Shri Ramnarayan Nayan Yadav, Surat V. The ACIT, Circle-6, Surat

ITA 1614/AHD/2014

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8913 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 07-03-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 22-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Source of fund
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92; 201; 208; 73; 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CAMP AT SURAT BEFORE: S H RI RAJPAL YADAV , JUDICIAL MEMBER AND SHR I AMARJIT SINGH , ACCOUNTANT MEMBER RAMNARAYAN NAYAN Y ADAV, 2 - A, MAHIMA TOWER, SAI ASHISH SOCIETY, PIPLOD, SURAT - 395007 PAN. AAMPY049K (APPELLANT) VS THE ACIT, CIRCLE - 6, SURAT (RESPONDENT) REVENUE BY : S H RI ALOK KUMAR , SR. D . R. ASSESSEE BY: S H RI R.N. VEPARI , A.R. DATE OF HEARING : 07 - 03 - 2 01 7 DATE OF PRONOUNCEMENT : 20 - 03 - 2 017 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2007 - 08 , AR I SES FROM ORDER OF THE CIT(A) - I, SURAT DATED 03 - 02 - 2014 IN APPEAL NO. CAS - I/TFR - 6.181/387/2012 - 13 , IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T A NO . 16 1 4 / A HD/20 14 A SSESSMENT YEAR 200 7 - 08 I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 2 2. THE ASSES SEE HAS RAISED FOLL OWING GROUND OF APPEAL: - 1. ADDITION U/S. 68 OF THE ACT: ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) ERRED IN CONFIRMING A SUM OF RS. 9,83,000/ - WHEN ALL THE PARTICULARS, DETAILS AND EV IDENCE WERE FURNISHED. 3. IN THIS CASE, RETURN OF INCOME DECLARING INCOME OF RS. 5 , 56 ,5 00/ - WAS FILED ON 31 ST OCTOBER, 2007. SUBSEQUENTLY, THE CASE WAS SELECTED UNDER SCRUTINY AND THE NOTICE U/S. 1 4 3 ( 2 ) OF THE ACT WAS ISSUED AN D SERVED ON 26 - 09 - 2008. 4 . DURING THE COURSE OF ASSESS MENT PROCEEDINGS, THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH EXPLANATION REGARDING UNEXPLAINED CASH CREDIT OBTAINED FROM THE DIFFERENT PARTIES . IN THIS CONNECTION, THE ASSESSEE HAS FURNISHED LIST OF UNSECURED LOANS FRO M AS MANY AS 137 PARTIES FROM WHOM ASSESSEE HAS OBTAINED UNSECURED LOANS OF RS. 40 , 36 , 828/ - . ON FURTHER VERIFICATION, THE ASSESSING OFFICER NOTICED THAT THERE WAS NO CONFIRMATION FURN ISHED FROM 73 PARTIES FROM WH OM AN AMOUNT OF LOAN OF UNSECURED LOAN OF R S. 13,34,000/ - WAS OBTAINED. T HE ASSESSING OFFICER HAS FURTHER STATED THAT IN RESPECT OF 13 PARTIES NO PROPER CONFIRMATION OR SUPPORTING EVIDEN CES WERE FURNISHED REGARDING LOAN AMOUNT OF RS. 2,38,000/ - . THEREFORE, THE ASSESSING OFFICER H AS ADDED RS. 15,72,000/ - (RS. 13,34,000/ - + RS. 2,38,000) U/S. 68 OF THE ACT TO THE TOTAL INCOME OF THE ASSESSEE. I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 3 5. AGGRIEVED AGAINST THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) PROVIDED PART RE LIEF TO THE EXTENT OF RS. 5,89,000/ - AND CONFIRMED THE REMAINING AD DITION AMOUNT ING OF RS. 9,83 ,000/ - BY OBSERVING AS UNDER: - I HAVE CONSIDERED THE FACTS OF THE CASE, SUBMISSIONS OF APPELLANT AND REMAND REPORT OF A.O. AS CAN BE SEEN THAT THE LIST OF LENDERS FROM WHOM UNSECURED LOANS TAKEN BY APPELLANT AND TREATED BY A.O. AS UNEXPLAINED CAN BE DIVIDED INTO THREE PARTS. IN FIRST PART, THERE ARE 13 PARTIES, AS MENTIONED IN PARA 7 OF ASSESSMENT ORDER, WHEREIN COMPLETE DETAILS HAVE NOT BEEN FILED BY APPEL LANT. SECOND PART CONSISTS OF TWO SUB - PARTS - IN FI RST SUB PART, PARTICULARS RELA TED TO SOME PARTIES SUCH AS CONFIRMATION, COPY OF BALANCE SHEET, PROFIT AND LOSS ACCOUNT, COPY OF ACKNOWLEDGE OF IT RETURN ETC. HAVE BEEN FILED OUT IN SECOND SUB PART ONLY THOS E PARTIES FALL WHOSE PANS AN WARD NOS. ONLY HAVE BEEN GIVEN. THESE PARTIES ARE AS UNDER: - A. FIRST PART: - SL. NO. NAME OF THE LENDER AMOUNT OF LOAN (RS.) WHETHER SQUARED UP ? REMARKS 1 ANILKUMAR K. SISANGIA 19000 NO NO CONFIRMATION 2 ANKIT K. VAGHASIA 18000 NO NO CONFIRMATION 3 ANUP J. BISHT 18000 NO NO CONFIRMATION 4 JAPRAKASH L. MISHRA 18000 NO BALANCE SHEET NO FILED 5 MANOJKUMAR J. SITAPARA 18000 NO NO CONFIRMATION 6 SANTOSH K PATHAK 19 000 NO BALANCE SHEET NOT FILED 7 SHAILESH D. PATEL 18000 NO NO CONFIRMATION 8 YOESHKUMAR V. MARU 19 000 NO NO CONFIRMATION 9 BATUKBHAI G. PATEL 18000 YES NAME NOT REFLECTED IN B/S 10 BHARATBHAI L. SOLANKI 17 000 YES NO CONFIRMATION 11 FARUKH ISMAIL SINANGWALA 18000 YES NO CONFIRMATION 12 KEMMY P. PATEL 19 000 NO NO CONFIRMATION I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 4 13 PRATIK S. PATEL 19 000 YES NO CONFIRMATION 238000 B. SECOND PART: - (I) SUB - PART - I SR. NO. NAME OF THE LENDER AMOUNT OF LOAN (RS.) 1 ARUN V. SHETTY 19000 2 ARUNBEN M. KHIRSARIA 18000 3 ATULBHAI L. SANTOK 19000 4 BHAVESHBHAI V. BHALODIA 19000 5 BIPINBHAI P. JAVIA 19000 6 DINESHBHAI B. KALARIYA 17 000 7 JIGNESH M. RADDIYA 17 000 8 KEVIN D. DADHANIYA 19000 9 MANSUKH BHAI M. MENDPARA 19000 10 MUKESH BHAI M. MANDPARA 19000 11 MUKESH M. RAMOLIA 17 000 12 NARESHBHAI L. BALDA 19000 13 PRAGNESH V. BORKATARIA 18 000 14 RAJESH A. TIWARI 19000 15 RAVINDRANATH J. PAKKALA 17 000 16 SABHAJEET R. YADAV 18 000 17 SANDEEP T. DHARSANDIYA 18 000 18 UMASHANKAR J. SINGH 19000 19 VASANTBHAI C. VACHHANI 19000 20 HARSHADBHAI N. SPARIYA 18 00 0 21 HARSUKHLAL K. DEVADIA 19000 22 JASMIN NAROTTAMBHAI SPARIYA 19000 23 KAMLESHBHAI M. GAGALIA 19000 24 KIRANBEN P. PATEL 18 000 25 MALTIBEN T. PATEL 1 8 000 26 MINAXIBEN S. DADHANIYA 19000 27 MITESH N. FALDU 18 000 28 PRAKASH M. PATEL 19000 29 REKHA BEN M. PATEL 17 000 30 SANJAYKUMAR J. DADHANIYA 19000 31 TEJAS M. PATEL 18 000 32 