SHRI RAJ KUMAR JAIN, Alwar V. CIT, Alwar

ITA 136/JPR/2012

• Counselvise Citation: 13623114 RSA 2012
• Duration Of Justice: 2 year(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 1992-1993
• Appeal Filed On: 08-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA
• Assessee Lawyers: KRANTI MEHTA; K L GUPTA
• Keywords: Peak credit; Additional evidence; Corroborative evidences
• Section: 154; 143(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR (BEFORE SHRI HARI OM MARATHA AND SHRI N.K. SAI NI) ITA NO. 136/JP/2012 ASSESSMENT YEAR : 1992-93 PAN: ABEPJ 7326 Q SHRI RAJ KUMAR JAIN VS. THE ITO PROP. M/S. R.R. OSWAL & CO. WARD- 2(1) BAJAJA BAZAR, ALWAR ALWAR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI KRANTI MEHTA & SHRI K.L. GUPTA DEPARTMENT BY: SHRI D.C. SHARMA DATE OF HEARING: 30-01-2014 DATE OF PRONOUNCEMENT: 26-02-2014 ORDER PER HARI OM MARATHA, JM:- THIS APPEAL OF THE ASSESSEE FOR THE ASSESSMENT YEA R 2007-08 IS DIRECTED AGAINST THE ORDER OF THE LD. CIT (A), ALWA R DATED 08-11-2011 WHEREIN FOLLOWING GROUNDS HAVE BEEN RAISED. 1. THAT UNDER THE FACTS AD CIRCUMSTANCES OF THE C ASE THE ORDER PASSED BY THE AO U/S 143(3) IS BAD IN LAW. 2. THAT THE LD. AO NOT CONSIDER FACT OF THE CASE AN D ASSESSED UNDER PRESSURE IN LAST DATE AS TIME BARRED CASE. 3. THAT THE LD. AO CONFIRMED THE CREDIT WORTHINESS OF DR BRIJENDRA SINGHAL, WHO HAS GIVEN LOAN TO THE ASSESS EE AND SAME ADVANCES NOT ALLOWED TO THE ASSESSEE. 2 4. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A), INCOME-TAX, ALWAR ERRED IN CONFIRMING THE A DDITION MADE BY THE LD. AO. 5. THAT THE ASSESSEE CRAVES YOUR INDULGENCE TO ADD, AMEND, OR ALTER ALL OR ANY GROUNDS OF APPEAL AT THE TIME, OR BEFORE THE HEARING OF THE APPEAL. 2.1 BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ORIGINAL ASSESSMENT IN THIS CASE WAS COMPLETED ON 24-02-1995 ON TOTAL INCO ME OF RS. 12,69,068/-. THE ASSESSEE WENT IN APPEAL BEFORE THE LD. CIT(A) W HO VIDE HIS ORDER DATED 21-03-1996 SET ASIDE THE ASSESSMENT ORDER WITH A DI RECTION TO FOLLOW THE DECISION PERTAINING TO ASSESSMENT YEAR 1991-92 PASS ED BY THE FIRST APPELLATE AUTHORITY AND TO MAKE AFRESH ASSESSMENT. ACCORDINGL Y, THE AO COMPLETED THE SET ASIDE ON 26-02-1999 ON A TOTAL INCOME OF RS . 9,32,066/-. AGAIN THE ASSESSEE WAS AGGRIEVED AND FILED AN APPEAL AND THE LD. CIT(A) PASSED HIS ORDER DATED 19-11-1999 AND DISMISSED THE APPEAL AND CONFIRMED THE ORDER OF THE AO. IN BETWEEN THE ORDER U/S 143(3)/ SET ASIDE ORDER DATED 26-02-1999, THE AO REVISED THE ORDER U/S 154 OF THE ACT VIDE HI S ORDER DATED 31-08-1999 AND THE TOTAL INCOME WAS DETERMINED AT RS. 8,88,402 /-. 2.2 HOWEVER, THE ASSESSEE PREFERRED AN APPEAL AGAIN ST THE ORDER OF THE LD. CIT(A) DATED 19-11-1999 BEFORE THE TRIBUNAL WHO VID E THEIR ORDER DATED 27- 04-2007 AFTER ADMITTING THE ADDITIONAL EVIDENCES PR ODUCED BY THE LD. AR OF THE ASSESSEE UNDER RULE 29 OF INCOME TAX APPELLATE RULES, 1963, RESTORED THE MATTER TO THE FILE OF THE AO TO EXAMINE THE ISS UE IN THE LIGHT OF THE 3 ADMITTED ADDITIONAL EVIDENCES AND FRAMED DE NOVO AS SESSMENT. IN FRESH ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO F URNISH ALL THE DETAILS REGARDING ADDITIONAL EVIDENCES IN SUPPORT OF THE IM PUGNED ISSUE WHICH IS REGARDING GENUINITY OF A LOAN ALLEGEDLY RECEIVED BY THE ASSESSEE FROM DR BRIJENDRA SINGHAL, WHO IS A REAL BROTHER-IN-LAW OF THE ASSESSEE AND WORKING IN SAUDI ARABIA. THE ASSESSEE DERIVES INCOME FROM S HARES FROM THE FIRM M/S. SUA LAL GYAN CHAND WHO DEALS IN SHARE BUSINESS . THE ASSESSEE HAS SHOWN HIS INCOME AT RS. 43,362/-. THE TOTAL TRANSAC TION OF SHARES HAS BEEN SHOWN AT RS. 28,90,862/- AND COMMISSION THEREON HAS BEEN SHOWN @ 15%. THE ASSESSEE FURNISHED CASH FLOW CHART ON THE BASI S OF BANK ENTRIES. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF DEPOSIT IN THE BANK ACCOUNT WITH THE HELP OF EVIDENCE. THE ASSESSEE DID NOT MAINTAIN THE BOOKS OF ACCOUNT. IT WAS STATED THAT THE ASSESSEE USED TO ENCASH THE REF UND ORDERS THROUGH BANK RELATED TO VARIOUS PERSONS AND WOULD CHARGE COMMIS SION @ 15%. HE WAS FURTHER ASKED TO FURNISH THE DETAILS OF PARTIES TO WHOM REFUND ORDERS WERE ENCASHED BUT INSTEAD OF IT, THE ASSESSEE MADE A SUR RENDER OF RS. 7,39,288/-. IT WAS CONTENDED THAT THERE WAS A PEAK CREDIT FOR THE QUARTER ENDING ON 30-09- 1991 WHICH COMES TO RS. 10,54,074/- AS AGAINST RS. 13,91,075/- ADOPTED BY THE AO WHILE COMPUTING THE ORIGINAL ASSESSMENT. THE ASSESSEE ALSO FURNISHED CHART SHOWING PEAK CREDIT SEPARATELY FOR THE AMOUNTS DEPOSITED IN BANK THROUGH REFUND ORDERS AND CASH. THE DETAILS OF THESE ENTRIES ARE AS UNDER:- 4 FIRST QUARTER : PEAK BY CLEARINGS 2,22,013/- PEAK BY CASH 3,36,375/- TOTAL 5,58,388/- SECOND QUARTER : PEAK BY CLEARINGS 3,80,074/- PEAK BY CASH 6,74,000/- TOTAL 10,54,074/- FIRST QUARTER : DEPOSIT BY DEPOSIT IN CASH WITHDRAWAL (1+2+3) CLEARING CASH ------------- ----------------- ----------------- ---- --------------- 2,22,013/- 5,07,600/- 1,71,225/- 5,58,388/- SECOND QUARTER 3,80,074/- 9,90,000/- 3,16,000/- 10,54,074/- AFTER EXAMINING THE ABOVE DETAILS REGARDING PEAK AM OUNT, THE AO ACCEPTED THE SAME TO BE CORRECT. HOWEVER, THE ASSESSEE HAS A LSO STATED THAT HE HAD AVAILABLE FUNDS TO THE TUNE OF RS. 3,03,000/- WHIC H ARE REQUIRED TO BE REDUCED FROM THE ABOVE PEAK AMOUNT OF RS. 10,54,074 /-. BUT THE AO ACCEPTED THE AVAILABLE OF OPENING CAPITAL OF RS. 2 ,14,900/- AND HAS REDUCED IT FROM THE ABOVE PEAK AND RESULTANT PEAK COMES TO RS. 8,39,174/-. THIS AMOUNT WAS ADDED TO THE TOTAL INCOME OF THE ASSESSE E. 2.3 BEFORE THE LD. CIT(A), THE ASSESSEE PRODUCED TH E ADDITIONAL EVIDENCES IN THE FORM OF THE AFFIDAVIT OF THE AND MEDICAL CER TIFICATE ETC. THESE EVIDENCES WERE ADMITTED AND THE MATTER WAS RESTORED BACK TO THE FILE OF THE AO FOR AFRESH CONSIDERATION. THE