ITO 9(2)(3), MUMBAI V. SANJAY YESHWANT MODI, MUMBAI

ITA 3342/MUM/2013

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9371 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 30-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Unexplained investment; Additional evidence
• Section: 69; 6; 68

Judgement Text

, , , , , ,, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI , , ! BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO.3342/MUM/2013 ASSESSMENT YEAR:2009-10 INCOME TAX OFFICER - 9(2)(3), ROOM NO.225, 2 ND FLOOR, AAYKAR BHAVAN, M.K. ROAD MUMBAI-400020 ' ' ' ' / VS. SHRI SANJAY YESHWANT MODI A/81, RUSHTOMJEE ADARSH HERITAGE VIHAR COMPLEX, ADARSH LANE, MALAD(WEST), MUMBAI-400064 ( / REVENUE) ( ' %&' /ASSESSEE) P.A. NO.AEYPM8324B ( ) ( ) ( ) ( ) / REVENUE BY SHRI NEIL PHILIP - DR ' %&' ( ) ( ) ( ) ( ) / // / ASSESSEE BY): NONE ' ( '* / / / / DATE OF HEARING : 04/02/2015 + + + + ( '* /DATE OF ORDER 06/02/2015 + + + + / / / / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) : THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATE D 26/02/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI ON THE GROUND THAT THE LD. COMMISSIONER OF INCOME TAX (APP EALS) ERRED IN DELETING THE ADDITION OF RS.62,00,000/- MADE U/S 68 AS UNEXPLAINED CASH CREDIT AS HE COULD NOT ESTABLISHED THE SOURCE OF CREDIT TO ITS CAPITAL ACCOUNT AND ALSO DELETING THE AMOUNT OF SHRI SANJAY YESHWANT MODI 2 RS.14,60,000/- MADE AS UNEXPLAINED INVESTMENT U/S 6 9 OF THE INCOME TAX ACT AS THE ASSESSEE COULD NOT PROVIDE AN Y SUPPORTING DOCUMENT IN SUPPORT OF ITS CLAIM FOR INVESTMENT OF RS.14,60,000/-. 2. AT THE TIME OF HEARING, NOBODY WAS PRESENT FOR THE ASSESSEE IN SPITE OF SERVICE OF REGISTERED NOTICE AS IS EVID ENT FROM THE POSTAL ACKNOWLEDGMENT AVAILABLE ON RECORD. ON 05/0 8/2014, THE APPEAL WAS ADJOURNED AT THE REQUEST OF THE ASSE SSEE TO 04/02/2015. TODAY, AT THE TIME OF HEARING, THE ASS ESSEE NEITHER PRESENTED HIMSELF (OR THROUGH AUTHORIZED REPRESENTA TIVE) NOR MOVED ANY APPLICATION FOR ADJOURNMENT. IT SEEMS TH AT THE ASSESSEE HAS NOTHING TO SAY, THEREFORE, WE PROCEED TO DISPOSE OF THIS APPEAL ON THE BASIS OF MATERIAL AVAILABLE ON R ECORD. 2.1. THE LD. DR, SHRI NEIL PHILIP, DEFENDED THE CON CLUSION ARRIVED AT IN THE ASSESSMENT ORDER. SO FAR AS, ADDITION MA DE U/S 68 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT), IS CONCERNED, IT WAS SUBMITTED THAT THE ASSESSEE COULD NOT ESTABLISH ED THE SOURCE OF CREDIT TO ITS CAPITAL ACCOUNT. ON THE AD DITION OF RS.14,60,000/-, MADE AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT, IT WAS PLEADED THAT THE ASSESSEE COULD NOT PRO VIDE ANY SUPPORTING DOCUMENT IN SUPPORT OF MAKING THE INVEST MENT OF THE IMPUGNED AMOUNT. 2.2. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. DR A ND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS, IN BR IEF, ARE THAT THE ASSESSING OFFICER VIDE LETTER DATED 01/12/2011 ASKE D THE ASSESSEE TO FURNISH THE COPY OF RETURN FILED AND BA LANCE SHEET OF ALL THE PARTIES FROM WHOM UNSECURED LOANS WERE TAKE N ALONG SHRI SANJAY YESHWANT MODI 3 WITH CONFIRMATION OF LOAN AND COPY OF BANK STATEMEN T OF THE PARTIES. THE ASSESSEE FURNISHED NON-CONFIRMATION O F CERTAIN PARTIES WHERE THE ASSESSEE WAS EITHER PARTNER OR DI RECTOR. AS PER THE REVENUE, THE ASSESSEE DID NOT FURNISH THE NECES SARY DETAILS AND FINALLY THE IMPUGNED AMOUNTS WERE TREATED AS UN EXPLAINED AND ADDED U/S 68 OF THE ACT. 2.3. BEFORE THE LD. COMMISSIONER OF INCOME TAX (APP EALS), THE ASSESSEE FILED DETAILED REPLY ALONG WITH ADDITIONAL EVIDENCES. THE ASSESSING OFFICER WAS PROVIDED OPPORTUNITY FOR HIS COMMENTS VIDE LETTER DATED 24/07/2012. THE ASSESSEE ALSO FIL ED ADDITIONAL EVIDENCE UNDER RULE 46A OF THE RULES, BEFORE THE CI T(A). THE ASSESSING OFFICER FILED ITS REPRESENTATION/REMAND R EPORT THROUGH LETTER DATED 04/02/2013. THE ASSESSEE WAS CONFRONTE D WITH THE REMAND REPORT BY THE LD. CIT(A). THERE IS FINDING I N PARA-4.3 OF THE IMPUGNED ORDER THAT CONFIRMATION AND DETAILS OF UNSECURED LOANS WERE FURNISHED BEFORE THE ASSESSING OFFICER A ND FURTHER DURING ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER DID NOT ASK FOR FURTHER EVIDENCE. IN VIEW OF THESE FACTS, AND SPECIALLY REMAND REPORT BY THE ASSESSING OFFICER, WE FIND THAT THERE WAS NO BASIS FOR MAKING THE ADDITION U/S 68. THE PARTIES FROM W HOM UNSECURED LOANS WERE TAKEN WERE GENUINE AND THERE W AS ENTRY OF THE RESPECTIVE AMOUNT, GIVING LOAN TO THE ASSESSEE, IN THE ACCOUNTS OF THE RESPECTIVE PARTIES. IN SUCH A SITU ATION, DUTY IS CAST UPON THE ASSESSING OFFICER TO PROVE OTHERWISE. IT IS ALSO SEEN THAT EVEN THERE IS NO VIOLATION OF RULE-46A AS OPPORTUNITY WAS PROVIDED TO THE ASSESSING OFFICER ALSO. THE AS SESSING OFFICER BEFORE FRAMING THE ASSESSMENT ISSUED QUESTIONNAIRE TO THE ASSESSEE CALLING FOR RELEVANT DETAILS AS IS EVIDENT FROM PARA- SHRI SANJAY YESHWANT MODI 4 1(PAGE-1) OF THE ASSESSMENT ORDER. THERE IS CATEGO RICAL FINDING IN THE ASSESSMENT ORDER ITSELF (PARA-2) THAT THE DETAI LS CALLED FOR WERE FILED BY THE ASSESSEE AND THE CASE WAS DISCUSS ED, THEREFORE, IF THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE DETAILS OF THE ASSESSEE, NOTHING PREVENTED HIM TO CALL OTHER DETAI LS. LOAN CONFIRMATION WERE DULY FILED BY THE ASSESSEE, THUS, IT IS NOT A CASE OF MAKING ADDITION U/S 68 AS THE IDENTITY, GEN UINENESS AND CREDITWORTHINESS OF THE PARTIES WAS PROVED. SUCH LO ANS WERE TAKEN FROM SHRI H.P. SONI (RS.15 LAKH), SHRI NILESH PATEL (RS.2 LAKH) AND RS. 45 LAKH FROM RAJESH PATEL. THE STAND OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) IS AFFIRMED. 2.4. THE NEXT ADDITION PERTAINS TO MADE U/S 69 OF T HE ACT. THE ASSESSING OFFICER ASKED THE ASSESSEE TO FURNISH THE DETAILS OF PROPERTY ALONG WITH COPY OF AGREEMENT FOR PURCHASE OF PROPERTY FOR VERIFICATION WITH RESPECT TO RS.14,60,000/-, WH ICH WAS SHOWN BY WAY OF ADVANCE FOR PROPERTY. THE ASSESSEE VID E LETTER DATED 06/12/2011 PRODUCE THE COPY OF THE LEDGER ACCOUNT, GIVING THE IMPUGNED AMOUNT OF RS.11,10,600/- TO SHRI BENNY DS OUZA AS ADVANCED FOR PURCHASE OF PLOT OF LAND. SINCE, THE TRANSACTION COULD NOT MATERIALIZED, THE SAID AMOUNT REMAINED TO BE RECOVERED. LIKEWISE, THE AMOUNT OF RS.3,50,000/- W AS GIVEN TO MR. SHAWANT AS A FRIENDLY LOAN, WHICH WAS ALSO TO B E RECOVERED. THE ASSESSING OFFICER MADE THE ADDITION OF THE IMPU GNED AMOUNTS BY SAYING THAT PROPER EXPLANATION WAS NOT OFFERED BY THE ASSESSEE. WE FIND THAT THERE ADVANCES WERE MAD E THROUGH ACCOUNT PAYEE CHEQUE AND THE ASSESSEE FURNISHED THE LEDGER ACCOUNT AND BANK STATEMENT. THE PAYMENT WAS MADE OU T OF KNOWN SOURCES, THUS, THERE IS NO REASON TO MAKE THE ADDITION SHRI SANJAY YESHWANT MODI 5 U/S 69 OF THE ACT. THIS GROUND OF THE REVENUE IS A LSO HAVING NO MERIT. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE PRESENCE OF THE LD . DR IN OPEN COURT ON 04/02/2015. SD/- (RAJENDRA) SD/- (JOGINDER SINGH) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; ,' DATED : 06/02/201 5 F{X~{T? P.S/. '.. + ( .'/ 0/1' + ( .'/ 0/1' + ( .'/ 0/1' + ( .'/ 0/1'/ COPY OF THE ORDER FORWARDED TO : 1. 23 / THE APPELLANT 2. .423 / THE RESPONDENT. 3. 5 ( ) / THE CIT, MUMBAI. 4. 5 / CIT(A)- , MUMBAI 5. /78 .'' , , / DR, ITAT, MUMBAI 6. 89% : / GUARD FILE. +' +' +' +' / BY ORDER, 4/' .' //TRUE COPY// ; ;; ;/ // /< < < < (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI