M/S. SHIV SUNDER GRIT UDYOG,HARYANA vs. ITO, NARNAUL

This is an appeal filed by the Assessee directed against the order dated 22.12.2014 of Ld.CIT(A), Rohtak pertaining to the Assessment Year (A.Y.) 2010-11. The effective ground of appeal is ground no.2 which reads as under.

2. That the Ld.CIT(A) erred in confirming the addition of Rs.1,71,627/- made by the Ld.A.O. by treating the sundry creditors as bogus.

2. After hearing rival contentions, I find that the assessee has furnished confirmation of balances of sundry creditors to the tune of Rs.27,46,791/-. Copies of accounts and confirmations were not furnished only in the case of creditors to the tune of Rs.1,71,627/-. But the assessee submitted that these creditors listed out at page 2 of the assessment order, are labourers and truck owners, who have been paid these amounts in the immediately succeeding financial year and that confirmations cannot be obtained from them, as they do not have any fixed addresses. In my view this Explanation

Shiv Sunder Grit Udyog has to be upheld, the conclusion of the Ld.CIT(A) that these amounts are bogus and fictitious liabilities is not correct. When the liability in question has been discharged in the subsequent A.Y., no addition can be made unless the evidence is gathered to the contrary by the Revenue.