Sh. Dinesh Bansal, New Delhi V. ITO, New Delhi

ITA 1058/DEL/2014

• Counselvise Citation: 105820114 RSA 2014
• Duration Of Justice: 1 year(s) 5 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 01-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 24-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GAGAN SOOD
• Assessee Lawyers: RAHUL KOCHAR
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SMT DIVA SINGH, JUDICIAL MEMBER I.T.A .NO. - 1058 /DEL/201 4 (ASSESSMENT YEAR - 200 7 - 08 ) DINESH BANSAL, 2864/213, TRI NAGAR, NEW DELHI - 110035. PAN - AFWPB9007R ( APPELLANT) VS ITO, WARD - 25(2), NEW DELHI (RESPONDENT ) APPELLANT BY SH.RAHUL KOCHAR, ADV. RESPONDENT BY SH.GAGAN SOOD, SR.DR ORDER BY THE PRESENT APPEAL FILED BY THE ASSESSEE THE CORRECTNESS OF THE ORDER DATED 26 . 12 .201 3 OF CIT (A) - X VII , DELHI IS ASSAILED. 2. THE RECORD SHOWS THAT TO THE RETURNED INCOME OF RS.1,48,041/ - ADDITION OF RS.10,12,000/ - WAS MADE AS THE EV IDENCE IN SUPPORT OF THE CLAIM OF RECEIVING UNSECURED LOANS WAS NOT ACCEPTED BY THE AO. A PERUSAL OF THE STATEMENT O F FACTS FILED BY THE ASSESSEE AND THE GROUNDS RAISED IN THE PRESENT PROCEEDINGS SHOW THAT UNSECURED LOANS WAS CLAIMED TO HAVE BEEN TAKEN FROM SEVEN PARTI ES. AS PER THE STATEMENT OF FACT IT IS STATED THAT THESE SEVEN PERSONS WERE CLOSE RELATIVE S AND FRIENDS OF THE ASSESSEE WH OS E N AME S , A DDRESS ES , I NCOME T AX PAN, B ANK DETAILS OF LOANS BY ACCOUNT PAYEE C HEQUE NO. A SSESSMENT P ARTICULAR S, C OPY OF INCOME T AX R ETURN ETC. F ILED FOR THE YEAR UNDER CONSIDERATION ALONGWITH CONFIRMATION OF ACCOUNT WERE FILED BEFORE THE AO AND WITHOUT COLLECTING ANY EVIDENCE INDEPENDENTLY FROM THE LENDERS U/S 133(6)/131 THE ADDITION WAS MADE . IT IS STATED THAT T HESE FACTS WERE BROUGHT TO THE NOTICE TO THE CIT(A ) BY WAY OF WRITTEN SUBMISSIONS AND IT WAS ALSO SUBMITTED THAT IN RESPONSE TO LETTER DATED 22.11.2012 OF THE AO IN THE REMAND PROCEEDINGS THE ASSESSEE WAS REQUIRED TO FILE THE EVIDENCE S RELIED UPON. THE RESPONSES RECEIVED TO NOTICE S DATE OF HEARING 01 .0 7 .2015 DATE OF PRONOUNCEMENT 07 .0 8 .2015 I.T.A .NO. - 1058/ DEL/2014 PAGE 2 OF 3 ISSUED U/S 133(6) WERE ALSO NOT MADE AVAILABLE TO THE CIT(A) B Y T H E A O WHICH THE ASSESSEE CLAIMED TO HAVE. THE RELEVANT EXTRACT IS EXTRACTED FROM THE STATEMENT OF FACTS HEREUNDER: - THESE FACTS WERE ALSO PLACED BEFORE THE LD.CIT APPEALS IN WRITTEN SUBMISSION PRODUCED BEFORE HIM/HER. THE LD.CIT APPEAL ISSUED A LETTER ASKING REMAND REPORT FROM THE L D. ASSESSING OFFICER. I N RESPONSE TO WHICH THE L D. A.O. ISSUED A LETTER DATED 22.11.2012 TO THE ASSESSEE TO FILE TH E EVIDENCES FOR NECESSARY EXAMINATION AND ALSO ISSUED NOTICES UNDER SECTION 133(6) OF THE INCOME TAX ACT 1961 TO ALL THE SEVEN LOAN CREDITORS. IN RESPONSE TO THE NOTICE ISSUED TO THE ASSESSEE HE SUBMITTED THE DETAILS OF LOANS ACCEPTED ALONG WITH THE CONFI RMATIONS OF PARTIES, THEIR ITR AND BANK STATEMENT ONCE AGAIN BEFORE THE LD. ASSESSING OFFICER. THE CASH FLOW STATEMENT OF PARTIES FOR THE FINANCIAL YEAR 2006 - 07 EXPLAINING THE SOURCE OF CASH WAS ALSO SUBMITTED. ALL THE SEVEN LOAN CREDITORS TO