Expense cannot be held unproved, un-genuine and bogus sham for merely because it remain unpaid on B/s Date

Brief Facts of the Case The assessee during the year under consideration had shown sales of Rs.3,76,70,648/- and has declared gross profit of Rs.25,75,650/- and net profit of Rs.8,28,918/-. The AO, from the balance sheet of the assessee found that the assessee has made provision for unpaid expenses. The AO observed that due to this provision, the income of the assessee was reduced. According to the AO, almost entire expenditure debited to the Trading and Profit & Loss account is appearing as outstanding expenses in the balance sheet. Therefore, he held that only expenses shown for elect...