Shri Haji Mohmmadsafi Abdulrehman Shaikh, Baroda V. The DCIT, Circle-3 (1), Baroda

ITA 1690/AHD/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 7193 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 07-07-2017
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHRIMS SON IA KUMAR
• Keywords: Bogus purchase; Unexplained cash credit; Depreciation; Additional evidence; Corroborative evidences; TDS
• Section: 143(3); 133(6); 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEFORE: SHR I AMARJIT SINGH , ACCOUNTANT MEMBER AND MS. MADHUMITA ROY , JUDICIAL MEMBER SHRI. HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH, FAIJILA APARTMENT, NEAR SULEMANI BANK, GENDIGATE ROAD, BARODA - 390001 PAN: ASCPS1485M (APPELLANT) VS THE D CIT, CIRCLE - 3( 1 ) , BARODA (RESPONDENT) REVENUE BY : SHRI/MS. SON IA KUMAR , SR. D . R. ASSESSEE BY: SHRI MUKUND BAKSHI, A.R. DATE OF HEARING : 12 - 03 - 2 019 DATE OF PRONOUNCEMENT : 10 - 04 - 2 019 / ORDER P ER : AMARJIT SINGH, ACC OUNTANT MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2012 - 13 , ARI SES FROM ORDER OF THE CIT(A) - 2, BARODA DATED 20 - 03 - 2 017 , IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF A PPEALS: 1. THE LD. CIT(A) - 2, VADODARA HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE LD. A.O. IN THE ADDITION MADE U/S. 68 OF THE ACT TO THE EXTENT OF RS.62,89,643/ - OUT OF THE TOTAL ADDITION OF RS. 1,36,37,643/ - TREATING THE PURCHASES MA DE BY THE APPELLANT AS NON - GENUINE AND BOGUS. THE ADDITION OF RS. 62,89,643/ - BEING IN COMPLETE DISREGARD OF AVAILABLE FACTS AND THE LAW IS PRAYED TO BE DELETED. I T A NO . 1690 / A HD/20 17 A SS ESSMENT YEAR 2012 - 13 I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 2 2. THE LD. CIT(A) - 2, VADODARA HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE LD. A.O. IN THE ADDITION MADE U/S. 68 OF THE ACT TO THE EXTENT OF RS.9,93,500/ - , OUT OF THE TOTAL ADDITION OF RS.27,71,517/ - TREATING THE CREDITS AS UNEXPLAINED. THE ADDITION OF RS.9,93,500/ - BEING IN COMPLETE DISREGARD OF AVAILABLE FACTS AND THE LAW IS P RAYED TO BE DELETED. 3. THE LD. CIT(A) - 2, VADODARA HAS ERRED IN CONFIRMING THE ACTION OF THE LD. A.O. IN DISALLOWANCE OF INTEREST OF RS.2,55,000/ - BEING INTEREST CHARGED IN EXCESS OF 12% P.A.. THE INTEREST DISALLOWED OF RS.2,55,000/ - MAY PLEASE BE PRAY ED TO BE ALLOWED AS CLAIMED. 4. THE LD. CIT(A) - 2, VADODARA HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF THE ID. A.O. IN MAKING ADHOC DISALLOWANCE OF RS. 5,91,648/ - (I.E. 20% OF RS.29,58,238/ - ) ON ACCOUNT OF VEHICLE RUNNING AND MAINTENANCE, INTEREST ON CAR LOAN AND CAR DEPRECIATION BY TREATING IT AS PERSONAL IN NATURE. THE DISALLOWANCE BEING ERRONEOUS IN LAW AND IN FACTS IS PRAYED TO BE ALLOWED AS CLAIMED. 3 . THE BRIEF FACT OF THE CASE IS THAT ASSESSEE HAS FILED RETURN OF INCOME ON 15 TH MAR CH, 2013 DECLARING TOTAL INCOME AT RS. 56 , 70 , 880/ - . SUBSEQUENTLY, THE CASE WAS SELECTED UNDER SCR UTINY BY ISSUING OF NOTICE U/S. 143(2) OF THE ACT ON 8 TH MARCH, 2013. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF BUILDER AND DEVELOPER. THE REMAIN ING FACT S PERTAINING TO THE ISSUES IN THE APPEAL ARE DISCUSSED AS UNDER: - GROUND NO. 1 (ADDITION ON ACCOUNT OF BOGUS PURCHASES ) 4. DURI NG THE COURSE OF ASSESSMENT , THE A SSESSING OFFICER HAS CALLED DETAIL OF PURC HASES EXCEEDING RS. 10 LACS PER PARTY MADE DURING TH E YEAR UNDER CONSIDERATION. THE ASSESSE HAS SUPPLIED THE AFORESAID INFORMATION. THEREAFTER, THE ASSESSING OFFICER HAS ASKED THE ASSESSE TO FURNISH THE CONFIRMATION FROM THE PARTIES F R O M WHOM THE PURCHASES EXCEEDING