VEENABEN KHODABEN 19000 I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 5 VAGHASIA TOTAL 5,89,000 (II) SUB - PART - II SR. NO. NAME OF THE LENDER AMOUNT OF LOAN (RS.) 1 ABHAYRAJ B. YADAV 17000 2 AFJALA U. SHAIKH 18000 3 ASIF DINMOHMAD KADIWALA 19 000 4 BIPIN M. BARIA 18000 5 BIPINBHAI N. VIJOJA 17 000 6 CHANDUBHAI U. FALDU 19 000 7 DIGAMBARPRASAD G. YADAV 18000 8 DINESHBHAI D. PADALIYA 19 000 9 IMTIYAZ HAZI RAZAK TEBHALA 19 000 10 IRSHADALI HASANALI KADIWALA 18 000 11 JAMANBHAI H. VACHHANI 19000 12 JAYNARAYAN M. TIWARI 17 000 13 KAMARALI RASULBHAI KADIWALA 18 000 14 MAHESHBHAI V. PARMAR 17 000 15 MANSUKHABHAI G. VACHHANI 19000 16 MUTAK AHMEDSHAIK H. SIDDIKI 19000 17 NITESHKUMAR N. VACHHANI 19000 18 PANDURANG B. GUNJ AL 18 000 19 PRAVINBHAI. B. MENDAPARA 19000 20 RAJDHAR R. PANDEY 17 000 21 RAJESH J. TAYAL 17 000 22 RATILAL M. KALOLA 17 000 23 SANJAYBHAI B. GHEVARI 19000 24 SATISH S. PATEL 17 000 25 SHAILESH A. GHETIYA 18 000 26 SHANTILAL J. DADHANIYA 19000 27 SHANT ILAL M. THUMBAR 19000 28 SUNILKUMAR K. SISANGIA 19000 29 VIJAYBHAI S. PATEL 19000 30 VISHAL D. KHIRSARIYA 18 000 31 DEVENDRA V. SITAPARA 18 000 32 DHARMESH P. DHADUK 17 000 33 GOPALBHAI LAXMANBHAI SITAPARA 19000 34 IRFAN ISMAIL BHADELIYA 17 000 35 KISH ORBHAI B. SAVAJ 19000 I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 6 36 NILESHBHAI N. BHALODIYA 18 000 37 RASILABEN S. DADHANIYA 19000 38 RIYAZ ISMAIL SINANGWALA 19000 39 SABBIR IBRANHIM NAVIWALA 19000 40 SAKIL MOHAMAD ISMAIL BHADELIAYA 17 000 41 SURESHBHAI S. PATEL 17 000 TOTAL 745000 3.3.1 AS CAN BE SEEN FROM THE ABOVE CITED CHARTS, IN RESPECT OF UN - SE CURED LOANS AGGREGATING TO RS. 2,38,000/ - RECEIVED FROM 13 PARTIES, COMPLETE DETAILS WERE NOT FILED BY APPELLANT DURING ASSESSING PROCEEDINGS. IN CASE OF 10 LENDERS, NO CONFIRMATIONS WERE FILED A ND FOR OTHER 3 LENDERS, DETAILS FILED WERE EITHER INCOMPLETE OR DEFECTIVE. DURING THE REMAND PROCEEDINGS ALSO, NOT A SINGLE ADDITIONAL DETAIL WAS SUBMITTED BY APPELLANT IN RESPECT OF AFORESAID 13 PARTIES. IN THIS WAY, THE APPELLANT HAS FAILED TO FULFILL THE CONDITIONS AS STIPULATED BY SECTION 68 OF THE ACT IN RESPECT OF AFORESAID 13 PARTIES. 3.3.2 SO FAR AS THE UNSECURED LOANS MENTIONED IN SUB PART - I OF PART - II ARE CONCERNED, APPELLANT FILED THE FOLLOWING DETAILS: (A) COPIES OF CONFIRMATIONS (B) COPIES OF ACKNOWLEDGMENTS AND INCOME TAX RETURNS. (C) COPIES OF BALANCE SHEET FROM THE ABOVE DOCUMENTS FILED BY APPELLANT, IDENTITY, SOURCE OF FUNDS AND GENUINENESS OF TRANSACTIONS ARE EXPLAINED IN RESPECT OF CREDITORS FALLING IN THIS SUB PART AGGREGATING TO RS . 