A.C.I.T.. Cir.-1, Nagpur V. M/S PRAJAKTA CONSTRUCTION, Nagpur

ITA 155/NAG/2015

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4522 (ITAT-NAGPUR)
• Duration Of Justice: 1 year(s) 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 12-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AGNESH P THOMAS
• Keywords: Unexplained cash credit; Corroborative evidences
• Section: 143(3); 68

Judgement Text

1 , INCOME TAX APPELLATE TRIBUNAL,NAGPUR BENCH . . , BEFORE S/SH. D T GARASIYA,JUDICIAL MEMBER & RAJENDRA,ACCOUNTANT MEMBER ./ ITA/155/NGP/2015 , / ASSESSMENT YEAR:2007 - 08 A CIT,CIRCLE - 1,NAGPUR VS. M/S PRAJAKTA CONSTRUCTION, NAGPUR. PAN AACFP 1168L ( / APPELLANT ) ( / RESPONDENT ) REVENUE BY: SMT. AGNESH P. THOMAS. ASSESSEE BY: NONE / DATE OF HEARING: 29.08.201 6 / DATE OF PRONOUNCEMENT: 29.08.2016 , 1961 254 ( 1 ) ORDER U/S.254(1)OF THE INCOME - TAX ACT,1961(ACT) PER RAJENDRA A.M. - CHALLENGING THE ORDER,DTD.13 - 02 - 2015 OF CIT(APPEALS) - I,NAGPUR,THE ASSESSING OFFICER(AO) HAS FILED PRESENT APPEAL.ASSESSEE - FIRM, ENGAGED IN THE BUSINESS OF BUILDER AND DEVELOPER,FILED IS RETURN OF INCOME ON 03 - 11 - 2007,DECLARING TOTAL INCOME AT RS.74. 88 LAKHS.THE AO COMPLET - ED THE ASSESSMENT, U/S 143(3) ON 30 - 12 - 2009, DETERMINING THE INCOME OF THE ASSESSEE AT RS.1.54 CRORES. 2.DURING THE ASSESSMENT PROCEEDINGS,THE AO FOUND THAT THE ASSESSEE HAD CREDITED THE SUM OF RS.80 LAKHS IN ITS BOOKS OF ACCOUNTS UNDER THE HEAD LOANS RECEIVED FROM SIX PERSONS, NAMELY, FULCHAND TIKAMCHAND (RS.15 LAKHS), JHAWAR AND CO.(RS. 10 LAKHS), RAMESH SANTANI (JHAWAR) (RS.10 LAKHS),RAMESH BRIJLAL SANTANI (BUNTY) (RS.25 LAKHS),SATYANARAYAN AGRAWAL (RS.5 LAKHS) AND SPRING WATER D ISTILLERS LTD. (RS.15 LAKHS).HE DIRECTED THE ASSESSEE TO FILE DETAILS OF PERSONS ALONG WITH CONFIRMATION LETTERS.AS PER THE AO,THE ASSESSEE DID NOT FILE CONFIRMA - TION LETTERS FROM THE LENDERS.ACCORDINGLY.HE HELD THAT THE ASSESSEE HAD FAILED TO DISCHARGE THE ONUS U/S.68 OF THE ACT,THAT THE ONUS WAS ON THE ASSESSEE TO PROVE THE IDENTITY OF THE LENDERS AND THE GENUINENESS OF THE TRANSACTION. FINALLY,HE HELD THAT RS.80 LAKHS CREDITED BY THE ASSESSEE ON ACCOUNT OF UNSECURED LOANS IN ITS BOOKS HAD TO BE TREATED AS UNEXPLAINED CASH CREDIT AND HAD TO BE ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE FIRST APPELLATE AUTHORITY(FAA).BEFORE HIM,THE ASSESSEE FILED SUPPORTING EVIDENCES,INCLUDING THE CONFIRMATION LETTERS IN RESPECT OF SIX PARTIES. HE CALLED FOR A REMAND REPORT FROM THE AO ON THE WRITTEN SUBMISSIONS MADE AND EVIDENCES FILED BY THE ASSESSEE.AFTER CONSIDERING REMAND 2 REPORT AND THE SUBMISSIONS OF THE ASSESSEE,THE FAA HELD THAT LOANS WERE TAKEN FROM THE PARTIES THROUGH BANKING CHANNELS,THAT THE AMOUNTS IN QUESTION WERE REFLECTED IN THE REGULAR BOOKS OF ACCOUNTS OF THE PARTIES WHO HAD ADVANCED THE LOANS, THAT ALL THE CREDITORS WERE ASSESSED TO TAX,THAT THE ASSESSEE HAD FILED COMPLETE NAMES A ND ADDRESSES OF THE PARTIES BEFORE THE AO,THAT IT HAD PAID INTEREST TO THOSE PARTIES AND HAD DEDUCTED TAX AT SOURCE, THAT THE DETAILS OF TDS MADE WERE SUBMITTED BEFORE THE AO IN THE COURSE OF ASSESSMENT PROCEEDINGS THAT CONTAINED THE DETAILS AND PANS OF TH E PARTIES, THAT THE CREDIT WORTHINESS AND THE IDENTITY OF THE PARTIES, FROM WHOM LOANS WERE OBTAINED,HAD BEEN ESTABLISHED,THAT THERE WAS NO EVIDENCE TO SHOW THAT THE ASSESSEE HAD INTRODUCED HIS OWN MONEY IN THE NAME OF DIFFERENT CREDITORS,THAT COPIES OF TH E CONFIRMATIONS OBTAINED FROM ALL THE PARTIES WERE PRODUCED DURING THE APPELLATE PROCEEDINGS,THAT THE ASSESSEE HAD DISCHARGED ITS ONUS OF FILING THE CONFIRMATION LETTERS,THAT THE LOANS OBTAINED WERE REPAID BY IT BY ACCOUNT PAYEE CHEQUES,THAT BY FILING CONF IRMATION LETTERS, PANS AND THE DETAILS OF PAYMENT,PRINCIPAL AND INTEREST IT HAD FULLY DISCHARGED THE ONUS CAST ON IT,THAT THE CREDITWORTHINESS OF THE PARTIES, IDENTITY OF THE LENDERS AND THE GENUINENESS OF THE TRANSACTIONS WERE ESTABLISHED.FINALLY,HE DELET ED THE ADDITIONS MADE BY THE AO. 4. BEFORE US THE DEPARTMENTAL REPRESENTATIVE (DR) SUPPORTED THE ORDER OF THE AO.NONE APPEARED ON BEHALF OF THE ASSESSEE AS STATED EARLIER. 5. WE HAVE PERUSED THE MATERIAL ON RECORD. WE FIND THAT DURING THE ASSESSMENT PROCEEDINGS, THE ASSESSEE HAD NOT FILED CERTAIN DETAILS ABOUT THE LOANS TAKEN BY IT FROM SIX PARTIES,THAT THE AO MADE AN ADDITION OF RS.80 LAKHS INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT, THAT DURING THE APPELLATE PROCEEDINGS IT FILED ALL THE NECESS ARY DETAILS, THAT THE FAA CALLED FOR A REMAND REPORT, THAT DURING THE REMAND PROCEEDINGS THE ASSESSEE FURNISHED THE DETAILS ABOUT THE MODE OF PAYMENT OF THE AMOUNTS IN QUESTION AS WELL AS THE PERMANENT ACCOUNT NOS. AND THE DETAILS OF INCOME - TAX ASSESSMENTS OF THE PARTIES WHO HAD ADVANCED LOANS TO IT,THAT THE FAA HAS GIVEN A CATEGORICAL FINDING OF FACT THAT LOANS WERE ROUTED THROUGH BANKING CHANNELS, THAT THE ASSESSEE HAD REPAID THE LOANS ALONG WITH THE INTEREST,THAT ALL THE SIX PARTIES WERE ASSESSED TO INC OME - TAX. IN THESE CIRCUMSTANCES, WE ARE OF THE OPINION THAT THE ASSESSEE HAD DISCHARGED THE ONUS CAST UPON IT.AS THE ASSESSEE HAS PROVED THE IDENTITY OF THE PARTIES, GENUINENESS OF THE TRANSACTION AND THE CREDIT WORTHINESS OF THE LENDERS, SO, IN OUR OPINI ON, THE ORDER OF THE FAA DOES NOT SUFFER FROM ANY LEGAL OR FACTUAL INFIRMITY. CONFIRMING THE SAME,WE DECIDE THE EFFECTIVE GROUND OF APPEAL AGAINST THE AO. 3 AS A RESULT, APPEAL FILED BY THE AO STANDS DISMISSED. . ORDER PRONOUNCED IN THE OPEN COURT ON AUGUST, 2016. , 2016 SD/ - SD/ - ( . . / D T GARASIYA ) ( / RAJENDRA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER NAGPUR ; DATED :29 . 0 8 . 2016. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR NAGPUR BENCH, ITAT, / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , / ITAT,NAGPUR.