Assessee failed to Prove Entries of Credit against Addition section/s 68 of Income tax Act: ITAT allows Revenue Dept's Appeal

The Kolkata ITAT upheld the addition under Section 68 of the Income Tax Act, as the assessee failed to substantiate credit entries. Mangalvani Commercial Pvt. Ltd received substantial share capital and premium but couldn't clarify the source. \r

The AO's summons to the Director went unanswered, hindering scrutiny of transactions. Despite CIT(A)'s deletion of the addition citing absence of cash receipts, the ITAT reasoned that mercantile accounting allows for journal entries without cash receipts. The tribunal, led by Anikesh Banerjee and Dr. Manish Borad, affirmed the AO's authority to scrutinize credit entries. \r

Consequently, the ITAT upheld the revenue's appeal due to lack of explanation for the transactions.