M/S SURESH SINGH THAKUR, KORBA(CG) V. ITO -1, KORBA(CG)

ITA 35/BIL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2425 (ITAT-RAIPUR)
• Duration Of Justice: 2 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 17-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H M MOHARANA
• Assessee Lawyers: R B DOSHI
• Keywords: Unexplained cash credit

Judgement Text

, RA IPUR IN THE INCOME TA X A PPELLA TE TRIBUNA L, RA IPUR BEFORE S/SHRI MUKUL SHRAW AT ( JM) SHAMIM YAH Y A (AM) , , ./ I.T.A. NO. 35/BLPR/2013 ( / ASSESSMENT YEAR : 2004 - 05 ) M/S. SURESH SINGH THAKUR, C/O. S.S. THAKUR, PLOT NO.174/21, NEAR KALI MANDIR, KOSABADI, KORBA / VS. ITO - 1, 1 ST FLOOR, MAHANADI COMPLEX, NIHARIKA ROAD, KORBA. ./ ./ PAN/GIR NO. : AAYF S 8036 A ( / AP PELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI R.B,.DOSHI / RESPONDENT BY : SHRI H.M.MOHARANA / DATE OF HEARING : 1 6 - 02 - 2016 / DATE OF PRONOUNCEMENT : 17 - 02 - 2016 / O R D E R PER MUKUL SHRAWAT, JM THIS IS AN APPEAL FILED BY THE ASSESSEE ARISING FROM AN ORDER OF THE LD CIT (A), BILASPUR DATED 30.10.2012 FOR THE ASSESSMENT YEAR 2004 - 05. T HE ONLY GROUND RAISED BY THE ASSESSEE IS REPRODUCED BELOW: THAT LD CIT(A) ERRED IN CONFIRMING ADDITION OF RS.2,00,000/ - MADE BY AO U/S.68 FOR ALLEGED UNEXPLAINED CASH CREDITS I N THE NAME OF MITHLESH SINGH AND LATE BHAGWAN SINGH OF RS.1,50,000/ - AND RS.50,00 0/ - RESPECTIVELY WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE PROPERLY AND JUDICIALLY AND WITHOUT PROPERLY APPRECIATING THE MATERIALS FURNISHED BEFORE HIM TO PROVE TRANSACTIONS WITH BOTH THE PERSONS AS GENUINE. 2 I.T.A. NO.35/BLPR/2013 A SSESSMENT YEAR : 2004 - 05 SURESH SINGH THAKUR 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER U/S.143(3) OF THE I.T.ACT, 1961 DATED 27.12.2006 WERE THAT THE ASSESSEE FIRM IS IN CONTRACT WORK BUSINESS. T HE AO HAS NOTICED THAT THE ASSESSEE HAD TAKEN UN SECURED LOAN OF RS.1,00,00 0/ - EACH FROM SHRI ISHWAR SINGH AND SHRI DINESH SINGH, RESPECTIVELY. T HE EXPLANATION OF THE ASSESSEE WAS THAT MR ISHWAR SINGH IS THE ELDER BROTHER OF THE ASSESSEE. WH ENEVER THE FUND IS REQUIRED, THE ASSESSEE USED TO REQUEST THE ABOVE PERSONS AND IN THE S AME MANNER THIS YEAR ALSO THE IMPUGNED AMOUNT WAS ARRANGED BY THEM AND PAYMENT WAS MADE THROUGH BANKING CHANNELS AS UNDER: 1 . RS.1,00,000/ - VIDE DD NO.7233 DT.,29.1.2004 FROM SHRI MITHLESH SINGH. 2. RS. 50,000/ - VIDE DD NO.860097 DT.4.3.2004 FROM SHRI B HAGWAN SINGH (DINESH SINGH) 3. RS. 5 0,000/ - VIDE DD NO.007542 DT.9.3.2004 FROM SHRI MITHLESH SINGH 2.1 IT WAS FURTHER CLARIFIED THAT SON OF ONE PARTY WHO IS INDEPENDENTLY ASSESSED TO INCOME TAX HAS ARRANGED THE FUNDS AND THEREUPON IT WAS SENT TO THE AS SESSEE. H OWEVER, THE AO WAS NOT CONVINCED AND IN HIS OPINION THE LOAN WAS TAKEN FROM SHRI ISHWAR SINGH AND NOT FROM SHRI MITHLESH SINGH. H ENCE, THE ASSESSEE WAS NOT ABLE TO PRODUCE CORRECT CONFIRMATION. T HE AO HAS ALSO MENTIONED THAT THE PARTIES WERE NO T PRODUCED BEFOR E HIM FOR CROSS VERIFICATION. IT WAS CONCLUDED THAT THE ASSESSEE WAS NOT ABLE TO PROVE THE GENUINENESS OF THE UN SECURED LOAN TOTALING TO RS.2,00,000/ - , HENCE, THE SAME WAS ADDED IN THE 3 I.T.A. NO.35/BLPR/2013 A SSESSMENT YEAR : 2004 - 05 SURESH SINGH THAKUR TAXABLE INCOME OF THE ASSESSEE ALONGWITH INTEREST OF RS.24,000/ - CALCULATED @ 12% PER ANNUM. 