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Showing contexts for: peak theory in Saral Plastics Pvt. Ltd.,, Ahmedabad vs The Income Tax Officer, Ward-8(1),, ... on 25 May, 2017Matching Fragments
9. Ld.Counsel also submitted that if Hon'ble Tribunal is not with the assessee on applying cumulative peak credit theory than the correct individual peak credit figure in case of two parties may be applied namely M/s.J.P. Corporation at Rs.6,37,534/- and M/s.Swastik Corporation at Rs.14,64,000/- as against Rs.14,61,700/- and Rs.18,38,139/- respectively confirmed by Ld.CIT(A) with regard to these two parties.
9.1 Further Ld.counsel relied on the decision of Co-ordinate Bench in the case of S.R. Enterprises V/s. ITO in ITA no.2429/Ahd/1999 pronounced on 20/07/2000 in respect of his contention of applying cumulative peak theory.
13. Ld.CIT(A) thereafter adopted the peak credit theory and called for details for calculating individual peak credit of each party because the details cheque issued, cheque cleared names of the parties were not reaching at the correct conclusion. Ld.CIT(A) accordingly confirmed the addition of Rs.61,09,368/- being total peak credit of these five parties. We would like to summarize the figures of the following five parties containing the details of unsecured loan in the name of each parties and the peak credit confirmed by Ld.CIT(A).
13.1 We further observe that Ld.DR has pleaded about non application of peak theory in the case of assessee which we find not to be correct in the given facts and circumstances because the basic about opening balance of such cash credit, how much cash/fund had come from known and accept sources where the fund has flow are not on record. It is only the negative figure i.e shortage of fund which is unexplained needs to be added to the income of assessee.
13.2 We find it pertinent to reproduce the detailed findings of Ld.CIT(A) on this issue of application of peak theory which reads as under:
The addition u/s 68 of the Act to the extent Rs. 6109368/- are upheld. It is therefore the A.O. is directed to delete the balance addition of Rs. 84,68,293/- (1,45,77,661 - 51,09,368). The appellant gets part relief. This ground is partly allowed.
13.3 In the given case Ld.CIT(A) has discussed at length about the five parties as referred above and comes to the conclusion that as there were no details about journal entries, mismatch of name and assest bank statement entries and those reflected in the book. In this situation Ld.CIT(A) has rightly adopted peak credit theory. We confirm the action of Ld.CIT(A) of applying peak credit theory .