Asstt. CIT, RAIPUR (CG) V. M/s Xpress Mining Private Limited, RAIPUR (CG)

ITA 105/BIL/2012

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4446 (ITAT-RAIPUR)
• Duration Of Justice: 6 year(s) 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 06-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V B SARGAR
• Assessee Lawyers: S R RAO
• Keywords: Unexplained cash credit; Unexplained investment; Opportunity of being heard; Principle of natural justice; Additional evidence
• Section: 143(3); 153A; 131; 68; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND DR. MITHA LAL MEENA, ACCOUNTANT MEMBER ITA NO.105/RPR/2012 ASSESSMENT YEAR : 2009-10 ACIT, CIRCLE-2(1) RAIPUR (CG). VS. XPRESS MINING PRIVATE LIMITED, C/O SHRI PAWAN KUMAR AGRAWAL, PYARELAL AGRAWAL MARG PUNJAB OIL MILL GALI RAMSAGARPARA, RAIPUR (CG). PAN : AAACX0411B (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI V. B. SARGAR, ADDL. CIT ASSESSEE BY : SHRI S. R. RAO, ADV. DATE OF HEARING : 13-05-2019 DATE OF PRONOUNCEMENT : 14-05-2019 O R D E R PER DR. MITHA LAL MEENA, AM : THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A), RAIPUR (CG) DATED 31.05.2012 RELATING TO ASSESSMENT YEAR 2009-10. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- 1. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.56,00,000/- MADE BY THE AO U/S. 68 OF THE I.TAX ACT, 1961 ON ACCOUNT OF SHARE CAPITAL / PREMIUM RECEIVED BY THE ASSESSEE . 2. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS.24,00,000/- MADE BY THE AO U/S. 68 OF THE I.TAX ACT, 1961 ON ACCOUNT OF CASH DEPOSITED IN BANK ACCOUNT OF THE ASSESSEE. 2 ITA NO.105/RPR/2012 3. WHETHER IN LAW AND ON FACTS & CIRCUMSTANCES OF THE CASE, THE CIT (A) WAS JUSTIFIED IN ADMITTING ADDITIONAL EVIDENCE IN VIOLATION OF RULE 46A OF I.TAX RULES, 1962.' 4. THE ORDER OF THE LD. CIT (A) IS ERRONEOUS BOTH IN LAW AND ON FACTS. 5. ANY OTHER GROUND THAT MAY BE ADDUCED AT THE TIME OF HEARING. 3. SINCE, THE ISSUE IN BOTH THE GROUNDS OF APPEAL ARE INTERRELATED PERTAINING TO ADDITION U/S 68 OF THE ACT ON ACCOUNT OF UNEXPLAINED INVESTMENT IN SHARE CAPITAL AND CASH DEPOSIT AND, THEREFORE, ADJUDICATED SIMULTANEOUSLY. 4. BRIEFLY, THE FACTS OF THE CASE ARE THAT A SEARCH ACTION U/S 132 OF THE ACT WAS CONDUCTED IN THE BUSINESS PREMISES OF THE ASSESSEE AND CONSEQUENTLY, THE ASSESSMENT WAS COMPLETED U/S 143(3) R.W.S. 153A OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS MADE INVESTMENT IN FIXED ASSETS AND NABARD BONDS AMOUNTING TO RS.21,00,000/- AND RS.49,87,500/- RESPECTIVELY DURING THE ACCOUNTING PERIOD UNDER CONSIDERATION. THE ASSESSING OFFICER FURTHER NOTICED THAT THE ASSESSEE HAS SHOWN CREDIT OF AN AGGREGATE AMOUNT OF RS.56,00,000/- AS SHARE APPLICATION MONEY/SHARE PREMIUM IN THE BALANCE SHEET AS ON 31.03.2009. THE ASSESSING OFFICER REQUIRED THE ASSESSE TO EXPLAIN THE SOURCES OF INVESTMENTS IN SHARE APPLICATION MONEY, FIXED ASSETS AND CASH DEPOSITS IN THE BANK. THE ASSESSING OFFICER BEING NOT SATISFIED WITH THE EXPLANATION OFFERED BY THE ASSESSEE REGARDING FOR CASH DEPOSITS APPEARING IN THE BANK ACCOUNT AND RECEIPTS OF SHARE 3 ITA NO.105/RPR/2012 APPLICATION MONEY AND, ACCORDINGLY, HE MADE AN ADDITION OF RS.56,00,000/- AS UNEXPLAINED SHARE APPLICATION MONEY AND RS.24,00,000/- AS UNEXPLAINED CASH DEPOSITS. 5. ON APPEAL BY THE ASSESSEE, THE CIT(A) HAS ALLOWED RELIEF TO THE ASSESSEE BY ADMITTING AN ADDITIONAL EVIDENCE U/S 46A OF THE I.T. RULES, STATING THEREIN THAT DUE OPPORTUNITY OF BEING HEARD WAS PROVIDED TO THE ASSESSING OFFICER. HOWEVER, THE ASSESSING OFFICER DID NOT ISSUE ANY QUERY LETTER IN THIS REGARD. WHILE CONCLUDING THE ISSUE, THE CIT(A) OBSERVED VIDE PARA 3.3 AND 4.3 OF THE IMPUGNED ORDER AND THE SAME ARE AS FOLLOWS :- 3.3 I HAVE GONE THROUGH THE OBSERVATIONS OF THE AO AND SUBMISSIONS OF THE APPELLANT. THE ADDITIONAL EVIDENCES FURNISHED BY THE APPELLANT ARE COPIES OF ACKNOWLEDGEMENTS OF IT RETURNS, CONFIRMATION OF ACCOUNT, ETC. OF THE INVESTORS. THOUGH PARTICULARS OF THE INVESTORS WERE FURNISHED, THESE DOCUMENTS COULD NOT BE FURNISHED FOR REASONS OF NON-COOPERATION BY THE INVESTORS, WHO HAPPENED TO BE THE OUTSIDERS. THIS FACT WAS BROUGHT TO THE NOTICE OF THE A.O. DURING ASSESSMENT PROCEEDINGS. UNDER SUCH CIRCUMSTANCES, THE NON-SUPPLY OF REQUISITE INFORMATION BY OUTSIDE PARTIES, HAS TO BE HELD AS SUFFICIENT CAUSE FOR NOT FURNISHING SUCH EVIDENCES DURING ASSESSMENT PROCEEDINGS AND ACCORDINGLY, THE SAME COMES WITHIN THE CIRCUMSTANCES NARRATED IN THE RULE AND HENCE, IT IS ADMITTED IN THE INTEREST OF JUSTICE. THE EVIDENCES ESTABLISH THE IDENTITY AND CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS. THE A.O. DID NOT CONDUCT ANY INQUIRIES TO ESTABLISH OTHERWISE. HE HAD SIMPLY MADE THE ADDITION FOR NON-COMPLIANCE IN A TECHNICAL MANNER. IT IS NOT THE CASE OF THE A.O. THAT AFTER RECEIPT OF PARTICULARS OF THE INVESTORS, HE CONDUCTED SOME INQUIRY AND ON THE BASIS OF OUTCOME OF SUCH INQUIRIES, HE CONCLUDED THAT THE IDENTITY AND CREDITWORTHINESS OF INVESTORS IS DOUBTFUL OR THE TRANSACTIONS ARE NOT GENUINE. MOST OF THE INVESTORS ARE ASSESSED TO INCOME-TAX AT THE SAME PLACE AND THE A.O. COULD HAVE VERY EASILY INVOKED SUCH INQUIRY, IF HE HAD ANY SERIOUS DOUBTS ABOUT THE TRANSACTIONS. THIS COULD HAVE BEEN DONE EITHER BY ISSUING SUMMONS U/S.131 OR EVEN BY DEPUTING INSPECTOR, WHICH WAS NOT DONE. THEREFORE, AFTER CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE CASE LAWS RELIED UP ON BY THE APPELLANT AND THE FACT THAT ALL THE PERSONS ARE REGULARLY ASSESSED TO TAX AND SUCH 4 ITA NO.105/RPR/2012 INVESTMENTS ARE NOT DISPUTED IN THEIR RESPECTIVE CASES, THE ADDITION MADE BY THE AO IS NOT SUSTAINABLE AND THE SAME IS DELETED. THIS GROUND OF APPEAL IS, ACCORDINGLY, ALLOWED. .. 4.3 I HAVE GONE THROUGH THE OBSERVATIONS OF THE A.O. AND SUBMISSIONS OF THE APPELLANT. THE APPELLANT HAS FILED COPIES OF BANK STATEMENT, COPY OF CASH BOOK FOR THE RELEVANT PERIODS, AUDITED BALANCE SHEET WITH RELEVANT SCHEDULE, TO ESTABLISH THE OPENING CASH BALANCES, AS ADDITIONAL EVIDENCES. THE A.O. DID NOT ISSUE ANY QUERY IN THIS REGARD. THEREFORE, THE SAME ARE ADMITTED AS ADDITIONAL EVIDENCES U/R.46A AFTER AFFORDING OPPORTUNITY TO THE A.O. PERUSAL OF THE CASH BOOK SHOWS THAT THE DEPOSITS WERE MADE OUT OF CASH BALANCE AVAILABLE WITH THE APPELLANT AS ON THE DATE OF DEPOSIT. IN FACT THE APPELLANT HAS RECEIVED RS.3,00,000/- ON 01.08.2005 AGAINST THE ISSUE OF SHARES FROM FOUR INVESTORS AND FILED THE CONFIRMATIONS OF THE CONCERNED PERSONS. THUS, THE IMMEDIATE SOURCE OF THE CASH DEPOSIT OF RS.1,25,000/- IS VERIFIABLE FROM THE CASH BOOK. SIMILARLY, THE CASH DEPOSITS OF RS.24,00,000/- (RS.15,00,000/- ON 16.03.2009 & RS.9,00,000/- ON 17.03.2009) IS COVERED BY THE CASH BALANCE AVAILABLE WITH THE APPELLANT BEFORE THE DATE OF DEPOSIT AT RS.25,18,938/-. IT IS ALSO A FACT THAT THE APPELLANT HAD WITHDRAWN RS.25,00,000/- ON 13.01.2008 FROM THE SAME BANK ACCOUNT AND IT WAS LYING WITH HIM, WHICH WAS RE-DEPOSITED SUBSEQUENTLY. THUS, THE IMMEDIATE SOURCE OF THE DEPOSITS IS FOUND EXPLAINED AND NO ADVERSE INFERENCE COULD BE POSSIBLE IN THIS CONTEXT. ACCORDINGLY, THE ADDITIONS OF RS.1,25,000/- (A.YR.2006-07) AND RS.24,00,000/- (A.YR.2009-10) ARE NOT SUSTAINABLE, HENCE DELETED. THE GROUND OF APPEAL IS ALLOWED. 6. AGGRIEVED WITH THE SAID DECISION OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 7. THE LD. SENIOR DR FOR THE REVENUE HAS CHALLENGED THE ADMISSION OF ADDITIONAL EVIDENCES IN VIOLATION OF NORMS AS PER RULE 46A OF THE I.T. RULES. THE LD. DR HAS CONTENDED THAT THE ADDITIONAL EVIDENCES CAN BE ADMITTED ONLY IF THE CONDITIONS, STIPULATED IN RULE 46A OF THE I.T. RULES, ARE FULFILLED AND IN THE PRESENT CASE NONE OF THE SAID CONDITIONS WERE FULFILLED. THEREFORE, THE ADDITIONAL EVIDENCES OUGHT NOT TO HAVE BEEN ACCEPTED. SHE CONTENDED THAT MERE DISCLOSURE 5 ITA NO.105/RPR/2012 OF CERTAIN MATERIALS, WILL NOT HELP THE ASSESSEE TO DISCHARGE THE BURDEN OF PROVING THE CREDITS U/S 68 OF THE ACT AND UNTIL THE ONUS IS DISCHARGED BY THE ASSESSEE, IT NEVER SHIFTS ON THE DEPARTMENT. 8. THE LD. AR FOR THE ASSESSEE, ON THE OTHER HAND, HEAVILY RELIED ON THE ORDER OF THE CIT(A) AND PRAYED FOR UPHOLDING THE ORDER OF THE CIT(A). IN THIS REGARD, LD. AR FOR THE ASSESSEE REITERATED THE SUBMISSIONS AND JUDICIAL PRONOUNCEMENTS FILED BEFORE THE LD. CIT(A). HE ALSO FILED A SYNOPSIS AND THE SAME IS EXTRACTED HEREUNDER :- SYNOPSIS A. A SEARCH U/S 132 OF THE INCOME-TAX ACT, 1961 WAS CONDUCTED IN THE CASE OF RESPONDENT ASSESSEE ON 04/02/2010. B. THE YEAR WISE TOTAL INCOME AS PER RETURN U/S. 153A AND ASSESSMENT IS AS UNDER: ASSTT. YEAR RETURNED INCOME ASSESSED INCOME 2006-07 RS. NIL RS. 55,75,000/- 2008-09 RS. NIL RS. 16,00,000/- 2009-10 RS. NIL RS. 80,00,000/- C. THE ENHANCEMENT IN RETURNED INCOME MAINLY RELATES TO ADDITIONS MADE U/S. 68 ON ACCOUNT OF SHARE PREMIUM/CAPITAL TREATED AS UNEXPLAINED CASH CREDIT. GROUND NO. 1 AOS OBSERVATIONS: (PARA-4) AGGREGATE SHARE APPLICATION MONEY OF RS.54,50,000/-, RS. 16,00,000/-, RS.56,00,000/- WERE FOUND CREDITED RESPECTIVELY IN ABOVE ASSESSMENT YEARS AND ASSESSEE FAILED TO SATISFACTORILY EXPLAIN THE SAME. IN REMAND REPORT, AO CONTENDED THAT ASSESSEE WAS ALLOWED SEVERAL OPPORTUNITIES BUT HE DID NOT COMPLY. ADDITIONAL EVIDENCES CAN BE ADMITTED ONLY IF CONDITIONS STIPULATED IN RULE 46 A ARE FULFILLED, HENCE HE OBJECTED. 6 ITA NO.105/RPR/2012 CIT(A)S FINDINGS (PARA 3.3) ASSESSEE FILED ADDITIONAL EVIDENCES, WHICH ARE COPIES OF ACKNOWLEDGEMENT OF ITRS, CONFIRMATION OF ACCOUNT, ETC OF THE INVESTORS. THOUGH PARTICULARS OF INVESTORS WERE FILED BEFORE AO, THE DOCUMENTS COULD NOT BE FILED FOR NON-COOPERATION OF INVESTORS WHO HAPPENED TO BE OUTSIDERS. UNDER SUCH CIRCUMSTANCES NON-SUPPLY OF REQUISITE INFORMATION BY OUTSIDE PARTIES HAS TO BE HELD AS SUFFICIENT CAUSE FOR NOT SUBMITTING SUCH EVIDENCES DURING ASSESSMENT PROCEEDINGS AND THE EVIDENCES WERE ADMITTED IN THE INTEREST OF JUSTICE. EVIDENCES ESTABLISH THE IDENTITY AND CREDITWORTHINESS OF CREDITORS AND GENUINENESS OF THE TRANSACTIONS. AO DID NOT CONDUCT ANY ENQUIRIES TO ESTABLISH OTHERWISE AND SIMPLY MADE THE ADDITIONS IN A TECHNICAL MANNER. IT IS NOT THE CASE OF AO THAT SOME ENQUIRIES WERE CONDUCTED AND ON SUCH OUTCOME IT WAS CONCLUDED THAT IDENTITY AND CREDITWORTHINESS IS DOUBTFUL OR THE TRANSACTIONS ARE NOT GENUINE. SOME INVESTORS ARE ASSESSED TO TAX AT THE SAME PLACE AND THE AO COULD HAVE VERY EASILY INVOKED SUCH ENQUIRY IF HE HAD ANY SERIOUS DOUBTS ABOUT THE TRANSACTIONS. THE ENQUIRY COULD HAVE BEEN DONE EITHER BY ISSUE OF SUMMONS U/S. 131 OR BY DEPUTING INSPECTOR WHICH WAS NOT DONE. AFTER CONSIDERING THE FACTS AND THE CIRCUMSTANCES OF THE CASE, THE CASE LAWS RELIED UPON BY THE APPELLANT AND THE FACT THAT ALL THE PERSONS ARE REGULARLY ASSESSED TO TAX AND SUCH INVESTMENTS ARE NOT DISPUTED IN THEIR CASES THE ADDITION MADE IS NOT SUSTAINABLE. ASSESSEES SUBMISSIONS THE ENTIRE SHARE CAPITAL STOOD DISCLOSED IN THE REGULAR ACCOUNT BOOKS MAINTAINED BY THE ASSESSEES COMPANY PRIOR TO THE DATE OF SEARCH U/S. 132. HENCE, NO ADVERSE INFERENCE SHOULD BE DRAWN U/S 153A IN UNABATED ASSESSMENT YEARS I.E. 2006-07 & 2008-09. THE INVESTORS ARE OUTSIDERS AND THEY WERE NOT IMMEDIATELY COOPERATING BY FURNISHING CONFIRMATION AND OTHER DETAILS. THEIR NAMES, ADDRESSES AND OTHER DETAILS WERE FURNISHED TO ID. AO BUT NO ENQUIRY WAS CONDUCTED BY HIM. ALL THE INVESTORS ARE REGULAR INCOME-TAX ASSESSEES. COPIES OF ACKNOWLEDGEMENT OF THEIR ITRS, CONFIRMATION OF A/C. AND OTHER DETAILS WERE FILED AND THE AO EXAMINED THESE DETAILS DURING REMAND PROCEEDINGS BUT HAS NOT FAULTED. THE ASSESSEE HAS DISCHARGED ITS ONUS BY FURNISHING ALL REQUISITE EVIDENCES INCLUDING NAMES, IT PARTICULARS, CONFIRMATIONS OWNING UP THE INVESTMENTS, ETC. THE ID. AO HAD NO SERIOUS DOUBTS ABOUT THE TRANSACTIONS. 7 ITA NO.105/RPR/2012 MOST OF THE INVESTORS ARE ASSESSED TO TAX AT THE SAME PLACE AND THE ID. AO COULD HAVE VERY EASILY CAUSED SUCH ENQUIRY IF HE HAD ANY SERIOUS DOUBTS ABOUT THE TRANSACTIONS. THE ID. CIT(A) HAS RIGHTLY ALLOWED RELEVANT GROUND OF APPEAL CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE LEGAL POSITION SETTLED IN THIS CASE INCLUDING DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS VENKATESHWAR ISPAT P. LTD. (2009) 319 ITR 0393(CHATTISGARH), WHICH HOLDS FIELD TILL DATE. GROUND NO. 2: (A.YR. 2006-07 & 2009-10) AOS OBSERVATIONS: CASH DEPOSIT OF RS. 1,25,000/- AND RS. 24,00,000/- WAS MADE RESPECTIVELY IN A.YRS. 2006-07 & 2009-10 AND ASSESSEE FAILED TO SATISFACTORILY EXPLAIN THE SAME. HENCE HE ADDED CIT(A)S FINDINGS (PARA 4.1) ASSESSEE FILED COPIES OF BANK STATEMENTS, CASH BOOK FOR RELEVANT PERIOD, RELEVANT SCHEDULES OF AUDIT REPORT TO ESTABLISH OPENING BALANCES AS ADDITIONAL EVIDENCES. A.O. DID NOT ISSUE ANY QUERY HENCE, THESE EVIDENCES ARE ADMITTED U/S.46A. THE IMMEDIATE SOURCE OF DEPOSIT IS COVERED BY AVAILABLE CASH BALANCE AND NO ADVERSE INFERENCE COULD BE POSSIBLE. ASSESSEES SUBMISSIONS THE LD. A.O. DID NOT RAISE ANY QUERY REQUIRING THE APPELLANT TO EXPLAIN THE SOURCE OF CASH DEPOSITS AND THE ADDITION MADE IS AGAINST THE PRINCIPLES OF NATURAL JUSTICE. THE DEPOSITS WERE MADE OUT OF CASH BALANCE AVAILABLE IN THE BOOKS OF THE COMPANY. THE FINANCIAL STATEMENTS AND BOOKS OF ACCOUNT CANNOT BE DISBELIEVED WITHOUT ANY MATERIAL AS IMMEDIATE SOURCE OF DEPOSIT IS VERIFIABLE. THE LD. CIT(A) HAS RIGHTLY ALLOWED THIS GROUND OF APPEAL AFTER CONSIDERING THE FACTS OF THE CASE. 9. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD AND THE CITATION RELIED UPON BY THE ASSESSEE. IT IS MATERIAL FACT ON RECORD THAT THE ADDITIONAL EVIDENCES IN THE FORM OF NAMES, ADDRESSES, COPIES OF 8 ITA NO.105/RPR/2012 ACKNOWLEDGEMENT OF ITRS, CONFIRMATIONS OF ACCOUNTS OF INVESTORS WERE FURNISHED BEFORE THE LD. CIT(A) WHO HAS NOTED THAT THE ASSESSEE HAS MADE A SPECIFIC REQUEST TO THE ASSESSING OFFICER VIDE PARA 4(I) OF LETTER DATED 20.12.2011 TO ALLOW TIME TO FURNISH THESE DETAILS, WHICH WAS NOT ALLOWED BY THE ASSESSING OFFICER. THEREFORE, THE ASSESSEE FILED THE SAME AS ADDITIONAL EVIDENCES UNDER RULE 46A OF THE RULES AND THE SAME HAS BEEN ADMITTED BY THE LD. CIT(A) AFTER CONFRONTING TO THE ASSESSING OFFICER BY WAY OF CALLING FOR A REMAND REPORT ON THE ADDITIONAL EVIDENCES FURNISHED BY THE ASSESSEE. HOWEVER, THE ASSESSING OFFICER, IN HIS REMAND REPORT, CONTENDED THAT THOUGH SEVERAL OPPORTUNITIES WERE ALLOWED TO THE ASSESSEE BUT HE DID NOT MAKE COMPLIANCE AND THE ADDITIONAL EVIDENCE CAN BE ADMITTED ONLY IF THE CONDITIONS STIPULATED IN RULE 46A OF THE RULES ARE FULFILLED AND IN THIS CASE THE SAID CONDITIONS OF RULE 46A WERE NOT FULFILLED. THEREFORE, THE ADDITIONAL EVIDENCE SHOULD NOT BE ACCEPTED. THE LD. COUNSEL CONTENDED THAT THOUGH THE NECESSARY DOCUMENTARY EVIDENCE IN RESPECT OF INVESTORS IN SHARE CAPITAL IN THE FORM OF ADDITIONAL EVIDENCES COULD NOT BE FURNISHED BEFORE THE ASSESSING OFFICER FOR THE REASON BEYOND THE CONTROL OF THE ASSESSEE AS THE PARTIES WERE OUTSIDER, AND THEY WERE RELUCTANT TO PROVIDE THE REQUIRED INFORMATION, AND THE ASSESSING OFFICER WAS REQUESTED TO EITHER ISSUE SUMMONS U/S 131 OF THE ACT OR TO MAKE VERIFICATION FROM THE OFFICE RECORD 9 ITA NO.105/RPR/2012 OF THE DEPARTMENT IN RESPECT OF DISPUTED INVESTORS IN THE SHARE CAPITAL OF THE ASSESSEE COMPANY. LD. COUNSEL HAS REFERRED TO PARA 3.3 OF THE ORDER OF THE LD. CIT(A) CONTENDING THAT THE CIRCUMSTANCES OF THE CASE BEYOND THE CONTROL OF THE ASSESSEE RESULTED IN NON-SUPPLY OF REQUISITE INFORMATION BY OUTSIDE PARTY WAS RIGHTLY HELD AS SUFFICIENT CAUSE FOR NON-FURNISHING EVIDENCE DURING THE ASSESSMENT PROCEEDINGS BY THE LD. CIT(A) AND ACCORDINGLY, HE HAS ADMITTED THE ADDITIONAL EVIDENCES UNDER RULE 46A IN THE INTEREST OF JUSTICE. THE SAID ADDITIONAL EVIDENCES ESTABLISHED THE IDENTITY AND CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS. THE ASSESSING OFFICER WITHOUT CONDUCTING ENQUIRIES TO ESTABLISH OTHERWISE, MADE THE ADDITION FOR NON- COMPLIANCE IN TECHNICAL MANNER CANNOT BE SUSTAINED IN THE INTEREST OF JUSTICE. OVER AND ABOVE, MOST OF THE INVESTORS ARE ASSESSED TO THE INCOME TAX AT THE SAME PLACE WHERE THE ASSESSING OFFICER COULD HAVE VERY EASILY INVOKED SUCH ENQUIRY, IF HE HAD ANY SERIOUS DOUBTS ABOUT THE GENUINENESS OF TRANSACTIONS. THIS COULD HAVE BEEN DONE EITHER BY THE SUMMONS U/S 131 OF THE ACT OR EVEN BY DEPUTING INSPECTOR, WHICH WAS NOT DONE. THESE FACTS HAVE NOT BEEN CONTROVERTED BY THE LD. DR. THE CONTENTION OF THE LD. DR THAT NO DETAILS HAVE BEEN FILED BEFORE THE ASSESSING OFFICER IN RESPECT OF SHARE APPLICATION AND HAS NO SATISFACTION IN THE ABSENCE OF SUPPORTING DOCUMENTARY EVIDENCES BEING AVAILABLE ON RECORD 10 ITA NO.105/RPR/2012 REGARDING SHIFTING ONUS ON THE ASSESSEE WITHOUT BEING ANY ENQUIRY INITIATED BY THE ASSESSING OFFICER. ONCE THE DETAILS HAVE BEEN PROVIDED BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS BEFORE THE LD. CIT(A) WHICH ARE ALSO PROVIDED TO THE ASSESSING OFFICER TO VERIFY THE SAME. THE ASSESSING OFFICER WAS DUTY BOUND TO INVOKE THE NECESSARY ENQUIRY BY WAY OF ISSUANCE OF SUMMONS U/S 131 OF THE ACT OR BY WAY OF DEPUTING AN INSPECTOR WHICH HE FAILS TO DO SO. THEREFORE, CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE THAT THE INVESTORS ARE REGULARLY ASSESSED TO INCOME TAX AND INVESTMENTS ARE NOT DISPUTED AND AS SUCH INVESTMENTS MADE BY THEM ARE NOT DISPUTED IN THEIR RESPECTIVE CASES. THE ADDITION SO MADE BY THE ASSESSING OFFICER IS NOT SUSTAINABLE AS RIGHTLY DELETED BY THE LD. CIT(A), FOLLOWING THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. VENKATESHWAR ISPAT P. LTD. (2009) 319 ITR 393 (CHHATTISGARH). 10. REGARDING THE UNEXPLAINED CASH DEPOSITS OF RS.24,00,000/- IN BANK ACCOUNT. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE FAILED TO SATISFACTORILY EXPLAIN THE DEPOSITS IN THE BANK ACCOUNT. THE CIT(A) HAS STATED THAT THE ASSESSEE HAS FILED COPY OF BANKS STATEMENTS, CASH BOOKS, AUDITED BALANCE SHEET WITH THE RELEVANT SCHEDULE FOR THE RELEVANT PERIODS TO ESTABLISH THE OPENING CASH BALANCES AS AN ADDITIONAL EVIDENCE ON WHICH THE ASSESSING OFFICER AGAIN 11 ITA NO.105/RPR/2012 DID NOT ISSUE ANY ENQUIRIES AND HENCE LD. CIT(A) HAS ADMITTED THE SAME AS AN ADDITIONAL EVIDENCE UNDER RULE 46A OF THE RULES AFTER AFFORDING DUE OPPORTUNITY TO THE ASSESSING OFFICER. THE LD. CIT(A) HAS OBSERVED THAT THE CASH DEPOSITS HAVE BEEN MADE OUT OF THE CASH BALANCE AVAILABLE WITH THE ASSESSEE AS ON THE DATE OF DEPOSITS. THE LD. CIT(A) HAS MADE SPECIFIC OBSERVATION REGARDING THE CASH DEPOSITS OF RS.24,00,000/- ON 17.03.2009 AS BEING MADE OUT OF CASH BALANCE AVAILABLE WITH THE ASSESSEE BEFORE THE DATE OF DEPOSITS BEING RS.25,18,938/- DULY SUPPORTED BY THE FACT THAT THE ASSESSEE HAS WITHDRAWN RS.25,00,000/- AS ON 13.12.2008 (PAGE 120 OF THE PAPER BOOK) FROM THE SAME BANK ACCOUNT AND IT WAS LYING WITH HIM AS UNUTILIZED WHICH WAS RE-DEPOSITED SUBSEQUENTLY. THUS, THE IMMEDIATE SOURCE OF THE CASH DEPOSITS STANDS EXPLAINED AND NO ADVERSE INFERENCE COULD BE DRAWN IN THIS CONTEXT. 11. KEEPING IN VIEW THE FACTS AND THE CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED OPINION THAT THE LD. CIT(A) IS CORRECT IN HOLDING THAT THE ASSESSING OFFICER HAS MADE THE ADDITION IN TECHNICAL MANNER. SINCE THE ASSESSING OFFICER HAD ALL THE INFORMATION EVEN HE CHOSEN NOT TO MAKE ANY ENQUIRY AGAINST THE CREDITORS, WHO ARE ASSESSED AT THE SAME PLACE. 12 ITA NO.105/RPR/2012 12. THEREFORE, WE FIND NO MERIT IN THE APPEAL OF THE REVENUE AND HENCE NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE CIT(A). THUS, THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 13. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH MAY, 2019. SD/- SD /- (PARTHA SARATHI CHAUDHURY) (DR. MITHA LAL MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 14-05-2019. SUJEET COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., RAIPUR. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY ITAT, RAIPUR