ITO, Ghaziabad V. M/s. Krishna Financers, Ghaziabad

ITA 1035/DEL/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74049 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-01-2014
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 16-01-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 01-03-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S N BHATIA
• Keywords: Gift; Opportunity of being heard; Source of fund

Judgement Text

ITA NO. 1035/DEL/2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D, NEW DELHI BEFORE SHRI I.C. SUDHIR, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER I.T.A. NO. 1035/DEL/2012 A.Y. : 2008-09 INCOME TAX OFFICER, WARD-1(3), CGO COMPLEX-1, HAPUR ROAD, GHAZIABAD VS. M/S KRISHNA FINANCERS, 118, RAMTE RAM ROAD, GHAZIABAD (PAN: AABFK6740N) (APPELLANT) (APPELLANT) (APPELLANT) (APPELLANT) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) ASSESSEE BY : SH. SANJAY MALIK, ADV. DEPARTMENT BY : SH. S.N. BHATIA, DR ORDER ORDER ORDER ORDER PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM PER SHAMIM YAHYA: AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), GHAZIABAD DATED 13.12.2011 PERTAINING TO ASSESSMENT YEAR 2008-09. 2. IN THIS CASE THE MATTER RELATES TO ADDITION ON ACCOUNT OF UNEXPLAINED DEPOSITS OF RS. 13,98,065/-; RS. 17,30 ,000/- AND UNEXPLAINED CAPITAL ADDITION OF RS. 4,00,000/-. AT THE OUTSET WE NOTE THAT REVENUE HAS RAISED GROUND REGARDING VIOLA TION OF RULE 46A. IN THIS REGARD, WE NOTE THAT ASSESSEE HAS S UBMITTED THE ADDITIONAL DOCUMENTS BEFORE THE LD. CIT(A). LD. CI T(A) HAS REMANDED THE SAME TO THE AO AND AOS REMAND REPORT IS ALSO OBTAINED. THEREAFTER, THE LD. CIT(A) HAS ALSO OBTA INED REJOINDER FROM THE ASSESSEE AND THEREAFTER ADJUDICATED THE I SSUE. ON GOING THROUGH THE APPELLATE ORDER, WE FIND THAT THERE I S NO ISSUE OF ITA NO. 1035/DEL/2012 2 VIOLATION OF RULE 46A. THE ASSESSEE HAS PLEADED BEFORE THE LD. CIT(A) THAT IT WAS NOT GIVEN PROPER TIME BY THE AO TO FILE THE NECESSARY DOCUMENTS AND THE SAME WERE FILED BEFO RE THE LD. CIT(A). LD. CIT(A) REMANDED THE SAME TO THE FIL E OF THE AO AND ALSO OBTAINED REMAND REPORT FROM THE AO. IN THES E CIRCUMSTANCES, LD. DR WAS ASKED TO POINT OUT THE VIOLATION OF RULE 46A. LD. DR COULD NOT MAKE ANY COGENT REPLY IN THIS REGARD. A CCORDINGLY, WE HOLD THAT THE GROUND RELATING TO VIOLATION OF RUL E 46A ARE NOT SUSTAINABLE. ACCORDINGLY, WE DISMISS THIS GROUND. 3. NOW WE DEAL WITH THE ISSUE ON MERITS. 4. UNEXPLAINED DEPOSITS RS. 13,98,065/ UNEXPLAINED DEPOSITS RS. 13,98,065/ UNEXPLAINED DEPOSITS RS. 13,98,065/ UNEXPLAINED DEPOSITS RS. 13,98,065/- -- -. . . . THIS COMPRISES OF: A) SURINDER KUMAR RS. 9,98,065/- B) PRAHLAD YADAV RS. 4,00,000/- TOTAL TOTAL TOTAL TOTAL RS. 13,98,065/ RS. 13,98,065/ RS. 13,98,065/ RS. 13,98,065/- -- - 5. THE ASSESSEE WAS ASKED BY THE AO TO EXPLAIN THE FOLLOWING DEPOSITS IN THE ASSESSEES BANK ACCOUNT (I) SURIND ER KUMAR RS. 5,98,065/- AND (II) PARHLAD YADAV RS. 4,00,000/-. THE ASSESSEE HAS EXPLAINED BEFORE THE AO THAT THE TOTAL RECEIPTS FR OM SURINDER KUMAR WER RS. 9,98,065/-. THE RECEIPTS WERE MOSTLY BY CH EQUES AND WERE IN THE NATURE OF BUSINESS TRANSACTION I.E. HIRE AND PURCHASE OF VEHICLE. PAYMENT OF RS. 5,98,065/- HAD BEEN RECEIVE D IN INSTALLMENTS AGAINST THE HIRE AND PURCHASE AGREEMENTS WHICH WERE ALSO PLACED ON RECORD. FURTHER, SUM OF RS. 4,00,000/- HAD BEEN DEPOSITED BY SH. SURENDER KUMAR AS ADVANCE FOR PURCHASE OF VEHICLE TAROLLA. AS PURCHASE DID NOT MATERIALIZE; THIS SUM WAS RETURNE D THROUGH ACCOUNT PAYEE CHEQUES. AO WAS NOT SATISFIED ABOUT THE CREDITWORTHINESS OF THE ABOVE PARTY AND HE TREATED THE TOTAL AMOUNT OF RS. 9,98,065/- AS ASSESSEES INCOME. ITA NO. 1035/DEL/2012 3 6. REGARDING RS. 4 LACS RECEIVED FROM PARHLAD YAD AV, ASSESSEE SUBMITTED THAT THE SAME WAS REPAID DURING THE YEAR . THE AMOUNT WAS CONFIRMED BY PARHLAD YADAV. THE EXPLANATION GI VEN WAS THAT THIS WAS ADVANCE RECEIVED BY CHEQUE FOR THE PURPO SE OF PURCHASE OF VEHICLE AND HOWEVER, SUBSEQUENTLY THE AMOUNT WA S REPAID, AS THE ANOTHER VEHICLE WAS NOT PURCHASED. HOWEVER, A O WAS NOT SATISFIED WITH THE ABOVE. HE HELD THAT ONUS WAS ON THE ASSESSEE TO PROVE THE IDENTITY AND CREDITWORTHINESS OF THE PERS ON AND THE GENUINENESS OF THE TRANSACTIONS. HENCE, THE AO ADD ED THE SAME TO THE INCOME OF THE ASSESSEE. 7. BEFORE THE LD. CIT(A) ASSESSEE MADE ELABORATE SU BMISSIONS. ASSESSEE ALSO FILED ADDITIONAL DOCUMENTS WHICH WERE REMANDED TO THE AO AND REMAND REPORT WAS OBTAINED. AS REGARDS THE AMOUNT RECEIVED FROM SH. SURINDER KUMAR, LD. CIT(A) ACCEP TED THE ASSESSEES SUBMISSIONS THAT THE SAME WERE IN THE NA TURE OF BUSINESS TRANSACTIONS. LD. CIT(A) FURTHER NOTED THAT THIS A SPECT WAS CONFIRMED BY SURINDER KUMAR, WHOSE INCOME TAX RETUR N WAS ALSO FILED. LD. CIT(A) NOTED THAT IN THE ASSESSMENT ORD ER IN THE CASE OF SURINDER KUMAR THE