Abhay Benara, Kanpur V. Astt. Commissioner of Income Tax, Kanpur

ITA 154/LKW/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1173 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 12-12-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 28-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 154/LKW/2016 ASSESSMENT YEAR: 2011 - 12 ABHAY BENARA C/O 24/4, THE MALL KANPUR V. AC IT CENTRAL CIRCLE - I KANPUR T AN /PAN : ADLPB2008Q (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI ASHISH JAISWAL, ADVOCATE RESPONDENT BY: SHRI A. K. PANDEY, D.R. DATE OF HEARING: 12 12 201 7 DATE OF PRONOUNCEMENT: 08 01 2018 O R D E R PER P ARTHA SARAT HI CHAUDHURY, J.M : THIS APPEAL PREFERRED BY THE ASSESSEE ARISES OUT OF THE ORDER OF THE LD. CIT(A) - IV, KANPUR DATED 29/2/2016. 2 . IN THE REVISED GROUNDS OF APPEAL, THE GRIEVANCE OF THE ASSESSEE IS FIRSTLY AGAINST CONFIRMATION BY THE LD. CIT(A) OF ADDITION OF REMAINING LENDERS OF UNSECURED LOAN; WHEREAS THE DETAILS OF THE LENDERS WERE PROVIDED AND SECONDLY AGAINST CONFIRMATION OF DISALLOWANCE OF INTEREST PAID ON REMAINING UNSECURED LOAN ON ACCOUNT OF NON - VERIFIABILITY IN THE REMAND REPORT. 3 . THE BRIEF FACTS IN T HIS CASE ARE THAT THE ASSESSEE CLAIMED INTEREST OF RS.18,89,065/ - TO VARIOUS DEPOSITORS. ACCORDINGLY , ASSESSEE WAS REQUIRED TO JUSTIFY HIS CLAIM. ASSESSEE FILED JUSTIFICATION BEFORE THE ASSESSING OFFICER BUT NOT BEING SATISFIED, THE ASSESSING OFFICER ADD ED [ ITA NO.154/LKW/2016 ] 2 RS.18,89,065/ - TO THE TOTAL INCOME OF THE ASSESSEE. FURTHER, THE ASSESSING OFFICER NOTICED FROM THE DETAILS OF UNSECURED LOAN THAT DURING THE YEAR UNDER CONSIDERATION, ASSESSEE HAS TAKEN FRESH LOAN AMOUNTING TO RS.87 LAKHS. THE ASSESSEE WAS ALSO REQUI RED TO PROVE THE GENUINENESS OF THE SAID LOAN. ASSESSEE, ACCORDING TO THE ASSESSING OFFICER, WAS NOT ABLE TO FURNISH REQUISITE DETAILS AND THE ASSESSING OFFICER ADDED RS.87 LAKHS TO THE TOTAL INCOME OF THE ASSESSEE. 4 . ASSESSEE HAD FURNISHED A DETAILED SUBMI SSION BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAS CALLED FOR REMAND REPORT FROM THE ASSESSING OFFICER. ASSESSEE WAS EVEN CONFRONTED WITH THE REMAND REPORT OF THE ASSESSING OFFICER AND ACCORDINGLY ASSESSEE FILED HIS SUBMISSION ON 29/9/2016. THE LD. CIT(A ) , IN HIS ORDER , HAS OBSERVED THAT THE ASSESSEE COULD NOT EXPLAIN WHY LETTERS FROM THE ASSESSING OFFICER WAS NOT SERVED ON THE GIVEN ADDRESS OR WAS NOT REPLIED BACK BY THE LENDERS. THE LD. CIT(A), THEREFORE, WAS OF THE OPINION THAT IDENTITY, GENUINENESS A ND CREDITWORTHINESS OF THE LENDERS COULD NOT BE ESTABLISHED AND IN RESPECT OF 9 PERSONS HE CONFIRMED ADDITION. SIMILARLY, WITH REGARD TO THE INTEREST INCOME, ADDITION WAS CONFIRMED IN RESPECT OF THESE 9 PERSONS. THE LD. CIT(A) IN HIS ORDER IN DETAIL HAS NARRATED THE REMAND REPORT, CONTENTIONS OF THE ASSESSEE AND HIS OWN REASONS FOR DECISION WHICH NEED NOT TO BE REPEATED HEREIN AGAIN, AND FOR THOSE REASONS, AS APPEARING IN HIS ORDER, HE HAS CONFIRMED THE ADDITION WITH RESPECT TO 9 PERSONS AS LENDERS AND IN TEREST PAID TO THEM. 5 . AT THE TIME OF HEARING BEFORE US, THE LD. A.R. OF THE ASSESSEE VEHEMENTLY ARGUED THAT ALL THE DETAILS AND NECESSARY DOCUMENTS IN RELATION TO THE CASE WERE WITH THE DEPARTMENT RIGHT FROM ASSESSMENT STAGE. THE LD. A.R. OF THE ASSESSEE F URTHER SUBMITTED THAT ASSESSEE HAS FURNISHED CONFIRMATIONS, BANK ACCOUNTS, COPY OF ITR OF THE DEPOSITORS , [ ITA NO.154/LKW/2016 ] 3 TO WHOM INTEREST HAVE BEEN PAID AND TDS DEDUCTED. THE TRANSACTIONS ARE DONE THROUGH BANKING CHANNELS, PARTIES ARE REGULAR INCOME TAX ASSESSEES. T HER EFORE, THE ASSESSEE HAS DISCHARGED HIS ONUS UNDER SECTION 68 OF THE ACT. 6 . THE LD. D.R., ON THE OTHER HAND, RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 7 . WE HAVE PERUSED THE CASE RECORD AND WE FIND THAT IN THE ASSESSMENT ORDER ITSELF IT IS STATED BY THE A SSESSING OFFICER THAT ASSESSEE WAS ASKED TO FURNISH THE DETAILS AND ASSESSEE DID FURNISH THOSE DETAILS AT THE END OF THE FINANCIAL YEAR. THEREFORE, IT IS NOT IN DISPUTE THAT ALL THE RECORDS REGARDING CREDITORS WERE AVAILABLE WITH THE DEPARTMENT. EVEN THE LD. CIT(A), AFTER CALLING FOR REMAND REPORT, HAS CONFIRMED THE ADDITION WITH RESPECT TO 9 PERSONS BUT THE FACT REMAINS THAT THE ENTIRE MACHINERY WAS WITH THE INCOME TAX DEPARTMENT AND IF SOME ENQUIRY WAS NOT COMPLETED BY THE ASSESSING OFFICER, THE LD. CIT (A) COULD HAVE ALSO UNDERTAKEN NECESSARY EXERCISE AND AT THE SAME TIME WHEN ASSESSEE HAS FURNISHED ALL THE RELEVANT DETAILS REGARDING THE CREDITORS AND COMPLIED WITH THE ONUS IMPOSED UPON BY THE INCOME TAX STATUTE, THEN IF ANY CREDITOR DOES NOT RESPOND TO THE LETTER OF THE ASSESSING OFFICER OR DOES NOT MAKE HIMSELF PRESENT BEFORE THE INCOME TAX AUTHORITIES, THE ASSESSEE CANNOT BE PENALIZED FOR THAT. 8 . THE HON'BLE APEX COURT IN THE CASE OF CIT VS. ORISSA CORPORATION (P) LTD. REPORTED IN 1986 AIR 1849, HAS HE LD THAT ASSESSEE DISCHARGED THE BURDEN WHICH CAST UPON IT ONCE HE HAS PROVIDED THE NAMES AND ADDRESSES OF THE ALLEGED CREDITORS. IT WAS IN THE KNOWLEDGE OF THE REVENUE THAT THEY WERE INCOME TAX ASSESSEES. THEIR INDEX [ ITA NO.154/LKW/2016 ] 4 NUMBERS WERE IN THE FILE OF THE DEPAR TMENT. THE DEPARTMENT HAS MADE NO EFFORT TO PURSUE THE SO CALLED ALLEGED CREDITORS. 9 . FURTHER, THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. JAGDISH PRASAD TEWARI REPORTED IN 220 TAXMAN 141 (ALLD) HAS HELD THAT JUST BECAUSE SOME CREDITORS H AD NOT CONFIRMED THEIR RECEIPTS, NO ADDITION COULD BE MADE TO THE ASSESSEES INCOME; PARTICULARLY WHEN IDENTITY; GENUINENESS AND CREDITWORTHINESS HAVE BEEN PROVED BEYOND DOUBT. IN THIS CASE, THE ASSESSEE HAS PROVIDED ALL NECESSARY DETAILS BEFORE THE DEPAR TMENT FROM THE TIME OF ASSESSMENT PROCEEDINGS AND THIS FACT IS NOT DISPUTED BY THE LD. D.R. 10 . IN THE GIVEN SCENARIO, IF SOME CREDITORS HAVE NOT RESPONDED, ADDITION CANNOT BE MADE IN THE HANDS OF THE ASSESSEE. UNDER THESE FACTS AND CIRCUMSTANCES OF THE CAS E, WE ARE OF THE CONSIDERED VIEW THAT NO ADDITION SHOULD BE MADE IN THE HANDS OF THE ASSESSEE ON THIS ISSUE AND, THEREFORE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND ALLOW THE APPEAL OF THE ASSESSEE. ACCORDINGLY, THE GROUNDS OF APPEAL OF THE ASSESSEE A RE ALLOWED. 11 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 8/1/2018 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 8 TH JANUARY, 2018 JJ: 1212 [ ITA NO.154/LKW/2016 ] 5 COPY FORWARDED TO : 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR