A.R. HALDER, J.M. This appeal by revenue and cross objection by assessee are disposed of by this combined order for sake of convenience. grounds of appeal raised in Departmental appeal centre round deletion of Rs. 25,000 added by ITO as unexplained income of assessee. assessee firm was doing business in cloth on wholesale basis. As result of search on 19th Aug., 1967; in business premises of assessee by Excise Department and police, one exercise book containing 191 pages was found alongwith other books of account and documents. Sri. A.K. Jaiswal, Inspector of IT Department, who was directed to be present at time of search, signed various books of account and documents including exercise book containing 191 pages and took extracts from exercise book which were signed by one of partners of assessee firm and also Inspector. In course of assessment proceedings, assessee produced various account books signed by Inspector but when required to produce exercise book, assessee claimed that there was no such exercise book. ITO found that extracts taken by Inspector from exercise book showed that assessee was doing business outside books. He further found that said extracts also showed deposits in name of various parties and peak credit of these deposits, as per Inspector s report dt. 10th Jan., 1967 was Rs. 25,000. He also found that concerned parties denied having advanced amounts as mentioned in extracts to assessee. These facts led ITO to believe that amount of Rs. 25,000 was unaccounted for income of assessee and accordingly he included same in assessee s total income under head income from other sources On appeal by assessee, AAC deleted addition of Rs. 25,000 by observing that impugned addition was made on scanty and slender evidence in shape of alleged extracts taken by Inspector from exercise book. Against said order of AAC revenue preferred appeal before Tribunal and Tribunal by its order dt. 19th June, 1976 in ITA No.1851 (All)/74-75 set aside order of AAC and restore case to; him for his redecision by observing as under: "After considering facts of case we feel that assessee s contention that exercise book reported by Income-tax Inspector did not exist at time of search cannot be accepted. list of account books etc. found at time of search as prepared by Inspector clearly mentions this exercise book. list also shows that each page of this exercise book was signed by Inspector. list was duly signed by partner of assessee. extracts taken from exercise book are fairly detailed and it is impossible to believe that they could have been noted out of imagination. These extracts are also signed by Shri Ram Prakash, partner with endorsement that extracts had been taken from books of assessee. It is also not possible to believe that this exercise book; was created by some outsider and planted at time of search with view to harass assessee. No such objection was taken at time of search. Even otherwise there is no basis for this allegation. extracts taken from this exercise book also; show that this exercise book contained transactions with parties with whom assessee is admittedly having business dealings. entire circumstances show that exercise book as reported by Inspector was found at time of search and contained entries mentioned by him in his report. fact that assessment for this year was completed by Income-tax Inspector under section 143(3) and not under section 144 of IT Act which he could have done for non-production of exercise book before him, has no relevant so far as fact of existence of exercise book is concerned. dates of entries mentioned in extract clearly show that entries related to accounting year of assessee for this assessment year. AAC was, therefore, not justified in accepting assessee s contention that no such exercise book really existed at time of search. We, therefore, reverse his finding on this point. AAC had allowed assessee s appeal by accepting its contention that there was no such exercise book as reported by ITI that finding we have reversed. AAC will please now consider reasonableness of addition made by ITO for which purpose we would restore appeal to his". At time of rehearing of appeal; by AAC it was contended on behalf of assessee that no such exercise book was available at all in assessee s premises at time of search. It was urged that search was conducted at instance of one Sri Tutha Ram who was in litigation with assessee and that said Tutha Ram in order to harass assessee handed over extracts to Inspector. It was claimed that partner of assessee firm did not know English at all and, therefore, he could not detect that in seizure list there was mention of exercise book in English. It was also; urged that ITO had added amount of Rs. 25,500 under s. 68 but no cash credit was appearing in assessee s book. He pointed out that all concerned parties denied having advanced money to assessee. Reference was made to statement made by Sri Ram Prakash Anand, partner of assessee firm, on oath before ITO to effect that there was no existence of any exercise book containing 191 pages from which IIT took extracts. AAC again deleted addition of Rs.25,000 by observing as under: " My brief contention is that ITO has no independent and corroborative evidence in his possession to show that sum of Rs. 25,000 was unexplained investment of appellant . appellant has discharged his onus of proof in respect of sum of 25,000. Therefore, onus now lies on Department to prove that assessee really made some cash credit and same remained explained by him but I am afraid, Department has not discharged its onus. I agree with view of Sri S.S. pandey learned counsel that action of ITO in adding back Rs. 25,000 as unexplained cash credit under s. 68 is not correct as there was no cash credit appearing in books of account of appellant. assessee did not admit it and if assessee had admitted it then only question of addition would have arisen. However, I feel that Department has not come out with any corroborative evidence to justify addition of 25,000. It is also important to remember that party did not confirm any credit. Since Department has no