3. WH EN THE MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AUTHORITY, LD CIT(A) HAS HELD THAT MERE FILING OF INCOME TAX RETURNS AS A PROOF OF GENUINENESS OF TRANSACTION WAS NOT SUFFICIENT. I N THE OPINION OF THE LD CIT(A), THE ASSESSEE WAS ALSO NOT ABLE TO PROVE THE CREDITWORTHINESS OF THE PARTIES. A FTER MENTIONING FEW CASE LAWS, LD CIT(A) HAS CONFIRMED THE ACTION OF THE AO. 4. HEARD BOTH THE SIDES. T HE ISSUE IS TRIFLE IN NATURE. T HE ADMITTED FACTUAL POSITION WA S THAT THE ASSESSEE HAS PLACED ON RECORD THE INCOME TAX RETURNS OF THE PARTIES WHO HAVE ADVANCED THE LOAN. M OREOVER, BEFORE US, LD A.R. HAS ALSO STATED THAT THOSE PARTIES WERE ALSO SUBJECT TO TAX BY THE SAME ASSESSING OFFICER. WE H AVE NOTED THAT EVEN THE LD CIT(A) HAS ALSO MADE AN OBSERVATION THAT THE ASSESSEE HAD PLACE D RELIANCE OF INCOME TAX RETURN OF SHRI MITHLESH SINGH, SON OF SHRI ISHWAR SINGH. H E HAS TRANSFERRED THE MONEY THROUGH DD ON REQUEST. T HE LOANS WERE GIVEN THROUGH DD AND THE NUMBERS WERE DULY MENTIONED BY THE AO IN THE ASSESSMENT ORDER. T HIS HAS ALSO BEEN INF ORMED THAT ONE OF THE PARTIES WAS ALSO HAVING ACCOUNT IN THE SUB - DEALERSHIP OF TVS SUJUKI, ETC. I T HAS ALSO BEEN VEHEMENTLY PLEADED THAT BOTH THE PARTIES WERE OLD TAXPAYERS. AN AF FI DAVIT OF SHRI MITHLESH SINGH HAS ALSO BEEN PLACED ON RECORD TO DEMONSTRATE THAT HE HAS AFFIRMED ON OATH THE GENUINENESS OF THE TRANSACTION. 4 I.T.A. NO.35/BLPR/2013 A SSESSMENT YEAR : 2004 - 05 SURESH SINGH THAKUR 4.1 IN THE LIGHT OF FACTUAL MATRIX, WE HAVE EX AMINED A CITED DECISION IN THE CASE OF CIT VS. METACHEM INDUSTRIE S, 245 ITR 160 (MP), WHEREIN, THE BURDEN WAS PLACED ON THE REVENUE AUTHORITIES TO UNDERTAKE FURTHER INVESTIGATION IF T HE ASSESSEE HAD DISCHARGED THE PRELIMINARY ONUS. ANOTHER DECISION NAMELY CIT VS. ORISSA CORPORATION PVT LTD., 159 ITR 78 (SC) HAS ALSO BE EN REFERRED, WHEREIN, THE ASSESSEE HAD GIVEN THE NAME AND ADDRESS OF THE CREDITORS. T HE ASSESSEE HAS ALSO FURNISHED INDEX NO AND FILE NO OF THOSE CREDITORS, HENCE, REVENUE WAS EXPECTED TO EXAMINE THE CORRECTNESS OF THE ALLEGED CREDITORS. ON THE BASIS OF THE INFORMATION GIVEN BY THE ASSESSEE, THE AO CAN EXAMINE THE SOURCE OF INCOME OF THOSE CREDITORS AS WELL AS CREDITWORTHINESS BEFORE DIS - REGARDING THE EVIDENCE ON RECORD. C ONSIDERING THE SMALLNESS OF THE AMOUNT INVOLVED AS WELL AS THE EVIDENCE ON RECORD W ITH SUPPORTING CASE LAWS, WE HEREBY HOLD THAT FOR SUCH SMALL INVOLVEMENT OF AMOUNT, THE LITIGATION SHOULD SET AT REST, HENCE, WE HEREBY DIRECT THE AO ; ` THAT CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, TO DELETE THE ADDITION. W E D IRECT ACCORDINGLY. 5. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 /02/2016 . SD/ - SD/ - ( , ) ( , ) SHAMIM Y AHY A , ACCOUNT ANT MEMBER MUKUL SHRA WA T , JUDICIAL M EM BER RAIPUR , DATED 17 / 02 /20 1 6 . . ./ PARIDA , SR. PS 5 I.T.A. NO.35/BLPR/2013 A SSESSMENT YEAR : 2004 - 05 SURESH SINGH THAKUR / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT : M/S. SURESH SINGH THAKUR, C/O. S.S. THAKUR, PLOT NO.174/21, NEAR KALI M ANDIR, KOSABADI, KORBA 2. / THE RESPONDENT : ITO - 1, 1 ST FLOOR, MAHANADI COMPLEX, NIHARIKA ROAD, KORBA. 3. ( ) / THE CIT(A) - BILASPUR 4. / CIT , BILASPUR 5. , , / DR, ITAT , RAIPUR 6 . / GUARD FILE. / BY ORDER, //TRUE COPY// SR. PS, ITAT, CAMP: RAIPUR