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M/s. R.L. Traders 2046, Katra Tobacco Khari Baoli New Delhi- 110 006 Vs. ITO Ward-29(1) New Delhi
August, 18th 2015
                      DELHI BENCHES : "F" NEW DELHI

                 SHRI C.M. GARG, JUDICIAL MEMBER

                               ITA No: 4495/Del/2013
                                 Asstt. year 2007-08

             M/s. R.L. Traders          vs.          ITO
             2046, Katra Tobacco                     Ward-29(1)
             Khari Baoli
             New Delhi- 110 006                      New Delhi
              (PAN AAAFR5508C)
              (Appellant)                     (Respondent)

                               ITA No: 5300/Del/2013
                                 Asstt. year 2007-08

             ITO                      vs.            M/s. R.L. Traders
             Ward-29(1), Room No. 103                2046, Katra Tobacco
             Drum Shaped Building,                   Khari Baoli
             I.P. Estate                             New Delhi ­ 110 006.
              New Delhi                             (PAN AAAFR5508C)

              (Appellant)                     (Respondent)

                      Appellant by  : Shri K.R. Manjani, Advocate
                      Respondent by :Shri Vikram Sahay, Sr.DR
                    Date of Hearing  :23.7.2015
              Date of pronouncement :      2015



     These are cross appeals directed against the order of the Commissioner of

Income Tax (Appeals)-IV, New Delhi dated 14.6.2013 for the assessment years

                                                      ITA Nos. 4495,5300/Del/2013
                                                      M/s. R.L. Traders vs. ITO

2.      Facts in brief : Assessee is a partnership firm engaged in the business of

purchase of starch, oil, gum and sale of hing as per requirement of the customers.

It filed its return of income on 30.10.2007.The AO determined the total income at

Rs. 30,70,270/-, by estimating gross profit @ 15% on sale. Aggrieved the assessee

carried the matter on appeal. The first appellate authority partly allowed the appeal

of the assessee. For the assessment year 2000-01 and for the assessment year

2006-07, similar addition was made by the AO and on appeal the Ld. CIT(A) -II

New Delhi, vide order dated 31.8.2010 deleted the addition. This order was

confirmed by the ITAT, `F' bench Delhi vide order dated 17.6.2011 in ITA No. 4768

to 4744 /Del/2010. The Ld. CIT(A) in the impugned assessment year deleted the

addition by following the order of the Tribunal for the earlier assessment years. The

revenue filed an appeal on this issue.

3.     The AO made an addition of Rs. 1,34,584/- as unexplained cash credit of Rs.

1 lac received from M/s. Pradeep Kumar Bansal, HUF and interest debited thereon.

The addition was made by the AO, as the assessee could not produce the Karta of

the HUF Shri Pradeep Kumar Bansal. The assessee had also not produced any

confirmation letter from M/s, Pradeep Kumar Bansal HUF. Instead he requested the

AO to issue summons to Shri Bansal u/s 131, of the Income Tax Act, which the AO

did. Shri Pradeep Kumar Bansal appeared before the AO and stated that he has

given only a book entry of loan of Rs. 50,000/- to M/s. R.L. Traders, in exchange of

cash of Rs. 50,000/- and that the transaction was not a genuine transaction. Shri

Pradeep Kumar Bansal further stated that his HUF has also given a bogus loan entry

of Rs. 50,000/- to M/s. R.L. Traders and that his wife Smt. Shashi Bala Bansal, has

also given a bogus loan entry of Rs. 1 lac to M/s. R.L. Traders during the year 2007-

                                                        ITA Nos. 4495,5300/Del/2013
                                                        M/s. R.L. Traders vs. ITO

08. Based on these submissions the addition was made by the AO and confirmed by

the first appellate authority. Aggrieved the assessee is in appeal before us.

4.     Ld. Counsel for the assesee Shri K.R.Manjani submits that statement of Shri

Bansal was recorded behind his back and that the assesee has filed all details that

were in his control. He contended that the AO summoned Shri P.K. Bansal originally

on a particular date and did not record the statement of Shri Bansal on that date, as

the assessee was also present on that date, and later, just before completion of

assessment on 4.12.2009 has hastly recorded the statement on 29.11.2009 and

made the addition, without giving the assessee any opportunity.

5.      He submits that by the time Ld. CIT(A) asked for the remand report, Shri

Pradeep Kumar Bansal passed away and hence he could not be cross examined.

Thus he prays that the statement of Shri Bansal can not be considered as evidence.

6.       Ld. DR referred to the statement of Shri Pradeep Kumar Bansal and relied

on the order of the first appellate authority. He submitted that no evidence is filed

by the assesee and hence the addition is to be confirmed.

7.     After hearing rival contentions, we find that Shri Pramod Kumar Bansal has

been summoned only on the request of the assessee, for the reason that the

assessee could not produce him nor any evidence in support of the transaction. . In

the statement recorded Shri Pramod Kumar Bansal clearly states that all these loans

are bogus loans. The Ld. Counsel for the assessee vehemently contends that a

statement from Shri Pramod Kumar Bansal was not recorded on 21st June, 2009

when the original summons were given, but on a later date behind is back. As cross

examination was not given to the assessee the evidential value of the statement

                                                        ITA Nos. 4495,5300/Del/2013
                                                        M/s. R.L. Traders vs. ITO

recorded by the AO on 20.11.2009 can be ignored. When the statement of Shri

Bansal is ignored, then the initial burden is on the assesee to prove the transaction

is genuine. This burden is not discharged by the assessee. Hence we uphold the

order of the first appellate authority on this issue and dismiss this ground of appeal

of the assessee.

8.        The revenue appeal is against the deletion of addition made, by applying GP

rate of 15%. As this issue is admittedly covered in favour of the assessee against the

revenue by a decision of the Tribunal in the assessee's own case on the very same

facts for the earlier assessment year, we find no reason to interfere in the order of

the first appellate authority. Hence we dismiss this appeal of the revenue.

9.           In the result both the appeals of the assessee and the revenue are


     Order pronounced in the open court on   14th August, 2015.

                      sd/-                                  sd/-

               (C.M. GARG)                    (J. SUDHAKAR REDDY)
             JUDICIAL MEMBER                   ACCOUNTANT MEMBER

Dated: the      14th August, 2015

Copy of the Order forwarded to:

1.      Appellant
2.      Respondent
3.      CIT
4.      CIT(A)
5.      DR
6.      Guard File                      By order
                                                   Dy. Registrar

                                                            ITA Nos. 4495,5300/Del/2013
                                                            M/s. R.L. Traders vs. ITO

Sl.                    Description                   Date

1.    Date of dictation by the Author              10.8..2015

2.    Draft placed before the Dictating Member     11.8.2015

3.    Draft placed before the Second Member

4.    Draft approved by the Second Member

5.    Date of approved order comes to the Sr. PS

6.    Date of pronouncement of order

7.    Date of file sent to the Bench Clerk

8.    Date on which file goes to the Head Clerk

9.    Date of dispatch of order

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