INCOME WAS ASSESSED AT RS. 6,12, 900/- AND BANK STATEMENT WAS ALSO FILED. LD. CIT(A) NOTED THAT A O HAS NOT BEEN ABLE TO POINT OUT ANYTHING ADVERSE IN THE REMAND RE PORT. LD. CIT(A) HELD THAT NOT ONLY THE NATURE OF TRANSACTIONS ARE WELL EXPLAINED, IDENTITY AND CREDITWORTHINESS ARE PROVED. EVEN THO UGH, THE SAME WAS NOT ONUS ON THE ASSESSEE, BECAUSE IT WAS A BUSI NESS TRANSACTION AND NOT A LOAN TRANSACTION. ACCORDINGLY, LD. CIT( A) DELETED THE ADDITION OF RS. 9,98,065/-. 8. LD. CIT(A) FURTHER HELD THAT THE RECEIPT OF RS. 4,00,000/- BY CHEQUE FROM SH. PARHLAD YADAV WAS AN ADVANCE RECEIV ED BY CHEQUE FOR PURCHASE OF VEHICLE AND THE SAME WAS LATER ON R EPAID THROUGH THE ACCOUNT PAYEE CHEQUES. LD. CIT(A) HELD THAT ID ENTITY AS WELL AS ITA NO. 1035/DEL/2012 4 CREDITWORTHINESS IS WELL PROVED FROM THE CONFIRMATI ON, COPY OF INCOME TAX RETURNS AND COPY OF BANK ACCOUNT. THUS , HE DELETED THE ADDITION OF RS. 4 LACS IN THIS REGARD. THUS THE E NTIRE ADDITION OF RS. 13,98,065/- ON THE ABOVE ACCOUNT WAS DELETED BY THE LD. CIT(A). 9. AGAINST THE ABOVE ORDER THE REVENUE IS IN APPEAL BEFORE US. 10. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. WE NOTE THAT ASSESSEE HAS EXPLAINED IN THIS REGARD THA T THE ABOVE TRANSACTION ARE NOT LOAN TRANSACTION, BUT THE ABOVE WERE REGULAR BUSINESS TRANSACTION OF THE ASSESSEE WHICH WAS HIRE AND PURCHASE OF VEHICLE. THE PAYMENT WAS RECEIVED FROM SH. SURI NDER KUMAR AMOUNTING TO RS. 5,98,065/- WHICH WAS RECEIVED IN I NSTALMENTS AGAINST THE HIRE PURCHASE AGREEMENT, WHICH WAS ALSO PLACED ON RECORD. FURTHER A SUM OF RS. 4,00,000/- WAS DEPOSI TED BY SH. SURINDER KUMAR AS ADVANCE FOR PURCHASE OF VEHICLE. AS THE PURCHASE DID NOT MATERIALIZE, THE SAME WAS RETURNED THROUGH ACCOUNT PAYEE CHEQUE. SIMILARLY, IN THE CASE OF PARHLAD YADAV, TH E ADVANCE WAS RECEIVED FOR PURCHASE OF VEHICLE AMOUNTING TO RS. 4 LACS. AS THE PURCHASE DID NOT MATERIALIZE, THE SAME WAS REPAID L ATER THROUGH ACCOUNT PAYEE CHEQUE. FURTHERMORE, THE ABOVE TRANSA CTIONS WERE DULY CONFIRMED BY THE PERSONS, THEIR INCOME TAX RET URNS AND BANK STATEMENTS WERE ALSO FILED. UNDER THE CIRCUMSTANCE S, THERE IS NO INFIRMITY OR ILLEGALITY IN THE ORDER OF THE LD. CIT (A). ACCORDINGLY, WE UPHOLD THE SAME. 11. UNEXPLAINED CAPITAL ADDITION OF RS. 4,00,000/ UNEXPLAINED CAPITAL ADDITION OF RS. 4,00,000/ UNEXPLAINED CAPITAL ADDITION OF RS. 4,00,000/ UNEXPLAINED CAPITAL ADDITION OF RS. 4,00,000/- -- - THE