RS. 1 LACS WERE MADE DURING THE YEAR UN DER CONSIDERA TION. THE ASSESSING OFFICER STATED THAT ASSESSE HAS NOT FURNISHED CONFIRMATION FROM 10 PARTIES LISTED AT PAGE NO. 5 OF ASSESSMENT ORDER FROM WHOM THE ASSESSEE HAS CLAIM ED TO HAVE MADE PURCHASE TO THE AMOUNT OF RS. 6 0 , 17 , 719/ - DURING THE YEAR UNDER CONSIDERATION . T HE ASSESSING OFFICER HAS ALSO NOTICED THAT ASSESSEE HAS NOT FURNISHED PROPER CONFIRMATION F R O M TWO PA R TI ES FRO M WHOM THE A SSESSEE HAS MADE TOTAL PURCHASES TO THE AMOUNT OF R S. 76 , 19 , 924/ - DURING THE YEAR. I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 3 THEREFORE , THE ASSESSING OF FICER HAS STATED THAT IT IS NOT POSSIBLE TO ASCERTAIN THE GENUINENESS OF THE SE PURCHASE TRANSACTIONS , THEREFORE, ADDITION OF RS. 1 , 36 , 37 , 643/ - (RS. 60 , 17 , 719 + RS. 76 , 19 , 924/ - ) WERE MADE TR EAT ING THE AFORESAID PURCHASES AS UNEXPLAINED. GROUND NO. 2 ( ADDIT ION U/S. 68 OF THE ACT) 5. DURING THE COURSE OF ASSES SMENT, THE ASSESSING OFFICER A SKED THE ASSESSEE TO FURNISH CON FIRMATION, COPIES OF ACCOUNT OF UNSECURED LOAN , N AME, PAN, ADDRESS ES , ASSESSMENT DETAIL S, COPIES OF BANK STATEMENT, COPIES OF LEDGER ACCOUNT OF CREDITORS IN HIS BOOKS OF ACCOUNT. ON VERIFICATION OF THE DETAIL FILED, THE ASSESSING OFFICER STATED THAT ASSESSEE HAS FAILED TO FURNISH THE DETAIL IN RESPECT OF SIX PARTIES MENTIONED AT PAGE NO. 5 OF THE ASSESSMENT ORDER. THEREAFTER , ON VERIFICATION OF THE BANK STATEMENT OF THE FOLLOWING PARTI ES THE ASSESSING OFFICER NOTICED THAT THERE WERE FREQUENT CASH DEPOSIT S IN THEIR BANK ACCOUNT AS UNDER: - (1) SHRI ASIF ABDULREHMAN S HAIKH ON VERIFICATION OF CONFIRMATION OF SHRI ASIF ABDULREHMAN SHAIKH, IT IS FOUND THAT THE ASS ESSEE HAS CREDITED RS,9,93,500 / - ON ACCOUNT OF 'GJ 6 FD 9793 I - 20 FOR CAR SELLI NG.' DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS STATED - VIDE SUBMISSION DATED 26 /03/2O15 THAT TRANSACTIONS OF SALARY AND PURCHASES OF MOT OR CA R FROM ASIF ABDULREHRAAN SHAIKH. HOWEVER, THE ASSESSEE HAS NOT SHOWN THE SAM E CAR IN HIS BALANCE SH EET. FURTHER, THE ASSESSEE HAS SUBMITTED ANY EVIDENCE RELATED TO THE SELLIN G OF MO TOR CAR. MOREOVER, THE RETURN INCOME OF RS. ASIF ABDULREHMAN SHAIKH FO R A.Y. 2012 - 13 IS RS. 2,15,220/ - . IN ABSENCE OF PROPER JUSTIFICATION, IT HAS BECOME IMPOSSIBLE TO ASCERTAIN THE MODE OF TRANSACTION, GENUINENESS AND CREDITWORTHINESS OF THIS PARTY. THE ONUS LIED ON THE ASSESSEE TO PROVE THE SAME WHICH WAS NOT DISCHARGED BY THE ASSESSEE. THEREFORE, IT IS PROVED THAT AN AMOUNT OF RS. 9,93,500/ - AS MUTINIED ABOVE IS UNEXPLAINED CASH CREDIT AND THE SAME IS ADDED U/S. 68 OF THE ACT TO THE TOTAL INCOME OF THE ASSESSEE. (2) SHRI ROHAN SURJIBHAI BARNADA SHRI ROHAN SURJIBHAI BAR NADA HAS GIVEN LOAN TO THE ASSESSEE AMOUNTING RS. 10,00,000/ - ON 15/12/2011. THE RETURN INCOME OF SHRI ROHAN SURJIBHAI BARNADA FOR A.Y. 2012 - 13 IS RS. 2,15,220/ - . ON VERIFICATION OF BANK ACCOUNT NO. 060752590/ - IN THE NAME OF SHRI ROHAN SURJIBHAI BARNDA WITH BANK OF BARODA THE FOLLOWING CASH DEPOSITS WERE FOUND: - DATE PARTICULAR WITHDRAWAL DEPOSIT 02/08/2011 BY CASH 45000 09/08/2011 BY CASH 15000 I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 4 04/11/2011 BY CASH 10000 05/11/2011 BY CASH 20000 09/1 1/2011 BY CASH 20000 15/11/2011 BY CASH 10000 TOTAL 3,24,000 ON VERIFICATION OF THE BANK STATEMENT THAT HE HAS FREQUENTLY DEPOSITED CASH ACCO UNT TO GIVE LOAN TO THE ASSESAEE. MOREOVER, ON VERIFICATION OF THE RETURN OF INCOME, THE CREDIT - WORTHINESS OF SHRI ROHAN SURJIBHAI BARNDA IS ALSO NOT PROVED. FURTHER, THE SOURCE OF CASH DEPOSITS IS ALSO NOT