VASANT RAMJI SAVLA, MUMBAI V. ASST CIT 18((1), MUMBAI

ITA 1633/MUM/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 4382 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 09-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV GUBGOTRA
• Assessee Lawyers: DHAMESH SHAH
• Keywords: Unexplained cash credit; Bogus loan
• Section: 142(1); 133(6); 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'F' BENCH, MUMBAI BEFORE SHRI RAJESH KUMAR, ACCOUNTANT MEMBER AND SHRI AMARJIT SINGH, JUDICIAL MEMBER ITA NOS. 1633, 1634 & 1637/MUM/2017 (ASSESSMENT YEARS: 2010-11, 2012-13 & 2013-14) SHRI VASANT RAMJI SALVA PLOT NO. 170, RAWAL SEA VIEW 1ST FLOOR, M.B. RAUT ROAD SHIVAJI PARK, DADAR MUMBAI 400028 VS. A C I T - 18(1) PIRAMAL CHAMBERS LALBAUGH, PAREL, MUMBAI PAN AMKPS7067B APPELLANT RESPONDENT APPELLANT BY: SHRI DHAMESH SHAH RESPONDENT BY: SHRI RAJEEV GUBGOTRA DATE OF HEARING: 04.10.2018 DATE OF PRONOUNCEMENT: 31.10.2018 O R D E R PER RAJESH KUMAR, AM THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AG AINST THE ORDER OF THE CIT(A)-33, MUMBAI AND THEY RELATE TO ASSESSMENT YEARS 2010-11, 2012-13 AND 2013-14. ITA NO. 1633/MUM/2017 A.Y. 2010-11 2. THE ONLY GROUND RAISED BY THE ASSESSEE IS AGAINST T HE ORDER OF THE CIT(A) UPHOLDING THE ORDER OF THE AO THEREBY CONFIR MING THE ADDITION OF ` 2,27,50,000/- U/S 68 OF THE ACT (HEREINAFTER 'THE A CT') BEING THE AMOUNT OF UNSECURED LOANS TAKEN DURING THE YEAR FROM VARIO US PARTIES ON THE GROUND THAT THE CREDITWORTHINESS OF THE LENDERS WER E NOT ESTABLISHED WHEREAS THE LENDERS HAVE DULY ACCEPTED THE NOTICES UNDER SECTION 133(6) OF THE ACT ISSUED BY THE AO DURING THE REMAND PROC EEDINGS AND HAS CONFIRMED THE LOANS. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED HIS RETURN OF INCOME ON 30.07.2010 DECLARING AN INCOME OF ` 24,85,590/-. THE CASE OF ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 2 THE ASSESSEE WAS SELECTED UNDER CASS AND NOTICE UND ER SECTIONS 143(2) AND 142(1) OF THE ACT WERE DULY ISSUED AND SERVED U PON THE ASSESSEE. THE ASSESSEE IS DERIVING INCOME BY WAY OF SALARY FROM P RIVATE COMPANIES, HOUSE PROPERTY, INTEREST AND DIVIDEND, ETC. THE AO, ON THE BASIS OF AIR INFORMATION, OBSERVED THAT THE ASSESSEE HAS RECEIVE D HUGE UNSECURED LOANS TO THE TUNE OF ` 2,66,35,000/- AND ACCORDINGLY THE ASSESSEE WAS ASKED TO CONFIRM THE LOANS WITH SUPPORTING COPIES OF BANK STATEMENTS AND OTHER EVIDENCES TO PROVE THE GENUINENESS AND CREDIT WORTHINESS OF THE LENDERS. THE ASSESSEE FILED BEFORE THE AO THE BANK STATEMENTS, ITRS, CONFIRMATIONS AND PAN ETC. AFTER VERIFYING VARIOUS RECORDS AND CONFIRMATIONS INCLUDING THE BANK STATEMENTS, THE