AO NOTED THAT THE CAPITAL ACCOUNT OF VEENA RA NI SHOWS AN AMOUNT INTRODUCED ON 21.7.2007 OF RS. 3,00,000/-, T HE SOURCE WAS SAID TO BE LOAN FROM SIKHA CHOUDHARY, DAUGHTER. IN SUPPORT OF THE AFORESAID LOAN THE ASSESSEE HAS FILED A CONFIRMATIO N OF SHIKHA CHOUDHARY. AO WAS NOT SATISFIED. HE HELD THAT EVE N THE COPY OF ITA NO. 1035/DEL/2012 5 INCOME TAX RETURN AND BANK STATEMENT OF THE LENDER HAS NOT BEEN FILED. HENCE, HE HELD THAT THIS CANNOT BE ACCEPTED AS ADVANCE. AO FURTHER NOTED THAT IN THE CAPITAL ACCOUNT OF RA M PYARI, THERE WAS ADDITION ON 28.4.2007 FOR AN AMOUNT OF RS. 1,00 ,000/- WHICH WAS GIFT FROM OM PARKASH, BROTHER. IN SUPPORT OF T HE AFORESAID GIFT ASSESSEE ONLY FILED CONFIRMATION FROM OM PARKASH. IN THE ABSENCE OF ANY FURTHER EVIDENCE PROVING THE CREDITWORTHINES S OF THE DONOR, THE AO HELD THAT A SUM OF RS. 1,00,000/- WAS TO BE ADDED BACK TO THE INCOME OF THE ASSESSEE AS IT WAS FROM UNDISCLOS ED SOURCES. ACCORDINGLY, AO MADE THE TOTAL ADDITION OF RS. 4,00 ,000/- AS UNEXPLAINED CAPITAL INTRODUCED IN THE FIRM. 12. UPON ASSESSEES APPEAL LD. CIT(A) NOTED THAT AO HAS ADDED THE ABOVE AMOUNT ON THE GROUND THAT CREDITWORTHINES S OF THESE PERSONS GIVING THE SAME TO PARTNERS IS NOT PROVED. HOWEVER, LD. CIT(A) FOUND THAT THESE PARTNERS HAVE FILED THEIR I NCOME TAX RETURNS AND THEIR BANK STATEMENT ARE ALSO ON RECORD. LD. C IT(A) NOTED THAT BOTH THESE PARTNERS HAVE CLAIMED TO HAVE RECEIVED G IFT AND LOANS WHICH THE AO WAS NOT CONVINCED. LD. CIT(A) NOTED T HAT IN SUCH A CASE, AO SHOULD HAVE TAKEN REMEDIAL ACTION BY WAY O F ENQUIRY AND ADDITIONS IF SUITABLE SHOULD BE MADE IN THE HANDS O F THE PARTNERS. HE HELD THAT ONCE THE PARTNERS HAVE CONFIRMED THEIR TR ANSACTIONS AND ARE CLEARLY AND SUFFICIENTLY CREDITWORTHY ON THEIR OWN STANDING AOS ACTION OF MAKING THE ADDITION IS UNCALLED FOR. 13. AGAINST THE ABOVE ORDER THE REVENUE IS IN APPEA L BEFORE US. 14. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. WE FIND THAT ASSESSEES PARTNERS IN THIS CASE HAVE INT RODUCED RS. 3 LACS (RECEIPT ON ACCOUNT OF LOAN) AND RS. 1,00,000/- (ON ACCOUNT OF GIFT) AS CAPITAL ADDITION. EXCEPT THE CONFIRMATION, NOTHI NG IN SUPPORT OF THE CREDITWORTHINESS OF THE LENDERS/DONORS WAS SUB MITTED. IN SUCH ITA NO. 1035/DEL/2012 6 CIRCUMSTANCES, IN OUR CONSIDERED OPINION, MERE CONF IRMATION OF TRANSACTION CANNOT BE TREATED AS SUFFICIENT PROOF O F THE TRANSACTIONS. LD. CIT(A) HAS HELD THAT THE AO SHOULD HAVE TAKEN R EMEDIAL ACTION BY WAY OF ENQUIRY AND ADDITION, IF SUITABLE BE MAD E IN THE HANDS OF THE PARTNERS. WE ARE NOT IN AGREEMENT WITH THE LD. CIT(A) IN THIS REGARD. THE ABOVE AMOUNT IS CAPITAL INTRODUCTION IN THE FIRM. HENCE, IT IS THE ONUS OF THE ASSESSEE TO PROVE THE GENUINENESS OF THE CAPITAL INTRODUCED IN THE FIRM. WE FIND THAT THE CR EDITWORTHINESS OF THE LENDERS / DONOR HAS NOT BEEN PROPERLY EXAMINED . HENCE, WE REMIT THIS ISSUE TO THE FILE OF THE AO. THE AO SHA LL EXAMINE THE CREDITWORTHINESS OF THE ABOVE SAID TRANSACTIONS AFR ESH, AFTER GIVING THE ASSESSEE PROPER OPPORTUNITY OF BEING HEARD. 15. UNEXPLAINED DEPOSITS OF RS. 17,30,000/ UNEXPLAINED DEPOSITS OF RS. 17,30,000/ UNEXPLAINED DEPOSITS OF RS. 17,30,000/ UNEXPLAINED DEPOSITS OF RS. 17,30,000/- -- -. . . . IN THIS REGARD, ADDITION IS WITH REFERENCE TO THE FOLLOWING DEPOSITORS. I) BR FINANCIERS RS. 13,00,000/- II) OM PARKASH RS. 60,000/- III) RAM DEVI RS. 60,000/- IV) ISHWAR DEVI RS. 1,00,000/- V) SANJAY MALHOTRA RS. 1,50,000/- VI) SUBHASH KUMAR RS. 60,000/- TOTAL TOTAL TOTAL TOTAL RS. 17,30,000/ RS. 17,30,000/ RS. 17,30,000/ RS. 17,30,000/- -- - BR FINANCIERS BR FINANCIERS BR FINANCIERS BR FINANCIERS FROM THE ABOVE PARTIES THE ASSESSEE HAS RECEIVED FOLLOWING DEPOSITS:- 15.10.2007 RS. 8,00,000/- 29.1.2007 RS. 3,00,000/- ITA NO. 1035/DEL/2012 7 17.3.2007 RS. 2,00,000/- TOTAL = TOTAL = TOTAL = TOTAL = RS. 13,00,000/ RS. 13,00,000/ RS. 13,00,000/ RS. 13,00,000/- -- - REGARDING THE ABOVE AMOUNTS, THE AO NOTED THAT FO R THE AFORESAID GIFTS, THE ASSESSEE HAS MERELY FILED THE CONFIRMATION OF GK ARORA, THE PROPRIETOR OF M/S BR FINANCIERS. AS T HE CREDITWORTHINESS OF THE DEPOSIT WAS NOT PROVED, THE AO MADE THE IMPUGNED ADDITIONS. 16. UPON ASSESSEES APPEAL LD. CIT(A) NOTED THAT AO HAS WRONGLY OBSERVED THAT DEPOSITS FOR THESE PARTNERS WERE IN THE SHAPE OF GIFTS. HE OBSERVED THAT THE DOCUMENTS PRODUCED BY THE A SSESSEE DURING THE ASSESSMENT PROCEEDING AND APPEAL PROCEE DINGS FULLY PROVED THAT M/S BR FINANCIERS IS A CONCERN OF HIGH REPUTE AND STANDING AND IS ASSESSED TO TAX AND ASSESSEE IS H AVING REGULAR BUSINESS TRANSACTIONS OF THIS CONCERN. HENCE, LD. CIT(A) DELETED THE ADDITION MADE BY THE AO. 17. AGAINST THE ABOVE ORDER THE REVENUE IS IN APPEA L BEFORE US. 18. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED TH E RECORDS. WE FIND THAT THERE IS AN APPARENT ANOMALY IN THE FI NDINGS OF THE AO AND THE LD. CIT(A). WHILE THE AO OBSERVED THAT THIS IS A GIFT RECEIVED AND LD. CIT(A) HAS OBSERVED THAT THE ASSESSEE HAD BUSINESS RELATIONSHIP WITH THE SAID CONCERN. FURTHERMORE, W E NOTE THAT ASSESSEE HAS ONLY FILED CONFIRMATION OF THE TRANSA CTIONS TO THE AO. NO DOCUMENTS IN SUPPORT OF THE CREDITWORTHINESS WAS PRODUCED. LD. CIT(A) HAS NOTED THAT AS PER THE DOCUMENTS FILED, T HE SAID CONCERN IS OF HIGH REPUTE AND STANDING AND WAS ASSESSED TO TAX AND ASSESSEE IS HAVING REGULAR BUSINESS TRANSACTIONS OF THIS CONCE RN. HOWEVER, WHILE MAKING THE AFORESAID OBSERVATION, LD. CIT(A) HAS NOT SPELT OUT THE DOCUMENTS FROM WHICH HE HAS DRAWN THE ABOVE SAI D CONCLUSIONS. ITA NO. 1035/DEL/2012 8 IN OUR CONSIDERED OPINION, THIS MATTER NEEDS TO GO BACK TO THE FILE OF THE AO. THE AO SHALL PROPERLY EXAMINE WHETHER THIS IS A CASE OF GIFT OR IT IS A CASE OF REGULAR BUSINESS TRANSACTIONS. AO SHALL ALSO EXAMINE THE DOCUMENTS FROM WHICH LD. CIT(A) HAS DED UCED THAT THE SAID CONCERN IS OF HIGH REPUTE AND STANDING AND THE ASSESSEE HAS REGULAR BUSINESS TRANSACTIONS. ACCORDINGLY, THIS I SSUE IS REMITTED TO THE FILE OF THE AO. 19. AS REGARDS THE OTHER DEPOSITS MENTIONED ABOVE F ROM THE REMAINING 5 PARTIES, THE ADDITION WAS MADE BY THE A O ON THE GROUND EXCEPT FOR CONFIRMATION, ASSESSEE HAS NOT FILED AN Y DOCUMENTS IN SUPPORT OF THE GENUINENESS AND CREDITWORTHINESS OF THE TRANSACTIONS. 20. AS REGARDS RECEIPT OF RS. 60,000/- FROM OM PARK ASH, LD. CIT(A) NOTED THAT THIS PERSON HAS GIVEN INTEREST B EARING DEPOSITS TO THE ASSESSEE AND THE BALANCE ARE BEING CARRIED FORW ARD FROM THE PAST. THE ASSESSEE ALSO PRODUCED COPY OF ASSESSMEN T ORDER WHEREIN SUCH DEPOSITS OF OM PARKASH WAS INVESTIGATE D AND FOUND GENUINE AND NO ADDITION WAS MADE. LD. CIT(A) FURTH ER NOTED THAT THE SAID PERSON HAD SUFFICIENT LAND HOLDINGS AND TH EREFORE, CREDITWORTHINESS IS EXPLAINED. 21. WE FIND THAT IN LIGHT OF THE ABOVE SAID FINDING OF THE LD. CIT(A), WE ARE OF THE OPINION THAT THE DEPOSITS IS SUFFICIE NTLY EXPLAINED AND HENCE, WE UPHOLD THE ORDER OF THE LD. CIT(A) IN THI S REGARD. 22. AS REGARDS DEPOSIT OF SMT. RAM DEVI (RS. 60,000 ); SMT. ISHWAR DEVI (RS. 1,00,000/- AND SH. SUBHAS KUMAR (RS. 60,0 00). 23. LD. CIT(A) OBSERVED THAT BALANCE OF THESE DEPOS ITS HAVE BEEN CARRIED FORWARD FROM THE PAST AND IN THE PAST THESE DEPOSITORS HAVE BEEN TREATED AS GENUINE. LD. CIT(A) OBSERVED THAT IF AO HAS ANY ITA NO. 1035/DEL/2012 9 DOUBT REGARDING THE SOURCE OF FUNDS IN THE HANDS O F THE DEPOSITOR, HE CAN INITIATE INQUIRY IN THE HANDS OF THE DEPOSIT OR. ACCORDINGLY, HE DELETED THE ADDITION. 