PROVED. THEREFORE, THE LOAN TAKEN FROM SHRI MAYANK SURJIBHAI BARNDA OF RS.10,00,000/ - IS TREATED AS UNEXPLAINED CAS H.CREDITS AND IS ADDED TO TH E TOTAL INCOME OF THE ASSESSEE. FU RTHER, THE ASSESSEE HAS PAID INTEREST OF RS .35, 178/ - ON UNSECUR ED LOAN OF SHRI ROLIAA SU RJIB HAI BARNDA. THEREFORE, INTEREST PAID TO SH RI ROHAN SURJIBHAI BARNDA IS ALS O DISALLOWED AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. THEREFORE, TOTAL RS.10,35,178/ - IS ADDED TO THE TOTAL INCOME OF THE ASSESSEE. (3) SHRI MAYANK SURJIBHAI BARNDA SHRI MAYAAK SURJIBHAI BARNDA HAS GIVEN LOAN TO THE ASSESSEE AMOUNTING TO RS.6,86,000 | - ON 03/12/2011. THE RETURN INCOM E OF SHRI MAYANK SURJIBHAI BARNDA FOR A.Y. 2012 - 13 IS RS.2,24,420/ - . ON VERIFICATION OF BANK ACCOUNT NO. 0676010GK126 42 IN THE NAME OF SHRI MAYANK SURJIB HAI BARNDA WITH BANK OF BARODA, THE FOLLOWIN G CASH DEPOSITS WERE FOUND: - DATE PARTIC ULAR WITHDRAWAL DEPOSIT 10/06/2011 BY CASH 20000 02/08/2011 BY CASH 45000 09/08/2011 BY CASH 15000 17/08/2011 BY CASH 40000 04/11/2011 BY CASH 45 000 05/11/2011 BY CASH 35 000 09/11/2011 BY CASH 3 5000 - BY CASH 27000 - BY CASH 12000 - BY CASH 45000 30/11/2011 BY CASH 5000 TOTAL 3,24,000 I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 5 ON VERIFICATION OF THE BANK STATEMENT THAT HE HAS FREQUENTLY DEPOSITED CASH AMOU NT TO GIVE LOAN TO THE ASSESSEE. MOREOVER, ON VER IFICATION OF THE RETURN OF INCOME, THE CREDITW ORTHINESS OF SHRI MAYANK SURJIBHAI BARNDA IS ALSO NOT PROVED. FURTHER, THE SOURCE OF CASH DEPOSITS IS ALSO NOT PROVED. THEREFORE, THE LOAN TAKEN FROM SHRI MAYANK SURJIBHAI BARNDA OF RS.6,86,000 /' - IS TREATED AS UNEXPLAINED CAS H CREDIT AND IS ADDED TO THE TOTAL INCOME OF THE ASSESSES FURTHER, THE ASSESSEE HAS PAID INTEREST OF RS.56,839/ - ON UNSECURED LOAN OF SHRI MAYANK SURJIBHAI BARNDA, THEREFORE, INTEREST PAID TO SHRI MAYANK SURJIBHAI BAR NDA IS DISALLOWED A ND ADDED BACK TO THE TO THE INCOME OF THE ASSESSEE. THEREFORE, TOTAL RS.7,42,839/ - IS ADDED TO TH E TOTAL INCOME OF THE ASSESSEE. 6. SINCE THE ASSESSEE HAS FAILED TO PROVE THE GENUINENESS OF THE AFORESAID LOAN TRANSACTION S , THEREFORE, THE ASSESSING OFFICE R HAS ADDED THE TOTAL AMOUNT OF RS. 27 , 71 , 517/ - TREATING THE SAME AS UNEXPLAINED CASH CREDIT U/S. 68 OF THE ACT. GROUND NO. 3 ( DISALLOWANCE OF INTEREST PAID ON UNSECURED LOAN) 7. DURING THE COURSE OF ASSESSMENT ON VERIFICATION OF CONFIRMATION OF UNSECURED LOAN IN THE CASES OF DINABEN JAJEDA & SWETA B JADEJA, THE ASSESSING OFFICER HAS NOTICED THAT A SSESSEE HAS PAID INTEREST @ 24%, H OWEVER, TH E ASSESSEE HAS PAID INTEREST ON UNSECURED LOAN TO THE OTHER PARTIES @ 12%. T HEREFORE, THE ASSESSING OFFICER WAS OF TH E VIEW THAT ASSESSEE HAD PAID INTEREST TO THE AFORESAID TWO PARTIES IN EXCESS BY 12%. CONSEQUENTLY, THE ASSESSING OFFICER HAS DISALLOWE D THE CLAIM OF EXCESS INTEREST PAYMENT OF RS . 3,40,000/ - IN RESPECT OF ABOVE TWO PARTIES AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESEE. GROUND NO . 4 ( DISALLOWANCE O F DEPRECIATION ) 8. DURING THE COURSE OF ASSE SSMENT, THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAS CLAIMED MOTOR CAR EXPENSES TO THE AMOUNT OF RS. 29 , 58 , 238/ - DURING THE YEAR UNDER CONSIDERATION. ON VERIFICATION OF THE AFORESAID EXPENDITURE UNDER THE HEAD MOTOR CAR CLAIMED BY THE ASSESSEE, THE ASSESSING OFFICER OBSERVED THAT IN SU CH TYPE OF BUSINESS POSSIBILITY OF USE OF MOTOR CAR I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 6 FOR PERSONAL PURPOSE CANNOT BE RULED OUT. THEREFORE , HE HAS DISALLOWED 20% OF THESE EXPENSES TO THE AMOUNT OF RS. 5 , 91 , 648/ - AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 9. AGGRIEVED ASSESSEE HAS FILED APPEAL BEFORE THE LD. CIT(A) LD. CIT(A). IN RESPECT OF ADDITION ON ACCOUNT OF UNEXPLAINED PURCHASES, T HE LD. CIT(A) HAS PARTLY AL LOWED THE APPEAL OF THE ASSESSEE AND DELETED THE ADDITION OUT OF BOGUS PURCHASES TO THE EXTENT OF RS. 62 , 89 , 643/ - . THE RELEVANT PART OF THE DECISION OF THE LD. CIT(A) IS REPRODUCED AS UNDER : - 4.1. GROUND NO. 1. PERTAINS T O DISALLOWANCE OF EXPEN SES OF RS. L,36,37 , 643/ - BEING BOGUS PURCHASES. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO FURNISH DETAILS OF MORE THAN RS. 1,00,000/ - AND ACCORDINGLY THE DETAILS FU RNISHED WAS B Y THE ASSESSING OFFICER. THE N ASSESSING OFFICER REQUIRED TO FUR NISH CONFIRMATION FROM THE CREDITORS OF EXPENSES TO WHICH, THE ASSESSEE CONFIRMATION IN RESPECT OF 16 PARTIES. HOWEVER, IN RESPECT OF 10 PARTIES TOTALING TO PURCHASES MADE FROM THEM AMOUNTING TO RS.60,17 ,719/ - , NO CONFIRMATION WAS FILED. H OWEVER, THE CONFIRMATION FILED IN RESPECT OF 2 PARTIES, FROM, WHOM PURCHASES OF RS.76,19,924/ - WERE MADE, WAS NOT PROPER. ACCORDINGLY, THE PURCHASES TO THE TUNE OF RS.1,36,37,643/ - RS.60,17,719 + RS.76,19,92 4 ), WERE DISALLOWED. DURING THE C OURSE OF APPELLATE PROCEEDINGS , THE LD. AUTHORIZED REPRESENTATIVE HAS FURNISHED CERTAIN ADDITIONAL EVIDENCES WHICH HAVE BEEN EXAMINED BY THE ASSESSING OFFICER WHITE PREPAR ING REMAND REPORT AS REPRODUCED ABOVE. THE PURCHASES MADE FROM DIFFERENT PARTIES DISALLOWED BY THE ASSESSING OFFIC ER ARE BEING DISCUSSED AS UNDER - (I) T. SQUARE 2MEDIA : FROM PARTY, THE ASSESSEE HAS SHOWN PURCHASES OF RS.2,11,019/ - AND TO THE QUANTUM OF PURCHASES, THE ASSESSEE HAS FILED A LEDGER CLAIMED TO BE IN T HE BOOKS OF T. SQUARE MEDIA. UND OUB TEDLY, TH E NAME IS DIFFERENT FROM WHOM COPY OF ACCOUNT HAS TEEN FILED. TH E PERMANENT ACCOUNT NO. OF THE P ARTY AS WELL AS ANY OTHER PROOF OF IDENTITY HAS NOT BEEN FILED. THERE IS N O EVIDENCE AS TO WHETHER PARTY I S ASS ESSED TO TAX OR NOT. ACCORDINGLY, GENUINENESS OF PURCHASES FROM THIS PARTY IS NOT CONCLUSIVELY PROVED AND HENCE LIFE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS SUSTAINED. (II) MAA KRUPA SALES THE APPELLANT HAS NOT FURNISHED CONFIRMATION FR OM THIS PARTY FOR THE PURCHASES OF RS. 6,63,873/ - . ONLY A COPY OF ACCOUNT IN THE BOOKS OF APPEL LANT AND PURCHASE BILLS ALONG WITH BAN K STATEMENT HAVE BEEN FURNISHED. MERE BECAUSE, THE PAYMENT HAS BEEN MADE BY CHEQUE, GENUINENESS OF PURCHASES CANNO T BE CONSIDERED TO HAVE BEEN ESTABLISHED. WHEN THE ASSESSING OFFICER HAS DEMANDED CONFIRMATION, THE APPELLANT HAS TO FURNISH THE SAME. MOREOVER, THE IDENTITY AND EXISTENCE OF THIS PARTY HAS NOT BEEN PROVED BY THE APPELLANT AND ACCORDINGLY THE ALLEGED PURC HASES H AVE TO BE TREATED AS BOGUS AND HENCE THE DISALLOWANCE MADE IS CONFIRMED. (III) SOMANT MARBLE: THE APPELLANT HAS NOT FURNISHED CONFIRMATION FROM THIS PARTY FOR THE PUR CHASES OF RS.13,52,375/ - . ONLY A COPY OF ACCOUNT IN THE BOOKS OF APPELLANT AND PURCH ASE BILLS ALONG WITH BANK STATEMENT, HAVE BEEN, FURNI SHED. MERELY BECAUSE, THE PAYMENT HAS BEEN MADE BY CHEQUE, GENUINENESS OF PURCHASES CANNOT BE CONSIDERED TO HAVE BEEN ESTABLISHED. WHEN THE ASSESSING OF FICER HAS DEMANDED CONFIRMATION , THE APPELLANT HAS TO FURNISH THE SAME. MOREOVER, THE IDENTITY AND I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 7 EXISTENCE OF THIS PARTY HAS NO T BEEN PROVED BY THE APPELLANT ACCORDINGLY THE ALLEGED PURCHASES HAVE TO BE TREATED AS BOGUS AND THENCE THE DISALLOWANCSE MADE IS CONFIRMED. (IV) SHRENATH ALULATER: FROM THIS PARTY, THE APPELLANT SH OWN