-11 AND AS ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 6 EXPLAINED BY THE LD. A.R., THE ASSESSEE WAS WORKING IN WINE SHOP AND THE INCOME EARNED FROM THE WINE SHOP AS SALARY WAS SUFFICIENT TO MEET THE PERSONAL REQUIREMENTS AND THERE IS NO SCOPE FOR GENERATION OF THE SURPLUS. HENCE THE ARGUMENT OF THE LD.A.R THE ON ES TIMATION OF INCOME NO FURTHER ADDITION CALLED FOR AND THE SOURCE FROM THE PERSONAL SAVINGS IS UNTENABLE. LD. A.R. DID NOT BRING ANY EVIDENCE TO PROVE THE GENUINENESS AND SOURCE OF THE INTRODUCTION OF CAPIT AL, THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT( A) AND THE SAME IS UPHELD. THE APPEAL OF THE ASSESSEE ON THESE GROUND S IS DISMISSED. 7. THE NEXT ISSUE OF ADDITION IS ` 19,15,000/- CONFIRMED BY THE LD. CIT(A) WITH REGARD TO UNSECURED LOANS. DURING THE ASSESSMENT PROCEEDINGS, THE A.O. FOUND THAT THE ASSESSEE HAS R ECEIVED UNSECURED LOANS OF ` 19,15,000/- AND FURNISHED THE CONFIRMATION LETTER S FROM 13 CREDITORSFOR A SUM OF ` 17,55,000/- AND NO CONFIRMATION WAS FURNISHED BY THE ASSESSEE FOR THE BALANCE AMOUNT OF ` 1,60,000/-. FROM THE CONFIRMATION LETTERS, THE A.O. FOUND THE FOLLOWING DEFECTS WITH REGARD TO THE SOURCE AND GENUINESS: 4(III) AS SEEN FROM THE UNSECURED LOAN CREDITOR DET AILS MENTIONED IN PARA 4(1) ABOVE, ALL THE 13 PERSONS HAVE GIVEN DEMAND DRAFTS OF RS.1,35,000 EACH IN THE NAME OF PROHIBITION EXCISE SUPERINTENDENT AS AD MITTED BY THE CONCERNED PERSONS. THE AMOUNTS WERE NOT GIVEN TO TH E ASSESSEE DIRECTLY THROUGH ACCOUNT PAYEE CHEQUES OR DRAFTS DRAWN IN FA VOUR OF THE ASSESSEE. FURTHER, IT IS SEEN THAT THE CREDITORS HA VE NOT EVEN MENTIONED THE DATES OF GIVING LOANS. IN THE CIRCUMSTANCES AND FOR THE FOLLOWING ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 7 MENTIONED FURTHER REASONS, THE UNSECURED LOAN AMOUN TS TOTALLING TO RS.17,55,000 (13 X 1,35,000) ARE TREATED AS UNEXPLA INED UNSECURED LOANS: A. THE CREDITORS DID NOT FURNISH ANY DOCUMENTARY EVIDE NCES/BANK ACCOUNT EXTRACTS FOR IMMEDIATE AVAILABILITY OF FUNDS FOR TA KING DEMAND DRAFTS. EVEN COUNTER FOILS FOR TAKING THE DD'S ARE NOT FILE D. THUS, GENUINENESS OF LOAN TRANSACTION IS NOT PROVED WITH NECESSARY EVIDE NCES. B. ALL THE DEMAND DRAFTS ARE FOR THE SAME AMOUNT OF RS -1,35,000 WHICH APPEAR TO BE ABNORMAL. C. ALL THE FEMALE CREDITORS HAVE SHOWN THEIR SOURCES O F INCOME AS SAREE DESIGNING AND EMBROIDERY WORKS WITHOUT ANY DOCUMENT ARY EVIDENCES FOR THE SAME. THUS, CREDITWORTHINESS OF THE CREDITORS IS NO T PROVED. D. ALL THE MALE CREDITORS HAVE SHOWN THEIR SOURCES OF INCOME AS ACCUMULATED SAVINGS FROM PRIVATE EMPLOYMENT IN A STEREO TYPE MA NNER WITHOUT ANY RELEVANT DOCUMENTARY EVIDENCES. THUS, CREDITWORTHIN ESS OF THE CREDITORS IS NOT PROVED. E. MERE FILING OF CONFIRMATIONS FROM THE CREDITORS ARE NOT SUFFICIENT ENOUGH TO PROVE THE GENUINENESS OF THE LOAN TRANSACTIONS. F. THE ASSESSEE HAS NOT PAID OR PROVIDED ANY INTEREST FOR THE UNSECURED LOANS OBTAINED FROM THE SO CALLED BELOW AVERAGE MIDDLE CL ASS PERSONS. ANY SUCH PRUDENT UNSECURED LOAN CREDITOR WOULD NOT LEND MONI ES WITHOUT CHARGING ANY INTEREST. ALL THE ABOVE POINTS TEND TO SHOW THA T THE UNSECURED LOAN CREDITOR AMOUNTS ARE MERE PAPER ENTRIES. HENCE, THE LD. A.O. HELD THAT THE UNSECURED LOANS ARE NOT GENUINE TRANSACTIONS AND THE SAME WAS ADDED BACK TO THE INC OME. AGGRIEVED BY THE ORDER OF THE A.O., THE AS SESSEE WENT ON APPEAL BEFORE THE CIT(A) AND THE LD. CIT(A) HAS CONFIRMED THE ADDITION MADE BY THE A.O. DURING THE APPEAL HEARING, BEFORE THE CIT(A), THE ASSESSEE FILED ADDITIONAL EVIDENCE IN THE FORM OF AFFIDAVITS AND THE LD. CIT(A) HAS CALLED FOR THE REMAND REPORT FROM THE A.O. THE A.O . FURNISHED REMAND REPORTS STATING THAT NO FRESH EVIDENCE WAS FURNISHE D BY THE ASSESSEE ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 8 AND THE ASSESSING OFFICER HAS ALREADY EXAMINED THE CREDITS IN DETAIL AND BROUGHT THE DEFECTS, HENCE THE ADDITIONAL EVIDENCE NEED NOT BE CONSIDERED U/S 46A OF THE ACT. THE LD. CIT(A) EXAM INED THE CREDITS WITH RESPECT TO THE CONFIRMATION LETTERS AND OTHER SUPPORTING PARTICULARS FILED BEFORE THE A.O. AND THE AFFIDAVITS FILED DURI NG THE APPEAL HEARING AND THE REMAND REPORT AND CONFIRMED THE UNSECURED L OANS HOLDING THAT THE UNSECURED LOANS ARE NOT GENUINE. FOR READY REF ERENCE, WE EXTRACT THE RELEVANT PARAGRAPHS OF THE LD. CIT(A) ORDER AS UNDER: 7.1 CREDIT IN THE NAME OF J. PEDDIRALU: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE J. PEDDIRAJU, S/O. KANAKARAJU, 3-19, KADALI ON 05.12.2 013 CONFIRMING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. SUBSEQUEN TLY, DURING THE APPEAL HEARING AN AFFIDAVIT FROM ONE JOGI PEDDIRAJU S./O. SUBBA RAO RESIDENT OF D.NO.2-29/1, KADALI VILLAGE WAS FILED C ONFIRMING THE SAID ADVANCE. THE ASSESSEE FAILED TO PRODUCE THE CREDITO R FOR EXAMINATION. IT IS NOTED THAT THE SIGNATURE IN THE CONFIRMATION LETTER AND THE SIGNATURE IN THE AFFIDAVIT WERE TOTALLY DIF FERENT. THE FATHER'S NAME AND ADDRESS STATED IN THE AFFIDAVIT AND CONFIR MATION LETTER WERE DIFFERENT. THUS THE IDENTITY OF THIS ALLEGED CREDIT OR AND GENUINENESS OF THE TRANSACTION WAS NOT PROVED. IT IS ALSO NOTED THAT SIMILAR AFFIDAVIT WAS FILED FROM JOGI PEDDIRAJU IN THE CASE OF ANOTHER LIQUOR DEALER KATTA SRINIVSA RAO CONFIRMING ADVANCE OF RS. 1.35 LAKH. AS PER HOUSEHOLD CARD ENCLOSED WITH THESE AFFIDAVITS THE A NNUAL INCOME OF THE SAID PERSON WAS ONLY RS.20,000/-. IT IS IMPROBA BLE THAT THIS PARTY WITHOUT ANY REGULAR SOURCE OF INCOME COULD ADVANCE SUCH HUGE AMOUNTS, INDICATING HE WAS MERELY A NAME LENDER WIT HOUT ANY SOURCE. IN THE CIRCUMSTANCES, IT IS HELD THAT THE A SSESSEE FAILED TO PROVE THE IDENTITY AND CREDITWORTHINESS OF THIS TRA NSACTION. HENCE THE IMPUGNED ADDITION IN REGARD TO THIS CREDITOR IS CON FIRMED. 7.2 CREDIT IN THE NAME OF M. PARVATHI: THE ASSESSEE FILED CONFIRMATION LETTER DATED 05.03. 2014 BEFORE THE AO AT A LATER STAGE FROM ONE M. PARVATHI DEVI, W/O. SAI BABU ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 9 CONFIRMING LOAN OF RS.1.35 LAKH TO THE ASSESSEE BY WAY OF DDS. SUBSEQUENTLY THE ASSESSEE FILED AFFIDAVIT FROM ONE MEKA PARVATTHI DEVI CONFIRMING THAT SHE GAVE LOAN OF RS. 1.35 LAKH BY WAY OF DD TO THE ASSESSEE. A COPY OF HER RETURN OF INCOME FOR THREE YEARS I.E. A.Y.2010-11, A.Y.2011-12 -'A.Y.201 2-13 WERE ALSO FILED. WITH REFERENCE TO THESE IT WAS CONTENDED TH AT THE LOAN TRANSACTION WAS GENUINE. IT IS ALSO NOTED THAT THE RETURNS WERE FILED ON 07.08.2013 MUCH AFTER THE FILING OF CONFIRMATION LETTER. THE RETURNS OF INCOME FOR A.Y.2010 - 11 & A.Y.2011-12 ARE NOT VALID AND ONLY INCOME BELOW TAXABLE LIMITS WERE DECLARED. THE SE INDICATE THAT THE FILING OF RETURNS WAS ONLY AN AFTERTHOUGHT. IT IS ALSO NOTED THAT AN AFFIDAVIT WAS FILED FROM MEKA PARVATHI DEVI BEARING SAME ADDRESS AND IDENTITY IN THE CASE OF KATTA SRINIVASA RAO, AN OTHER LIQUOR DEALER CONFIRMING ADVANCE OF RS.1.35 LAKH TO HIM. THE INCO ME DECLARED IN THE RETURN OF INCOME WAS RS.1,20,000/-. IT IS IMPRO BABLE THAT WITH SUCH PALTRY INCOME SUCH HUGE ADVANCES COULD BE MADE , WHICH CLEARLY INDICATE THAT SHE WAS MERELY A NAME LENDER WITHOUT ANY SOURCE, AND WHICH ALSO RAISES DOUBTS AS TO THE GENUINENESS OF T HE TRANSACTION. IN VIEW OF THE DISCREPANCIES NOTED ABOVE, I FIND THAT THE CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION IS IN DOUBT AND NOT PROVED. HENCE, THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS UPHELD. 7.3 CREDIT IN THE NAME OF MEKA SRINU: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE M. SRINU, S/0. NARASIMHA MURTHY ON 05.12.2013 CONFIRMI NG ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. SUBSEQUENTLY, DURING THE APPEAL HEARING AN AFFIDAVIT FROM ONE MEKA SRINIVASARAO WAS FILED CONFIRMING THE SAID ADVANCE. IT IS NOTED THAT THE SIGNATURE IN THE CONFIRMATION LETTER AND THE SIGNATURE IN THE AFFIDAVIT WERE DIFF ERENT. THE ASSESSEE FAILED TO PRODUCE THIS CREDITOR FOR EXAMINATION BEF ORE THE AO. NO INFORMATION WAS FURNISHED AS TO THE CREDITWORTHINES S OF THIS CREDITOR. THUS, I FIND THAT THE IDENTITY, CREDITWORTHINESS OF THIS CREDITOR AND GENUINENESS OF THE TRANSACTION WAS NOT PROVED. HENC E THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS CONFIRMED. 7.4 CREDIT IN THE NAME OF VELIGATLA MANIKYAMMA: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE V. MANIKYAMMA, W/O. NARASIMHAMURTHY, 79-8-20, I.N. ROA D ON 05.12.2013 CONFIRMING ADVANCE OF RS.1,35,000F- TO T HE ASSESSEE. THE SAID CONFIRMATION LETTER WAS SIGNED IN TELUGU. SUBS EQUENTLY, DURING THE APPEAL HEARING AN AFFIDAVIT FROM ONE VELIGATLA MANIKYAMMA, WIFE OF VENKATA NARASIMHAMURTHY, RESIDENT AT 79-22-8, VA DREVU NAGAR WAS FILED CONFIRMING THE SAID ADVANCE OF RS.1.35 LA KH TO THE ASSESSEE. ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 10 THE SIGNATURE IN THE CONFIRMATION LETTER AND THE AF FIDAVIT WERE TOTALLY DIFFERENT INDICATING THAT THE PERSONS WHO HAVE SIGN ED THESE DOCUMENTS ARE DIFFERENT RAISING DOUBTS AS TO THE GE NUINENESS OF THE TRANSACTION AND IDENTITY OF THE CREDITOR. THE ASSES SEE FAILED TO PRODUCE THIS CREDITOR BEFORE THE AO. THUS, I FIND T HAT THE IDENTITY OF THE ALLEGED CREDITOR, HER CREDITWORTHINESS AND THE GENU INENESS OF THIS TRANSACTION HAVE NOT BEEN PROVED. HENCE THE IMPUGNE D ADDITION IN REGARD TO THIS CREDIT IS UPHELD. 7.5 CREDIT IN THE NAME OF KOYYA KESHAVA RAO: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE KOYYA KESHAVA RAO, S/O. GANPATHI RAO ON 05.12.2013 CONFIRMING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. THE SAID CONFIRMATION LETTER WAS SIGNED IN ENGLISH. SUBSEQUENTLY, DURING THE APPEAL HEARING AN AFFIDAVIT FROM ONE KOYYA KESHAVA RAO CON FIRMING THE ADVANCE OF RS.1.35 LAKH TO THE ASSESESE. THE ASSESS EE FAILED TO PRODUCE THIS CREDITOR BEFORE THE AO FOR EXAMINATION . IT IS NOTED THAT THE SIGNATURE IN THE CONFIRMATION LETTER AND THE SI GNATURE IN THE AFFIDAVIT ARE TOTALLY DIFFERENT RAISING DOUBT AS TO THE GENUINENESS OF THE TRANSACTION AND IDENTITY OF THE CREDITOR. BESID ES NO INFORMATION WAS FURNISHED AS TO THE CREDITWORTHINESS OF THIS TR ANSACTION. AS THE IDENTITY, GENUINENESS OF THE CREDIT TRANSACTION AND CREDITWORTHINESS OF THE ALLEGED CREDITOR WAS NOT PROVED, THE IMPUGNED A DDITION IN REGARD TO THIS CREDIT IS CONFIRMED. 7.6 CREDIT IN THE NAME OF V. PADMA: THE ASSESSEE HAD FILED BEFORE THE AO CONFIRMATION L ETTER FROM ONE VELIGATLA PADMA, W/O. NAGESWARA RAO ON 05.12.2013 C ONFIRMING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. SUBSEQUEN TLY, DURING THE APPEAL HEARING AN AFFIDAVIT FROM ONE V. PADMA CONFI RMING THE ADVANCE OF RS.1.35 LAKH TO THE ASSESESE. IT IS NOTE D THAT THE SIGNATURE IN THE CONFIRMATION LETTER AND THE SIGNAT URE IN THE AFFIDAVIT ARE TOTALLY DIFFERENT INDICATING THAT THE PARTIES W HO HAVE SIGNED THESE DOCUMENTS WERE DIFFERENT. THUS THE IDENTITY OF THE ALLEGED CREDITOR AND GENUINENESS OF TRANSACTION IS IN DOUBT. NO INFO RMATION WAS FURNISHED AS TO THE CREDITWORTHINESS OF THIS CREDIT OR. IT IS ALSO NOTED THAT AS PER BALANCE SHEET THE AMOUNT ADVANCED WAS S AID TO BE RS.1.45 LAKH, WHEREAS THE AMOUNT MENTIONED IN THE C ONFIRMATION LETTER AND AFFIDAVIT WAS RS.1.35 LAKH. ALL THESE CL EARLY INDICATE THAT THE CREDIT TRANSACTION WAS ONLY A MAKE BELIEVE ARRA NGEMENT. IN THE CIRCUMSTANCES, THE IMPUGNED ADDITION IN REGARD TO T HIS CREDIT IS CONFIRMED. 7.7. CREDIT IN THE NAME OF KILAPARTHI VENKATESWARA RAO: ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 11 THE ASSESSEE HAD FILED BEFORE THE AO CONFIRMATION L ETTER FROM ONE KILAPARTHI VENKATESWARA RAO S/O. SATYANARAYANA ON 0 5.12.2013 CONFIRMING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE . NO AFFIDAVIT WAS FILED FROM THIS CREDITOR, NOR THIS CREDITOR WAS PRO DUCED BEFORE THE AO. THUS, I FIND THAT THE ASSESSEE FAILED TO PROVE THE IDENTITY OF THIS CREDITOR, HIS CREDITWORTHINESS AND GENUINENESS OF T HE TRANSACTION. HENCE THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS C ONFIRMED. 7.8 CREDIT IN THE NAME OF SURAGANA SRINU: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE SURAGANA SRINU, S/O. YESUBABU ON 05.12.2013 CONFIRM ING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. SUBSEQUENTLY, DURING THE APPEAL HEARING AN AFFIDAVIT WAS FILED FROM ONE SURAGANI SR INU CONFIRMING THE ADVANCE TO THE ASSESSEE. IT IS NOTED THAT THE SIGNA TURE IN THE CONFIRMATION LETTER AND THE SIGNATURE IN THE AFFIDA VIT ARE TOTALLY DIFFERENT RAISING DOUBT AS TO THE GENUINENESS OF TH E TRANSACTION, AND IDENTITY OF THE ALLEGED CREDITOR. BESIDES, NO INFOR MATION WAS FILED AS TO THE CREDITWORTHINESS OF THIS CREDITOR. THUS, I F IND THAT THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THIS CREDIT TRA NSACTION WAS NOT PROVED, 3ND HENCE THE IMPUGNED ADDITION IN REGARD T O THIS CREDIT IS CONFIRMED. 7.9 CREDIT IN THE NAME OF MYANAK RATTAIAH: THE ASSESSE HAD FLIED BEFORE THE AO CONFIRMATION LETTER FROM ON E MYNAM RATTAIAH, S/O. NAGESWARA RAO ON 05.12.2013 CONFIRMING LOAN OF RS.1,35,000/- TO THE ASSESSEE. THE ASSESSEE DID NOT FILE ANY AFFIDAVIT FROM THIS CREDITOR NOR COULD PRODUCE THIS CREDITOR FOR EXAMINATION. FURTHER, NO INFORMATION WAS FILED AS T O THE CREDITWORTHINESS OF THIS CREDITOR. THUS THE IDENTIT Y AND THE CREDITWORTHINESS OF THE CREDITOR ARE NOT PROVED. HE NCE THE IMPUGNED ADDITION IN RESPECT OF THIS CREDIT IS CONFIRMED. IT IS PERTINENT TO NOTE THAT SUBSEQUENTLY AFFIDAVIT WAS FILED FROM ONE MYNA M VENKATARATNAM TO PROVE THE ALLEGED CREDIT IN THE NAME OF M. RATTA IAH. IT IS ALSO NOTED THAT AFFIDAVITS FROM MYNAM VENKATARATNAM WERE FILED IN THE CASE OF OTHER LIQUOR DEALERS NAMELY BALUSU PRASAD, KATTA SR INIVASA RAO CONFIRMING ADVANCE OF RS.1.35 LAKH EACH TO THEM. IN ALL THESE CASES M. RATTAIAH WAS SHOWN AS CREDITOR IN THE BALANCE SH EET. IT IS IMPROBABLE THAT A PERSON WITHOUT ANY REGULAR INCOME COULD MAKE SUCH HUGE ADVANCES CLEARLY INDICATING THAT HE ACTED MERE LY AS NAME LENDER WITHOUT ANY INCOME SOURCE. THIS ALSO RAISES SERIOUS DOUBTS AS TO THE GENUINENESS OF THESE TRANSACTIONS. AS THE IDENTITY, GENUINENESS AND ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 12 CREDITWORTHINESS OF THIS CREDIT TRANSACTION WAS NOT PROVED, THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS CONFI RMED. 7.10 CREDIT IN THE NAME OF PULLURI PRASAD: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE PULLURI PRASAD, S/O SRINIVASA RAO, AGARTHAPALEM VIL LAGE ON 05.12.2013 CONFIRMING ADVANCE OF RS.1,35,000/- TO T HE ASSESSEE. THE SAID CONFIRMATION LETTER WAS SIGNED IN