AO CAME TO THE CONCLUSION THAT 3 PARTIES, I.E. LABH CREATIONS, LABDHI CORPORATION AND ADITYA TEXTILES HAVE LOANED THE MONEY OUT OF THEIR OVER DRAFT ACCO UNT WITH CKP CO-OPERATIVE BANK LTD. AND ACCORDINGLY THE ASSESSEE WAS GIVEN BENEFIT OF ` 38,85,000/- WHILE THE REMAINING LOANS AGGREGATING T O ` 2,27,50,000/- WERE TREATED AS UNEXPLAINED CASH CRED IT UNDER SECTION 68 OF THE ACT AND ADDED TO THE INCOME OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE HAS FAILED TO DISCHARGE THE ONUS IN PROVIN G THE CREDITWORTHINESS AND GENUINENESS OF THE LOANS. 4. IN APPELLATE PROCEEDINGS THE LEARNED CIT(A) DISMISS ED THE APPEAL OF THE ASSESSEE, AFTER CONSIDERING VARIOUS CONTENTIONS AND SUBMISSIONS OF THE ASSESSEE AND ALSO THE REMAND REPORT CONFIRMING THE LOAN TRANSACTIONS, BY OBSERVING AND HOLDINGS AS UNDER: - 21.4 AS OBSERVED FROM THE ASSESSMENT ORDER IN PARA 4.6 THAT THE DEPARTMENT HAS MADE ALL OUT EFFORTS TO LOCATE THE L ENDERS BUT THE LENDERS ARE NOT FOUND AVAILABLE AT THE GIVEN ADDRES S. AS A RESULT OF THIS, THE APPELLANT WAS GIVEN THE OPPORTUNITY TO PR ODUCE THE LENDERS TO ASCERTAIN THEIR IDENTITY AND CREDITWORTHINESS. HOWE VER, THE APPELLANT FAILED IN HIS DUTY TO PRODUCE THE PERSONS FOR VERIF ICATION OF THE AO. NO DOUBT, DURING REMAND PROCEEDINGS, IT IS REPORTED BY THE AO THAT IN RESPONSE TO NOTICES ISSUE U/S 133(6) OF THE ACT, RE PLIES WERE RECEIVED FROM MOST OF THE PERSONS, STILL THE CREDITWORTHINES S OF THE SUCH ALLEGED LENDERS ARE NOT ESTABLISHED BEFORE THE DEPARTMENT. THEREFORE, IN MY OPINION, THE APPELLANT HAS NOT DISCHARGED HIS ONUS AS HELD IN VARIOUS JUDICIAL DECISIONS AND IT CANNOT SHIFT HIS BURDEN A ND DICTATE THE AO TO ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 3 SUMMON THE LENDERS WHEN SUCH LENDERS ARE TREATED AS WITNESSES OF THE APPELLANT. 22. SINCE ESTABLISHING THE CREDITWORTHINESS OF THE LENDERS BY THE APPELLANT IS A CRUCIAL FACTOR TO ESTABLISH GENUINEN ESS OF THE LOAN, WHICH THE APPELLANT HAS FAILED COMPLETELY, IT IS AB UNDANTLY CLEAR THAT THE UNSECURED LOANS TO THE EXTENT OF RS. 2,27,50,00 0/- CANNOT BE HELD TO BE GENUINE HENCE, THE ADDITION OF RS. 2.27 , 50.000/- MADE U/S 68 OF THE IT. ACT IS CONFIRMED. HENCE, GROUNDS OF APPE AL NO. 2 AND 3 ARE DISMISSED. 5. THE LEARNED A.R. VEHEMENTLY SUBMITTED BEFORE US THA T THE FIRST APPELLATE AUTHORITY COMPLETELY IGNORED THE FACTS ON RECORDS SUCH AS LOAN CONFIRMATIONS, BANK STATEMENTS AND OTHER EVIDENCES FILED BY THE ASSESSEE AND ALSO THE REMAND REPORT SUBMITTED BY THE AO AND REPLIES TO THE NOTICES ISSUED UNDER SECTION 133(6) OF THE ACT. THE LEARNE D A.R. SUBMITTED THAT THE LEARNED CIT(A) HAS CITED VARIOUS REASONS FOR NO T ACCEPTING THE LOANS AS GENUINE IN PARA 20 OF HIS ORDER. THE LEARNED A.R., WHILE CONTROVERTING THE FINDINGS OF THE LEARNED CIT(A) ON EACH AND EVERY PO INT ON WHICH THE LEARNED CIT(A) DISBELIEVED AND DOUBTED THE TRANSACT IONS OF LOANS SUBMITTED THAT THE ASSESSEE HAS FILED ALL THE EVIDENCES IN TH E FORM OF CONFIRMATION LETTERS, BANKS STATEMENTS, ITRS, BALANCE SHEETS AND COPIES OF PAN CARDS IN ORDER TO PROVE THE IDENTITY AND CREDITWORTHINESS AN D GENUINENESS OF THE LENDERS. IN PARA 20(3) THE CIT(A) DOUBTED THE TRANS ACTIONS ON THE BASIS THAT THE LENDER, NAMELY SHRI PRATAP DAMA, WHO DEPOS ED BEFORE THE DEPARTMENT UNDER SECTION 131 OF THE ACT HAS NOT EVE N A HOUSE TO LIVE BUT THE LEARNED A.R. STRONGLY REVERTED THE FINDING OF T HE CIT(A) ON THE GROUND THAT THE SAID PERSON IS ONLY 38 YEARS OF OLD AND IS STAYING WITH HIS FAMILY. ANOTHER REASON CITED BY THE CIT(A) IS THAT ALL THE LENDERS WERE FOUND TO HAVE BEEN MAINTAINING THEIR ACCOUNTS WITH CORPORAT ION BANK, GHATKOPAR (W) BRANCH WHICH WAS STRONGLY REBUTTED BY THE LEAR NED A.R. BY INVITING THE ATTENTION OF THE BENCH TO THE FACT THAT 16 LEN DERS WERE FROM GHATKOPAR AND THEREFORE IT IS QUITE LIKELY THAT THE SAID PERSONS ARE HAVING THEIR ACCOUNTS IN CORPORATION BANK, GHATKOPAR (W) B RANCH. THE LEARNED A.R. ALSO ADVANCED ANOTHER ARGUMENTS THAT IN MUMBAI A PERSON RESIDING IN ONE LOCALITY WHEREAS HE IS HAVING BANK ACCOUNT A T DIFFERENT LOCALITY AND THAT IS NOT THE BASIS FOR TREATING THE LOAN TRANSAC TIONS AS NON GENUINE AND ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 4 DOUBTFUL. FURTHER THE LEARNED A.R. SUBMITTED THAT T HE CIT(A) HAS ALSO DOUBTED IN PARA 20(5) THAT THERE WAS NO TRANSACTION IN THE BANK OF THE ASSESSEE AND ONLY A FEW DAYS PRIOR TO THE LOAN TO T HE ASSESSEE SOME TRANSACTIONS WERE THERE WHICH WAS CONTROVERTED BY T HE LEARNED A.R. BY SUBMITTING THAT THERE IS NO TRANSACTION IN CASH EIT HER BEFORE OR AFTER THE DATE OF LOAN TO THE ASSESSEE AND THE MONEY HAS COME THROUGH RTGS OR CHEQUE AND POSSIBLY THROUGH THE ASSESSEES OWN ACCO UNTS AND THE AUTHORITIES BELOW HAVE FAILED TO ESTABLISH ANY TRAN SFER OF MONEY OR MONEY TRAIL BETWEEN THE ASSESSEE AND LENDERS. THE LEARNE D A.R. ALSO STATED THAT THE CIT(A) DOUBTED THE TRANSFER ON THE BASIS THAT IN THE CASE OF 41 LENDERS OUT OF 47 THERE IS ONLY ONE INTRODUCER IN THE BANK AND THIS IS NOT A BASIS FOR TREATING THE TRANSACTION AS NON GENUINE. THE LE ARNED A.R. ALSO SUBMITTED THAT THE CIT(A) HAS DOUBTED THAT THE INCO ME TAX RETURNS OF THE LENDERS AS THE SAME COULD NOT BE SCRUTINISED DESPIT E BEING FILED BEFORE THE AO AND THEREFORE SUBMITTED THAT IT IS NOT THE FAULT OF THE ASSESSEE THAT THE RETURNS OF THE LENDERS COULD NOT BE SCRUTINISED BY THE DEPARTMENT. 6. THE LEARNED A.R., WHILE REFERRING TO PAGES 17 TO 22 OF THE PAPER BOOK, SUBMITTED THAT THE LENDERS HAVE RESPONDED TO THE NO TICES UNDER SECTION 133(6) OF THE ACT ISSUED BY THE AO. THE LEARNED A.R . SUBMITTED THAT IN ALL THESE CASES THE LOANS WERE REPAID BY WAY OF ACCOUNT PAYEE CHEQUES. THE LEARNED A.R. FURTHER SUBMITTED THAT THE DOUBT OF TH E REVENUE AUTHORITIES IS BASELESS AND WITHOUT ANY REASON ESPECIALLY IN VIEW OF THE FACT THE ASSESSEE HAS DULY PAID INTEREST ON THE SAID LOANS AFTER DEDU CTION OF TDS AND THE REVENUE AUTHORITIES HAVE NOT DISPUTED THE INTEREST AMOUNT AND WAS ACCEPTED . THE LEARNED A.R. CONTENDED THAT HOW THE REVENUE AUTHORITIES CAN ACCEPT THE INTEREST ON LOAN WHEREAS TREATING TH E LOANS ITSELF AS NON GENUINE AND DOUBTFUL TRANSACTIONS. THE LEARNED A.R. RELIED HEAVILY ON THE FOLLOWING JUDGEMENTS IN DEFENCE OF HIS ARGUMENTS TH AT ONCE THE ASSESSEE HAS FILED ALL THE EVIDENCES SUCH AS CONFIRMATIONS , PAN, BANK STATEMENTS , ITRS AND FINANACIAL STATEMENTS OF THE LENDERS , NO ADDITION COULD BE MADE U/S 68 OF THE ACT : - I) CIT VS. ORISSA CORPORATION PVT. LTD. 159 ITR 78 (SC ) ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 5 II) CIT VS. RANCHHOD JIVABHAI NAKHAVA 21 TAXMANN.COM. 1 59 (GUJ) III) LABH CHAND BOHRA VS. ITO 219 CTR 571 (RAJ) IV) GOLDEN REMEDIES (P) LTD. VS. ITO 28 SOT 260 (DEL-TR IB) V) SHRI RAKESH KUMAR BHARAGAVA VS. ITO ITA NO. 3432/DE L/2015 DATED 17.09.2015 VI) UMESH ELECTRICALS VS. ACIT 131 ITD 128 (AGRA-TRIB) (TM) VII) CIT VS. KAMALJEET SINGH 147 TAXMAN 18 (ALL) VIII) CIT VS. SMT. P.K. NOORJAHAN 237 ITR 570 (SC) THE LEARNED A.R. SUBMITTED THAT SINCE THE ASSESSEE HAS SUFFICIENTLY DISCHARGED THE ONUS CAST UPON IT BY FILING ALL THE DOCUMENTS AS REQUIRED BY THE AO AND CIT(A) SUCH AS LOAN CONFIRMATION, COPY O F ITRS, BANK STATEMENT, LENDERS PAN AND ADDRESS AND THEREFORE IT IS FOR THE REVENUE TO CARRY OUT INVESTIGATIONS. FINALLY THE LEARNED A.R. PLEADED THAT IN VIEW OF THE FACTS OF THE ASSESSEE AND THE RATIO LAID DOWN I N VARIOUS JUDICIAL DECISIONS AS CITED ABOVE THE CASE OF THE ASSESSEE M AY KINDLY BE ALLOWED. 7. THE LEARNED D.R., ON THE OTHER HAND, RELIED HEAVILY ON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT BOTH THE A UTHORITIES BELOW HAVE UNEQUIVOCALLY PROVED THAT THE SAID LOANS WERE NOT G ENUINE AND WERE DOUBTFUL AS THE VARIOUS ATTENDANT CIRCUMSTANCES CLE ARLY POINTED TOWARDS NON GENUINENESS AND SUSPICIOUS NATURE OF THE LOANS. THE LEARNED CIT(A) CLEARLY BROUGHT OUT ALL THE FACTS WITH DETAILED REA SONING AND THEREFORE THE ORDER OF THE LEARNED CIT(A) SHOULD BE AFFIRMED. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORDS CAREFULLY INCLUDING THE IMPUGNED ORDER AND VARIOUS CASE LAWS CITED BY THE ASSESSEE. WE FIND THAT THE ASSESSEE HAS FILED COPIE S OF CONFIRMATION LETTERS, BANK STATEMENT, LENDERS ITRS, PAN AND ADDRESSES, S O THE PRIMARY ONUS BY THE ASSESSEE WAS DULY DISCHARGED AND THEREAFTER THE ONUS SHIFTS TO REVENUE AUTHORITIES TO CARRY OUT NECESSARY INVESTIG ATIONS, WHICH WE OBSERVE THAT HAS NOT BEEN DONE. WE FURTHER FIND THA T THE NOTICES ISSUED UNDER SECTION 133(6) OF THE ACT IN ORDER TO VERIFY THE LOAN TRANSACTIONS WERE RESPONDED AND REPLIED BY THE LENDERS, COPIES O F WHICH WERE PLACED IN THE PAPER BOOK . A PERUSAL OF THE ORDER OF THE CIT( A) REVEALS THAT THE ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 6 VARIOUS REASONS CITED BY THE CIT(A) IN PARA 20 OF T HE APPELLATE ORDER WERE SPECIFICALLY REBUTTED BY THE LEARNED A.R. WHICH AP PEARS TO BE QUITE JUSTIFIABLE. OUT OF THE TOTAL LENDERS 16 WERE FROM GHATKOPAR BUT CIT(A) DOUBTED THE TRASACTIONS ON THIS BASIS ALSO. MOREOVE R, OPENING OF ACCOUNT IN ONE BANK COULD NOT BE A BASIS FOR DOUBTING THE TRAN SACTIONS. WE FURTHER OBSERVE THAT THE REVENUE AUTHORITIES HAVE NOT DISPU TED THE INTEREST PAID DURING THE YEAR WHICH IS DULY PAID/DISCHARGED BY T HE ASSESSEE AFTER DEDUCTING TAX AT SOURCE. IT IS VERY SURPRISING AND STRANGE THAT THE REVENUE HAS ACCEPTED INTEREST ON LOAN BUT THE GENUINENESS W AS DOUBTED WHICH APPEARS TO BE FALLACIOUS AND WRONG. THE CASE OF THE ASSESSEE IS SUPPORTED BY A SERIES OF DECISIONS SUCH AS IN THE CASE OF CIT VS. ORISSA CORPORATION PVT. LTD. (SUPRA) WHEREIN THE HON'BLE SUPREME COURT HAS HELD THAT WHERE THE ASSESSEE HAS GIVEN NAMES AND ADDRESSES OF THE A LLEGED CREDITORS AND THE SAID CREDITORS WERE IN THE KNOWLEDGE OF THE REV ENUE AUTHORITIES TO BE INCOME TAX ASSESSEES AND THEIR INDEX NUMBERS WERE I N THE FILE OF REVENUE, THE REVENUE DID NOT PURSUE THE MATTER FURTHER APART FROM ISSUING NOTICES UNDER SECTION 131 OF THE ACT. THE HON'BLE COURT HAS HELD THAT THE REVENUE DID NOT EXAMINE THE SOURCE OF INCOME OF THE SAID AL LEGED CREDITORS TO FIND OUT WHETHER THEY WERE CREDITWORTHY OR WERE SUCH WHO COULD ADVANCE THE ALLEGED LOANS. THUS THERE WAS NO EFFORT MADE TO PUR SUE THE SO CALLED ALLEGED CREDITORS. THE COURT FURTHER HELD THAT IF TRIBUNAL CAME TO THE CONCLUSION THAT THE ASSESSEE HAS DISCHARGED THE BUR DEN THEY LAY ON HIM, THEN IT COULD NOT BE SAID THAT SUCH A CONCLUSION WA S UNREASONABLE OR PERVERSE OR BASED ON NO EVIDENCE. 