PURCHASES OF RS. 11 , 00,000/ - . TO SUPPORT THE CONTENTION OF PURCHASES, THE APPELLANT HAS FILED COPY OF T HE ACCOUNT OF ASSESSEE IN THE BOOKS OF SRINATH ELEVATORS. UNDOUBTEDLY, THERE IS VARIATION IN THE NAME. M O REOVER, NEITHER THE COPY OF BILLS NO R ANY OTHE R EVIDENCE TO ESTABLISH THE IDENTITY AND EXISTENCE OF THE PARTY BE EN FURNISHED. THUS, I HOLD THAT THAT PURCHASES T O THE EXTENT OF RS. 11,00,000/ - FROM THIS PARTY ARE NOT PROVED AND HENCE THE ADDTION IS SUSTAINED. (V) BHAVAN TILES: - FROM THIS PARTY, THE HAS CLAIME D PURCHASES OF RS.2,85,578/ - . HOWEVER, A BILL OF BHAVAN TILES WITHOUT ANY DATES HAS FURNISHED. NO OTHER PROOF TO PROVE THE IDENTITY AND EXITENCE OF BHAVAN TILES HAS BEEN FILED AND HENCE I H OLD THAT THE APPELLANT HAS FAILED TO PROVE PURCHASE OF TILES CONCLUSIVELY. THUS, THE DISALLOWANCE BY THE ASSESSING OFFICER AT RS.2,35,573/ - ON THIS ACCOUNT IS CONFIRMED. (VI) R.V. PATEL & ASSOCIATES: - THE ASSESSEE HAS CLAIMED PURCHASES FROM T HIS PARTY AT RS.2,20,600/ - . HOWEVER, THE COPY OF LEDGER ACCOUNT FURNISHED WHICH IS DULY CONFIRMED BY R.V. PATEL & ASSOCIATES, SHOWS CONSULTING CHARGES OF RS.5 00000 / - ONLY, THUS, IT IS CLEAR THAT EXPENSES ON THIS ACCOUNT WERE RS.50,000/ - ONLY AS AGAINST CLAIMED BY THE APPELLANT AT RS.2,20,600/ - . HENCE THE PURCHASES TO THE EXTENT OF RS.1,70,600/ - (RS.2,20,600 + RS.50,000), CLAIMED BY THE APPELLANT HAVE NOT BEEN CONFIRMED BY THE PARTY. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO ALLOW THE RELIEF TO THE EXTENT OF RS.50,000/ - AND BALANCE OF DISALLOWANCE AT RS.1,70,600/ - IS CONFIRMED. (VII) S. H. ENGINEERS : - THE APPELLANT HAS SHOWN PURCHASES AT RS.2,34,272/ - FROM THIS PARTY AND TO ESTABLISH HIS CLAIM, HE HAS FILED A HAND WR ITTEN DETAILS OF DEBIT AND CREDIT ENTRIES SIGNED BY SOMEONE ON BEHALF OF S.H. ENGINEERS. IT IS NOT KNOWN AS TO WHAT TYPES OF ITEMS WERE PURCHASED BY THE APPELLANT FROM THIS PARTY. THE IDENTITY AND EXISTENCE OF S.H. ENGINEERS HAS NOT BEEN ALSO PROVED CONCLU SIVELY BY FILING DOCUMENTARY EVIDENCES. THEREFORE, I HOLD THAT THE PURCHASES TO T HE EXTENT OF RS.2,34,272/ - REMAINED UNEXPLAINED AND HENCE THE DISALLOW ANCE MADE BY THE ASSESSING OFFICER IS CONFIRMED. (VIII) H.M. PATHAN: - NAME OF THIS PERSON SHOWN IN SUNDRY CREDITOR WITH BALANCE - OUTSTANDING AT RS.5,00 ,000/ - . ON VERIFICATION OF THE DETAILS FURNISHED, I T IS NOTICED THAT THE APPELLANT HAS SHOWN U NSECURED LOAN OF RS.5,00,000/ - ON 15.06.2011 BY TWO DIFFERENT RS.2,50,0 00/ - EACH . SINCE THE NAME OF THIS PERSON WAS SHOWN IN SUNDRY CREDITORS, THE INTENTION OF APPEAL IS VERY TO THE RELEVANT AS UNSECURED LOANS ARE SEPARATELY REQUIRED TO BE SHOWN IN THE BALANCE SHEET AND HE HAS ALSO SHOWN OTHER UNSECURED LOAN ACCORDINGLY. O NL Y A CONFIRMATION WITHOUT COMPLETE ADDRESS, PROOF OF IDENTITY AND CREDITWORTHINESS OF THE CREDITOR, HAS BEEN FILED. THE APPELLANT HAS NOT FURNISHED COPY OF HIS BANK STATEMENT AND ASSESSMENT PARTICULARS OF THE CREDITOR. ACCORDINGLY, I HOLD THAT THE BASIC R EQUIREMENTS OF SECTION 68 SUCH AS PROOF OF IDENTITY AND CREDITWORTHINESS AS WELL AS GENUINENESS OF TRANSACTION HAVE NOT BEEN PROVED. ACCORDINGLY, THE ADDITION TO THE EXTENT OF RS.5,00,000/ - IS CONFIRMED AS UNEXPLAINED CASH CREDIT U/S. 68 INSTEAD OF DISALLO WANCE OF PURCHASES. (IX) SIMWALA NASIM A.: NAME OF THIS PERSON WAS ALSO SHOWN IN SUNDRY CREDITOR WITH BALANCE OUTSTANDING WITH RS.4,50,000 / - . ON VE RIFICATION OF THE DETAILS FURNISH HED, IT IS NOTICED THAT THE APPELLANT HAS SHOWN UNSECURED LOAN OF RS.4,50,000 / - ON 13.02,2012. BY CHEQUE. SINCE THE NAME OF THIS PERSON WAS SHOWN IN SUNDRY CREDITORS, THE INTENTION