AO EXAMINED THE EV IDENCES IN AFRESH ASSESSMENT PROCEEDINGS ON 22-12-2008. DR BRIJENDRA SINGHAL WHO IS HUSBAND OF SISTER OF THE ASSESSEE WAS PRODUCED BEFO RE THE AO FOR HIS 5 PERSONAL EXAMINATION. HIS STATEMENT WAS RECORDED ON OATH. IN HIS STATEMENT, HE ADMITTED THAT HE HAD GIVEN A LOAN OF RS. 8.00 LA CS TO SHRI RAJ KUMAR JAIN ON VARIOUS DATES DURING THE PERIOD BETWEEN JUNE, 19 91 AND NOV. 1991 IN CASH OUT OF HIS BANK ACCOUNT MAINTAINED IN THE PNB, JOHRI BAZAR, JAIPUR BUT NO SUPPORTING EVIDENCE WAS PRODUCED. ACCORDINGLY, T HE AO DID NOT RELY ON THE STATEMENT OF DR BRIJENDRA SINGHAL. IT IS NOTICE D THAT THE TRIBUNAL HAS ORDAINED THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE M ATTER IS RESTORED TO THE FILE OF THE AO WHO WILL EXAMINE THE ISSUE DE NOVO. THE ASSESSEE IS AUTHORIZED TO SUBMIT THE CASE BEFORE TH E AO WITH ALL THE EVIDENCES/ DOCUMENTS IN SUPPORT OF HIS CLAIM. IN THE DE NOVO ASSESSMENT PROCEEDINGS TO EXPLAIN THE ADDED AMOUNT OF RS. 8.00 LACS, THE ASSESSEE HAS PUT THE EVIDENCE OF LOAN ALLEGEDLY TAKEN FROM HIS B ROTHER-IN-LAW BUT ONLY BECAUSE OF NON-SUPPORTING EVIDENCE REGARDING BANK D EPOSIT ETC IN THE CASE OF NRI DR BRIJENDRA SINGHAL, THE AO DID NOT ACCEPT THE LOAN THEORY AND HAS MADE THE IMPUGNED ADDITION. 2.4 IN THIRD ROUND, THE LD. CIT(A) HAS OBSERVED THA T HEARING OF THE CASE WERE FIXED ON 2-12-2008 AND 26-12-2008. THE ASSESSE E SUBMITTED THE EVIDENCES AND DOCUMENTS IN RESPECT OF THE CASE AND ON THAT DATE THE STATEMENT OF THE ASSESSEE, DR.J.S. SHARMA AND DR BR IJENDRA SINGHAL (BROTHER- IN- LAW OF THE ASSESSEE ) WERE RECORDED. THEY CLAIM ED THAT HE RECEIVED LOAN OF RS. 8.00 LACS FROM HIS BROTHER-IN-LAW WHO IS NRI AND RESIDENT OF RIYADH (SAUDI ARABIA) SINCE 1983. DR BRIJENDRA SING HAL HAS ALSO ACCEPTED 6 THIS FACT IN HIS STATEMENT RECORDED ON OATH BY THE AO. REGARDING FATHER OF THE ASSESSEE SHRI GYAN CHAND JAIN, THE STATEMENT OF DR J.S. SHARMA WAS RECORDED AND HE STATED THAT HE WAS UNDER HIS TREAT MENT SINCE 1992 AND HE IS UNDER DEPRESSION AND MENTAL TENSION. 2.5 NOW WE CUT LONG STORY SHORT AND OBSERVE THAT TH E ASSESSEE HAS TAKEN THE LOAN OF RS. 8.00 LACS FROM HIS BROTHER-IN-LAW I N THE YEAR 1991 IN CONNECTION WITH HIS SHARE BUSINESS AND ACCORDING TO HIM, THIS FACT WAS NOT EXPLAINED NOR INFORMED TO HIS FATHER BECAUSE HE WAS UNDER DEPRESSION AND MENTAL TENSION. IT IS STATED THAT HIS SISTER DR BI NA JAIN AND BOTHER-IN-LAW DR BRIJENDRA SINGHAL USED TO COME AND VISIT JAIPUR AND ALWAR IN CONNECTION WITH RECEPTION CEREMONY OF THEIR SON TO BE HELD AT SISODIA GARDEN, JAIPUR ON 27-12-2008. IN PROOF THEREOF, THE RECEPTION CARD WA S PRODUCED AT THE TIME OF MAKING STATEMENT. IT IS STATED THAT IN A MARRIAGE O F DAUGHTER OF HIS SADU (DR BRIJENDRA SINGHAL) HELD ON 21-12-2008, THE MARRIAGE CARD WAS PRODUCED. DR BRIJENDRA SINGHAL HAS ADMITTED THIS FACT OF GIVING LOAN IN CASH TO HIS BROTHER- IN-LAW FOR BUSINESS PURPOSES AND STATED THAT HE HAD WITHDRAWN THE SAME AMOUNT FROM HIS BANK I.E. NEW BANK OF INDIA, JOHRI BAZAR, JAIPUR NOW MERGED INTO PUNJAB NATIONAL BANK W.E.F. 3.-09-1993. THE COPY OF THIS ACCOUNT WAS ALSO PRODUCED. THE COPIES OF THE SERVIC E RECORD, PASSPORT AND BANK ACCOUNT COULD NOT BE PRODUCED AT THAT TIME. BU T LATER ON ALL THE EVIDENCES WERE FURNISHED IN THE FORM OF COPY OF NRI ACCOUNT, BANK ACCOUNT ETC WHICH WERE DIRECTED TO BE CONSIDERED BY THE TRI BUNAL. THE ADDITIONAL 7 EVIDENCES PRODUCED BEFORE THE LD. CIT(A) WERE SENT TO THE AO FOR CALLING THE REMAND REPORT. THE LD. CIT(A) HAS ALSO GONE TOO MUC H IN THE MATTER IN DEEP AND DISMISSED THE ASSESSEE'S APPEAL. 2.6 BEFORE US, SIMILAR ARGUMENTS WERE REITERATED FR OM BOTH THE SIDES. 2.7 AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE CONSIDERED OPINION THAT IN THE GIVEN CIRCUMSTANCES OF THE CASE , THE LOAN OF RS. 8.00 LACS DULY STANDS PROVED. THE STATEMENT OF THE ASSESSEE R ECORDED BY THE AO CONFIRMED THIS LOAN. THE STATEMENT OF THE DONOR DR BRIJENDRA SINGHAL, WHO IS BROTHER-IN-LAW OF THE ASSESSEE ALSO CONFIRMED THE A DVANCE OF THE LOAN. THERE IS A NATURAL LOVE AND AFFECTION BETWEEN SUCH RELATI ONS AND AT THE BEHEST, ANYBODY LIKE SISTER AND BROTHER-IN-LAW WOULD HELP I N INDIAN SOCIETY. IT IS ALSO PROVED ON RECORD THAT MENTAL CONDITION OF THE FATHE R OF THE ASSESSEE WAS NOT GOOD STATE AND THEREFORE, HE WAS NOT AWARE OF THIS LOAN. DR BRIJENDRA SINGHAL IS A NRI AND HE HAS EXPLAINED HIS SOURCE OF INCOME AND HE HAS ALSO MENTIONED HIS BANK ACCOUNT AND HIS NRI ACCOUNT THRO UGH WHICH THE IMPUGNED AMOUNT IS ROUTED. SO WE ARE OF THE CONSIDE RED OPINION THAT THE LOAN OF RS. 8.00 LACS STANDS CONFIRMED ON RECORD. W E DO NOT FIND MUCH FORCE IN THE SUBMISSION OF THE LD. DR THAT WHY SHOULD THE BROTHER-IN-LAW WOULD GIVE A LOAN OF RS. 8.00 LACS AND WOULD NOT DEMAND I T BACK. HE HAS STATED THAT THIS AMOUNT HAS TO BE STRICTLY CONSIDERED AND PROOF THEREOF HAS TO BE STRICTLY MADE. AS WE HAVE OBSERVED ABOVE THAT THIS AMOUNT OF RS. 8.0 LACS STAND THOROUGHLY PROVED ON RECORD AND NOTHING MORE IS REQ UIRED TO PROVE THIS LOAN. 8 ONLY IF THE REVENUE CAN BRING ON RECORD ANY CONTRAR Y EVIDENCE TO DISPUTE ANY EVIDENCE PRODUCED FOR EXAMINATION BEFORE THE AO THEN ONLY THE ASSESSEE WOULD FURTHER SIT ON THE ASSESSEE OTHERWISE THE ASS ESSEE HAS DISCHARGED INITIAL BURDEN CAST ON HIM TO PROVE THIS LOAN AMOUN T OF RS. 8.00 LACS. ACCORDINGLY, WE ALLOW THE APPEAL OF THE ASSESSEE AN D ORDER TO DELETE THE IMPUGNED ADDITION. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26-02-2014. SD/-/- SD/-/- (.N.K. SAINI) (HARI OM MARATHA) ACCOUNTANT MEMBER JUDICIAL MEMEBR JAIPUR DATED: 26 TH FEB. 2014 *MISHRA COPY FORWARDED TO:- BY ORDER 1. SHRI RAJ KUMAR JAIN, ALWAR 2. THE ITO , WARD- 2(1), ALWAR 3. THE LD. CIT(A) 4. THE LD. CIT 5. THE DR 6. THE GUARD FILE (ITA NO.136/JP/12) A.R. ITAT: JAIPUR 9 10