9. IN THE CASE OF RANCHHOD JIVABHAI NAKHAVA (SUPRA) TH E HON'BLE GUJARAT HIGH COURT HAS HELD THAT ONCE THE ASSESSEE HAS ESTABLISHED THAT HE HAS TAKEN MONEY BY WAY OF ACCOUNT PAYEE CHEQUES FROM THE LENDERS WHO ARE ALL INCOME TAX ASSESSEES WHOSE PAN HAVE BEE N DISCLOSED, THE INITIAL ONUS UNDER SECTION 68 OF THE ACT WAS DISCHA RGED. THEN IT IS THE DUTY OF THE AO TO FIND OUT WHETHER IN THEIR RESPECTIVE R ETURNS THEY HAS SHOWN EXISTENCE OF SUCH AMOUNT OF MONEY AND HAD FURTHER S HOWN THAT THOSE AMOUNT OF MONEY HAD BEEN LENT TO THE ASSESSEE. ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 7 10. SIMILARLY IN THE CASE OF LABCHAND BOHRA (SUPRA) THE HON'BLE RAJASTHAN HIGH COURT HAS HELD THAT WHERE THE IDENTI TY OF THE CREDITOR HAVE BEEN ESTABLISHED AND THEY HAVE CONFIRMED THE CREDIT S BY MAKING STATEMENTS ON OATH AND AMOUNT HAS BEEN ADVANCED BY ACCOUNT PAYEE CHEQUE, THE ADDITION IN RESPECT OF THE ENTRIES CANN OT BE SUSTAINED. 11. IN THE CASE OF GOLDEN REMEDIES P. LTD. (SUPRA) THE DELHI BENCH OF THE TRIBUNAL HELD THAT WHERE THE LOANS WERE ACCEPTED TH ROUGH ACCOUNT PAYEE CHEQUES AND HAD BEEN REPAID THROUGH ACCOUNT PAYEE C HEQUES, WHICH WERE ALSO CONFIRMED BY THE PARTIES AND THE ASSESSEE HAS ALSO PRODUCED BANK ACCOUNT AND PAN OF EACH PARTY TO SUPPORT HIS CASE, THE AO IS NOT JUSTIFIED IN TREATING THE TRANSACTIONS AS NON GENUINE AND NO ADDITION CAN BE MADE UNDER SECTION 68 OF THE ACT. 12. CONSIDERING THE FACTS IN TOTALITY IN THE LIGHT OF V ARIOUS JUDICIAL DECISIONS WHICH SQUARELY COVER THE CASE OF THE ASSE SSEE WE ARE INCLINED TO SET ASIDE THE ORDER OF THE CIT(A) BY HOLDING THAT T HE ASSESSEE HAS DULY DISCHARGED THE ITS ONUS BY FILING THE NECESSARY EVI DENCES BEFORE THE AUTHORITIES BELOW AND THEREFORE ADDITION BY THE AO U/S 68 OF THE ACT IS ORDERED TO BE DELETED. THE APPEAL OF THE ASSESSEE I S ALLOWED. ITA NO. 1634/MUM/2017 A.Y. 2012-13 13. THE ONLY ISSUE RAISED BY THE ASSESSEE IS WITH REGAR D TO CONFIRMATION OF ADDITION OF ` 27,97,283/- BY CIT(A) AS MADE BY THE AO ON ACCOUNT OF INTEREST PAID ON UNSECURED LOANS WHICH WERE TREATED AS BOGUS IN A.Y. 2010-11. 14. SINCE WE HAVE ALREADY DECIDED IN ITA NO. 1633/MUM/2 017 THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING THAT THE LOANS RAISED BY THE ASSESSEE WERE GENUINE, OUR FINDING IN THE ABOVE MENTIONED AP PEAL WOULD , MUTATIS MUTANDIS, WILL APPLY TO THIS APPEAL ALSO. AS A RESU LT, THE ISSUE OF INTEREST ON THE UNSECURED LOANS IS DECIDED IN FAVOUR OF THE ASSESSEE AND THE AO IS DIRECTED TO THE DELETE THE DISALLOWANCE. 15. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 8 ITA NO. 1637/MUM/2017 A.Y. 2013-14 16. THE ISSUE RAISED IN THE 1 ST GROUND OF APPEAL IS AGAINST CONFIRMATION OF ADDITION OF ` 20 LAKHS BY THE CIT(A) AS MADE BY THE AO ON ACCOUNT OF UNSECURED LOANS TAKEN FROM SMT. RACHANA RAVAN DURIN G YEAR BY TREATING THE SAME AS UNEXPLAINED CASH CREDIT FOR WANT OF CRE DITWORTHINESS OF THE LENDER. 