OF APPELLANT IS VERY CLEAR TO HIDE THE RELEVANT FACTS AS UNSECURED LOANS ARE REQUIRED TO BE SHOWN IN THE BALANCE SHEET AND' FOE HAS ALSO SHOWN OTHER UNS ECURED LOAN ACCORDINGLY. ONLY A CONFIRMATION - WITHOUT COMPLETE ADDRESS, PROOF OF IDENTITY AND CREDITWORTHINESS OF THE CREDITOR,, HAS BEEN FILED. THE APPELLANT HAS NOT FURNISHED COPY OF HIS STATEMENT AND PARTICULAR S OF THE CREDITOR. ACCORDINGLY, I HOLD THAT THE BASIC REQUIREMENTS OF SE CTION 68 SUCH AS PROOF OF IDENTITY AND CREDITWORTHINESS AS WELL AS GENUINENESS OF TRANSACTI ON I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 8 HAVE NOT PROVED. ACCORDINGLY THE ADDI TION TO THE OF RS.4,50,00 0/ - IS CONFIRMED AS UNEXPLAINED CASH CREDIT U/S. 6 8 OF DISALLOWANCE OF PURCHASES. (X) MO. IBRAHLM ABDUL P.: - NAME OF THIS SHOWN I N SUNDRY CREDITOR WITH BALANCE OUTSTANDING WITH RS. 10,00,000/ - . ON VERIFICATION OF THE DETAILS FURNISHED, IT IS NOTICED THAT THE APPELLANT HAS SHOWN UNSECURED LOAN OF RS.10,00,000/ - ON 17.02.2012 AND 18.02.2012 BY TWO DIFFERENT CHEQUES OF RS. 50,00,000/ - EACH. SINCE THE NAME OF THIS PERSON WAS SHOWN IN THE SUNDRY CREDITORS, THE INTENTION OF APPELLANT IS VERY CLEAR TO HIDE THE RELEVANT FACTS AS UNSECURED LOANS ARE SEPARATEL Y REQUIRED TO BE SHOWN IN THE BALANCE SHEET AND THE HAS ALSO SHOWN OTHER UNSECURED LOAN ACCORDINGLY. ONLY A CONFIRMATION WITHOUT COMPLETE ADDRESS, PROOF OF IDENTITY AND CREDITWORTHINESS OF THE CREDITOR HAS FILED. THE APPELLANT HAS NOT FURNISHED COPY OF H IS BANK STATEMENT AND ASSESSMENT PARTICULARS OF THE CREDITOR. ACCORDINGLY, I HOLD THAT THE BASIC REQUIREMENT SO SECTION 68 SUCH AS PROOF OF IDENTITY AND CREDITWORTHINESS AS WELL AS GENUINENESS OF TRANSACTIONS HAVE NOT BEEN PROVED. ACCORDINGLY, THE ADDITI ON TO THE EXTENT OF RS. 10,00,000/ - IS CONFIRMED AS UNEXPLAINED CASH CREDIT U/S. 68 INSTEAD OF DISALLOWANCE OF PURCHASES. (XI) JUBIR HUSSSAIN U.: - THE APPELLANT HAS SHOWN PURCHASES OF RS. 73,48,000/ - FROM THIS PARTY. ON PERUSAL OF CO NFIRMED COPY OF CONTRACT GIVEN TO THE ABVOE MENTIONED PARTY. TO SUPPORT TH E CLAIM OF. EXPENDITURE, COPY OF RETURN OF SHRI JUBIR HUSSAIN U. HAS FILED WHEREIN HE HAS OFFERED CON NTRACT AND SUB - CONTRACT RECEIPT OF RS.73,48,000/ - WITH CONSEQUENTIA L CREDIT OF TDS AT RS.73,480/ - . THIS PARTY HAS SHOWN TOTAL INCOME OF RS. 1 4,46,770/ - TO THE RETURN OF INCOME FILED FOR THE YEAR UNDER CONSIDERATION. IN VIEW OF THESE DOCUME NTARY EVIDENCES PLACED, ON RECORD, THE EXPENDITURE INCURRED ON SUB - CONTRACT OF THE WORK, C ANNOT, B E CONSIDERED AS BOGUS AND HENCE NO DISALLO WANCE ON THIS ACCOUNT IS CALLED FOR. THE ASSESSING OFFICER IS ACCORDINGLY DIRECTED TO DELETE THE ADDITION MADE ON THIS ACCOUNT. (XII ) SAEETF PATCH. THE HAS SHOWN, PURCHA SES AT RS.2,71,924/ - FROM THIS PART Y AND TO ESTABLISH HIS CLAIM, HE HAS FILE D A HAND - WRITTEN DETAILS OF DEBIT AND CREDIT ENTRIES SIGNED BY SOMEONE ON BEHALF OF SAEED PATEL. IT IS NOT KNOW AS - TO WHAT TYPES OF ITEMS WERE PURCHASED BY THE APPELLANT FROM PARTY. THE IDENTITY AND EXISTEN CE OF SAEED PPATEL HAS NOT PROVED CONCLUSIVELY BY FILING DOC UMENTARY EVIDENCES. THEREFORE, I HOLD THAT THE PURCHASES TO THE EXTENT OF RS.2,71,9247 - REMAINED UNEXPLAINED AND HENCE T HE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS CONFIR M ED. 10. WE HAVE HEARD THE RIVAL CONTE NTIONS ON THIS ISSUE . WITH THE ASSISTANCE OF LD. REPRESENTATIVES, WE HAVE PERUSED THE MATERIAL ON RECORD. IT IS NOTICED THAT IN THE CASE OF T SQUARE 2MEDIA, THE LD. CIT(A) HAS SUSTAINED THE ADDITION ON UNACCOUNTED PU RCHASES TO THE AMOUNT OF RS. 2 , 11 , 019/ - AS THE GENUINENESS OF THE PURCHASES