JYOTI GUPTA, Alwar V. ITO, Alwar

ITA 100/JPR/2014

• Counselvise Citation: 10023114 RSA 2014
• Duration Of Justice: 1 year(s) 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 07-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DHK
• Keywords: Unexplained cash credit
• Section: 131; 68

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JUDICIAL MEMBER VK;DJ VIHY LA-@ ITA NO. 100/JP/2014 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09. SMT. JYOTI GUPTA 8, KRISHNA COLONY, MANGLANCER CIRCLE, ALWAR. CUKE VS. THE INCOME - TAX OFFICER, WARD-1(1), ALWAR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAPPG 2011 A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL, CA JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA, JCIT LQUOKBZ DH RKJH[K@ DATE OF HEARING : 19/10/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 19/10/2015 VKNS'K@ ORDER PER R.P. TOLANI, JM THE APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER OF THE LD. CIT (A), CENTRAL, JAIPUR DATED 04.06.2014 FOR THE ASSESSMENT YEAR 200 9-10. THE FOLLOWING GROUNDS ARE RAISED BY THE ASSESSEE :- 1. THAT THE LD. ASSESSING OFFICER HAS ERRED IN L AW AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING A N ADDITION OF RUPEES 97,500.00 AS UNEXPLAINED CASH CREDIT WITHIN THE MEANING OF SECTION 68 OF THE INCOME-TAX ACT, 1961 AND LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ALWAR HAS ERRED IN SUSTAINI NG THE SAME. 2 ITA NO. 100/JP/2014 A.Y. 2008-09 SMT. JYOTI GUPTA VS. ITO ALWAR. 2. THAT THE LD. ASSESSING OFFICER HAS ERRED IN LAW AS WELL AS ON THE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING A N ADDITION OF RUPEES 65,500.00 AS UNEXPLAINED CASH CREDIT WITHIN THE MEANING OF SECTION 68 OF THE INCOME-TAX ACT, 1961 AND LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ALWAR HAS ERRED IN SUSTAINI NG THE SAME. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE QU A SHOWN CASH CREDITS IN THE BOOKS OF THE ASSESSEE. THE AO MADE AN ADDITION OF RS. 97, 500/- WHICH WAS CHALLENGED IN FIRST APPEAL BY THE ASSESSEE. THE LD. CIT (A) CALLED FOR REMAND REPORT. ASSESSEE FILED THE CONFIRMATIONS AND AFFIDAVITS FROM THE CREDITORS. TH E AO ISSUED SUMMONS U/S 131 WHICH WERE SERVED ON THE CREDITORS BUT THEY DID NOT APPEA R PERSONALLY AND FILED THE AFFIDAVITS. THE AO DID NOT DISPUTE THE AFFIDAVITS AND CONFIRMAT IONS CONTAINING SOURCE OF INCOME AND PAN OF THE CREDITORS PROVIDED. HE SUSTAINED THE ADDITION ONLY ON THE GROUND THAT THE CREDITORS DID NOT TURN UP IN COMPLIANCE OF SUMM ON ISSUED U/S 131. ASSESSEE FILED RE-JOINDER ON 21.10.2013 CONTENDING THAT SHE HAS FU RNISHED THE AFFIDAVIT OF ALL THE ALLEGED FIVE CASH CREDITORS WHEREIN THEY HAVE ACCEP TED TO HAVE GIVEN LOAN TO THE ASSESSEE AND ALSO EXPLAINED THE SOURCE OF THEIR INC OME FROM WHERE THEY HAVE GIVEN THE AMOUNT. IN RESPONSE TO THE SUMMON ISSUED U/S 131, A LL THE CASH CREDITORS HAVE SENT THEIR REPLY THROUGH REGISTERED SPEED POST WHEREIN T HEY AGAIN ACCEPTED TO HAVE GIVEN THE AMOUNT OF THE ASSESSEE OUT OF THEIR OWN INCOME AND ALSO ACCEPTED TO HAVE RECEIVED BACK THE AMOUNT. THUS, THE ADDITION MADE U/S 68 BE DELETED. 3. THE LD. CIT (A), HOWEVER, CONFIRMED THE ADDITION OF RS. 97,500/- BY GIVING THE FOLLOWING FINDINGS :- 4.8. IN THE COURSE OF REMAND PROCEEDINGS, THE AO HAD GIVEN A NUMBER OF OPPORTUNITIES TO THE APPELLANT TO PRODUCE THE SA ID CASH CREDITOR FOR 3 ITA NO. 100/JP/2014 A.Y. 2008-09 SMT. JYOTI GUPTA VS. ITO ALWAR. EXAMINATION. ON EACH DATE, THE APPELLANT FAILED TO PRODUCE THE CASH CREDITOR. THE AO HAS ISSUED NOTICES U/S 131 OF THE IT ACT TO THE CASH CREDITORS BUT THE SAME REMAINED UN-COMPLIED WITH. A S REGARDS, FURNISHING OF PARTICULARS BY THE CASH CREDITORS IN THEIR AFFID AVITS ARE CONCERNED, THESE APPEARS TO BE MECHANICALLY PREPARED AND FILED. NO F URTHER EVIDENCE HAS BEEN ADDUCED TO SUBSTANTIATE THE CLAIM OF THEIR SOU RCES OF INCOME AND THE CREDIBILITY OF HAVING EARNED THE INCOME FROM THOSE SOURCES. THE LOANS GIVEN IN CASH ARE BORDERING ON THE LIMIT SET UNDER THE RELEVANT PROVISION OF THE IT ACT WHICH BAR RECEIPT OF LOANS IN CASH EXCEE DING THE SPECIFIED LIMIT. THE ONUS IN SUCH CASES IS ON THE APPELLANT TO PROVE FIRST THE VERY EXISTENCE OF SUCH TRANSACTION AND THEN TO SUBSTANTI ATE WITH EVIDENCE THE CREDITWORTHINESS OF THE CREDITOR AS REQUIRED UNDER THE PROVISIONS OF SEC. 68 OF THE IT ACT. THE CASE LAWS CITED BY THE APPELLANT ARE DISTINGUISHABLE ON FACTS AND HENCE ARE NOT APPLICABLE IN THIS CASE. THE LD. COUNSEL CONTENDS THAT ONCE THE ASSESSEE HAS FILED ALL THE CONFIRMATIONS AND AFFIDAVITS CONTAINING PAN AND SOURCE OF DEPOSIT, TH EN ADDITION CANNOT BE SUSTAINED ONLY BECAUSE THE CREDITORS DID NOT RESPOND TO AOS SUMMO N U/S 131. RELIANCE IS PLACED ON HONBLE SUPREME COURT JUDGMENT IN THE CASE OF ORISS A CORPORATION, 159 ITR 78 (SC). THE ASSESSEE HAD DISCHARGED HER BURDEN. THEREFORE, THE ADDITION OF RS. 97,500/- IS UNJUSTIFIED. 4. APROPOS SECOND GROUND, IT IS CONTENDED THAT THE BALANCE OF RS. 65,500/- WAS FROM THE EARLIER YEARS AND NOT RECEIVED IN THIS YEA R. AO, HOWEVER, MADE THE ADDITION. IN FIRST APPEAL BEFORE LD. CIT (A), ASSESSEE EXPLAI NED THAT AMOUNT OF RS. 65,000/- ARE NOT SUNDRY CREDITORS BUT CASH CREDITORS WHICH ARE C ARRIED FORWARD FROM LAST SEVERAL 4 ITA NO. 100/JP/2014 A.Y. 2008-09 SMT. JYOTI GUPTA VS. ITO ALWAR. YEARS. IN SUPPORT OF SAME, THE LEDGER ACCOUNT OF EA RLIER YEARS WAS FILED. THE LD. CIT (A) CALLED THE REMAND REPORT. THE AO IN REMAND REPORT S TATED THAT IT IS A MERE MANIPULATION OF BALANCE SHEET WHICH MAY INVITE ACTION U/S 147. ON THESE FACTS THE LD. CIT (A) HELD THAT THE ASSESSEE HAS NO MATERIAL TO JUSTIFY THE EX ISTENCE OF SUNDRY CREDITORS DECLARED IN THE BALANCE SHEET WHEN HE HAS NOT CARRIED OUT ANY B USINESS ACTIVITY IN EARLIER YEARS AND THE ASSESSEE IS SHIFTING HIS STAND. HE THEREFORE CO NFIRMED THE ADDITION. 5. THE FACT ON RECORD THAT SUNDRY CREDITORS ARE COM ING FROM EARLIER YEARS, IS NOT DISPUTED BY THE LOWER AUTHORITIES. THEREFORE, ADDIT ION OF THIS AMOUNT WHICH IS COMING FROM EARLIER YEARS CANNOT BE MADE IN THE YEAR UNDER CONSIDERATION. HENCE, THE ADDITION BE DELETED. 6. THE LD. D/R SUPPORTED THE ORDER OF THE AO. 7. I HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. FROM THE CONFIRMATIONS AND AFFIDAVITS FILED BY THE ASSESSEE IT EMERGES THAT THE NAMES, ADDRESSES, PAN AND AFFIDAVITS OF THE CREDITORS WERE FURNISHED BY THE ASSESSEE. THE ADDITION OF RS. 97,500/- HAS BEEN SUSTAINED ONLY BE CAUSE THE CREDITORS DID NOT APPEAR AFTER RECEIVING THE SUMMONS UNDER SECTION 131. FROM THE DOCUMENTS FILED BY THE ASSESSEE, IT EMERGES THAT ASSESSEE HAS DISCHARGED H ER PRIMARY ONUS IN FILING THE EVIDENCE IN RESPECT OF IDENTITY, GENUINENESS AND CR EDITWORTHINESS OF THE TRANSACTION. NON APPEARANCE OF A WITNESS IN COMPLIANCE TO SUMMON DULY SERVED ON THE PERSON CANNOT DESERVE ANY DETRIMENT TO THE ASSESSEE AS HEL D BY HONBLE SUPREME COURT IN THE 5 ITA NO. 100/JP/2014 A.Y. 2008-09 SMT. JYOTI GUPTA VS. ITO ALWAR. CASE OF ORISSA CORPORATION LTD. (SUPRA). IN VIEW T HEREOF THE ADDITION IN GROUND NO. 1 IS DELETED. 8. APROPOS GROUND NO. 2, SINCE THE SUNDRY CREDITORS IN QUESTION WERE APPEARING IN BOOKS OF ACCOUNTS SINCE LAST 2-3 YEARS AND ARE NOT THE CASH CREDITS OF THIS YEAR, THEY CANNOT BE ADDED AS ASSESSEES UNEXPLAINED CASH CRED ITS. THEREFORE, THIS ADDITION IS ALSO DELETED. 9. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19/10/20 15. SD/- VKJ-IH-RKSYKUH (R.P.TOLANI) U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 19/10/ 2015 DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. JYOTI GUPTA, ALWAR. 2. IZR;FKHZ@ THE RESPONDENT- THE ITO WARD 1(1), ALWAR. 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.100/JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 6 ITA NO. 100/JP/2014 A.Y. 2008-09 SMT. JYOTI GUPTA VS. ITO ALWAR.