24. WE FIND THAT WITH REGARD TO THE ABOVE DEPOSITS, THE LD. CIT(A) HAS NOTED THAT SOME DEPOSITS WERE ALSO MADE IN THE EARLIER YEARS AND THE SAME WERE ACCEPTED BY THE AO. THIS CANNOT I PSO FACTO PROVE THE GENUINENESS OF THE AMOUNT RECEIVED DURING THE YEAR. WE FURTHER DO NOT AGREE WITH THE FINDINGS THAT IF TH E AO HAD ANY DOUBT ABOUT THE SOURCE IN THE HANDS OF THE DEPOSITORS, HE CAN INITIATE INQUIRY IN THE HANDS OF THE DEPOSITORS. WE FIND THA T IN SUCH CASES, ONUS IS UPON THE ASSESSEE TO PROVE THE CREDITWORTHI NESS OF THE LOANS/DEPOSITS RECEIVED BY HIM. THE POWERS OF THE LD. CIT(A) ARE CO-TERMINUS WITH THAT OF THE AO. IT IS NOT THE CA SE THAT LD. CIT(A) HAS HIMSELF MADE THE ENQUIRIES. IN THIS REGARD, WE PLACE RELIANCE OF THE HONBLE APEX COURT DECISION IN THE CASE OF KAPU RCHAND SHRIMAL VS. CIT, 131 ITR 451 WHEREIN, IT WAS HELD THAT IT I S THE JURISDICTION AS WELL AS DUTY OF THE APPELLATE AUTHORITY TO CORRECT THE LACUNA IN THE ORDER OF THE AUTHORITIES BELOW AND ISSUE APPROPRIAT E DIRECTION WHERE NEEDED. ACCORDINGLY, WE REMIT THE ABOVE SAID ISSU E OF DEPOSITS TO THE FILE OF THE AO. THE AO SHALL EXAMINE THEM AFRE SH. 25. AS REGARDS DEPOSIT OF SANJAY MALHOTRA (RS. 1,50 ,000/-). LD. CIT(A) OBSERVED THAT IN THIS CASE NAME, ADDRESS AND PAN WERE FURNISHED. HE HAS ALSO GIVEN INTEREST BEARING DEPOS ITS. COPY OF BANK STATEMENT HAS BEEN BROUGHT ON RECORD. LD. CIT(A) F OUND THAT CREDITWORTHINESS IS WELL PROVED FROM THE ASSESSMEN T RETURNS AND ASSESSMENT ORDER OF THE DEPOSITORS. THUS, LD. CIT(A ) DELETED THIS ADDITION. 26. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS A ND PERUSED THE RECORDS. WE FIND THAT LD. CIT(A)S OBSERVATIONS AS ABOVE ARE COGENT. ITA NO. 1035/DEL/2012 10 IN VIEW OF THE DOCUMENTS FURNISHED BY THE ASSESSEE, LD. CIT(A) HAS RIGHTLY CONCLUDED THAT THE ADDITION IN THIS REGARD IS NOT TENABLE. ACCORDINGLY, WE UPHOLD THE ORDER OF THE LD. CIT(A ) IN THIS REGARD. 27. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/1/2014. SD/- SD/- [ [[ [I.C. SUDHIR I.C. SUDHIR I.C. SUDHIR I.C. SUDHIR] ]] ] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] [SHAMIM YAHYA] JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER DATE 24/1/2014 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO. 1035/DEL/2012 11