17. IDENTICAL ISSUE HAS BEEN DECIDED IN ITA NO. 1633/MU M/2017 WHEREIN WE DELETED THE ADDITION AS MADE BY THE AO U /S 68 OF THE ACT. IN THE PRESENT CASE THE AO HAS ADDED ` 38 LAKHS AS UNEXPLAINED CASH CREDIT FOR THE REASON THAT THE ASSESSEE FAILED TO PROVE TH E GENUINENESS OF THE LOANS. THE CIT(A) PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY SUSTAINING PARTLY TO THE EXTENT OF ` 20 LAKHS BY OBSERVING THAT GENUINENESS OF THAT LOAN COULD NOT BE ACCEPTED GIVING SAME LOGIC AS DI SCUSSED IN AS WAS GIVEN QUA BOGUS LOANS IN A.Y. 2010-11. 18. THE LEARNED A.R. VEHEMENTLY SUBMITTED BEFORE US THA T ALL THE NECESSARY EVIDENCES REQUIRED TO PROVE THE GENUINEN ESS OF THE SAID LOAN WERE FURNISHED BEFORE THE AUTHORITIES BELOW. THE LE ARNED A.R. REFERRED TO PAGES 7,8,9 AND 10 OF THE PAPER BOOK, WHICH COMPRIS ED OF CONFIRMATION LETTER FROM THE LENDER, BANK STATEMENT EVIDENCING T HE PAYMENT BY THE LENDER. THE LEARNED A.R. SUBMITTED THAT THE ASSESSE E HAS DULY FILED PAN, ADDRESS AND BANK STATEMENT OF THE LENDER BEFORE THE AUTHORITIES BELOW AND THEREFORE IT IS FOR THE REVENUE AUTHORITIES TO CARR Y OUT FURTHER INVESTIGATIONS. IT WAS FURTHER SUBMITTED BY THE LEA RNED A.R. THAT THERE WAS NO CASH DEPOSIT PRIOR TO THE DATE OF LOAN TO THE AS SESSEE BY SMT. RACHANA RAVAN AND THEREFORE THE CONCLUSION OF THE AUTHORITI ES BELOW IS TOTALLY FALLACIOUS AND WRONG THAT THE LOAN TAKEN BY THE ASS ESSEE IS NOT GENUINE. WHILE REFERRING TO THE COPY OF BANK STATEMENT AS A TTACHED IN PAGES 9 AND 10 THE LEARNED A.R. SUBMITTED THAT THERE IS NO ENTR Y IN THE BANK STATEMENT WHICH IS OF SUSPICIOUS NATURE AND THE ASSESSEE HAS SUFFICIENT TRANSACTIONS IN HER BANK ACCOUNTS. THEREFORE TO TREAT THE LOAN A S NON GENUINE BY THE REVENUE AUTHORITIES IS TOTAL WRONG AND DEVOID OF M ERIT. FINALLY THE LEARNED A.R. SUBMITTED BEFORE THE BENCH THAT THE ASSESSEE H AS DISCHARGED HIS ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 9 ONUS BY FILING ALL THE NECESSARY EVIDENCES AND IT I S FOR THE REVENUE AUTHORITIES TO CARRY OUT NECESSARY INVESTIGATIONS. THE ORDER OF THE LEARNED CIT(A) CONFIRMING THE ORDER OF THE AO IS INCORRECT AS THE SAME IS BASED UPON PRESUMPTIONS AND SURMISES. FINALLY THE LEARNED A.R. RELYING ON THE DECISIONS AS CITED IN ITA NO. 1633/MUM/2017 SUPRA PRAYED BEFORE THE BENCH THAT THE APPEAL OF THE ASSESSEE MAY BE ALLOWE D AS THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE SAID DECISIONS. 19. THE LEARNED D.R., ON THE OTHER HAND, RELIED ON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT THE ASSESSEE C OULD NOT PROVE THE GENUINENESS OF THE SAID LOAN DESPITE BEING SPECIFIC ALLY ASKED TO DO SO. THE LEARNED D.R. STRONGLY OBJECTING TO THE ARGUMENTS OF THE LEARNED A.R. SUBMITTED THAT THE LOAN FROM SMT. RACHANA RAVAN WAS NOT GENUINE AS INCOME OF THE SAID LADY WAS VERY MEAGRE TO GIVE SUC H HUGE LOAN. THE LEARNED D.R., RELYING HEAVILY ON THE ORDER OF THE C IT(A), SUBMITTED THAT THE FIRST APPELLATE AUTHORITY HAS GIVEN VERY CONVINCING REASONS FOR TREATING THE LOAN AS DOUBTFUL IN PARA 45 OF THE APPELLANT ORDER. FINALLY THE LEARNED D.R. PRAYED BEFORE THE BENCH THAT IN VIEW OF THE AFORESA ID FACTS THE APPEAL OF THE ASSESSEE NEEDS TO BE DISMISSED. 20. AFTER HEARING BOTH THE PARTIES AND PERUSING THE REC ORD AND THE IMPUGNED ORDER WE OBSERVE THAT THE ISSUE IN THE PRE SENT APPEAL IS SIMILAR TO THE ISSUE RAISED IN ITA NO. 1633/MUM/2017 IN WHI CH WE HAVE DELETED THE ADDITION BY SETTING ASIDE THE ORDER OF THE CIT( A) ON THE GROUND THAT THE ASSESSEE HAS DISCHARGED ITS ONUS BY FURNISHING LOAN CONFIRMATIONS , BANK STATEMENTS , PAN AND ITS ETC. IN THE PRESENT CASE A LSO WE FIND FROM A PERUSAL OF THE RECORD BEFORE US IN THE FORM OF PAPE R BOOK THAT THE ASSESSEE HAS FILED ALL THE EVIDENCES BEFORE THE REVENUE AUTH ORITIES SUCH AS ITR, COPY OF BANK ACCOUNT, CONFIRMATION, AND THE PAN CARD OF THE LENDER. THEREFORE OUR FINDING IN ITA NO. 1633/MUM/2017 WOULD, MUTATIS MUTANDIS, APPLY TO GROUND NO. 1 OF THIS APPEAL. ACCORDINGLY WE SET ASI DE THE ORDER OF THE CIT(A) ON THIS ISSUE AND DIRECT THE AO TO DELETE TH E ADDITION OF ` 20 LAKHS. ITA NOS. 1633, 1634 & 1637/MUM/2017 SHRI VASANT RAMJI SALVA 10 21. THE ISSUE RAISED BY THE ASSESSEE IN THE 2 ND GROUND OF APPEAL IS AGAINST THE CONFIRMATION OF ADDITION OF ` 32,08,252/- AS MADE BY THE AO ON ACCOUNT OF INTEREST PAID ON UNSECURED LOAN WHICH HA S BEEN TREATED AS BOGUS DURING A.Y. 2010-11 UNDER SECTION 68 OF THE A CT. SINCE WE HAVE ALREADY DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSE E TREATING THE LOAN AS GENUINE AND THEREFORE THE INTEREST ON SUCH LOAN HAS TO BE ALLOWED, WHICH HAS ALSO BEEN DECIDED BY US IN ITA NO. 1634/-MUM/20 17. ACCORDINGLY WE DIRECT THE AO TO DELETE THE DISALLOWANCE OF INTERES T. THE APPEAL OF THE ASSESSEE IS ALLOWED. 22. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESS EE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST OCTOBER, 2018. SD/ - SD/ - (AMARJIT SINGH) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 31 ST OCTOBER, 2018 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -33, MUMBAI 4. THE PR.CIT - 21, MUMBAI 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.