ENGLISH. SUBSEQUENTLY, DURING THE APPEAL HEARING AN AFFIDAVIT WAS FILED FR OM ONE PULLURI PRASAD, RATHAIAH, 11-24, B.C. COLONY, GULLUPADU VIL LAGE CONFIRMING THE ADVANCE OF SAID AMOUNT. THE SAID AFFIDAVIT WAS SIGNED IN TELUGU INDICATING THE PERSON WHO SIGNED THE CONFIRM ATION LETTER AND THE PERSON WHO SIGNED THE AFFIDAVIT ARE DIFFERE NT. THE ASSESSEE COULD NOT PRODUCE THIS CREDITOR BEFORE THE AO FOR E XAMINATION. THUS, THE IDENTITY OF THE ALLEGED CREDITOR AND THE GENUINENESS OF THE TRANSACTION IS IN DOUBT. NO SUPPORTING EVIDENCE WAS FILED AS TO THE CREDITWORTHINESS OF THE CREDITOR. IT IS ALSO NO TED THAT AFFIDAVITS OF THE ABOVE ALLEGED CREDITOR PULLURI PRASAD WERE F ILED IN THE CASE OF OTHER LIQUOR DEALERS NAMELY BALUSU PRASAD, KATTA SRINIVASA RAO CONFIRMING ADVANCE OF RS.1.35 LAKH EACH TO THEM. IT IS IMPROBABLE THAT A PERSON WITHOUT ANY REGULAR INCOME COULD MAKE SUCH HUGE ADVANCES. THESE CLEARLY SHOW THAT HE ACTED MERELY A S NAME LENDER WITHOUT ANY INCOME SOURCE. THE DISCREPANCY IN THE N AME, FATHER'S NAME AND ADDRESS ALSO RAISES SERIOUS DOUBTS AS TO T HE GENUINENESS OF THESE TRANSACTIONS. THUS THE IDENTITY, GENUINENE SS AND CREDITWORTHINESS OF THIS CREDIT TRANSACTION WAS NOT PROVED. HENCE THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS C ONFIRMED. 7.11 CREDIT IN THE NAME OF MAINAM RAMBABU: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE MYNAM RAMBABU, S/O NAGESWARA RAO, GOLLAPPADU VILLAGE ON 0 5.12.2013 CONFIRMING ADVANCE OF RS1,35,000/- TO THE ASSESSEE . SUBSEQUENTLY, AN AFFIDAVIT WAS FILED FROM ONE MAINAM RAMBABU S/O SATYANARAYANA, YARRAMALLA VILLAGE. THE SIGNATURE IN THE CONFIRMATION LETTER AND IN THE AFFIDAVIT WERE TOTAL LY DIFFERENT RAISING DOUBTS AS TO THE IDENTITY AND :JINENESS OF THE TRANSACTION. NO INFORMATION WAS FILED AS TO THE CREDITWORTHINESS OF THIS CREDITOR. AS THE IDENTITY OF THIS CREDITOR, HIS CREDITWORTHIN ESS OF THE GENUINENESS OF THE TRANSACTION WAS NOT PROVED, THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS CONFIRMED. 7.12 CREDIT IN THE NAME OF KOTA VENKATESWARLU: THE ASSESSE HAD FILED BEFORE THE AO CONFIRMATION LE TTER FROM ONE ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 13 KOTA VENKATESWARLU, S/O. TRIMURTHULU ON 05.12.2013 CONFIRMING ADVANCE OF RS.1,35,000/- TO THE ASSESSEE. SUBSEQUEN TLY, DURING THE APPEAL HEARING AN AFFIDAVIT WAS FILED FROM ONE KOTA VENKATESWARA RAO, S/. MAHANKALI CONFIRMING ADVANCE TO THE ASSESS EE. THE CONFIRMATION LETTER WAS SIGNED AS K. VENKATESWARLU IN ENGLISH AND THE AFFIDAVIT WAS SIGNED AS K. VENKATESWARA RAO IN ENGLISH, WHICH CLEARLY SHOW THE PERSONS WHO HAVE SIGNED THESE DOCU MENTS WERE DIFFERENT. THE ASSESSEE FAILED TO PRODUCE THIS CRED ITOR FOR VERIFICATION BEFORE THE AO. THE DISCREPANCIES IN THE NAME, FATHE R'S NAME, ADDRESS AND SIGNATURE CLEARLY SHOW THAT THE IDENTIT Y OF THE CREDITOR AND THE GENUINENESS OF THE TRANSACTION ARE IN DOUBT . THUS IT IS HELD THAT THE ASSESSEE FAILED TO PROVE THE IDENTITY OF T HE CREDITOR, HIS CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSAC TION. HENCE, THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS CONFI RMED. 7.13 CREDIT IN THE NAME OF M. GOPAIAH: THE ASSESSEE HAD FILED BEFORE THE AO CONFIRMATION L ETTER FROM ONE MYNAM GOPAIAH S/O. SURYANARAYANA, GOLLAPADU VILLAGE ON 05.12.2013 CONFIRMING ADVANCE OF RS.1,35,000/- TO T HE ASSESSEE. SUBSEQUENTLY, DURING THE APPEAL HEARING, AN AFFIDAV IT WAS FILED FROM ONE MYNAM GOPAIAH, S/O KIRSHNAMURTHY, 12-5-11, RAMA LAYAM STREET, YERRAMALLA VILLAGE. THE SIGNATURE IN THE CO NFIRMATION LETTER WAS IN ENGLISH AND THE SIGNATURE IN THE AFFIDAVIT W AS IN TELUGU, INDICATING THAT THE PERSON WHO SIGNED THE AFFIDAVIT AND CONFIRMATION LETTER WERE DIFFERENT, RAISING SERIOUS DOUBTS AS TO THE IDENTITY OF THE CREDITOR AND GENUINENESS OF THE TRANSACTION. NO INF ORMATION WAS FURNISHED AS TO CREDITWORTHINESS OF THE ALLEGED CRE DITOR. IN VIEW OF THE ABOVE DISCREPANCIES, I FIND THAT THE IDENTITY O F THE CREDITOR, HIS CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSAC TION ARE NOT PROVED. HENCE THE IMPUGNED ADDITION IS CONFIRMED. 7.14 CREDIT IN THE NAME OF BOLLA SRINU: THE ASSESSEE HAD FILED BEFORE THE AO CONFIRMATION L ETTER FROM ONE BOLLA SRINU S/O. MALLIKARJUNA RAO, 2-11-9, TATIKAPA ON 05.03.2013 STATING THAT AN AMOUNT OF RS.1,35,000/- WAS ADVANCE D TO THE ASSESSEE. SUBSEQUENTLY AN AFFIDAVIT WAS FILED DURIN G THE APPEAL HEARING FROM ONE BOLLA SRINIVAS RAO,S/O MUTYALU, 11 -38, RAMALAYAM STREET, GULLAPADU VILLAGE CONFIRMING THE ADVANCE. T HE ASSESSEE FAILED TO PRODUCE THIS CREDITOR FOR EXAMINATION. FURTHER N O INFORMATION WAS FURNISHED AS TO THE CREDITWORTHINESS OF THIS CREDIT OR. THE CONFIRMATION LETTER WAS SIGNED AS B. SRINU, BUT THE AFFIDAVIT WA S SIGNED IN TELUGU AS B. SRINIVASA RAO, INDICATING THAT THE PERSON WHO SI GNED THE CONFIRMATION LETTER AND THE AFFIDAVIT ARE DIFFERENT , RAISING DOUBTS AS TO THE GENUINENESS OF THE TRANSACTION. FURTHER, THERE WAS DISCREPANCIES ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 14 IN THE NAME, FATHER'S NAME AND ADDRESS / AND ALL TH ESE GO TO SHOW THAT THE IDENTITY OF THIS CREDITOR WAS NOT PROVED. IN VIEW OF THE THESE, THE ADDITION OF IMPUGNED CREDIT IS CONFIRMED. 7.15 CREDIT IN THE NAME OF V. SRINIVASARAO: THE ASSESSEE HAD FILED BEFORE THE AO CONFIRMATION L ETTER FROM ONE VALAVALA SRINIVASARAO, S,/O. SRIMANNARAYANA, RESIDE NT AT 12-9-33, TATIPAKA ON 05.12.2013 CONFIRMING ADVANCE OF RS.15, 000I- TO THE ASSESSEE. SUBSEQUENTLY, DURING THE APPEAL HEARING A N AFFIDAVIT WAS FILED FROM ONE VEMULA SRINIVASARAO, S/O KRISHNA, D. NO.2-74, AGARTHIPALEM CONFIRMING ADVANCE TO THE ASSESSEE. TH E ASSESSEE FAILED TO PRODUCE THIS CREDITOR FOR EXAMINATION BEFORE THE AO. THE SIGNATURE IN THE AFFIDAVIT AND CONFIRMATION LETTER THOUGH SIG NED AS V. SRINIVASARAO IN ENGLISH ARE TOTALLY DIFFERENT. THE DISCREPANCIES IN THE NAME, FATHER'S NAME, ADDRESS, SIGNATURE RAISE SERIO US DOUBTS AS TO THE GENUINENESS OF THE TRANSACTION AND IDENTITY OF THE CREDITOR. IN VIEW OF THE ABOVE, IT IS HELD THAT THE ASSESSEE FAILED TO P ROVE THE IDENTITY OF THE CREDITOR AND GENUINENESS OF THE TRANSACTION. HE NCE THE IMPUGNED ADDITION IN REGARD TO THIS CREDIT IS CONFIRMED. 