M/s. Nisuki Farms, Surat V. The Income tax Officer,Ward-6(3)., Surat

ITA 953/AHD/2007

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 57106 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 31-01-2012
• Assessment Year: 2003-2004
• Appeal Filed On: 02-03-2007
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M K PATEL
• Keywords: Unexplained cash credit; Unexplained investment

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD AHMEDABAD C BENCH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI B.P. JAIN, ACCOUNTANT MEMBER ITA NO.953 & 1142/AHD/2007 ASSESSMENT YEAR:2003-04 M/S NISUKI FARMS V.K. FARMING SOCIETY, GAVIER GAM, TAL. CHORYASI, SURAT PAN NO.AADFN6382R INCOME TAX OFFICER, WARD-6(3), SURAT ROOM NO.606-E, 6 TH FLOOR, AAYAKAR BHAVAN, MAJURA GATE, SURAT / V/S . / V/S . INCOME TAX OFFICER, WARD-6(3), SURAT M/S NISUKI FARMS, V.K. FARMING SOCIETY, GAVIER GAM, TAL. CHORIYASI, DIST. SURAT / APPELLANT .. / RESPONDENT /ASSESSEE BY SHRI M.K.PATEL, AR /REVENUE BY SHRI VINOD TANWANI, SR-DR / DATE OF HEARING 31-01-2012 !'# / DATE OF PRONOUNCEMENT 03-02-2012 $ $ $ $ / // / ORDER PER B.P. JAIN, ACCOUNTANT MEMBER:- THESE CROSS-APPEALS OF THE ASSESSEE AND THE REVENUE ARISE FROM THE ORDER OF LD. COMMISSIONER OF INC-TAX (APPEALS)-IV, SURAT DAT ED 03-01-2007 FOR THE ASSESSMENT YEAR 2003-04. THE ASSESSEE HAS RAISED TH E FOLLOWING GROUND OF APPEAL:- ITA NO.953/AHD/2007(BY THE ASSESSEE) ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AS WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF THE INCOME TAX (APPEALS) HAS ERRED CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN M AKING ADDITION OF AGRICULTURE INCOME RS.12,64,387 AS UNEXPLAINED CASH CREDIT. 2. IT IS THEREFORE PRAYED THAT THE ABOVE ADDITION M AY PLEASE BE DELETED AS LEARNED MEMBERS OF THE TRIBUNAL MAY DEEM IT PROPER. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL:- ITA NO.1142/AHD/2007 (BY REVENUE). 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A), SURAT HAS ERRED IN DIRECTING TO DELETE THE ADDITION OF RS.24,87,171/- MADE BY THE ASSESSING OFFICER. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A), SURAT HAS ERRED IN DELETING THE ADDITION OF RS.7,50,000/- U/S.68 OF THE I.T. ACT. 3. THE LD. CIT(APPEALS) HAS NOT APPRECIATED THE FAC T THAT THE ASSESSEE FIRM HAD GOT FUNDS THROUGH PARTNERS AND HAD GIVEN LOAN T O THE PARTNERS. THE CYCLE OF ROTATION OF MONEY CONTINUED THROUGH THIS CHANNEL WITHOUT ANY BASIS. 2. FIRST OF ALL, WE TAKE UP THE ASSESSEES APPEAL I N ITA NO.953/AHD/2007 AS UNDER:- THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE- FIRM HAD CLAIMED TO BE ENGAGED IN AGRICULTURAL ACTIVITY AND HAD CLAIMED TO HAVE EARNED GROSS AGRICULTURAL INCOME OF RS.12,64,387/- BY SALE OF PAPAYA, MANGO, CHIKOO, VEGETABLES ETC. THE ASSESSING OFFICER OBSERVED THAT THE FIRM CAME INTO EXISTENCE ON 03-03-1999 AND THE TWO PARTNERS WERE SHRI KIRAN PAREKH AND HIS WIFE SM T. PUSPA PAREKH. NO AGRICULTURAL LAND WAS INTRODUCED AS CAPITAL BY EITHER OF THE PAR TNERS AND THERE WAS NO SUBSEQUENT PURCHASE OF LAND BY THE ASSESSEE-FIRM. T HE AO THEREFORE ISSUED A SHOW- CAUSE NOTICE REGARDING OWNERSHIP OF AGRICULTURAL LA ND AND DETAILS THEREOF. IN RESPONSE, THE ASSESSEE STATED THAT IT HAD GOT LAND ON LEASE FOR A PERIOD OF SEVEN YEARS FROM 01-04-2002 FROM ONE SHRI ARVIND PATEL AN D WAS CULTIVATED BY LABOURERS. COPIES OF THE LEASE AGREEMENT AND FORM 7 X 12 RELAT ING TO FOUR PIECES OF LAND WERE FILED. THE AO FURTHER OBSERVED THAT THE COPIES OF 7 X 12 SHOWED THAT ONLY ONE PIECE OF LAND AD MEASURING SEVEN HECTARES OF PLOT NO.400 WAS IS IN THE NAME OF ARVIND PATEL AND THE OTHER THREE PIECES OF LAND WERE IN TH E NAME OF SHRI PRABHUDAS PATEL ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 3 WHOSE NAME WAS NOT MENTIONED ANYWHERE IN THE SAID L EASE AGREEMENT. THE AO RECORDED THE STATEMENT OF SHRI ARVINDBHAI PATEL WHO STATED THAT HE GAVE 58 BIGHAS OF LAND AT A LEASE RENT OF RS.60,000/- PER ANNUM AN D THAT ON THE DAY WHEN THE LAND WAS GIVEN ON LEASE, THE LAND HAD FRUIT GROWING TREE S WHICH WERE READY. THE AO THEREFORE WAS OF THE VIEW THAT SHRI PRABHUBHAI PATE L WAS NEITHER PARTY TO THE SAID LEASE AGREEMENT NOR DETAILS OF LAND WERE MENTIONED IN THE LEASE AGREEMENT. THE AO FURTHER OBSERVED THAT IN RESPECT OF LAND FALLING IN BLOCK NO.400, THE 7 X 12 CERTIFICATE DID NOT SHOW ANY MANGO OR PAPAYA TREES BUT MENTIONE D 3000 TEAK TREES. ALSO THE ASSESSEE-FIRM WAS CLAIMING TO HAVE ACQUIRED 58 BIGH AS OF LAND FROM SHRI ARVIND PATEL FOR A PETTY CONSIDERATION OF RS.60,000/- P.A. THAT TOO WHEN THE FRUIT CROP WAS RIPE AND THE ASSESSEE-FIRM STARTED SELLING THE SAME FROM THE VERY NEXT DAY EARNING RS.6000/- PER DAY. NO PERSON WOULD EVER OPT FOR SUC H A PROPOSITION AND THEREFORE, THE ENTIRE LEASE AGREEMENT WAS BOGUS. THE AO AGAIN ISSUED A SHOW-CAUSE NOTICE IN THE LIGHT OF INFORMATION THAT SALE BILL OF PRODUCE FILED BY THE ASSESSEE SHOWED THAT DURING THE FIRST 11 DAYS AFTER THE LEASE AGREEMENT, MANGOES, CHICKOO AND PAPAYA WERE SOLD FOR MORE THAN RS.64,000/- WHICH EXCEEDED THE ANNUAL LEASE RENT OF RS.6,000/- AND THAT DURING THE YEAR, THE ASSESSEE H AD CLAIMED SALE OF FRUITS WORTH RS.8,22,542/- AND THEREFORE THE AGRICULTURAL INCOME DECLARED BY THE ASSESSEE WAS FRAUDULENT. IN RESPONSE, THE ASSESSEE STATED THAT I T HAD OBTAINED LANDS BEARING BLOCK NO.398, 402 & 403 FROM SHRI PRABHUDAS PATEL TO WHOM 10% OF THE CROP GROWN WAS GIVEN AND BECAUSE OF THE LONG RELATIONS OF FRIENDSH IP WITH HIM, A MUTUAL AGREEMENT WAS ENTERED INTO. THE ASSESSEE ALSO FURNISHED COPY OF LEASE AGREEMENT IN RESPECT OF THESE BLOCKS WITH SHRI PRABHUDAS PATEL. THE AO WAS OF THE VIEW THAT THE SO-CALLED COPY OF THE LEASE AGREEMENT WITH SHRI PABHUDAS PATE L DATED 01-04-2000 WAS IN CONTINUATION AGREEMENT DATED 01-04-2000, THERE SHOU LD HAVE BEEN A MENTION OF THE SAME IN THE LATE AGREEMENT. HENCE, BOTH AGREEMENTS WERE NON-GENUINE. THE AO ALSO OBSERVED THAT AS PER 7 X 12 RECORDS OF THE SAI D THREE PLOTS OF LAND IN THE NAME OF PRABHUDAS PATEL, THERE WERE 300 CHICKOO TREES AND 3 00 SHELPHA TREES IN PLOT NO.403, 205 TEAK TREES AND 300 MANGO TREES IN PLOT NO.402 BUT IN THE STATEMENT, THE PARTNER OF THE FIRM SHRI KIRAN PAREKH HAD STATED TH AT ON 01-04-2000 THAT IS WHEN THE ALLEGED LEASE AGREEMENT WAS ENTERED INTO WITH SHRI PRABHUDAS PATEL NO TREES WERE THERE ON THE SAID LANDS. HOWEVER, THE ASSESSEE VIDE SUBMISSIONS DATED 20-01-2006 HAD STATED TO HAVE EARNED RS.3,53,882/- FROM SALE O F MANGOES AND RS.2,37,200/- FROM SALE OF CHICKOO, WHICH WAS NOT CORRECT SINCE 7 X 12 RECORDS DID NOT INDICATE ANY ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 4 SUCH CROP. THE AO THEN RECORDED THE STATEMENT OF TH E PARTNER OF THE ASSESSEE-FIRM SHRI KIRAN PARTEKH, WHO STATED THAT HE WAS IN TRADI NG OF ELECTRONIC ITEMS AND COULD NOT RECOLLECT WHETHER ANY FRUIT BEARING TREES WERE PRESENT ON THE LAND OR NOT AND THAT HE HAD NOT OBTAINED SECOND RIGHT NOR WAS HIS NAME I NTRODUCED IN 7 X12 RECORDS. HE ALSO DENIED HAVING ANY POSSESSIONS CERTIFICATE AND THAT FOR THE PERIOD FROM 01-04- 2001 TO 31-03-2003, NO AGRICULTURAL INCOME WAS EARN ED BY THE ASSESSEE. THE AO IN VIEW OF THE ABOVE FACTORS CONCLUDED THAT BOTH THE P ARTNERS OF THE ASSESSEE-FIRM WERE ONLY BUSINESSMEN AND WERE NOT FARMERS AND NO AGRICU LTURAL ACTIVITIES WAS PERFORMED BY THE ASSESSEE-FIRM ON ACCOUNT OF THE CONTRADICTIO NS IN THE STATEMENTS OF THE PARTNER AND SHRI ARVID PATEL REGARDING AREA OF LAND , OWNERSHIP OR NUMBER OF TREES THEREON. THE PARTNER HAD ALSO DENIED THAT ANY MANAG ER WAS APPOINTED FOR THE FIRM WHICH WAS AGAINST HIS EARLIER SUBMISSION THAT THE L AND WAS CONTROLLED BY A MANAGER. IT WAS ALSO HELD BY THE AO THAT THE LEASE AGREEMENT S WERE NON-GENUINE AND INVALID SINCE LEGAL FORMALITIES AS REQUIRED UNDER THE BOMBA Y TENANCY AND AGRICULTURAL LAND ACT, 1948 WHICH WERE APPLICABLE TO THE STATE OF GUJ ARAT. THE REQUIREMENTS OF THE ACT WERE THAT A NON-AGRICULTURIST COULD NOT BE A LESSEE AND THE LAND COULD BE TAKEN ON LEASE ONLY WITH THE PRIOR PERMISSION OF COLLECTOR A ND LAND POSITION CERTIFICATE AND SECOND RIGHT MUST BE OBTAINED BY THE LESSEE AND THE REFORE, THE ASSESSEES CLAIM OF OBTAINING THE LAND ON LEASE WAS NOT CORRECT. THE AO FURTHER RELIED ON THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CIT V. RAJA BENOY KUMAR SAHAS ROY (1957) AS REPORTED IN 32 ITR 466 (SC), WHEREIN AGRICULTURA L ACTIVITY WAS DEFINED AND HELD THAT SINCE NONE OF THE PRINCIPLES LAID DOWN BY THE SAID JUDGMENT WAS FOLLOWED IN THE CASE OF ASSESSEE, ITS CLAIM OF EARNING AGRICULTURAL INCOME WAS NON-GENUINE. THE AO THEREFORE HELD THAT THE INCOME SHOWN BY THE ASSESSE E IN THE GARB OF AGRICULTURAL INCOME WAS ONLY UNEXPLAINED CASH CREDITS U/S.68 OF THE ACT. 3. THE LD CIT(A) CONFIRMED THE ACTION OF ASSESSING OFFICER. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE CONCUR WITH THE VIEWS OF LD. CIT(A) THAT IT IS A CA SE WHERE THE PARTNERS OF THE FIRM ARE PURELY BUSINESS PERSONS APPARENTLY HAVING NOTHING T O DO WITH AGRICULTURAL ACTIVITY. THE ASSESSEES VERSION OF ENTERING INTO TWO DIFFERE NT LEASE AGREEMENTS, ONE ON 01- 04-2000 WITH SHRI PRABHUBHAI PATEL AND SECOND ON 01 -04-2002 WITH SHRI ARVINDBHAI ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 5 PATEL HAS BEEN TOTALLY DEMOLISHED BY THE AO. IT DOE S NOT APPEAL TO COMMON SENSE THAT A PERSON OWNING LAND WITH FRUIT BEARING TREES RIPE FOR SALES WOULD ENTER INTO A LEASE AGREEMENT WITH A THIRD PARTY FOR A CONSIDERAT ION OF RS.60,000/- P.A. WHEN WITHIN THE FIRST TWO WEEKS OF ENTERING INTO THE LEASE AGRE EMENTS, THE SO-CALLED LESSEE IS ABLE TO SELL FRUITS IN THE MARKET FOR MORE THAN THE ENTI RE YEARS LEASE RENT. ALSO THE SAME LESSEE FROM THE SAME PIECES OF LAND WAS ABLE TO EAR N AN INCOME OF MORE THAN RS.12 LAKHS BY PAYING A MEAGER RENT OF RS.60,000/- ONLY. ANYBODY WOULD LOOK AT THE DEAL WITH SUSPICION SINCE NOT EVEN THE DUMBEST PERSON WO ULD GIVE AWAY A PROFIT OF RS.12 LAKHS THAT HE COULD HAVE EARED FROM THE SAID LAND. THEREFORE, IT DOES NOT APPEAL TO REASON NOR IT IS PRACTICALLY POSSIBLE THAT ANYONE W OULD WILLINGLY SURRENDER SUCH A HUGE AMOUNT FOR THE SAKE OF SO-CALLED SECURITY AND MAINTENANCE OF THESE FRUIT BEARING TREES. FURTHER, ALTHOUGH 7 X 12 RECORDS ARE NOT SACROSANCT, THESE ARE INDICATIVE OF THE CROPS GROWN ON THE LAND DULY CERT IFIED BY THE LOCAL GOVERNMENT OFFICIAL LIKE TALATI. THERE COULD BE A DIFFERENCE O F TYPE OF CROP GROWN IN A PARTICULAR YEAR LIKE CROP OF WHEAT BEING MENTIONED INSTEAD OF PADDY BUT IT COULD NEVER BE THAT TEAK TREES ARE MENTIONED INSTEAD OF FRUIT BEARING T REES ON THIS RECORD. THERE HAS BEEN AN AGREEMENT DATED 01-04-2000 THE LATTER AGREE MENT DATED 01-04-2002 WHICH IS CLAIMED TO BE A CONTINUATION OF THE SO-CALLED FI RST AGREEMENT, WOULD HAVE MENTIONED THE FIRST AGREEMENT. IT ALSO APPEAR SUSPI CIOUS THAT THE SO-CALLED FIRST AGREEMENT WAS NEVER FURNISHED BY THE ASSESSEE DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS AND IT WAS ONLY WHEN THE AO ISSUED A SH OW-CAUSE NOTICE AFTER DETECTING IRREGULARITIES AND CONTRADICTIONS, THAT A COPY OF T HE SAME WAS FILED. FURTHER, THE PARTNER OF THE ASSESSEE-FIRM CONTRADICTED HIMSELF D URING A STATEMENT ALSO AND FURTHER STATED THAT NEITHER HE NOR HIS WIFE NOR HIS FATHER WAS AN AGRICULTURIST WHICH MEANS SHAT THE FIRM COULD NOT HAVE TAKEN AGRICULTURAL LAN D ON LEASE SINCE IN THE STATE OF GUJARAT, A LESSEE FOR AGRICULTURAL LAND, NECESSARIL Y HAS TO BE AN AGRICULTURIST AND NO PERMISSION OF THE LOCAL GOVERNMENT AUTHORITIES WAS OBTAINED FOR ENTERING INTO SO- CALLED LEASE AGREEMENT. THE CONTENTION OF THE BOOKS OF ACCOUNT AND BILLS REGARDING THE AGRICULTURAL ACTIVITY WERE FILED BEFORE THE ASS ESSING OFFICER IN SUPPORT OF AGRICULTURAL INCOME IS ALSO HAS NO BEARING ON THESE AFFECT SINCE SALE BILL OF PRODUCE DO NOT NECESSARILY INDICATE ANY AGRICULTURAL ACTIVI TY. THE LEASE AGREEMENTS ENTERED INTO BY THE ASSESSEE-FIRM WERE ONLY TO CREATE EVIDE NCE OF CLAIM OF AGRICULTURAL INCOME, NO AGRICULTURAL ACTIVITY WAS PERFORMED BY T HE ASSESSEE-FIRM AND THEREFORE, NO SUCH INCOME WAS EARNED BY THE FIRM AT THE ENTIRE AGRICULTURAL INCOME BEING ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 6 INTRODUCED IN THE BOOKS OF ACCOUNT WAS UNEXPLAINED CASH CREDITS U/S.68 OF THE ACT. IN THE CIRCUMSTANCES AND FACTS OF THE CASE, WE FIND NO INFIRMITY IN THE ORDER OF LD CIT(A). THUS, GROUND OF THE ASSESSEES APPEAL IS DI SMISSED. 5. NOW WE TAKE UP REVENUES APPEAL IN ITA NO.1142/A HD/2007 AS UNDER:- AS REGARDS GROUND NO.1 OF THE REVENUE, THE BRIEF FA CTS ARE THAT A CAPITAL IN THE NAMES OF THE PARTNERS SMT. PUSHABEN PAREKH, A CAPIT AL OF RS.19,29,595/- AT RS.5,57,576/- IN THE ACCOUNT OF SHRI KIRAN PAREKH W ERE APPEARING DURING THE YEAR. WHEN REQUIRED TO EXPLAIN THE SOURCES THEREOF, THE A SSESSEE SATED THAT THE TWO PARTNERS WERE ALSO PROPRIETORS OF TWO FIRMS AND THE FUNDS WERE RECEIVED FROM THESE FIRMS. IT WAS EXPLAINED HAT THE PARTNERS GAVE ADVAN CE TO NISUKI FARMS WHO IN TURN ADVANCED THE MONIES TO THE ASSESSEE-FIRM WHICH GAVE THE SAME BACK TO THE PARTNER AND THE CYCLE CONTINUED AND THROUGH THIS CHANNEL. T HE FIRM HAD GOT FUNDS THROUGH PARTNERS AND GIVEN ADVANCE TO PROPRIETORSHIP FIRMS OF BOTH THE PARTNERS. THE AO REJECTED THE EXPLANATION AND HELD THAT THE CAPITAL INTRODUCTION WAS NON-GENUINE IF THE LEDGER ACCOUNT OF THE PARTNERS WERE CO-RELATED WITH THE PROFIT AND LOSS ACCOUNT OF THE ASSESSEE-FIRM. THE AO HELD THAT ALTHOUGH BOTH THE P ARTNERS CLAIMED TO HAVE EARNED AGRICULTURAL INCOME OF RS.4,86,375/- THERE WAS NO M ENTION OF THE SAME IN THEIR RESPECTIVE COPIES OF LEDGER ACCOUNTS AND THE CONCEP T OF CYCLE OF ROTATION OF MONEY WAS WITHOUT ANY BASIS. HE, THEREFORE, TREATED THE E NTIRE AMOUNT AS UNEXPLAINED INVESTMENT, RELYING ON THE DECISIONS OF HONBLE ALL AHABAD HIGH COURT IN THE CASE OF NANAK CHANDRA LAXMAN DAS V. CIT (1983) AS REPORTED IN 140 ITR 151 (ALL) AND OTHER JUDICIAL PRONOUNCEMENTS. 6. LD. CIT(A) DELETED THE ADDITION SINCE THE ASSESS ING OFFICER HIMSELF HAS REPRODUCED THE BALANCE-SHEET AND COPY OF LEDGER ACC OUNTS OF TWO PERSONS IN THE ASSESSMENT ORDER AND ENTRIES THEREIN HAVE BEEN EXPL AINED BY THE ASSESSEE. THE LD. CIT(A) WAS OF THE VIEW THAT IDENTITY, CREDITWORTHIN ESS AND GENUINENESS OF THE TRANSACTIONS HAVE BEEN EXPLAINED AND ACCORDINGLY DE LETED THE ADDITIONS SO MADE. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. WE CONCUR WITH THE VIEWS OF THE LD. CIT(A) THAT THE AS SESSING OFFICER HIMSELF HAS ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 7 REPRODUCED THE BALANCE-SHEET AND COPY OF LEDGER ACC OUNT OF THE PARTNERS IN THE ASSESSMENT ORDER AND THE ENTRIES THEREIN HAVE BEEN EXPLAINED BY THE AO. MOREOVER, THE CAPITAL HAS BEEN DECLARED BY THE ASSESSEE IN TH EIR INDIVIDUAL RETURNS. THEREFORE, IN THE CIRCUMSTANCES AND FACTS OF THE CASE WHEN THE AMOUNT HAS ALREADY BEEN EXPLAINED AND DECLARED BY THE PARTNERS IN THEIR IND IVIDUAL RETURNS, NO ADDITION IN THE HANDS OF THE FIRM CAN BE MADE. ACCORDINGLY, WE FIND NO ERROR IN THE ORDER OF LD. CIT(A). THUS, GROUND NO.1 OF REVENUE IS DISMISSED. 8. AS REGARDS GROUND NO.2, THE BRIEF FACTS ARE THAT ASSESSING OFFICER OBSERVED THAT AN UNSECURED LOAN OF RS.7.50 LAKH WAS APPEARIN G IN THE BALANCE-SHEET OF THE FIRM IN THE NAME OF ONE PARTNER, SMT. PUSHPA PAREKH . WHEN REQUIRED TO EXPLAIN, THE ASSESSEE SATED THAT THIS WAS NOT AN UNSECURED LOAN BUT WAS CAPITAL INTRODUCED WHICH WAS WRONGLY TREATED BY THE ACCOUNTANT OF THE FIRM.. THE AO DID NOT ACCEPT THE EXPLANATION ON THE GROUND THAT THE TOTAL CAPITAL IN TRODUCED BY SMT. PUSHPA PAREKH STOOD AT RS.19,29,595/- ONLY AND THEREFORE, THE AMO UNT OF UNSECURED LOAN WAS UNEXPLAINED. IN RESPONSE THE ASSESSEE STATED THAT T HIS LOAN COULD BE VERIFIED FROM THE PERSONAL BALANCE-SHEET OF THE PARTNER BUT THE A O HELD THAT THE ASSESSEE HAD CLAIMED TO HAVE GIVEN LOANS AND ADVANCES TO ITS PAR TNERS BUT ON THE OTHER HAND, THE FIRM HAD SHOWN TO HAVE OBTAINED LOAN FROM ONE OF TH E PARTNERS AND THESE ADJUSTMENTS WERE ONLY AN ATTEMPT TO DEFRAUD THE REV ENUE AND MADE AN ADDITION OF THIS AMOUNT AS UNEXPLAINED CASH CREDIT. 9. THE LD. CIT(A) DELETED THE ADDITION FOR THE REAS ONS THAT PARTNERS HAVE DECLARED THE SAID LOANS IN THEIR INDIVIDUAL RETURNS AND WHO ARE ASSESSED TO TAX. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. ON IDENTICAL FACTS, AS IN GROUND NO.1 HEREINABOVE, THE PARTNERS HAVE DECLARED THE UNSECURED LOANS IN THEIR INDIVIDUAL RETURNS AND THE REFORE THE SAID AMOUNT CANNOT BE A SUBJECT-MATTER OF ADDITIONS IN THE HANDS OF THE ASS ESSEE-FIRM. IN THE CIRCUMSTANCES AND FACTS OF THE CASE, WE FIND NO INFIRMITY IN THE ORDER OF LD. CIT(A) WHO HAS RIGHTLY ITA NO.953 & 1142/AHD/2007 A.Y. 2003-04 M/S NISUKI FARMS V. ITO WD-6(3) SRT PAGE 8 DELETED THE ADDITION MADE BY THE ASSESSING OFFICER. THUS, GROUND NO.2 OF THE REVENUE IS DISMISSED. 11. IN THE RESULT, APPEAL OF ASSESSEE IN ITA NO.953/AHD/2007 AND APPEAL OF REVENUE IN ITA NO.1142/AHD/2007 ARE DISMISSED. % $ !'# &'( 03 / 02 /201 2 ! , - . / THIS ORDER PRONOUNCED IN OPEN COURT ON 03/02/ 201 2. SD/- SD/- ( BHAVNESH SAINI ) ( B.P. JAIN ) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) &'(- 03/02/2012 1 / DKP* $ $ $ $ 223 223 223 223 43' 43' 43' 43' / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. ''27 8 / CONCERNED CIT 4. 8- / CIT (A) 5. 3;. 2227, 27#, 1 / DR, ITAT, AHMEDABAD 6. .>? @% / GUARD FILE. BY ORDER/ $ , /TRUE COPY/ A/1 ' 27#, 1 /