COULD NOT BE PROVED SINCE THE ASSESSEE HAS FAILED TO FURNISH ANY SUPPORTING RELEVANT EVIDENCES. THE LD. CIT(A) HAS ALSO SUSTAINED THE ADDITION ON ACCOUNT OF UNEXPLAINED PURCHASES TO THE AMOUNT OF RS. 6 , 63 , 873/ - MADE FROM MA A KRIPA SALES SINCE THE ASSESSEE HAS FAILED TO FILE THE CONFIRMATION AND OTHER DETAILS FROM THE AFORESAID PARTY IN RESPECT OF PURCHASE MADE DURING THE YEAR UNDER CONSIDERATION. THE LD. CIT(A) HAS ALSO I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 9 SUSTAINED THE ADDITION OF RS. 13,52,375/ - AS UNACCOUNTED PURCHASE MADE FROM THE SOMANI MARBLES ON THE GROUND THAT ASSESSEE HAS FAILED TO FURNISH THE RELEVANT SUPPORTING INFORMATION. THE LD. CIT(A) HAS ALSO SUSTAINED THE ADDITION OF RS. 11 LACS IN RESPECT OF PURCHA SES MA DE FROM SREENATH ALUL ATER AS THE ASSESSE HAS FAILED TO FURNISH THE SUPPORTING EVIDENCES TO EST ABLISHED THE GENUINENESS OF THE PURCHASES MADE FROM THE SAID PARTY. THE LD. CIT(A) HAS ALSO CONFIRMED THE ADDITION OF RS. 2 , 85 , 578/ - AS UNACCOUNTED PURCHAS ES M ADE FROM BHABV AN TILE BECAUSE THE ASSESSEE HAS FAILED TO SUBSTANTIATE THE GENUINE NE SS OF THESE TRANSACTIONS WITH RELEVANT EVIDENCES . THE LD. CIT(A) HAS SUSTAINED THE ADDITION TO THE EXTENT OF RS.1,70,600/ - OF PURCHASE S MADE FROM R.B. PATEL AND ASSOCIA TE FOR WANT OF CONFIRMATION FROM THE SAID PARTY. SIMILARLY, THE LD. CIT(A) HAS ALSO SUSTAINED THE PURCHASES MADE FROM S.H. ENGINEERING TO THE EXTENT OF RS. 2 , 34 ,272/ - , RS. 5 LACS F R O M H.M. PATHAN , RS. 4,50,000/ - FROM SIM WA LA NASIM, RS. 10 LACS FROM MR. I BRAHIM ABDUL AND PURCHASES TO THE AMOUNT OF RS. 271924/ - FORM SAEED PATEL ON THE GROUND THAT GENUINENESS OF THESE PURCHASES COULD NOT BE PROVE D AS THE ASSESSEE FAILED TO FURNISH COMPLETE DOCUMENTARY EVIDENCES IN SUPPORT OF HIS CLAIM . 1 0. 1. WE HAVE GONE THROUGH THE PAPER BOOK SUBMITTED BY THE ASSESSEE DURING THE COURSE OF APPELLATE PROCEEDINGS CONTAINING DETAILS OF BILLS AND OTHER MATERIAL FURNISHED BEFORE THE ASSESSING OFFICER AND CIT(A) DURING THE COURSE OF ASSESSMENT AND APPELLATE PROCEEDINGS . IN THE PAPER BOOK, THE ASSESSEE HAS PLACED COPIES OF CONFIRMATION S OF UNSECURED LOAN OBTAI NED FROM DIFFERENT PARTIES, COPIES OF LEDGER ACCOUNT OF THE LOAN PARTIES, EXTRACT OF BANK STATEMENT S AND COPIES OF PAN CARD ETC. THE ASSESSEE HAS ALSO PLACED THE COPY OF R EMAND REPORT SUBMITTED BY THE A SSESSING OFFICER STATING THAT I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 10 COMPLETE DETAILS AND INFORMATION HAVE NOT BEEN FURNISHED BY THE ASSESSEE IN RESPECT OF 12 PARTIES FROM WHOM THE ASSESSEE HAS MADE PURCHASE S . DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, T HE LD. COUNSEL HAS SUBMITTED THAT SOME OF THESE PARTIES WERE NOT EXTENDING FULL CO - OPERATION, THEREFORE , THE REQUIRED DOCUMENTS COULD NOT BE FURNISHED AND ALSO CONTENDED THAT I T IS NOT JUSTIFIED TO DISALLOW THE WHOLE OF SUCH PURCHASE S BY TREATING THE SAM E AS UNACCOUNTED. AFTER PERUSAL OF THE MATERIAL ON RECORD , IT IS NOTICED THAT ASSESSING OFFICER HAS NEITHER ISSUED ANY NOTICE U/S. 133(6) NOR ISSUED ANY SUMMON U/S. 131 TO THE AFORESAID PARTIES TO OBTAIN THE I NFORMATION AND TO CARRY OUT NECESSARY VERIFICA TION AND EXAMINATION OF THE PURCHASE TRANSACTIONS . CONSIDERING THESE MATERIAL FACTS, WE ARE OF THE VIEW THAT IT WILL BE APPROPRIA TE TO RESTORE THIS ISSUE TO THE FILE OF THE ASSESSIN G OFFICER FOR DECIDING AFRESH AFTER EXAMINATION AND VERIFICATION OF REQUIR ED MATERIAL/INFORMATION BY ISSUING OF SUMMONS U/S. 131 TO THE 12 PURCHASES PARTIES FROM WHOM THE PURCHASES WERE TREATED AS UNEXPLAINED FOR WANT OF COMPLETE DETAIL AND INFORMATION . ACCORDINGLY, WE RESTORE THIS ISSUE TO THE FILE OF ASSESSING OFFICER FOR DEC IDING DE - NOVO AS DIRECTED ABOVE AFTER AFFORDING ADEQUATE OPPORTUNITY TO THE ASSESSEE. 