7.16 IT IS PERTINENT TO NOTE THAT THE ASSESSEE HAD FILED AFFIDAVIT FROM ONE MYNAM VENKATARATNAM AND ONE INAKONDA VENKATARAMANA CONFIRMING ADVANCE OF RS.1,35,000I/- EACH TO THE ASSESSEE BUT WHOSE NAMES DID NOT FIGURE IN THE LIST OF CREDITORS STATED IN THE B ALANCE SHEET. THESE AFFIDAVIT WERE PURPORTEDLY FILED TO PROVE CREDIT IN THE NAME OF M. RATTAIAH, AND K. VENKATARAMANA RAO IN WHOSE CASES A FFIDAVITS WERE NOT FILED. IT IS FURTHER NOTED THAT AFFIDAVITS FROM MYN AM VENKATARATNAM WERE ALSO FILED IN THE CASE OF OTHER LIQUOR DEALERS NAME LY BALUSU PRASAD, KATTA SRINIVASA RAO CONFIRMING ADVANCE OF RS.1.35 LAKH IN EACH CASE. IN ALL THESE CASES M. RATTAIAH WAS SHOWN AS CREDITOR IN TH E BALANCE SHEET. IT IS IMPROBABLE THAT A PERSON WITHOUT ANY REGULAR INC OME COULD ADVANCE SUCH HUGE AMOUNT INDICATING THAT HE ACTED MERELY AS NAME LENDER. THIS ALSO GOES TO PROVE THAT THE GENUINENESS OF MOST OF THE ABOVE CREDIT TRANSACTIONS ARE DOUBTFUL. 7.17 IT IS ALSO PERTINENT TO NOTE THAT IT WAS CLAIM ED THAT THESE CREDIT TRANSACTIONS WERE BY WAY OF DDS FROM THE ALLEGED CR EDITORS. HOWEVER, THERE IS NO EVIDENCE TO SHOW THAT THE ALL EGED CREDITORS HAVE TAKEN THE DDS. IT IS FURTHER NOTED THAT THERE WAS NO EVIDENCE TO SHOW THAT THE DDS WERE TAKEN OUT OF CHEQUE WITHD RAWALS. THE SERIAL NUMBERS OF THE DDS AND THE MANNER IN WHICH T HE CASH DDS WERE TAKEN TO PAY THE LICENCE FEE ALSO RAISES DOUBT S AS TO THE GENUINENESS OF THESE CREDIT TRANSACTIONS WHICH WOUL D BE ADDITIONAL REASON TO CONFIRM THE ABOVE ADDITIONS. ITA NO.86/VIZAG/2017 SRI NELLI TRIMURTHULU, RAJAHMUNDRY 15 8. THE LD.CIT(A) DISCUSSED THE TRANSACTION OF EACH CREDITOR AND HELD THAT THE TRANSACTIONS ARE NOT GENUINE AND IN SOME C ASES THE IDENTITY ALSO DOUBTFUL. NONE OF THE CREDITORS ARE HAVING CREDIT W ORTHINESS TO MAKE THE ADVANCES. DURING THE APPEAL HEARING, THE LD. A.R. D ID NOT BRING ANY EVIDENCE TO CONTROVERT THE FINDING OF THE LD. CIT(A ). THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT( A) AND THE SAME IS UPHELD. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 27 TH SEPT17. SD/- SD/- ( . ) ( . . ' ) (V. DURGA RAO) (D.S. SUNDER SINGH) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 27.09.2017 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT MEKA RAMESH KUMAR, 45-34-9/2A, A VA ROAD, RAJAHMUNDRY 2. / THE RESPONDENT THE ITO, WARD-3, RAJAHMUNDRY 3. + / THE CIT, RAJAHMUNDRY 4. + ( ) / THE CIT (A), RAJAHMUNDRY 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM