SHRI KALIDAS BHANABHAI PATEL,,VAPI vs. INCOME TAX OFFICER, WARD-2,, VAPI

Ground No.1 relates to addition of Rs.21,51,513/- made u/s.68 of the Act ignoring the evidences filed before them and Ground No.2 relates to addition on account of five depositors being difference in opening balance and in case of M/s.Delux Recycling India Pvt. Ltd., wrong entry of Rs.3,50,000/- confirmed by the creditor.

Both the above ground relates to addition of Rs.21,51,513/-, hence, same are being considered together which includes the quantum of second ground amount mentioned in the second ground also.

Briefly stated facts are that the addition of Rs.39,25,386/- was made u/s.68 of the Act vide order u/s.143(3) dated 22.12.2010. The assessee has preferred an appeal before the CIT(A) who had allowed the appeal to the assessee. However, the Revenue has filed appeal before the ITAT, Ahmedabad. The ITAT vide order no.2582/Ahd/2011 and C.O.No.13/Ahd/2012 dated 31.08.2012 set- aside the order to the file of the AO on the point of addition being unexplained cash credit u/s.68 of the Act to the tune of Rs.39,25,386/-. In view of this matter, the AO considered the matter as afresh and asked the assessee to reconcile the entries in

Being aggrieved, the assessee carried the matter before the ld.CIT(A), wherein it was claimed that M/s.Delux Recycling India Pvt. Ltd. has not made payment of Rs.3,50,000/- to the appellant, hence, same is not credited in the books of appellant. However, the CIT(A) observed that the assessee has been allowed sufficient opportunity to reconcile the difference and after considering the reply of the appellant, the addition was reduced from Rs.39,25,386/- to Rs.21,51,513/-. This itself was not reconciled by the assessee. Therefore, the explanation before him could not be accepted, because a number of opportunities were given to the assessee by the AO. Therefore, the additions of Rs.21,51,513/- was sustained.

Being aggrieved, the assessee has filed this appeal before this Tribunal. The ld.Counsel submitted that in the case of M/s.Delux

Per contra, the learned Senior Departmental Representative (Sr.DR) submitted that the assessee has failed to reconcile the differences of amounts in respect 11 (eleven) parties even though number of opportunities allowed to the assessee in the set-aside proceedings by the AO. In some case, notice issued u/s.133(6) of the Act wherein the parties have shown difference balances which

We have considered the facts and heard the rival submissions and perused the material on record. With regard to M/s.Delux Recycling India Pvt. Ltd., there is a difference of Rs.3,50,000/-. The assessee has furnished copy of ledger accounts and letter [PB-38] from the said parties before the CIT(A) stating that the payment of Rs.3,50,000/- dated 06.06.2008 in the account of assessee was debited by mistake, further such payment has been made by cheque which is not reflected in the assessee’s bank account also and therefore, in such circumstances also, it cannot be said that the assessee has received this amount of Rs.3,50,000/- from M/s.Delux Recycling India Pvt. Ltd. Hence, the addition made on this account is deserved to be deleted. Accordingly same is directed to be deleted.

With regard to addition in respect of balance 10 persons is concerned, we find that the assessee is not able to reconcile the differences, where it is an opening balance or during the year and further also the reply received from these parties in response to notice u/s.133(6) shows the balance which is not tallying with the

In the result, appeal of the assessee is partly allowed.

The order pronounced in the open Court on 23-08-2018.