1 0. 2. REGARDING ADDITION OF R S. 27,71 , 570/ - ON ACCOUNT OF UNEXPLAINED CASH CREDIT SHOWN IN THE NAME OF THREE PARTIES. THE LD. CIT(A) HAS DELETED THE ADDITION TO THE E XTENT OF RS. 17,78,017/ - IN RESPECT OF UNSECURED LOAN OBTAINED FROM SHIR ROHAN SURJIBHAI BARNADA, MAYANKSURJIBHAI BARNADA SINCE ASSESSEE HAS FURNISHED THE IN FORMATION REQUIRED UNDER SECTION 68 OF THE ACT . HOWEVER, I N RESPECT OF LOAN OF RS. 9,93,500/ - OBTAINED BY THE ASSESSEE FROM SHRI ASHIF ABDULRAMAN SAI KH, THE ASSESSEE CLAIMED THAT TRANSACTI ON I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 11 WAS PERTAINED TO SALE OF CAR . I N THIS CONNECTION , THE LD. CIT(A) STATED THAT THERE WAS NO SUCH CAR SHOWN IN THE BALANCE S HEET AND NO OTHER EVIDENCE HAS BEEN FURNISHED TO PROVE THAT THER E WAS A SALE OF CAR. T HEREFORE , THE LD. CIT(A) HAS HELD THE SAID CREDIT ENTRY FROM THE AFORESAID PARTIES AS BOGUS CREDIT U/S. 68 OF THE ACT. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFO RE US, THE ASSESSEE HAS FAILED TO FURNISH ANY EVIDENCE TO DISPROVE THE FINDING OF LD. CIT(A) THAT THE AFORESAID CASH CREDIT TO THE AMOUNT OF RS. 9,93,500/ - WAS RECEIVED ON ACCOUNT OF SALE OF CAR. THE ASSESSEE HAS FAILED TO FURNISH ANY RELEVANT SUPPORTING EVIDENCES IN SPITE OF GIVING A NUMBER OF OPPORTUNITIES AT THE TIME OF ASSESSMENT PROCEEDINGS AND APPELLATE PR OCEEDINGS. T HEREFORE , WE DO NOT FIND ANY REASON TO INTERFERE IN THE DECISION OF LD. CIT(A). ACCORDINGLY, ADDITION TO THE EXTENT OF RS. 9,93,500/ - IS SUSTAINED. THEREFORE, T HIS GROUND OF APPEAL IS PARTLY ALLOWED. 10.3. REGARDING ADDITION OF RS. 3,40,000/ - ON ACCOUNT OF EXCESS INTEREST PAID @ 24% TO TWO PERSONS AS AGAINST THE INTEREST RATE 12% PAID TO ALL OTHER PARTIES BY THE ASSESSEE, T HE LD. CI T(A) HAS PARTLY ALLOWED THE APPEAL OF THE ASSESSEE BY CONSIDERING THAT INTEREST RATE @ 15% WILL BE REASONABLE. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE ASSESSEE HAS NOT FURNISHED ANY DETAILED AND SUPPORTING INFORMATION TO SUBSTANTIATE T HE REASONABLENESS OF MAKING INTEREST PAYMENT @ 24% TO THE TWO PARTIES. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE DECISION OF LD. CIT(A), THEREFORE, THIS GROUND OF APPEAL IS DISMISSED. 10.4. T HE LAST GROUNDS OF APPEAL IS PERTAINED TO DISALLOWANCE OF VEHICLE EXPENSES @ 20% TO THE AMOUNT OF RS. 5 , 91 , 648/ - ON ACCOUNT OF PERSONAL USE I.T.A NO. 1690 /AHD/20 17 A.Y. 2012 - 13 PAGE NO SHRI HAJI MOHAMMADSAFI ABDULREHMAN SHAIKH VS. D CIT 12 AND THE LD. CIT(A) HAS SUSTAINE D THE DISALLOWANCE STATING THAT VEHICLE MUST HAVE BEEN USED FOR PERSONAL PURPOSE BY THE FAMILY MEMBERS OF THE AS S ESSEE. WE HAVE GONE THROUG H THE MATERIAL ON RECORD ON THIS ISSUE AND NOTICED THAT MOST OF THE E XPENSES IN RESPECT OF MOTOR CAR ARE PERTAINED TO DEPRECIATION, INTEREST ON LOAN AND VEHICLE INSURANCE, THEREFORE, WE OBSERV E THAT IT WILL BE REASONABLE TO RESTRICT THE DISALLOWANCE TO THE EXTENT OF RS. 10% AS AGAINST 20% OF THE TOTAL EXPENDITURE DISALLOWED BY THE LD. CIT(A), THEREFORE, WE RESTRICT THE DISALLOWANCE ON ACCOUNT OF PERSONAL USE OF MOTOR VEHICLE EX PENSES AT 10% TO THE AMOUNT OF R S. 29 , 582/ - . ACCORDINGLY, THIS GROUND OF THE ASS ESSEE IS PARTLY ALLOWED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 10 - 04 - 201 9 SD/ - SD/ - ( MADHUMITA ROY ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOU NTANT MEMBER AHMEDABAD : DATED 10 /04 /2019 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,