5,89,000/ - . THE A.O. ALSO HAS NOT DOUBTED THE ABOVE DOCUMENTS/EVIDENCE FILED BY APPELLANT. HE HAS O NLY QUESTIONED THE MANNER IN WHICH AFORESAID EV IDENCE/DOCUMENTS WERE FILED. T HE DOCUMENTS WERE ON RECORD. WHETHER THEY HAVE BEEN FI L ED BY ANY APPELLANT OR DIRECTLY THROUGH CREDITORS DOES NOT MAKE DIFFERENCE . THE A.O. SHOULD HAVE EXAMINED THE EVIDENCE FILED BY APPELLANT AND COMMENTED ABOUT THAT, BUT THE SAME HAS NOT BEEN DONE. HOWEVER, THE EXAMINATION OF AFORESAID EVIDENCE PROVES THE GEN UINENESS OF CASH CREDITORS AND LOANS ADVANCED BY THEM. I, THEREFORE, DELETE THE ADDITION TO THE EXTENT OF RS. 5,89,000/ - MADE BY A.O. 3.3.3 FURTHER, IN RESPECT OF CREDITORS FALLING UNDER SUB PART - II OF PART II , AGGREGATING TO RS.7,45,000/ - , APPELLANT FILE D THE DETAILS O F ONLY PANS AND THEIR WARD NOS. NO OTHER DETAILS ESTABLISHING THE CREDIT WORTHINESS AND GENUINENESS OF TRANSACTIONS IN RESPECT O F THESE CREDITORS HA VE BEEN FILE D I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 7 EITHER DURING ASSESSMENT PROCEEDINGS OR REMAND PROCEEDINGS. THE APPELLANT WAS GIVEN SUFFICIEN T OPPORTUNITY TO ESTABLISH THE GENUINENESS OF CREDITORS BY SU PPORTING WITH NECESSARY DOCUMENTARY EVIDENCE , BUT HE FAILED TO DO SO. IN ABSENCE OF ANY EVIDENCE TO ESTABLISH THE CREDIT WORTHINESS OF AFORESAID CREDITORS AND GENUINENESS OF TRANSACTION MADE BY THEM, CASH CREDITORS CANNOT BE TREATED AS EXPLAINED . THERE ARE PLETHORA OF JUDGMENTS OF DIFFERENT COURTS WHICH SAY THAT ONUS IS ON ASSESSEE TO PROVE THE CREDIT WORTHINESS OF CREDITORS AND GENUINENESS OF TH E TRANSA CTIONS MADE WITH THEM. THE A.O. IN HIS R EMAND REPORT HAS ALSO MENTIONED THESE JUDGMENTS . HERE THE APPELLANT HAS FAILED TO DISCHARGE HIS ONUS AS CASTED UPON HIM BY THE JUDGMENTS OF DIFFERENT COURTS. I, THEREFORE, HOLD THAT THE CASH CREDITS AGGREGATING TO RS. 7,45,000/ - ARE UNEXPLAINED U/S. 68 O F THE ACT. 3.3.4 IN TOTALITY, THE APPELLANT GETS RELIEF OF RS. 5,89,000/ - AND ADDITION OF RS. 9 , 83,000/ - (RS. 7,45,000+ RS. 2,38,000/ - ) IS CONFIRMED AS UNEXPLAINED CA SH CREDIT U/S. 68 OF THE ACT. T HIS GROUND IS PARTLY ALLOWED. 6. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL CONTENDED THAT LD. CIT(A) HAS ERRED IN CONFIRMING THE AD DITION TO THE EXTENT OF RS. 9,83 ,000/ - . HE ALSO FURNISHED PAPER BOOK CONTAINING INFORMATION REGARDING PARTICULARS O F UNSECURED LOAN, CONFIRMATIONS FIL ED ON 29 - 12 - 2009, PARTICULARS OF UNSECURED LOANS , ETC AND RELIED UPON THE JUDICIAL PRONOUNCEMENT OF GUJARAT HIGH COURT IN THE CASE OF RANCHHOD JIVABHAI NAKHAVA (2012) 208 TA XMAN 35 (GUJARAT) . ON THE OTHER HAND, LD. D.R. SUPPORTED THE ORDER OF LD. CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. WE NOTICED THAT LD. CIT(A) HAS PROVIDED RELIEF TO THE EXTENT OF RS. 5,89,000/ - TO THE ASSESSEE FROM THE ADDITION MADE BY TH E ASSESSING OFFICER AS STATED SUPRA IN THIS ORDER ON THE BASIS OF PRIMARY I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 8 INFORMATION FURNIS HED BY THE ASSESSEE. WE HAVE ALSO PERUSED THE JUDICIAL PRONOUNCEMENT RELIED UPON BY THE LEARNED COUNSEL I N THE CASE OF COMMISSIONER OF INCOME TAX V RANCHHOD JIVABHAI NAKHAVA (GUJARAT) AND FIND THAT FACTS OF THIS CASE ARE DISTINGUISHABLE FROM THE CASE OF T HE ASSESSEE. IN THAT CASE DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAD PRODUCED CONFIRMATION LETTERS FROM THREE DEPOSITORS , PHOTOCOPY OF THEIR PAN CARD , PASSBOOKS AND FURTHER THE ASSESSEE HAD RECEIVED LOANS BY ACCOUNT PAYEE CHEQUE S. IN THAT CASE DURING CROSS EXAMINATION BOTH THE LENDERS HAD CONF I RMED GIVING LOAN TO THE ASSESSEE , EXPLAINED SOURCE OF THE MONEY AND MADE INCONSISTENT STATEMENTS . ALL THOSE PERSON S WERE NOT ONLY HAVING PAN CARDS BUT THEY WERE ALSO ASSESSED TO INCOME TAX . UNDER T HESE CIRCUMSTANCES THE HON'B LE HIGH COURT OF GUJARAT STATED THAT THE ASSESSEE CANNOT BE ASKED TO PROVE THE SOURCE OF MONEY WITHO U T FURTHER VERIFYING SUCH FACTS FROM THE INCOME TAX RETURN OF THE CREDITORS . ON THE OTHER HAND , I N THE CASE OF THE ASSESSEE W E HAVE NOTICED THAT LEARNED CIT (A) HAS DELETED THE ADDITION TO THE EXTENT OF RS.5 , 89 , 000/ ON THE BASIS OF SU B SEQUENTLY FURNISHING OF BASIC INFORMATION BY THE ASSESSEE LIKE LOAN CONFIRMATION LETTERS , COPIES OF BALANCE SHEET, COPIES OF ACKNOWLEDGMENT OF I NCOME AND INCOME TAX RETURNS ON THE GROUND THAT IN THESE CASES THE ASSESSING OFFICER SHOULD HAVE FURTHER EXAMINED ON THE BASIS OF THE EVIDENCE S FILED BY THE ASSESSEE . WHEREAS IN THE REMAINING CASES THE A SSESSEE HAS FAILED TO FILE EVEN THE BASIC INFORMATION LIKE CONFIRMA TION LETTERS FROM THE LENDERS BEFORE THE LEARNED CIT (A) OR BEFORE THE ASSESSING OFFICER EV EN FAILED TO FURNISHED THE SAME DURING THE COURSE OF REMAND I.T.A NO. 1614 /AHD/20 14 A.Y. 2007 - 08 PAGE NO RAMNARAYAN NAYAN YADAV VS. ACIT 9 PROCEEDIN G. THESE FACTS INDICATE THAT THE ASSESSEE FAILED TO DI SCHARGE EVEN THE PRIMARY ONUS C A ST UPON HIM UNDE R SECTION 68 OF THE ACT. IT IS EVIDENT FROM THE FACTS NARRATED ABOVE THAT THE ASSESSEE FAILED TO PROVIDE PRIMARY EVIDENCE S ON THE BASIS OF WHICH FURTHER ACTIONS COULD BE INITIATED BY THE ASSESSING OFFICER TO PROVE THE IDENTITY, GENUINENESS AND CREDITWOR T HINESS OF THE CASH CREDIT AS PER THE PROVISION OF SECTION 68 OF THE ACT. AFTER CONSIDERING THE FACTS AND FINDINGS AS SUPRA , WE DO NOT FIND ANY REASON TO INTERFERE IN THE DETAILED FINDINGS OF THE LEARNED CIT (A) . THEREFORE , THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 20 - 03 - 201 7 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 20 /03/2017 / COPY OF ORDER FORWARDED TO: - 1. ASSES SEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,