Dhanalaxmi Jewellers, Angul V. ITO, Angul Ward, Angul

ITA 153/CTK/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5784 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 4 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-10-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2013-2014
• Appeal Filed On: 03-05-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: D K SHETHM SHETH A DVS
• Keywords: Unexplained cash credit; Opportunity of being heard; Question of law; Onus to prove
• Section: 133(6); 201; 144C; 131; 68; 132; 90

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL CUTTACK BENCH CUTTACK BEFORE SHRI C.M. GARG, JM & SHRI L.P. SAHU, AM . / ITA NO. 153 /CTK/2018 ( / ASSESSMENT YEAR : 201 3 - 201 4 ) M/S DHANALAXMI JEWELLERS, LAXMI BAZAR, ANGUL - 759122 VS. ITO, ANGUL WARD, ANGUL ./ PANNO. : A A GFD 8791 D ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI D.K.SHETH/M. SHETH , A DVS. /REVENUE BY : SHRI SUBHENDU DUTT A , DR / DATE OF HEARING : 01 /0 8 /2019 / DATE OF PRONOUNCEMENT : 01 / 10 /2019 / O R D E R PER L.P.SAHU , A M : TH IS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) - 2 , BHUBANESWAR , DATED 09.03.2018 FOR THE A SSESSMENT YEAR 201 3 - 201 4 . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : - 1. FOR THAT THE ADDITION OF RS.83,00,000/ - MADE U/S.68 OF THE I.T. ACT. UNDER HEAD UNDISCLOSED CASH CREDIT IS HIGHLY ARBITRARY AND UNLAWFUL IN VIEW OF THE FACT THAT THE APPELLANT SATISFACTORILY EXPLAINED THE NATURE AND SOURCES OF ALL THE CASH CREDIT . THE LEARNED COMMISSIONER IS ALSO NOT JUSTIFIED TO CONFIRM THE ADDITION . 2. FOR THAT THE ADDITION OF RS.2,29,841/ - BY DISALLOWING INTEREST PAID ON LOANS AS MADE BY THE LEA RNED AO AND AS CONFIRMED BY THE LEARNED COMMISSIONER IS ARBITRARY AND UNJUSTIFIED . 3. FOR THAT THE LEARNED COMMISSIONER SHOULD HAVE APPRECIATED THE CONTENTIONS OF THE APPELLANT AND IS NOT JUSTIFIED TO UPHOLD THE ACTION OF THE LEARNED AO IN RESPECT OF THE AFORESAID ADDITIONS . ITA NO. 153 /CTK/2018 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 28.09.2013 DECLARING AT INCOME OF RS.34,710/ - . THE RETURN WAS PROCESSED U/S.143(1) OF THE ACT AND LATER ON THE CASE WAS SELECTED FOR SCRUTINY AND STATUTORY NOTICES WERE ISSUED TO THE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS NOTICED THAT THE ASSESSEE HAS TAKEN UNSECURED LOAN TO THE TUNE OF RS.1,33,00 ,000/ - FROM DIFFERENT PERSONS/BODY CORPORATE, WHICH READS AS UNDER : - NAME OF THE PARTY PAN AMOUNT AAYUS MOHATA, FLAT NO. 4D, 493C/A G T ROAD VIKEK VIHAR , PHASE - V, BLOCK - ELEVEN, NEAR HOWRAH JUTE MILL, KOLKATA, WESE BENGAL - 711102 BPFPM2403E 12,00,000 APEX ACCOUNTING SERVICES PVT. LTD, 7 DIGAMBAR JAIN TEMPLE ROAD, 5 TH FLOOR, KOLKATA - 700007 AAK CA2127P 17,00,000 GOODSHINE VYAPAAR PVT. LTD., 23B, N S ROAD, KOLKATA - 700001 AAECG2127P 20,00,000 INDAR CHANDRA MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AAWPM1427H 2,00,000 JUHI VANJIA PVT. LTD., 21 ROSEMERRT LANE, HOWRAH, WEST BEN GAL 711101 AABCJ8917D 20,00,000 KAUSHALAYA MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AZZPM0685A 3,00,000 MONTROSE COMMODITIES PVT. LTD., 8/1, LAL BAZAR STREET, 3 RD FLOOR, ROOM NO.1, KOLKATA - 700001 AABCM7537N 20,00,000 PRIYANKA MUN DHRA, C/O. M/S. BHUTBNATH STORE, MAIN ROAD, ANGUL 759122 APSPM0685A 3,00,000 RAJ KUMAR MOHTA, 9 - HAT LANE, MULLICK FATAKM 5 TH FLOOR, HOWRAH 700001 ADRPM5323L 4,00,000 RANJAN KUMAR SAHU, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL 759122 DDXPS1862R 4, 00,000 RUKMA DEVI MAHESWARI, 9 - HAT LANE, MULLICK FATAK, 5 TH FLOOR, HOWRAH - 700001 AFMPM4147F 10,00,000 SAROJ DEVI MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 BFRPM5074F 1,00,000 SAROJ DEVI JHANWAR, 3030, JAI SHREE RAM MARKET, RING ROAD, SURAT, GUJRAT - 395002 BLKPD1718C 4,00,000 ITA NO. 153 /CTK/2018 3 SHANKAR PRASAD MAHESWARY, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 ATMPM1929M 3,00,000 GOPAL MUNDRA(HUF), C/O. M/S. BHUTNATH STORE, LAXMI BAZAR, MAIN ROAD, ANGUL - 759122 AAJHS8141K 4,00,000 RAMANAND MAHES WARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AZZPM6646A 5,00,000 TOTAL 1,33,00,000 4. THE AO ISSUED NOTICE U/S.142(1) OF THE ACT DATED 13.05.2015 AND ASKED TO FURNISH THE ACKNOWLEDGEMENT OF ITR, STATEMENT OF TOTAL INCOME, BANK STATEMENT, B ALANCE SHEET AND LOAN CONFIRMATION FROM THE LENDERS. THE ASSESSEE TOOK SEVERAL ADJOURNMENTS AND THEREAFTER FILED CONFIRMATIONS FROM THE LENDERS ON 31.12.2015 AND SUBMITTED THE FOLLOWING DOCUMENTS WHICH READ AS UNDER : - SL. NO. NAME OF THE PARTY PAN AMOUN T DOCUMENTS SUBMITTED DOCUMENTS NOT SUBMITTED 1 AAYUS MOHATA, FLAT NO. 4D, 493C/A G T ROAD VIKEK VIHAR , PHASE - V, BLOCK - ELEVEN, NEAR HOWRAH JUTE MILL, KOLKATA, WESE BENGAL - 711102 BPFPM2403E 12,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, BALANCE - S HEET & P&L A/C STATEMENT OF TOTAL INCOME & BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 2 APEX ACCOUNTING SERVICES PVT. LTD, 7 DIGAMBAR JAIN TEMPLE ROAD, 5 TH FLOOR, KOLKATA - 700007 AAKCA2127P 17,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMEN T, BALANCE - SHEET & P*L A/C STATEMENT OF TOTAL INCOME & BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 3 GOODSHINE VYAPAAR PVT. LTD., 23B, N S ROAD, KOLKATA - 700001 AAECG2127P 20,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, BALANCE - SHEET & P*L STATEMENT OF TOTAL INCOME & BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 4 INDAR CHANDRA MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AAWPM1427H 2,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCO ME, BALANCE - SHEET BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION ITA NO. 153 /CTK/2018 4 5 JUHI VANJIA PVT. LTD., 21 ROSEMERRT LANE, HOWRAH, WEST BENGAL 711101 AABCJ8917D 20,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT (ONLY THE TRANSACTION PAGE), STATEMENT OF TOTAL INCOME, BALANCE - SHEET 6 KAUSHALAYA MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AZZPM0685A 3,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET & BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 7 MONTROSE COMMODITIES PVT. LTD., 8/1, LAL BAZAR STREET, 3 RD FLOOR, ROOM NO.1, KOLKATA - 700001 AABCM7537N 20,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET & P&L A/C BANK STATEMENT ONLY THE PAGE CON TAINING THE TRANSACTION 8 PRIYANKA MUNDHRA, C/O. M/S. BHUTBNATH STORE, MAIN ROAD, ANGUL 759122 APSPM0685A 3,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET & P&L A/C BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 9 RAJ KUMAR MOHTA, 9 - HAT LANE, MULLICK FATAKM 5 TH FLOOR, HOWRAH 700001 ADRPM5323L 4,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET & P&L A/C STATEMENT OF TOTAL INCOME & BANK STATEMENT ONLY THE PA GE CONTAINING THE TRANSACTION 10 RANJAN KUMAR SAHU, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL 759122 DDXPS1862R 4,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET & P&L A/C BANK STATEMENT ONLY THE PAGE CONTAIN ING THE TRANSACTION 11 RUKMA DEVI MAHESWARI, 9 - HAT LANE, MULLICK FATAK, 5 TH FLOOR, HOWRAH - 700001 AFMPM4147F 10,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT,BALANCE - SHEET & P&L A/C STATEMENT OF TOTAL INCOME & BANK STATEMENT ONLY THE PAGE CONTAINING T HE TRANSACTION 12 SAROJ DEVI MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 BFRPM5074F 1,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 13 SAROJ DEVI JHANWAR, 3030, JAI SHREE RAM MARKET, RING ROAD, SURAT, GUJRAT - 395002 BLKPD1718C 4,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION ITA NO. 153 /CTK/2018 5 14 SHANKAR PRASAD MAHESWARY, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 ATMPM1929M 3,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 15 GOPAL MUNDRA(HUF), C/O. M/S. BHUTNATH STORE, LAXMI BAZAR, MAIN ROAD, ANGUL - 759122 AAJHS8141K 4,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION 16 RAMANAND MAHESWARI, C/O. M/S. BHUTNATH STORE, MAIN ROAD, ANGUL - 759122 AZ ZPM6646A 5,00,000 LOAN CONFIRMATION, ITR COPY, BANK STATEMENT, STATEMENT OF TOTAL INCOME BALANCE - SHEET BANK STATEMENT ONLY THE PAGE CONTAINING THE TRANSACTION TOTAL 1,33,00,000 5. FURTHER, THE AO ISSUED NOTICE U/S.133(6) OF THE ACT TO ALL THE LENDE RS FOR FURNISHING BANK STATEMENT FOR THE PERIOD FROM WHERE THE LOAN TRANSACTIONS HAVE BEEN MADE TO END OF THE RELEVANT PREVIOUS YEAR I.E. UPTO 31.03.2013 AND IN CASE OF CASH DEPOSITS PRIOR TO THE LOAN TRANSACTION, AND ALSO TO FURNISH THE CASH - FLOW STATEME NT TO FIND OUT THE CASH AVAILABLE ON THE DATE OF DEPOSIT IN THE BANK ACCOUNT AND OTHER FINANCIAL DOCUMENTS. THE AO FURTHER NOTICED THAT IN CASE OF M/S JUHI VANIJIA PVT. LTD. & APEX ACCOUNTING SERVICES PVT. LTD., NOTICE U/S.133(6) OF THE ACT WERE RETURNED U NSERVED BY THE POSTAL DEPARTMENT WITH REMARK NOT KNOWN AND IN CASE OF M/S GOODSHINE VYAPAAR PVT. LTD., NOTICE U/S.133(6) OF THE ACT WAS NEITHER RETURNED NOR ANY REPLY WAS RECEIVED BY THE AO TILL THE FINALIZATION OF THE ASSESSMENT AND THE ABOVE FACTS WER E INTIMATED TO THE ASSESSEE FOR PROVIDING CORRECT ADDRESS. IN THIS REGARD, THE ASSESSEE SUBMITTED REPLY THAT THE ALLEGED CORRECT ADDRESS OF M/S JUHI VANIJIA PVT. LTD. IS REGISTERED WITH ROCS SITE ONLY ITA NO. 153 /CTK/2018 6 ON 22.03.2016. AFTER RECEIPT OF REMAINING CREDITORS, W HO WERE COMING WITHIN THE JURISDICTION OF THE AO, NOTED THAT THE LENDERS HAVE DEPOSITED CASH INTO HIS/HER BANK ACCOUNT PRIOR TO THE ISSUANCE OF CHEQUES FOR LOAN IN FAVOUR OF THE ASSESSEE, WHICH HAS DULY BEEN NOTED BY THE AO HIS ORDER. THE AO ASKED THE ASSE SSEE TO ARRANGE PERSONAL APPEARANCE OF THE LENDERS TO EXAMINE THE GENUINENESS OF TRANSACTION. FOR THE GENUINENESS OF THE TRANSACTIONS BUT THE ASSESSEE EXPRESSED HIS INABILITY TO PRODUCE THE LENDERS WITHIN A SHORT SPAN OF TIME. AGAIN THE CASE WAS FIXED FOR HEARING ON 03.03.2016 AND HE ALSO TOOK TIME TO PRODUCE THE LENDERS WITHIN FORTNIGHT BUT TILL 18.03.2016 HE AGAIN DID NOT PRODUCE BEFORE THE AO TO THE LENDERS AND AGAIN THE CASE WAS FIXED FOR HEARING ON 22.03.2016 AND THE ASSESSEE WAS ASKED TO PRODUCE THE L ENDERS WITH THEIR CASH - FLOW STATEMENT AS THERE WERE CASH DEPOSITS PRIOR TO ADVANCING OF UNSECURED LOAN AND ON 22.03.2016 THE ASSESSEE DID NOT PRODUCE TO ANY LENDERS AND FURNISHED WRITTEN SUBMISSIONS IGNORING THE PERSONAL APPEARANCE OF THE LENDERS. ON EXAMI NATION OF THE BANK ACCOUNTS AVAILABLE BEFORE HIM, IT WAS NOTICED THAT THERE WAS ONLY CASH DEPOSITS. LD. AO EXAMINED THE DETAILS FURNISHED BY THE ASSESSEE AND ACCORDINGLY HE DISALLOWED RS.83 LAKHS AS UNSECURED CASH CREDIT U/S.68 OF THE ACT. FURTHER HE NOTIC ED THAT THE ASSESSEE HAD PAID INTEREST ON THE ABOVE LOAN TO WRITTEN OFF RS.2,29,841/ - AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. ITA NO. 153 /CTK/2018 7 6 . FEELING AGGRIEVED FROM THE ORDER OF THE AO, THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A) AND THE LD. CIT(A) AFTER CON SIDERING THE SUBMISSION OF THE ASSESSEE AND ORDER OF AO, DISMISSED THE APPEAL OF THE ASSESSEE. 7 . BEFORE US, LD. AR SUBMITTED A WRITTEN SYNOPSIS, APART FROM THIS, HE ALSO MADE ORAL ARGUMENTS. HE SUBMITTED THAT ALL THE COMPLIANCES WERE MADE AS REQUIRED BY THE AO. FURTHER, LD. AR SUBMITTED THAT THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS STATED THAT AS REGARDS THE CASH DEPOSITS THE SAME HAS BEEN DEPOSITED IN THE BANK ACCOUNT OF THE UNSECURED LOAN CREDITORS MUCH BEFORE THE REMITTANCE OF THE LOANS . FURTHER, HE SUBMITTED THAT IT CANNOT BE CONSTRUED THAT THERE WAS CASH DEPOSITS IMMEDIATELY BEFORE THE REMITTANCE OF LOAN. LD. AR FURTHER SUBMITTED THAT THE ASSESSEE HAS ALSO FILED COPY OF ACKNOWLEDGEMENT OF ITR AND BANK STATEMENT OF UNSECURED LOAN CREDIT ORS PROVING THEIR IDENTITY AND GENUINENESS OF THE TRANSACTIONS. ACCORDINGLY, LD. AR SUBMITTED THAT THE ASSESSEE HAS FULFILLED THE INGREDIENTS OF THE PROVISIONS OF SECTION 68 OF THE ACT, THEREFORE, PRAYED FOR DELETING THE ADDITION. IT WAS ALSO CONTENDED BY LD. AR THAT THE AO HAS DOUBTED THE SOURCE OF SOURCE, TO WHICH THE ASSESSEE IS NOT REQUIRED TO EXPLAIN THE SOURCE OF SOURCE AS PER THE SETTLED LAW LAID DOWN BY THE HONBLE JUDICIAL FORUMS. ITA NO. 153 /CTK/2018 8 8 . ON THE OTHER HAND, LD.DR RELIED ON THE ORDERS OF LOWER AUTHORITI ES AND SUBMITTED THAT AMPLE OPPORTUNITY WAS GIVEN TO THE ASSESSEE TO PRODUCE THE LENDERS BEFORE THE AO BUT HE DID NOT AVAIL THE OPPORTUNITY. IN CASE OF TWO COMPANIES NOTICE U/S.133(6) OF THE ACT WERE RETURNED UNSERVED BY THE POSTAL AUTHORITIES AND HE PROVI DED THE CORRECT ADDRESS IN THE FAG - END OF THE TIME BARRING ASSESSMENT. THE ASSESSEE WAS UNABLE TO SATISFY THE AO WITH REGARD TO THE CONDITIONS AS CONTEMPLATED UNDER THE PROVISIONS OF SECTION 68 OF THE ACT AS DECIDED BY THE MANY JUDICIAL HIGHER FORUMS. TH E AO ALSO OBSERVED THAT THE LENDERS HAVE DEPOSITED CASH IN HIS BANK ACCOUNT IMMEDIATELY BEFORE GIVING LOANS WHICH ALSO CREATES A DOUBT TO THE GENUINENESS OF THE LOANS. HE ALSO SUBMITTED THAT IN CASE OF INDIVIDUALS LENDERS THERE IS NO GENUINE BUSINESS ACTIV ITY WHICH SHOWS FROM THE COMPUTATION OF INCOME. 9 . AFTER CONSIDERING THE RIVAL SUBMISSIONS OF BOTH THE PARTIES AND PERUSING THE MATERIAL EVIDENCE AVAILABLE ON RECORD ALONG WITH THE ORDERS OF BOTH THE AUTHORITIES BELOW, WE FIND, AS NOTED BY THE AO IN THE A SSESSMENT PROCEEDINGS, THE ASSESSEE FILED BALANCE SHEET AS ON 31.03.2013 AND ON PERUSAL OF THE SAME, THE AO FOUND THAT THE ASSESSEE RECEIVED UNSECURED LOAN FROM DIFFERENT PERSONS AGGREGATING TO RS.1,33,00,000/ - . ON BEING ASKED BY THE AO, THE ASSESSEE FILED CONFIRMATIONS, HOWEVER, THE AO MADE IMPUGNED ADDITION U/S 68 OF THE ITA NO. 153 /CTK/2018 9 ACT ON THE ALLEGED GROUND THAT THE A SSESSEE WAS NOT ABLE TO PROVE THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE LOAN TRANSACTION WITH 11 CREDITORS/LENDERS AMOUNTING TO RS. 83,00,0 00/ - . THE AO ALSO DISALLOWED RS.2,29,841/ - ON ACCOUNT OF INTEREST PAID ON LOANS IN RESPECT OF 8 . IN APPEA L, THE CIT(A) DISMISSED THE APPEAL OF ASSESSEE OBSERVING THAT THE ASSESSEE HAS NOT PROVIDED ANY SUFFICIENT PROOF OF IDENTIFICATION OF SUBSCRIBER COMPAN Y AND THE ASSESSEE HAS FAILED TO COMPLY WITH THE DIRECTIONS OF AO. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, T HE A SSESSEE FILED COPIES OF THE ACKNOWLEDGEMENTS OF I NCOME TAX RETURNS, CONFIRMATION OF THE ACCOUNTS OF THE CREDITOR, COPY OF THE BANK STATEME NT, AUDITORS REPORT, BALANCE SHEET AS ON 31.03.2013, STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31.03.2013, FINANCIAL STATEMENTS FOR THE YEAR ENDED 31.03.2013, BANK STATEMENTS, ETC. BEFORE THE AUTHORITIES BELOW , WHICH WERE VERIFIED BY THE AO . COPIES OF THE SAME ARE FILED IN THE PAPER BOOK BEFORE THE TRIBUNA L ALSO . THE DOCUMENTS FILED ON RECORD HAVE NOT BEEN DISPUTED BY THE AUTHORITIES BELOW. THE REVENUE DID NOT EXAMINE THE SOURCE OF INCOME OF THE SAID ALLEGED CREDITORS TO FIND OUT WHETHER THEY WERE C REDITWORTHY OR WERE SUCH WHO COULD ADVANCE THE ALLEGED LOANS. THERE WAS NO EFFORT MADE TO PURSUE THE SO - CALLED ALLEGED CREDITORS BY THE AO DURING THE ASSESSMENT PROCEEDINGS . CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF MATERIAL ON RECORD, IT IS CLEAR THAT A SSESSEE PRODUCED SUFFICIENT DOCUMENTARY ITA NO. 153 /CTK/2018 10 EVIDENCE BEFORE THE REVENUE AUTHORITIES TO PROVE THE INGREDIENTS OF SECT ION 68 OF THE I.T. ACT. LD. AR DURING THE COURSE OF HEARING BEFORE US SUBMITTED THAT ONCE THE DOCUMENTARY EVIDENCES ARE SUBMITTED BY THE A SSESSEE, BURDEN SHIFTS TO THE REVENUE AND THEN REVENUE SHOULD BRING ON RECORD MATERIAL FROM WHICH IT COULD BE CONCLUDED THAT TRANSACTIONS BETWEEN THE ASSESSEE AND THE LENDERS, IN FACT, ARE NOT GENUINE. FROM THE ASSESSMENT ORDER, IT IS CLEAR THAT THE AO HAS REQUISITIONED ALL THE LENDERS IN QUESTION U/S.133(6) OF THE ACT TO FURNISH THE BANK STATEMENT FOR THE PERIOD FROM WHERE THE LOAN TRANSACTIONS HAVE BEEN MADE TO END OF THE RELEVANT PREVIOUS YEAR I.E. UPTO TO 31.03.2013 AND IN CASE OF CASH DEPOSITS PRIOR TO THE LOAN TRANSACTION ALONG WITH CASH FLOW STATEMENT TO FIND OUT THE AVAILABILITY OF CASH ON THE DATE OF DEPOSIT IN THE BANK ACCOUNT. THE A.O, HOWEVER, DID NOT MAKE ANY FURTHER ENQUIRY ON THE DOCUMENTS FILED BY THE A SSESSEE. THE A.O. THUS, FAILED TO CONDU CT ANY ENQUIRY AND SCRUTINY OF THE DOCUMENTS AT ASSESSMENT STAGE AND MERELY SUSPECTED THE TRANSACTION BETWEEN THE LENDERS AND A SSESSEE BECAUSE THE LENDERS HAVE DEPOSITED CASH IN THEIR RESPECTIVE ACCOUNTS AND TRANSFERRED THE SAME THROUGH BANKING CHANNEL TO THE ASSESSEE . 10 . ON FURTHER PERUSAL OF THE ASSESSMENT ORDER, WE FIND THAT T HE AO WHILE DISCUSSING THE TRANSACTIONS DETAILS AND THE FINANCIAL CAPABILITY OF THE EACH LENDER, HAS FOUND THAT IN CASE OF M/S JUHI VANIJIA PVT. LTD., M/S APEX ACCOUNTING SERVICES PVT. LTD. AND GOLDSHINE VYAPAAR PVT. LTD., ITA NO. 153 /CTK/2018 11 NOTICE U/S.133(6) OF THE ACT NEITHER RETURNED UNSERVED NOR ANY REPLY WAS RECEIVED FROM THE LENDER COMPANY TILL THE FINALIZATION OF THE ASSESSMENT ORDER. NOW, THE QUESTION ARISES AS TO WHY THE AO HAS NOT INVOKED T HE PROVISIONS OF SECTION 131 OF THE ACT AVAILABLE TO THE INCOME TAX AUTHORITIES FOR THE PERSONAL PRESENCE OF THE LENDERS. FOR COMPLETENESS OF THE ORDER, WE WOULD LIKE TO REPRODUCE THE PROVISIONS OF SECTION 131 OF THE ACT WHICH READ AS UNDER : - POWER REGARD ING DISCOVERY, PRODUCTION OF EVIDENCE, ETC. 131. (1) THE [ASSESSING] OFFICER, [DEPUTY COMMISSIONER (APPEALS)], [JOINT COMMISSIONER] [, COMMISSIONER (APPEALS)] [, [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER OR] COMMIS SIONER AND THE DISPUTE RESOLUTION PANEL REFERRED TO IN CLAUSE ( A ) OF SUB - SECTION (15) OF SECTION 144C ] SHALL , FOR THE PURPOSES OF THIS ACT, HAVE THE SAME POW ERS AS ARE VESTED IN A COURT UNDER THE CODE OF CIVIL PROCEDURE, 1908 (5 OF 1908), WHEN TRYING A SUIT IN RESPECT OF THE FOLLOWING MATTERS, NAMELY : ( A ) DISCOVERY AND INSPECTION; ( B ) ENFORCING THE ATTENDANCE OF ANY PERSON, INCLUDING ANY OFFICER OF A BANKIN G COMPANY AND EXAMINING HIM ON OATH; ( C ) COMPELLING THE PRODUCTION OF BOOKS OF ACCOUNT AND OTHER DOCUMENTS; AND ( D ) ISSUING COMMISSIONS. [(1A) [IF THE [PRINCIPAL DIRECTOR GENERAL OR] DIRECTOR GENERAL OR [PRINCIPAL DIRECTOR OR] DIRECTOR OR [JOINT] DIR ECTOR OR ASSISTANT DIRECTOR [OR DEPUTY DIRECTOR], OR THE AUTHORISED OFFICER REFERRED TO IN SUB - SECTION (1) OF SECTION 132 BEFORE HE TAKES ACTION UNDER CLAUSES ( I ) TO ( V ) OF THAT SUB - SECTION,] HAS REASON TO SUSPECT THAT ANY INCOME HAS BEEN CONCEALED, OR IS LIKELY TO BE CONCEALED, BY ANY PERSON OR CLASS OF PERSONS, WITHIN HIS JURISDICTION, THEN, FOR THE PURPOSES OF MAKING ANY ENQUIRY OR INVESTIGATION RELATING THER ETO, IT SHALL BE COMPETENT FOR HIM TO EXERCISE THE POWERS CONFERRED UNDER SUB - SECTION (1) ON THE INCOME - TAX AUTHORITIES REFERRED TO IN THAT SUB - SECTION, NOTWITHSTANDING THAT NO PROCEEDINGS WITH RESPECT TO SUCH PERSON OR CLASS OF PERSONS ARE PENDING BEFORE HIM OR ANY OTHER INCOME - TAX AUTHORITY.] [(2) FOR THE PURPOSE OF MAKING AN INQUIRY OR INVESTIGATION IN RESPECT OF ANY PERSON OR CLASS OF PERSONS IN RELATION TO AN AGREEMENT REFERRED TO IN SECTION 90 OR SECTION 90A , IT SHALL BE COMPETENT FOR ANY INCOME - TAX AUTHORITY NOT BELOW THE RANK OF ASSISTANT COMMISSIONER OF IN COME - TAX, ITA NO. 153 /CTK/2018 12 AS MAY BE NOTIFIED BY THE BOARD IN THIS BEHALF, TO EXERCISE THE POWERS CONFERRED UNDER SUB - SECTION (1) ON THE INCOME - TAX AUTHORITIES REFERRED TO IN THAT SUB - SECTION, NOTWITHSTANDING THAT NO PROCEEDINGS WITH RESPECT TO SUCH PERSON OR CLASS OF PERS ONS ARE PENDING BEFORE IT OR ANY OTHER INCOME - TAX AUTHORITY.] (3) SUBJECT TO ANY RULES MADE IN THIS BEHALF, ANY AUTHORITY REFERRED TO IN SUB - SECTION (1) [OR SUB - SECTION (1A)] [OR SUB - SECTION (2)] MAY IMPOUND AND RETAIN IN ITS CUSTODY FOR SUCH PERIOD AS IT THINKS FIT ANY BOOKS OF ACCOUNT OR OTHER DOCUMENTS PRODUCED BEFORE IT IN ANY PROCEEDING UNDER THIS ACT : PROVIDED THAT AN [ASSESSING] OFFICER [OR AN [ASSISTANT DIRECTOR [OR DEPUTY DIRECTOR]]] SHALL NOT ( A ) IMPOUND ANY BOOKS OF ACCOUNT OR OTHER DOCUM ENTS WITHOUT RECORDING HIS REASONS FOR SO DOING, OR ( B ) RETAIN IN HIS CUSTODY ANY SUCH BOOKS OR DOCUMENTS FOR A PERIOD EXCEEDING FIFTEEN DAYS (EXCLUSIVE OF HOLIDAYS) WITHOUT OBTAINING THE APPROVAL OF THE [ [ [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMIS SIONER OR [PRINCIPAL DIRECTOR GENERAL OR] DIRECTOR GENERAL OR [PRINCIPAL COMMISSIONER OR] COMMISSIONER OR [PRINCIPAL DIRECTOR OR] DIRECTOR THEREFOR E , AS THE CASE MAY BE.]] 11. FROM THE ABOVE PROVISIONS OF THE ACT, IT IS VIVIDLY CLEAR THAT S ECTION 131 OF THE INCOME TAX ACT EMPOWERS THE INCOME TAX AUTHORITIES TO CONDUCT INQUIRIES. IT PROVIDES POWERS TO SUMMON PERSONS/WITNESSES, EXAMINE THEM UNDER OATH, COMPEL PRODUCTION OF BOOKS OF ACCOUNT AND DOCUMENTS, AND ISSUE COMMISSIONS. THE POWER OF ENFORCING ATT ENDANCE OF A PERSON UNDER THIS SECTION IS THE SAME AS AVAILABLE UNDER THE CODE OF CIVIL PROCEDURE , 1908 . GENERALLY , IT IS SEEN THAT ASSESSEES ARE REPRESENTED BY THEIR ADVOCATES/CAS/AUTHORIZED REPRESENTATIVES DURING PROCEEDINGS BEFORE THE INCOME TAX AUTHORI TIES. HOWEVER, IF IT IS FELT THAT FOR INQUIRY IN A PARTICULAR MATTER, IT IS ESSENTIAL TO EXAMINE THE CONCERNED PERSON OR A WITNESS, THEN POWERS UNDER ITA NO. 153 /CTK/2018 13 SECTION 131 OF THE ACT ARE REQUIRED TO BE INVOKED. IF SUMMONS ARE ISSUED AND SERVED ON A PERSON FOR PERSON AL ATTENDANCE UNDER SECTION 131 OF THE ACT , IT IS BINDING ON HIM TO ATTEND IN PERSON AS HE CANNOT BE REPRESENTED BY A LAWYER OR AN AUTHORIZED REPRESENTATIVE. FURTHER, A PERSON CAN ALSO BE COMPELLED TO PRODUCE BOOKS OF ACCOUNT OR DOCUMENTS BY ISSUING A NOTI CE UNDER SECTION 131 OF THE ACT . NON - COMPLIANCE WITH THE SUMMONS/NOTICE ISSUED UNDER SECTION 131 OF THE ACT MAY RESULT IN LEVY OF PENALTY AS PER THE PROVISIONS OF THE I.T.ACT, 1961 FOR SUCH A DEFAULT. HERE IT IS ALSO IMPORTANT TO CLARIFY THAT AN A SSESSING O FFICER CAN INVOKE SECTION 131 OF THE ACT FOR MAKING INQUIRIES ONLY IN A CASE WHERE PROCEEDINGS ARE PENDING BEFORE HIM. FOR EXAMPLE, DURING THE COURSE OF ONGOING ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER CAN SUMMON A THIRD PARTY FOR VERIFYING FACTS PRE SENTED BEFORE HIM BY THE ASSESSEE. HE CAN ALSO SUMMON THE ASSESSEE TO HIS OFFICE FOR RECORDING HIS STATEMENT ON ANY OF THE ISSUES RELEVANT TO THE ASSESSMENT. ON THE OTHER HAND, OFFICERS OF THE INVESTIGATION WING CAN EXERCISE THESE POWERS EVEN IF NO PROCEED INGS ARE PENDING WITH THEM. THEY CAN INVOKE THIS SECTION DURING THE COURSE OF A SEARCH OR DURING A SURVEY FOR EXAMINING ANY PERSON UNDER OATH. 12 . IN THE PRESENT CASE IN HAND, IT IS CLEAR FROM THE ASSESSMENT ORDER, THAT WHEN THE AO FOUND THAT NOTICE S ISS UED U/S.133(6) OF THE ACT HAVE ITA NO. 153 /CTK/2018 14 BEEN RETURNED UNSERVED IN CASE OF THREE COMPANIES I.E. M/S JUHI VANIJIA PVT. LTD., APEX ACCOUNTING SERVICES PVT. LTD. AND M/S GOODSHINE VYAPAAR PVT. LTD., HE SHOULD HAVE INVOKED THE PROVISIONS OF SECTION 131 OF THE ACT, HOWEV ER, NOWHERE IT SMELLS IN THE ASSESSMENT ORDER THAT THE AO MADE HIS EFFORT TO DO THE SAME. FURTHER REGARDING THE ADDRESS SUPPLIED BY THE ASSESSEE ON WHICH NOTICES UNDER SECTION 133(6) OF THE ACT REMAINED UNSERVED, ASSESSEE SUPPLIED THE SAME ADDRESS WHICH IS ALSO SHOWN IN THE INCOME TAX RETURN OF THE LENDERS . MERELY BECAUSE 133(6) OF THE ACT NOTICES ISSUED TO THE PARTY RETURNED UN - SERVED THOUGH IT WAS THE SAME ADDRESS, WHICH WAS SUPPLIED BY LENDERS WHILE FILING THEIR INCOME TAX RETURN, NO FAULT CAN BE PUT ON THE SHOULDER OF ASSESSEE . 13 . AS REGARDS, THE REST OF THE EIGHT LENDERS/CREDITORS , THE AO IN THE ASSESSMENT ORDER HAS TAKEN INTO CONSIDERATION OF THE RETURN S OF THE INCOME FILED BY THE SOME LENDERS FOR THE ASSESSMENT YEARS 2009 - 10, 2010 - 2011, 2011 - 2012, 2 012 - 2013 & 2013 - 2014 AND CAME TO THE CONCLUSION THAT THE ASSESSEE HAS FAILED TO LET THE LENDERS TO APPEAR IN PERSON DURING THE COURSE OF ASSESSMENT PROCEEDING . 14. HOWEVER, THE AO RECORDED A FINDING THAT THE ASSESSEE COULD HAVE REQUESTED HIM TO ISSUE SUM MONS U/S.131 OF THE ACT FOR THE PERSONAL APPEARANCE OF THE LENDERS. IT IS SURPRISING THAT WHEN A VERY POWERFUL TOOL IS AVAILABLE TO THE INCOME TAX AUTHORITIES IN THEIR QUEST FOR THE ITA NO. 153 /CTK/2018 15 TRUTH , WHY THE AO WAITED FOR THE REQUEST OF THE ASSESSEE TO ISSUE SUMMONS U/S.131 OF THE ACT . MEANING THEREBY, T HE ASSESSING OFFICER HAS ALSO NOT BOTHERED TO ENFORCE THE PRESENCE OF CREDITORS BY ISSUING SUMMONS U/S. 131 OF THE ACT . WE, ACCORDINGLY ARE NOT INCLINED TO SUPPORT THE ORDERS OF THE AUTHORITIES BELOW ON THIS COUNT ALSO . 15 . NOW, COMING TO THE ADDITION MADE BY THE AO U/S.68 OF THE ACT AND CONFIRMED BY THE CIT(A) ON ACCOUNT OF UNEXPLAINED CASH CREDIT IN RESPECT OF THE THREE COMPANIES I.E. M/S JUHI VANIJIA PVT. LTD., APEX ACCOUNTING SERVICES PVT. LTD. AND M/S GOODSHINE VY APAAR PVT. LTD. AMOUNTING TO (20,00,000+17,00,000+20,00,000)=RS.57,00,000/ - , ON CAREFUL CONSIDERATION OF THE ORDERS OF BOTH THE AUTHORITIES BELOW, WE ARE OF THE OPINION THAT WHENEVER A SUM IS FOUND CREDITED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE THEN, IR RESPECTIVE OF THE COLOUR OR THE NATURE OF THE SUM RECEIVED WHICH IS SOUGHT TO BE GIVEN BY THE ASSESSEE, THE INCOME - TAX OFFICER HAS THE JURISDICTION TO ENQUIRE FROM THE ASSESSEE THE NATURE AND SOURCE OF THE SAID AMOUNT. WHEN AN EXPLANATION IN REGARD THERETO IS GIVEN BY THE ASSESSEE, THEN IT IS FOR THE INCOME - TAX OFFICER TO BE SATISFIED WHEN THE SAID EXPLANATION IS CORRECT OR NOT. FURTHER, THE AO HAS ONLY FOCUSED ON THE FACT THAT SOME LENDERS HAVE SHOWN LOW INCOME IN THEIR RETURN OF INCOME. IN OUR OPINION, THE INCOME/LOSSES DECLARED BY THE LENDERS IS NOT A SOLE CRITERION TO EXAMINE THE ITA NO. 153 /CTK/2018 16 CREDITWORTHINESS OF THE LENDERS . NONE OF THE AUTHORITIES BELOW HAVE BROUGHT ANY ADVERSE MATERIAL ON RECORD TO FALSIFY THE FUND FLOW SHOWN IN THE BANK STATEMENTS OF CREDITORS F ILED BY THE ASSESSEE. I N ANY MATTER, THE ONUS OF PROOF IS NOT A STATIC ONE. THOUGH IN SECTION 68 PROCEEDINGS, THE INITIAL BURDEN OF PROOF LIES ON THE ASSESSEE YET ONCE HE PROVES THE IDENTITY OF THE LEND ERS BY EITHER FURNISHING THEIR PAN NUMBER OR INCOME - TAX ASSESSMENT NUMBER AND SHOWS THE GENUINENESS OF TRANSACTION BY SHOWING MONEY IN HIS BOOKS EITHER BY ACCOUNT PAYEE CHEQUE OR BY DRAFT OR BY ANY OTHER MODE, THEN THE ONUS OF PROOF WOULD SHIFT TO THE REVE NUE. 16. HAVING GONE THROUGH THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. ORISSA CORPN.(P) LTD. , AS RELIED ON BY THE LD. AR OF THE ASSESSEE, WHICH HAS BEEN AFFIRMED BY THE HONBLE SUPREME COURT REPORTED IN [1986] 25 TAXMANN 80 F (SC), WHEREIN THE HONBLE APEX COURT HAS HELD AS UNDER : - IN THIS CASE THE ASSESSEE HAD GIVEN THE NAMES AND ADDRESSES OF THE ALLEGED CREDITORS. IT WAS IN THE KNOWLEDGE OF THE REVENUE THAT THE SAID CREDITORS WERE THE INCOME - TAX ASSESSEES. THEIR INDEX NUM BER WAS IN THE FILE OF THE REVENUE. THE REVENUE, APART FROM ISSUING NOTICES UNDER SECTION 131 AT THE INSTANCE OF THE ASSESSEE, DID NOT PURSUE THE MATTER FURTHER. THE REVENUE DID NOT EXAMINE THE SOURCE OF INCOME OF THE SAID ALLEGED CREDITORS TO FIND OUT WHE THER THEY WERE CREDIT - WORTHY OR WERE SUCH WHO COULD ADVANCE THE ALLEGED LOANS. THERE WAS NO EFFORT MADE TO PURSUE THE SO - CALLED ALLEGED CREDITORS. IN THOSE CIRCUMSTANCES, THE ASSESSEE COULD NOT DO ANY FURTHER. IN THE PREMISES, IF THE TRIBUNAL CAME TO THE C ONCLUSION THAT THE ASSESSEE HAD DISCHARGED THE BURDEN THAT LAY ON HIM, THEN IT COULD NOT BE SAID THAT SUCH A CONCLUSION WAS UNREASONABLE OR PERVERSE OR BASED ON NO EVIDENCE. IF THE CONCLUSION WAS BASED ON SOME EVIDENCE ON WHICH A CONCLUSION COULD BE ARRIVE D AT, NO QUESTION OF LAW AS SUCH COULD ARISE. ITA NO. 153 /CTK/2018 17 THE HIGH COURT WAS, THEREFORE, RIGHT IN REFUSING TO REFER THE QUESTIONS SOUGHT FOR. DECISION OF THE HIGH COURT AFFIRMED. 1 7 . IN THE INSTANT CASE, THE AO HIMSELF NOTED THAT THE NOTICE TO THE LENDERS HAVE RE TURNED UNSERVED AND EVEN NO REPLY HAS BEEN FILED BY THE LENDERS, HOWEVER, ON PERUSAL OF THE ASSESSMENT ORDER, THERE IS NO QUESTION OF ISSUANCE OF SECOND SUMMONS. IN THIS REGARD RELIANCE CAN BE PLACED ON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V. U.M. SHAH, PROPRIETOR, SHRENIK TRADING CO. [1973] 90 ITR 396 (BOM.) , WHEREIN THE HONBLE HIGH COURT HAS HELD THAT I F THE PARTIES HAD RECEIVED THE SUMMONS BUT DID NOT APPEAR, THE ASSESSEE COULD NOT BE BLAMED. HOWEVER, WHERE THE SUMMONS WAS RETURN ED WITH THE POSTAL REMARK NOT KNOWN (AND NOT FOUND), THE SAID IS AN ENDORSEMENT OF THE PRESUPPOSED THAT AT THE SPECIFIC ADDRESS FURNISHED BY THE ASSESSEE THE ADDRESSEE COULD NOT BE TRACED. IN SUCH CASES, THE QUESTION OF ISSUING A SECOND SUMMONS WOULD A RISE ONLY IF THE ADDRESS GIVEN EARLIER WAS ERRONEOUS, AND NOT WHEN IT WAS ALMOST IDENTICAL AS HELD IN THE CASE OF RAM KUMAR JALAN V. CIT [1976] 105 ITR 331 (BOM.). 1 8 . FURTHER, THE HONBLE GUJARAT HIGH COURT IN THE CASE OF DCIT VS. ROHINI BUILDERS (2002 ) 256 ITR 360 (GUJ), HAS HELD THAT MERE IDENTIFICATION OF THE SOURCE OF THE CREDITORS EVEN WITHOUT EVIDENCE AS TO THE NATURE OF THE INCOME COULD JUSTIFY ACCEPTANCE, WHERE THE ASSESSEE ITA NO. 153 /CTK/2018 18 HAS GIVEN PAN OF THE CREDITOR AND ALSO SHOWS THAT THE AMOUNTS WERE RECEI VED BY ACCOUNT PAYEE CHEQUES. HON. HIGH COURT, IN THIS CASE, ENDORSED THE FINDINGS OF THE TRIBUNAL THAT IT IS NOT NECESSARY THAT THERE SHOULD BE EXPLANATION AS TO THE SOURCE OF THE MONEY ON THE PART OF THE CREDITORS IN EVERY CASE. 1 9 . THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. BHAN & SONS (2005) 273 ITR 206 (P & H), HAS OBSERVED THAT IT WAS FOUND THAT THE CREDITS WERE RECEIVED BY ACCOUNT PAYEE CHEQUES AND THE CREDITORS WERE INCOME TAX ASSESSEES. BUT THE CONTENTION OF THE ASSESSING OFFIC ER WAS THAT THE ASSESSEE DID NOT RESPOND TO THE REQUIREMENTS OF THE PRODUCTION OF CREDITORS BEFORE HIM FOR VERIFICATION. THE FIRST APPELLATE AUTHORITY AND THE HIGH COURT FELT THAT IT WAS POSSIBLE FOR THE ASSESSING OFFICER TO HAVE ACCEPTED THE SAME OR MAKE FURTHER ENQUIRIES WITH REFERENCE TO THE FILES OF THE CREDITORS, SINCE THEY WERE ASSESSEES. 20 . IN THIS CASE, WE FIND THAT THE AO TREATED THE LOAN IN QUESTION RECEIVED BY THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION AS UNEXPLAINED CASH CREDIT U/S 68 F OR THE REASON THAT THE NOTICE ISSUED U/S 133(6) TO THE CONCERNED LOAN CREDITOR WAS RETURNED BACK UNSERVED BY THE POSTAL AUTHORITY . THE ASSESSEE HAD PROVIDED THE DOCUMENTS AS REQUIRED BY THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS, WHICH ITA NO. 153 /CTK/2018 19 HAVE NOT BE EN DOUBTED BY THE AUTHORITIES BELOW. MERELY BECAUSE NOTICE U/S.133(6) OF THE ACT ISSUED TO SOME OF THE CREDITORS COULD NOT BE SERVED OR THEY FAIL TO APPEAR BEFORE THE ASSESSING OFFICER CANNOT BE THE BASIS TO TREAT THE LOANS TAKEN BY THE ASSESSEE FROM THOSE CREDITORS AS NON - GENUINE . ON THIS ACCOUNT, AS DISCUSSED ABOVE, WE ARE OF THE OPINION THE ADDITION MADE U/S.68 OF THE ACT IN THE HANDS OF ABOVE THREE LENDERS I.E. M/S JUHI VANIJIA PVT. LTD., APEX ACCOUNTING SERVICES PVT. LTD. AND M/S GOODSHINE VYAPAAR PVT. LTD. AMOUNTING TO (RS.20,00,000 +17,00,000+20,00,000)=RS.57,00,000/ - IS NOT SUSTAINABLE AND WE DELETE THE SAME. 21. NOW, WITH REGARD TO THE EIGHT LENDERS FROM WHOM THE ASSESSEE HAS RECEIVED LOAN, AS NOTED BY THE AO IN THE ASSESSMENT ORDER, W E WOULD LIKE TO REPRODUCE T HE DETAILS INCOME DISCLOSED BY THE FOLLOWING LENDERS IN THEIR RESPECTIVE RETURNS AS NOTED BY THE AO IN ITS ORDER READ AS UNDER : - (I) INDAR CHANDRA MAHESWARI : ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,8 0,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 4,04,110 2,90,760 1,98,070 1,79,230 1,56,500 ( II ) KAUSHALAYA MAHESWARI : ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 3,25,880 1,95,600 1,99,400 1,93,300 NOT FILED ITA NO. 153 /CTK/2018 20 (III ) PRIYANKA MUNDHRA : ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 4, 94 , 900 3,28,230 2,43,120 2,05,970 1,82,500 (IV ) RANJAN KUMAR SAHU : [ ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 2,86,150 1,83,530 1,82,720 1,70,230 NOT FILED (V ) SHANKAR PRASAD MAHESWARY : ASST. YEARS 2013 - 14 20 12 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 3,20,140 1,91,910 1,73,800 1,63,800 NOT FILED (VI ) GOPAL MUNDRA (HUF) : ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,0 0,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNED INCOME 4, 70 , 670 2,81,650 1,80,040 1,67,790 1,63,710 (VII ) RAMANAND MAHESWARY : ASST. YEARS 2013 - 14 2012 - 13 2011 - 12 2010 - 11 2009 - 10 BASIC EXEMPTION 2,00,000 1,80,000 1,60,000 1,60,000 1,50,000 RETURNE D INCOME 3,82,820 2,57,630 2,46,400 2,49,400 NOT FILED (VIII ) SAROJ DEVI MAHESWARI , C/O M/S BHUTNATH STORE, ANGUL - 759122 - LOAN AMOUNT OF RS.1,00,000/ - . IN CASE OF THIS ASSESSEE, THERE IS NO PREVIOUS YEARS RETURN MENTIONED BY THE AO IN THE ASSESSMENT OR DER. FROM THE ABOVE, WE FIND THAT THE AO HAS TAKEN INTO CONSIDERATION OF EARLIER YEARS RETURN OF THE LENDERS, AS NOTED ABOVE, HOWEVER, ON PERUSAL OF THE ASSESSMENT ORDER, THE AO HAS ASKED THE ASSESSEE TO PROVIDE CASH FLOW STATEMENT OF THE ABOVE LENDERS, WHICH HAS NOT BEEN FURNISHED BY THE ASSESSEE TILL THE FIRST APPELLATE STAGE. WE OBSERVE THAT THE LENDERS ITA NO. 153 /CTK/2018 21 HAVE DEPOSITED CASH INTO THEIR RESPECTIVE BANK ACCOUNTS BEFORE ADVANCING LOAN TO THE ASSESSEE. IN THE INTEREST OF JUSTICE, WE RESTORE THE ISSUE ONLY FO R THE LIMITED PURPOSE AND DIRECT THE AO TO VERIFY AND EXAMINE THE CASH AVAILABILITY IN THE HANDS OF THE RESPECTIVE LENDERS FROM LEGITIMATE BUSINESS SOURCES. THE ASSESSEE IS DIRECTED TO COOPERATE WITH THE AO FOR ABOVE EXAMINATION AND VERIFICATION. NEEDLESS TO SAY THAT REASONABLE OPPORTUNITY OF BEING HEARD BE GIVEN TO THE ASSESSEE. 22 . WITH REGARD TO SECOND GROUND RAISED BY THE ASSESSEE IN RESPECT OF ADDITION MADE BY THE AO AND CONFIRMED BY THE CIT(A) ON ACCOUNT OF INTEREST PAID ON LOANS, AS WE HAVE ALREADY REMITTED THE ISSUE OF THE ADDITION MADE BY THE AO U/S.68 OF THE ACT ON ACCOUNT OF UNSECURED LOAN IN THE HANDS OF EIGHT LENDERS IN QUESTION , ACCORDINGLY THIS ISSUE IS ALSO RESTORED TO THE FILE OF AO FOR CALCULATING THE INTEREST AFRESH. THIS GROUND OF APPE AL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 2 3 . IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES IN TERMS AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 01 / 10 / 201 9 . SD/ - ( C.M.GAR G ) SD/ - ( L.P.SAHU ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER CUTTACK ; DATED 01 / 10 /201 9 PRAKASH KUMAR MISHRA, SR.P.S. ITA NO. 153 /CTK/2018 22 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( SENIOR PRIVATE SECRETARY ) , / ITAT, CUTTACK 1. / THE APPELLANT - M/S DHANALAXMI J EWELLERS, LAXMI BAZAR, ANGUL - 759122 2. / THE RESPONDENT - ITO, ANGUL WARD, ANGUL 3. ( ) / THE CIT(A), 4. / CIT 5. , , / DR, ITAT, CUTTACK 6. / GUARD FILE. //TRUE COPY//