proved credit of Rs. 25,000, I feel that entire addition of Rs. 25,000 is not called for. addition is therefore deleted. Against said order of AAC revenue has preferred present appeal before Tribunal and it was contended by ld. Departmental representative that AAC failed to appreciate findings and direction given representative that AAC failed to appreciate findings and direction given by Tribunal in its order dt 19th June, 1976. He pointed out that Tribunal recorded finding of fact that extracts taken from exercise book showed that assessee had business transaction with parties named in exercise book. ld. Departmental representative further pointed out that Tribunal has categorical by observed that dates of entries mentioned in extracts clearly show that entries related to accounting year of assessee for assessment year under appeal. ld. Departmental representative, therefore submitted that AAC should not have tried to make out case in favour of assessee about existence of exercise book. He vehemently urged that AAC was wrong; in holding that action of ITO in adding back Rs. 25,000 as unexplained cash credit under s. 68 is not correct as there was no cash credit appearing in books of account of assessee . He submitted that exercise book in which entries were found formed part of books of account of assessee. ld. Departmental representative urged that AAC should not have observed that Department has not come out with any corroborative evidence to justify addition of Rs. 25,000. He submitted that under s. 68 it was duty of assessee to explain satisfactorily source of amounts what were found credited in his books of account and it was not duty of revenue to prove that cash credit appearing in assessee s books of account was income of assessee. In short, ld Departmental representative contended that conclusion of AAC was based on appreciation of incorrect legal aspect of matter. Accordingly, he submitted that such order of AAC could not be sustained. ld. Counsel for assessee ,on other hand, referring to cross objection filed by assessee, contended that AAC was correct in; his findings that addition of Rs. 25,000 as unexplained income of assessee was not just and proper. He urged that in order to make addition either under s. 68 or under s. 69 one should carefully consider two important facts. Firstly, whether disputed amount represents genuine entry in assessee s books of account and secondly, if investments are not contained in any books of account they are unexplained. Then only value of investment is to be deemed to be income of assessee for financial; year preceding assessment year. He urged that ITO did not care to examine this very important aspect of matter. ld. counsel for assessee urged that so-called exercise book could not be proved by ITO to be book of assessee and moreover while making addition of Rs. 25,000, ITO had not taken into consideration dates of deposits appearing in so-called exercise book, extracts of which were taken by ITI. ld. Counsel for assessee placed reliance on certain decisions and urged that sine ITO failed to make out case in accordance with provisions of relevant section, AAC was justified in deleting addition that was made by ITO on consideration of irrelevant facts. We have heard submissions of both parties and considered facts on record. It is to be noted that issue regarding assessability of Rs. 25,000 as unexplained income of assessee came for consideration before Tribunal wherein Tribunal after examining entire factual aspect of matter came to conclusion that exercise book found as result of search contained transactions with parties with whom assessee was admittedly having business dealing and that dates of entries mentioned in extract clearly show that entries related to accounting year of assessee for this assessment year. Tribunal, however, set aside order of AAC and directed him to redecide appeal inasmuch as AAC deleted addition by accepting assessee s contention that no exercise book was found at time of search as reported by ITI. That being position, it has to be held that AAC while redeciding appeal; had not taken into consideration direction that was given by Tribunal. We see that ground on which AAC deleted addition was that assessee had discharged its onus; of proof in respect of sum; of Rs. 25,000 and Department has not proved that disputed amount was income of assessee. But we do not find any material on record from which it could be inferred that assessee discharged its onus. Rather, assessee was always denying existence of exercise book. There was also no satisfactory explanation as to source of various credits that were appearing in assessee s exercise book. language of ss. 68 and 69 is very clear that where any sum is found credited in books of account of assessee maintained for any previous year or where in financial year immediately preceding assessment year assessee has made investments which are not recorded in; books of account and assessee offers no explanation about nature and source thereof or explanation offered by him is not, in opinion of ITO satisfactory sum so credited or value of investment may be charged to income-tax as income of assessee of that previous year or of such financial year, as case may be. But AAC does not appear to have taken into consideration this; important aspect of matter and tried to place unnecessary burden on ITO to prove that disputed amount was income of assessee .We therefore, find it difficult to sustain such order of AAC. However, we see that Tribunal in its earlier order directed AAC to consider reasonableness of addition made by ITO. Since in our opinion, AAC overlooked this direction of Tribunal we think that in interest of justice this matter should go back once again to AAC for his redecision after considering correct factual and legal aspect of matter and in light of observations that we have made above. Objection having no special ground is fit to be dismissed. In result, Departmental appeal is allowed for statistical; purposes while cross objection filed by assessee is dismissed. *** INCOME TAX OFFICER v. SHITAL SHAH RAM PRAKASH ANAND