The ITO, Ward-9(3), Ahmedabad V. Dr.Mahesh D.Mehta, Ahmedabad

ITA 2305/AHD/2009

• Counselvise Citation: 230520514 RSA 2009
• Duration Of Justice: 2 year(s) 11 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2012
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 25-06-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 28-07-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAHUL KUMAR

Judgement Text

, , , , A, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, A BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .% %% % . .. .&'( &'( &'( &'(, , , , %) * %) * %) * %) * % ' % ' % ' % ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND A. K. GARODIA, ACCOUNTANT MEMBER) ITA NO.2305/AHD/2009 [ASSTT.YEAR : 2005-2006] ITO, WARD-9(3) AHMEDABAD. /VS. DR.MAHESH D. MEHTA C/O. MAYUR SHAH ASSOCIATES 21, KAJAL KIRAN 11/B, SHRIMALI SOCIETY OPP: JAIN TEMPLE, NAVRANGPURA AHMEDABAD 380 009. PAN : AEQPM 8480 E ( (( (,- ,- ,- ,- / APPELLANT) ( (( (./,- ./,- ./,- ./,- / RESPONDENT) * 0 1 %/ REVENUE BY : SHRI RAHUL KUMAR 34 0 1 %/ ASSESSEE BY : MS. URVASHI SHODHAN 5 0 46)/ DATE OF HEARING : 25 TH JUNE, 2012 7&8 0 46)/ DATE OF PRONOUNCEMENT : 6-7-2012 %9 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL OF THE REVENUE FOR A.Y.2005-2006 IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-XV, AHMEDABAD. 2. THE GROUNDS OF THE APPEAL OF THE REVENUE READ AS UNDER: 1 ) THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN D ELETING THE ADDITION OF RS.7,51,856/- MADE ON ACCOUNT OF UNEXPL AINED CASH CREDIT U/S.68 OF THE IT ACT, 1961. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD.CIT(A) ERRED IN LAW AND ON FACTS IN LOOKING TO T HE FACTS OF THE CASE, THE CIT(A) OUGHT TO HAVE UPHELD THE IMPUGNED ADDITIONS. ITA NO.2305/AHD/2009 -2- 3. THE LEARNED DR SUBMITTED THAT THE ASSESSEE COULD NOT PROVE THAT IT HAS RECEIVED LOANS AMOUNTING TO RS.7,51,856/- FROM TWO AGRICULTURISTS AND REFERRED TO RELEVANT PORTIONS OF THE ASSESSMENT ORD ER WHEREIN THE AO HAS RECORDED ALL THE FACTS AND HAS PASSED A SPEAKING OR DER ON THE ISSUE. HE SUBMITTED THAT THE SALE BILLS OF AGRICULTURAL PRODU CE OF THE ENTIRE LOAN AMOUNT COULD NOT BE PRODUCED BY TWO CREDITORS. HE SUBMITTED THAT THE ASSESSEE IS A REPUTED DOCTOR AND THERE WAS NO OCCAS ION TO RAISE THE LOANS FROM THE AGRICULTURISTS. THE LEARNED DR SUBMITTED THAT THERE WAS NO NEED AND URGENT SITUATION ARISEN TO RAISE A PERSONAL LOA N IN CASH AMOUNTING TO RS.2.52 LAKHS AND RS.5.00 LAKHS FROM TWO AGRICULTUR ISTS AS THE SEQUENCE OF THE EVENTS SHOWS THAT THE LOANS WERE RAISED ON 1 7 TH AND 18 TH APRIL, 2004 AND THE AMOUNTS OF LOANS WERE UTILIZED AFTER A LONG TIME AND THE STAND TAKEN BY THE ASSESSEE WAS CONTRADICTORY AND NOT REL IABLE. HE RELIED ON THE ORDER OF THE AO. THE LEARNED COUNSEL FOR THE ASSES SEE SUBMITTED THAT TWO AGRICULTURISTS HAVE FILED CONFIRMATIONS CONFIRMING THE ADVANCEMENT OF THE LOANS TO THE ASSESSEE AND HAVE ALSO SUBMITTED DOCUM ENTARY EVIDENCES OF THEIR LAND HOLDINGS. SHE SUBMITTED THAT THE IDENTI TY OF THE CREDITORS AND FINANCIAL POSITION OF THE CREDITORS COULD NOT BE DO UBTED BY THE AO. SHE SUBMITTED THAT THE AGRICULTURISTS CREDITORS WERE HA VING SUFFICIENT LAND HOLDING OF 2.75 HECTRES AND 30.96 HECTORS TO GIVE L OAN AMOUNT OF RS.2.52 LAKHS AND RS.5.00 LAKHS RESPECTIVELY. SHE RELIED O N THE ORDER OF THE CIT(A). 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND HAVE PE RUSED THE ORDERS OF THE AO AND THE CIT(A) AND ALSO COPIES OF VARIOUS DOCUMENTS FILED BY THE ASSESSEE IN ITS COMPILATION BEFORE THE TRIBUNAL . WE FIND THAT THE IDENTITY OF THE CREDITORS IS NOT IN DOUBT. THE CRE DITORS HAVE CONFIRMED THAT THEY HAVE GIVEN INTEREST FREE LOANS TO THE ASSESSEE OF RS.2.52 LAKHS ON 18- 4-2004 BY SHRI PRAKASH DATTATREY LOTLIKAR AND RS.5 LAKHS ON 17-4-2004 ITA NO.2305/AHD/2009 -3- BY SUBHASH DHONGDE. THEY HAVE ALSO FILED EVIDENCE OF THEIR LAND HOLDINGS OF 2.75 HECTRES AND 30.96 HECTRES RESPECTI VELY. HOWEVER, WE FIND THAT THE ASSESSEE HAS TAKEN CONTRARY STAND IN THIS REGARD BEFORE THE AO. THE ASSESSEE VIDE ITS LETTER DATED 17-12-2007 HAS SUBMITTED THAT THE LOAN OF RS.2.52 LAKHS WAS TAKEN IN CASH AS A TEMPOR ARY AND AN EMERGENCY PERSONAL LOAN AT THE ELEVENTH HOURS TO FULFILL HIS URGENT REQUIREMENT TO EXECUTE THE PURCHASE DOCUMENTS IN RESPECT OF VILLE PARLE, MUMBAI PROPERTY AND THEY HAVE NO TIME FOR TAKING CHEQUE SI GNATURE, SENDING THEM FOR CLEARANCE, WHICH WOULD HAVE TAKEN 5 TO 7 DAYS I N CLEARANCE, THE CREDITOR AND SHRI PRAKASHBHAI HELPED THE ASSESSEE B Y GIVING CASH OF RS.2.52 LAKHS. WE FIND THAT THE SEQUENCE OF THE EV ENTS SHOWS THAT THERE WERE NO SUCH URGENT AND EMERGENCY REQUIREMENT OF TH E ASSESSEE. NO CO- RELATION BETWEEN THE AMOUNT RAISED AS LOAN AND UTIL ISATION THEREOF ON EMERGENCY AND URGENT BASIS FOR THE PURCHASE OF PROP ERTY AT PARLE PROPERTY, COULD BE ESTABLISHED ON BEHALF OF THE ASS ESSEE. THE ASSESSEE HAS FILED EVIDENCE OF SALE OF AGRICULTURE PRODUCE BY SH RI PRAKASH D. LOTLIKAR TO THE EXTENT OF RS.1.15 LAKHS SUM OF TWO BILLS F OR SALE OF AGRICULTURAL PRODUCE. THE ASSESSEE COULD NOT ADDUCE ANY OTHER E VIDENCE WITH REGARD TO THE LOAN OF SHRI PRAKASH D. LOTLIKAR AMOUNTING T O RS.2.52 LAKHS. IN REPLY TO A SPECIFIC QUESTION FROM THE BENCH, THE AS SESSEE COULD NOT ESTABLISH THAT WHEN THE SAID LOAN AMOUNT WAS REPAID BY THE ASSESSEE TO THE CREDITORS. ACCORDINGLY, WE HOLD THAT ALLOWING THE B ENEFIT OF AMOUNT EVIDENCED BY TWO SALE BILLS OF AGRICULTURAL PRODUCE AMOUNTING TO RS.1.15 LAKHS AND ALSO HIS LAND HOLDINGS, THE ADDITION ON A CCOUNT OF LOAN FROM SHRI PRAKASH D. LOTLIKAR IS RESTRICTED TO RS.1.00 L AKHS AGAINST THE ADDITION OF RS.2.52 LAKHS MADE BY THE AO AND THE GROUNDS OF THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. WITH REGARD TO THE LOA N OF RS.5 LAKHS CLAIMED TO HAVE BEEN RECEIVED FROM SHRI SUBHASH DHONGDE, WE FIND THAT THE ASSESSEE HAS PRODUCED THE SALE BILL OF AGRICULTURAL PRODUCE AMOUNTING ITA NO.2305/AHD/2009 -4- RS.2.33 LAKHS. SHRI SUBHAS DHONGDE HAS 30.96 HECTE RS OF AGRICULTURE LAND. IN THESE FACTS AND CIRCUMSTANCES, ALLOWING T HE BENEFIT OF THE AMOUNT EVIDENCED BY SALE BILLS OF AGRICULTURE PRODUCE AMOU NTING TO RS.2.33 LAKHS AND ALLOWING THE SAME BENEFIT ON ACCOUNT OF LARGE L AND HOLDING OF THE CREDITOR, SHRI SUBHAS DHONGDE, WE HOLD THAT THE END S OF JUSTICE SHALL BE MET IF THE ADDITION IS RESTRICTED TO RS.2 LAKHS AS AGAINST THE ADDITION OF RS.5 LAKHS MADE BY THE AO ON ACCOUNT OF LOAN FROM S HRI SUBHASH DHONGDE AND THE GROUNDS OF THE REVENUES APPEAL IS PARTLY ALLOWED. IN NUTSHELL, THE ADDITION IS RESTRICTED TO RS.3.00 LAK HS AGAINST RS.7.51 LAKHS MADE BY THE AO AND THE GROUNDS OF THE APPEAL OF THE REVENUE ARE PARTLY ALLOWED. 5. IN THE RESULT, THE REVENUES APPEAL IS PARTLY AL LOWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( # ## #. .. .% %% % . .. .&'( &'( &'( &'( /A.K. GARODIA) %) * /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT VK* C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD