Patton Warehousing Pvt Ltd, Varansi V. ITO WARD - 19(3), New Delhi

ITA 1319/DEL/2020

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 5208 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 29-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RADHA KATYAL NARAN G
• Assessee Lawyers: SUBHASH CHANDRA
• Section: 68; 2; 143(3)

Judgement Text

ITA. No. 1319/Del/2020 Page 1 of 7 IN THE INCOME TAX APPELLATE TRIBUNAL [DELHI BENCH “SMC”: NEW DELHI] BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AS S.M.C. (Through Video Conferencing) ITA. No. 1319/Del/2020 (Assessment Year : 2015-16) M/s. Patton Warehousing Private Limited, 36, Lajpat Nagar, Maldahiya, Varanasi, Uttar Pradesh – 110 049. PAN: AACCP7802L Vs. Income Tax Officer, Ward : 19 (3), New Delhi. (Appellant) (Respondent) Assessee by : Shri Subhash Chandra, Advocate; Department by : Ms. Radha Katyal Narang, Sr. D. R; Date of Hearing : 05/04/2022 Date of pronouncement : 05/04/2022 O R D E R PER AMIT SHUKLA, J. M. : The aforesaid appeal has been filed by the assessee against the impugned order dated 18.03.2020, passed by the ld. Commissioner of Income Tax (Appeals)–38, New Delhi [hereinafter referred to as CIT (Appeals)] for the quantum of assessment under ITA. No. 1319/Del/2020 Page 2 of 7 Section 143(3) of the Income Tax Act, 1961 (the Act) for the assessment year 2015–16. 2. The only ground raised by the assessee is that ld. CIT (Appeals) has erred in law and on facts in confirming the addition of Rs.18,60,820/- made under Section 68 of the Act. 3. Brief facts of the case are that, the assessee had filed return of income on 31.10.2015 showing loss of Rs.27,95,310/-. Case of the assessee was selected for scrutiny under CASS for a limited category and one of the reasons for scrutiny was un-secured loans from the persons who have not filed the return of income. The ld. Assessing Officer noted that assessee had shown to have received loans aggregating to Rs.1,23,70,820/- from Shri Sachin Kumar, who is the Director of the company. Assessing Officer also noted that the assessee has filed the details of loans taken from Shri Sachin Kumar along with his ITRs and bank statements etc. However, the Assessing Officer noted on perusal of the bank statements that increase of the loan appeared in the confirmation were not verifiable from the bank statement of Shri Sachin Kumar filed by the assessee. He observed that amount of Rs.18,60,820/- which has been shown by the assessee to have been received on 31.03.2015 had not credited to the bank account of the assessee. Based on this, he has made the addition under Section 68 of the Act after observing and holding as under:- ITA. No. 1319/Del/2020 Page 3 of 7 “The assessee has filed details and bank statement of Sh. Sachin Kumar in respect of the above loan in its final reply. All the loan entries were tallied from the bank of Sachin Kumar except loan of Rs.18,60,820/-. On perusal of confirmed copy of account of Sachin Kumar it has been observed that assessee has shown to have received Rs.18,60,820/- from Sh. Sachin Kumar on 31,03.2015. The assessee in its reply dated 12.12.2017 in response to the show cause has explained that it has been transfer from syndicate bank S/A no 875L22A0060913 on page on 15. On perusal of page 15 of reply of assessee it has been observed that the amount of Rs.18,60,820/- has been transferred to assessee on 27.06.2015. As such this amount was not transferred to assessee on or before 31.03.2015. The assessee’s reply is not satisfactory with regard to the loan of Rs.18,60,820/- out of the Loan of Rs.1,23,70,820/-. The assessee has tried to explain an entry of prior period with actual transfer of later period. The source which is required to explained for the year under consideration cannot be accepted as explained with source of succeeding year of loan creditor. The assessee reply therefore, is not found satisfactory u/s 68 of the Income Tax Act, 1961. Therefore, reject the submission off assessee and treat the amount of Rs.18,60,820/- as deemed income of assessee u/s 68 of the Income Tax Act, 1961.” 4. Before the CIT (Appeals), the appellant had given copy of account of Shri Sachin Kumar, in the books of accounts of the assessee and also the bank details which has been incorporated from page Nos. 3 to 6. It was stated that the cheque was received on 31.10.2015 for an amount of Rs.18,60,820/-. However, the amount ITA. No. 1319/Del/2020 Page 4 of 7 was transferred to the account of the assessee on 27.06.2015 only in the next financial year. Even after calling of the remand report and the assessee’s explanation in this regard the ld. CIT (Appeals) has confirmed the said addition after observing as under:- “It is seen that the said transaction was credited in appellant’s books of account on 31.03.2015 through book entry. However, the actual transaction of the said transaction had taken place on 27.06.2015 which clearly showed that Mr. Sachin Kumar had transferred the amount of Rs.18,60,820/- to the assessee company only on 27.05.2015. The assessee had not received loan amount of Rs.18,60,820/- from the Director, Shri Sachin Kumar, as on 31.03.2015. In its rejoinder, the assessee has claimed that it was “missed from memory”. This explanation cannot be accepted as it is merely an after-thought devised by the appellant to cover up its mistake. Therefore, I am inclined to agree with the Assessing Officer and confirm the addition made. “ 5. I have heard both the parties and on perusal of the impugned order as well as the material on record placed before me, it is seen that, it is an undisputed fact that the assessee company had received loan from its Director, Shri Sachin Kumar, for sums aggregating to Rs.1,23,70,820/-. The Assessing Officer has accepted the genuineness of the loan as well as creditworthiness of Shri Sachin Kumar. However, the only dispute is that, one amount of loan received on 31 st March, 2015 for a sum of Rs.18,60,820/-, which has been shown in the balance sheet 3as at 1 st March, 2015 and in the books of accounts, has not been ITA. No. 1319/Del/2020 Page 5 of 7 credited in the bank account of the assessee as same was transferred only on 27 th June, 2015. It is very surprising that the Assessing Officer has made the addition under Section 68 of the Act only on the ground that sum of Rs.18,60,820/- has come in the account of the assessee in the next financial year and, therefore, this loan has been treated as non-genuine in this year which has been taxed under the deeming provisions of Section 68 of the Act. If the amount is credited in the bank account of the assessee in this year and has been shown as a loan in the books this year; and when the Assessing Officer is not doubting the identity, genuineness and creditworthiness of the transaction, then I do not find any reason as to why the addition under Section 68 of the Act can be made. Just because, the cheque has been cleared in the next financial year, it does not mean the amount credited in books when cheque was received on 31 st March is unexplained income of this year. If Assessing Officer is treating that it is not the amount received during the year, ostensibly then the addition under Section 68 could not have been made in this year. Thus, I do not find any reason for making addition of Rs.18,60,820/- under Section 68 of the Act in this year when the assessee had shown to have received amount of Rs.18,60,820/- in its books on 31 st March, 2015 and nothing has been questioned about the nature and source of the credit. Again it is reiterated that Identity, genuineness and creditworthiness for the loan received has not been doubted, albeit the credit appearing in books has been taxed just because amount credited in the bank account in the next ITA. No. 1319/Del/2020 Page 6 of 7 financial year. Accordingly, the addition of Rs.18,60,820/- is deleted. 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on : 05/04/2022. Sd/- ( AMIT SHUKLA ) JUDICIAL MEMBER Dated : 05/04/2022. *MEHTA* Copy forwarded to 1. Appellant; 2. Respondent 3. CIT 4. CIT (Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, New Delhi Date of dictation 05.04.2022 Date on which the typed draft is placed before the dictating member 05.04.2022 Date on which the typed draft is placed before the other member 05.04.2022 Date on which the approved draft comes to the Sr. PS/ PS 05.04.2022 ITA. No. 1319/Del/2020 Page 7 of 7 Date on which the fair order is placed before the dictating member for pronouncement 05.04.2022 Date on which the fair order comes back to the Sr. PS/ PS 05.04.2022 Date on which the final order is uploaded on the website of ITAT 05.04.2022 date on which the file goes to the Bench Clerk 05.04.2022 Date on which the file goes to the Head Clerk The date on which the file goes to the Assistant Registrar for signature on the order Date of dispatch of the order