WHO, NOTICE UNDER SECTION 133(6) WERE ISSUED RECEIVED THE NOTICE AND FILED ITS REPLY BEFORE THE LD. ASSESSING OFFICER. BUT IN SPITE OF OUR VARIOUS VERBAL REQUESTS AND WRITTEN REMINDER OF THE CIT APPEAL THE LD. ASSESSING OFFICER DID NOT FILED HIS REMAND REPORT TO CIT APPEAL FOR THE REASONS BEST KNOWN TO HIM. THE PROOF OF REPLIES FILED BY ALL THE SEVEN LENDERS ALONG WITH THE COPY OF NOTICE RECEIVED BY THEM WERE PRODUCED BEFORE THE LD.CIT APPEAL FOR HER CONSIDERATION. BUT EVEN AFTER PRODUCING SO MUCH OF EVIDENCES AN D RECORDS BEFORE THE CIT APPEAL THE ADDITIONS MADE BY THE LD.A.O. WERE SUSTAINED WHICH IS HIGHLY UNJUSTIFIED . (EMPHASIS PROVIDED) 3 . IN THESE CIRCUMSTANCES IT WAS THE PRAYER OF THE LD.AR THAT THE CIT(A) BE DIRECTED TO CALL FOR A REMAND REPORT FROM THE AO. A PERUSAL OF THE RECORD SHOWS THAT THE ASSESSEE WHO WAS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF FOOTWEAR WITH FACTOR Y AT G - 1081, DSIDC, NARELA INDUSTRIAL AREA, DELHI FILED RETURN OF INCOME OF RS.1, 48 ,041/ - . IN ITS FIRST YEAR OF BUSINESS, THE TURNOVER HAS BEEN SHOWN AT RS.1,06,63,586/ - AND G.P.@ 13.55%. CONSIDERING THE UNSECURED LOANS TAKEN FROM VARIOUS PARTIES , T HE AO MADE ADDITIONS OF RS.10,12,000/ - BRING ING OUT THE DETAILS OF THE SOURCE OF AMOUNT ADVANCED IN FAVOUR OF THE ASSESSEE THEREBY HOLDING THAT THE ASSESSEE HAS MANAGED THE SAME BY GETTING THE CASH DEPOSITED IN THE BANK ACCOUNTS OF RELATIVES/FAMILY MEMBERS/GROU PS CONCERNS JUST PRIOR TO THE CLEARING OF THE CHEQUES / INSTRUMENTS IN I T S FAVOUR . H AVING DOUBTED T HE CLAIM OF T HE AFORE - SAID LOANS , ADDITIONS OF THE SAID AMOUNT WAS MADE. THE ISSUE WAS CHALLENGED IN APPEAL BEFORE THE CIT(A) . P ARA 5.3 & 5.4 DEMONSTRATE THAT THE ISSUE WAS REMANDED BACK TO THE AO TAKING NOTE OF THE FACT THAT THE ASSESSEE WOULD PRODUCE THE SEVEN CREDITORS FOR CROSS - EXAMINATION. IN VIEW OF T HE FACT THAT THE I.T.A .NO. - 1058/ DEL/2014 PAGE 3 OF 3 CLAIM STATING THAT ALL THE INFORMATION WAS GIVEN TO THE AO WAS MADE IN AN UNSIGNED LETTER BEFORE THE CIT(A) AS PER PARA 5.4 , I T WAS CONCLUDED THAT NONE OF THE CREDITORS APPEARED . IN THE ABOVE FACTUAL MATERIAL CONSIDERING THE FACT S AS BROUGHT OUT IN T HE STATEMENT OF FACTS A PORTION OF WHICH HAS BEEN REPRODUCED IN THE EARLIER PART OF THIS ORDER AND TAKING NOTE OF THE FACT THAT IT IS A SIGNED STATEMENT OF FACTS FILED BEFORE THE BENCH A C C O R D I N G L Y AFTER HEARING THE LD. SR. DR AND THE LD.AR, IT IS DEEMED APPROPRIATE TO RESTORE THE ISSUE BACK TO THE FILE TO THE CIT(A) WITH THE DIRECTION T O CALL FOR THE RELEVANT RECORDS/ REMAND REPORT FROM THE AO IN REGARD TO RECORDING OF STATEMENT ETC. LIBERTY IS GRANTED TO THE ASSESSEE TO PRODUCE ANY FRESH EVIDENCE BEFORE CIT(A) TO JUSTIFY AND SUPPORT ITS CLAIM CALLED INTO QUESTION BY THE AO IN THE REMAN D PROCEEDINGS. THE LD.CIT(A) WHILE DECIDING THE SAME SHALL PASS A SPEAKING ORDER IN ACCORDANCE WITH LAW CONSIDERING THE EVIDENCES IF FILED. 4 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 7 T H OF AUGUST, 2015. S D / - (DIVA SINGH) JUDICIAL MEMBER DATED: 0 7 /0 8 /2015 * AMIT KUMAR * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI