IT: Where Assessing Officer had drawn an adverse conclusion only on account of non-verifiability of sundry creditors but there being no dispute as regards purchases, and trading results having been accepted, addition made under section 68 was not sustainable
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[2015] 55 taxmann.com 522 (Lucknow - Trib.) (TM)
IN THE ITAT LUCKNOW BENCH 'A' (THIRD MEMBER)
Income-tax Officer, Ward 29 (4), New Delhi
v.
Zazsons Exports Ltd.*
S.V. MEHROTRA, ACCOUNTANT MEMBER (AS A THIRD MEMBER)
SUNIL KUMAR YADAV, JUDICIAL MEMBER
AND A.K. GARODIA, ACCOUNTANT MEMBER
IT APPEAL NO. 219 (LUCK.) OF 2009
[ASSESSMENT YEAR 2005-06]
APRIL 25, 2014
Section 68 of the Income-tax Act, 1961 - Cash credits (Sundry creditors) - Assessment year 2005-06 - Assessee company was carrying on business of export of finished leather and manufacture of shoe uppers and shoes - While framing assessment, Assessing Officer required assessee to furnish complete list of persons from whom raw hides of goats were purchased and from whom advance in shape of credit had been taken by assessee and to whom huge amounts were payable - Not being satisfied with reply given by assessee, Assessing Officer made addition under section 68 on ground that assessee failed to give postal address, whereabouts, creditworthiness of vendors and also could not prove genuineness of transaction - Whether mere non-verifiability of sundry creditors ipso facto would not lead to conclusion that sundry creditors were bogus - Held, yes - Whether since Assessing Officer had drawn an adverse conclusion only on account of non-verifiability of sundry creditors but there being no dispute as regards purchases and trading results having been accepted, addition made under section 68 was not sustainable - Held, yes [Paras 15.2 & 15.3][In favour of assessee]
■■■
[2015] 55 taxmann.com 522 (Lucknow - Trib.) (TM)
IN THE ITAT LUCKNOW BENCH 'A' (THIRD MEMBER)
Income-tax Officer, Ward 29 (4), New Delhi
v.
Zazsons Exports Ltd.*
S.V. MEHROTRA, ACCOUNTANT MEMBER (AS A THIRD MEMBER)
SUNIL KUMAR YADAV, JUDICIAL MEMBER
AND A.K. GARODIA, ACCOUNTANT MEMBER
IT APPEAL NO. 219 (LUCK.) OF 2009
[ASSESSMENT YEAR 2005-06]
APRIL 25, 2014
Section 68 of the Income-tax Act, 1961 - Cash credits (Sundry creditors) - Assessment year 2005-06 - Assessee company was carrying on business of export of finished leather and manufacture of shoe uppers and shoes - While framing assessment, Assessing Officer required assessee to furnish complete list of persons from whom raw hides of goats were purchased and from whom advance in shape of credit had been taken by assessee and to whom huge amounts were payable - Not being satisfied with reply given by assessee, Assessing Officer made addition under section 68 on ground that assessee failed to give postal address, whereabouts, creditworthiness of vendors and also could not prove genuineness of transaction - Whether mere non-verifiability of sundry creditors ipso facto would not lead to conclusion that sundry creditors were bogus - Held, yes - Whether since Assessing Officer had drawn an adverse conclusion only on account of non-verifiability of sundry creditors but there being no dispute as regards purchases and trading results having been accepted, addition made under section 68 was not sustainable - Held, yes [Paras 15.2 & 15.3][In favour of assessee]
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