DCIT, JODHPUR V. M/s. Panchmukhi Vishwakarma, JODHPUR

ITA 357/JODH/2014

• Counselvise Citation: 35723314 RSA 2014
• Duration Of Justice: 3 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 28-08-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 04-06-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P MEENA
• Assessee Lawyers: DEEPAK ARORA
• Keywords: Unexplained cash credit; Unexplained investment; Document seized; Additional evidence; Documents seized
• Section: 133A; 153A; 234B; 132; 68; 69

Judgement Text

IN THE INCOMETAX APPELLATE TRIBUNAL , JODHPUR BENCH: J ODHPUR ( BEFORE SHRI H ARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER ) I.T.A. NO. 357 /JODH/2014 (A.Y. 200 7 - 0 8 ) DCIT V S M/S. PANCHMUKHI VISHWAKARMA CENTRAL CIRCLE - 2, G - 2, GANESHPURA, RATANADA, JODHPUR. JODHPUR. PAN NO. AAJFP3575G I.T.A. NO. 249/JODH/2014 (A.Y. 2007 - 08) M/S. PANCHMUKHI VISHWAKARMA V S. DCIT, G - 2, GANESHPURA, RATANADA, CENTRAL CIRCLE - 2, JODHPUR. JODHPUR. PAN NO. AAJFP3575G (APPELLANT) (RESPONDENT) ASSESSEE BY: - SHRI AMIT KOTHARI, AND SHRI DEEPAK ARORA. DEPARTMENT BY : - SHRI O.P. MEENA - CIT - D.R. DATE OF HEARING : 28 /0 8 /201 4 DATE OF PRONOUNCEMENT : 25 / 0 9 /2014 O R D E R P E R HARI OM MARATHA, J.M. : THESE CROSS APPEALS FOR A.Y. 2007 - 08, HAVE BEEN FILED AGAINST THE ORDER OF LD. CIT(A), DATED 11.03.2014. 2 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE - FIRM IS A REALTOR, DEVELOPING AND SELLING THE LAND. A SEARCH U/S 132 OF THE I.T. ACT, 1961, [ THE ACT FOR SHORT ] , WAS CARRIED OUT AT ITS BUSINESS PREMISES AND RESIDENTIAL PREMISES OF ITS PARTNERS ON 15/16 - 12 - 2009 (15.12.2009 AND 16.12.2009). DURING THIS SEARCH MANY DOCUMENTS WERE FOUND AND SOME OF THEM WERE ALSO SEIZED. A SIMULTANEOUS SURVEY U/S 133A OF THE ACT WAS ALSO CONDUCTED AT ASSESSEES BUSINESS PREMISES. A NOTICE U/S 153A OF THE ACT WAS ISSUED TO THE ASSESSEE ON 14.10.2010. IN RESPONSE THEREOF THE ASSESSEE FILED RETURN ON 30.03.2011 DECLARING TOTAL INCOME OF RS. NIL. THE ASSESSEE - FIRM CONS ISTED OF TWO PARTNERS NAMELY SHRI PUNA RAM JANGID AND SMT. PREM LATA JANGID, AND CAME INTO EXISTENCE ON 01.04.2006. THE ASSESSMENT WAS FRAMED FOR A.Y. 2007 - 08 U/S 153A R.W.S. 153B/143(3) OF THE ACT ON 28.12.2011 AT TOTAL INCOME OF RS. 1,32,81,030/ - . THE A.O. HAS ADDED A SUM OF RS. 30,65,000/ - U/S 68 (VIDE PARA NO. 5 OF THE ORDER) AND SUM OF RS. 1,02,16,030/ - U/S 69 (AS PER PARA NO. 6 OF HIS ORDER). 2.1 AGGRIEVED, THE ASSESSEE - FIRM FILED APPEAL AND LD. CIT(A) HAS GIVEN A PART RELIEF. AGAINST THE ORDER OF LD. CIT(A), DATED 11.03.2014 BOTH THE ASSESSEE AND REVENUE HAVE FILED THEIR RESPECTIVE APPEALS. 3 2.2 THE REVENUE H AS RAISED THE FOLLOWING GROUNDS : - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), ALWAR HAS ERRED IN ADMITTING THE ADDITIO NAL EVIDENCES UNDER RULE 46A OF THE I. T. RULES, 1962 IGNORING THE FACT THAT REASONABLE AND SUFFICIENT OPPORTUNITIES WERE GIVEN BY THE AO TO THE ASSESSEE THROUGH QUERY LETTERS, SUBSEQUENT NOTICES ETC. ISSUED DURING THE ASSESSMENT PROCEEDINGS BUT THE ASSESSE E FAILED TO FURNISH ANY DETAILS OR EVIDENCES; 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), ALWAR HAS ERRED IN DIRECTING THE AO TO DELETE THE ADDITION OF RS. 1,01,65,140/ - OUT OF THE TOTAL ADDITION OF RS. 1,02,16,030/ - MADE BY HIM ON ACCO UNT OF THE INVESTMENT MADE IN THE PURCHASE OF PLOT NO. 100, NEW POWER HOUSE, JODHPUR (RS. 59,50,000/ - ) AND PLOT NO. 2, POLO, JODHPUR (RS. 44,66,030/ - ) TREATED AS UNEXPLAINED INVESTMENT U/S 69 OF THE L/T. ACT, 1961; 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A), ALWAR HAS ERRED IN DIRECTING THE AO TO DELETE THE ADDITION MADE BY HIM ON A/C OF UNEXPLAINED CASH CREDIT U/S 68 SHOWN IN THE NAME OF SMT. INDU CHHAJER AT RS. 15,00,000, M/S SHARMA INDUSTRIES AT RS. 7,00,000, SHRI MOTI RAM KULERIA AT RS. 5,50,000 AND SHRI SUKHRAM JANGID AT RS. 2,50,000 , IGNORING THE FACT THAT THE CASH CREDITORS HAD FAILED TO PROVE IT S WORTHINESS/CAPACITY TO LOAN AND GENUINENESS OF THE TRANSACTION DESPITE GRANTING OF REASONABLE AND SUFFICIENT OPPORTUNITY DURING THE COU RSE OF THE ASSESSMENT AS WELL AS THE APPELLATE 4 PROCEEDING. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS : - 1. THE ID. CIT(A) HAS ERRED IN SUSTAINI NG THE ADDITION OF RS.65,000/ - U/S 68 IN RELATION TO UNSECURED LOAN TAKEN FROM JAGDISH JANGID. THE ADDITI ON SO SUSTAINED IS BAD IN LAW AND BAD ON FACTS. 2. THE ID. CIT(A) HAS ERRED IN SUSTAINING THE ADDITION OF RS.50,890/ - ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PURCHASE OF PROPERTY. THE ADDITION SO SUSTAINED IS BAD IN LAW AND BAD ON FACTS. 3. THE ID. CIT(A) HAS ERRED IN NOT GRANTING TELESCOPING EFFECT OF INCOME ALREADY SURRENDERED BY THE APPELLANT IN THE VARIOUS YEARS AND HAS ALSO FURTHER ERRED IN NOT GRANTING TELESCOPING EFFECT OF THE ADDITIONS SUSTAINED. 4. THE INTEREST CHARGED U/S 234B AND 234C IS BAD IN LAW AND BAD ON FACTS. 5. THE APPELLANT PRAY FOR SUITABLE COSTS. 2.3 WE HAVE HEARD BOTH SIDES. WE HAVE ALSO GONE THROUGH THE ENTIRE RECORD AVAILABLE BEFORE US, INCLUDING WRITTEN SUBMISSIONS AND PAPER BOOKS ETC. PRODUCED BY THE PARTIES. 5 2.4 SINCE MAJOR ISSUES HAV E BEEN RAISED IN REVENUES APPEAL, WE WILL DEAL ITS GROUND FIRST, AND WHEREVER NECESSARY THE CONNECTED GROUNDS OF ASSESSEES APPEAL WI LL BE SIMULTANEOUSLY DEALT WITH. THROUGH THE FIRST GROUND THE REVENUE HAS CHALLENGED THE ADMISSION OF ADDITIONAL EVIDENCE STATING THAT THESE HAVE NOT BEEN ADMITTED IN TERMS OF RULE 46 A OF THE I.T. RULES, 1962. IT WAS ARGUED THAT THE A.O. HAD GIVEN REASONABLE AND SUFFICIENT OPPORTUNITIES TO THE ASSESSEE THROUGH LETTERS, QUERY LETTERS, BUT THE ASSESSEE FAILED TO FURNISH REQUIS ITE DETAILS OR EVIDENCE, THEREFORE, IT IS PRECLUDED FROM RAISING SUCH ADDITIONAL EVIDENCE ON THE BASIS OF THE LD. CIT(A) HAS DELETED MOST OF THE ADDITIONS. THE LD. CIT(DR) SHRI O.P. MEENA, VEHEMENTLY ARGUED AND ALSO SUBMITTED THROUGH WRITTEN SUBMISSIONS (W .S.) THAT THE LD. CIT(A) HAS INCORRECTLY ADMITTED THESE EVIDENCES. ON THE OTHER HAND LD. A.R. SHRI AMIT KOTHARI ASSISTANCE BY SHRI DEEPAK ARORA VOCIFEROUSLY DEPENDED ACTIONS OF BOTH THE ASSESSEE AND THE LD. CIT(A) IN RESPECTIVELY PRODUCING AND ADMITTING TH EM. 2.5 AFTER CONSIDERING RIVAL SUBMISSIONS, WE HAVE FOUND THAT GROUND NO. (1) OF REVENUES APPEAL IS CONNECTED WITH GROUND NO. 2 AND 3 OF REVENUES APPEAL. WE HAVE CAREFULLY TREADED THROUGH THE ENTIRE RECORD INCLUDING THE LETTERS DATED 17.10.2011 COPY PLACED AT PAPER BOOK PAGE 23 - 30; LETTER DATED 25.11.2011 COPY PLACED AT PAPER BOOK PAGE 31 - 46, 6 LETTER DATED 26.11.2011 COPY ENCLOSED AT PAPER BOOK 47 - 53, COPY OF LETTER DATED 28.12.2011 COPY OF WHICH ENCLOSED AT PAPER BOOK PAGE 54 - 67. WE HAVE ALSO GONE THR OUGH THE COY OF WRITTEN SUBMISSIONS FILED BY THE ASSESSEE BEFORE THE A.O. WE HAVE ALSO GONE THROUGH THE COPY OF LETTER DATED 07.10.2011 WHICH WAS PRODUCED BEFORE US BY LD. CIT(DR) TO STATE THAT THE A.O. HAD DEMANDED EXPLANATION FROM THE ASSESSEE REGARDING VARIOUS DETAILS. THIS IS A LENGTHY QUERY LETTER RUNNING INTO 7 PAGES AND REQUIRING THE ASSESSEE TO PRODUCE EVIDENCE REGARDING 52 ITEMS. THROUGH THIS LETTER THE A.O. HAS DIRECTED THE ASSESSEE TO SUBMIT REPLY BY 17.10.2011. THE ASSESSEE FILED ITS REPLY VIDE LETTER DATED 17.10.2011. AS WE HAVE STATED THE ASSESSEES LETTERS DATED 25.11.2011, 26.11.2011 AND 28.12.2011 ARE ON RECORD. IN FACT THE ASSESSEE HAD REPLIED AND SUBMITTED MANY EVIDENCE/ PROOF AS DESIRED BY A.O. THE A.O. STATED PROCEEDING WITH ASSESSMENT P ROCEEDINGS, PROPERLY, ON 07.10.2011 AND VERY LITTLE TIME WAS LEFT UPTO 31.12.2011, BY WHICH THE ASSESSMENT ORDER WAS TO BE FRAMED. WE HAVE, IN FACT, FOUND THAT EFFECTIVELY NO ADDITIONAL EVIDENCE WAS PRODUCED BEFORE LD. CIT(A). WHATEVER EVIDENCE WERE ALREAD Y PRODUCED BEFORE THE A.O. WHICH HE COULD NOT EXAMINE DUE TO PAUCITY OF TIME AND THE ASSESSEE PREFERRED TO PRODUCE THEM AGAIN IN DETAIL ALONGWITH WRITTEN SUBMISSIONS, WAS SENT TO A. O . THE A.O. WAS GIVEN OPPORTUNITY TO INVESTIGATE HIS REMAND 7 REPORT (R.R.). THE A.O. HAS AGAIN INVESTIGATED INTO THE MATTER AND AFTER RELYING ON THE R.R. THE LD. CIT(A) HAS DECIDED HIS APPEAL. THE SUBMISSION OF THE DEPARTMENT WAS THAT THE ASSESSEE WAS SELECTIVE IN SUPPLYING INFORMATION. WE FAIL TO UNDERSTAND AS TO HOW THE ASSESSEE WAS SELECTIVE IN ANSWERING WHEN THE 4 LETTERS MENTIONED ABOVE CLEARLY SPEAK ABOUT ASSESSEES CO - OPERATION DURING ASSESSMENT PROCEEDINGS. THE DECISION ON WHICH A.O. HAS RELIED IN HIS WRITTEN SUBMISSIONS ARE ENTIRELY DISTINGUISHABLE. THE ASSESSEE HAS BEEN D ENIED AMPLE OPPORTUNITIES TO EXPLAIN ITS CASE AS WE HAVE DISCUSSED ABOVE. THE FOLLOWING DECISIONS RELIED ON BY LD. A.R. SUPPORT OUR ABOVE FINDING. A) JUTE CORPORATION OF INDIA LTD. VS. CIT. (1991) 187 ITR 688 (SC) B) CIT VS. KANPUR COAL SYNDICATE(19 64) 53 ITR 225 (SC) C) CIT VS. PIONEER PRESS (P) LTD. (2001) 170 CTR (MAD) 152 D) CIT VS. K. RAVINDRANATHAN NAIR (2003) 184 CTR (KER) 46 : (2004) 265 ITR 217 (KER) E) CIT VS. SURETECH HOSPITAL & RESEARCH CENTRE LTD. (2007) 293 ITR 53 (BOM) F) CIT VS. PARIMAL KANTI CHANDA (2007) 291 ITR 77 (GAU) G) CIT VS. PODDAR SWADESH UDYOG (P) LTD. (2007) 295 ITR 252 (GAU) H) ACIT VS. VENKATESHWAR ISPAT (P) LTD. (2009) 319 ITR 393 (CHHATTISGARH) I) SMT. PRABHAVATI S. SHAH VS. CIT (1998) 231 ITR 1 (BOM) J) ITO VS. INDUSTRIAL ROADWAYS ITAT, MUMBAI 'K' BENCH (2007) 112 TTJ (MUMBAI) 157 K) SURMUKH SINGH VS. ITO (2008) 115 TTJ (ASR) 852 8 L) ANMOL COLOURS INDIA (P) LTD. VS. ITO (2009) 121 TTJ (JP) 269 M) SHAHRUKH KHAN VS. DCIT (2007) 13 SOT 61 (MUM BAI N) ITO VS. DWARKA PRASAD VS. ITO (1998) 60 TTJ (PAT)(TM) 292 THEREFORE, WE ARE NOT IN AGREEMENT WITH LD. CIT(DR) THAT THE ADDITIONAL EVIDENCE HAVE BEEN ADMITTED IN CONTRAVENTION OF RULE 46A. HENCE WE CANNOT ALLOW GROUND NO. (1) OF REVENUES APPEAL A ND DISMISS THE SAME. 3. ON MERITS THE FACTS OF GROUND NO. 2 OF REVENUES APPEAL WHICH IS RAISED AGAINST THE DELETION OF AN ADDITION OF RS. 1,01,65,140/ - OUT OF TOTAL ADDITION OF RS, 1,02,16,030/ - MADE BY THE A.O. ON ACCOUNT OF INVESTMENT MADE IN THE PUR CHASE OF PLOT NO. 100, AT NEW POWER HOUSE, JODHPUR (OF RS. 59,50,000/ - ) AND IN PLOT NO 2, POLO, JODHPUR (OF RS. 44,66,030/ - ), BY TREATING AS UNEXPLAINED INVESTMENT U/S 69 OF THE ACT. THE ASSESSEE IS ALSO IN APPEAL AGAINST THE RELATED SUSTAINED ADDITION OF RS. 50,890/ - A S GROUND NO. (2) OF ITS APPEAL. THE FACTS OF THIS COMMON ISSUE ARE THAT THE ASSESSEE - FIRM HAS SHOWN TWO PROPERTIES AS STOCK IN TRADE, UNDER THE HEAD CURRENT ASSETS, THE DETAILS OF WHICH ARE AS UNDER: - 9 1. PLOT NO. 100, NEW POWER HOUSE RS. 59,50,000/ - 2. PLOT NO. 2, POLO RS. 42,66,030/ - TOTAL RS. 1,02,16,030/ - AS PER THE A.O. THE ASSESSEE HAS NOT SHOWN THESE PROPERTIES IN ITS TRADING ACCOUNT, AS PURCHASE AS IT HAS NOT EVEN PREPARED THE TRADING ACCOUNT. HE HAS ALSO OBSERVED T HAT COMPLETE DETAILS OF PURCH A SE OF THESE PROPERTIES HAVE NOT BEEN PRODUCED BY THE ASSESSEE. IT HAS NOT PROVED THE SOURCE OF INVESTMENT. THEREFORE, HE HAS ADDED RS. 1,02,16,030/ - U/S 69 AS ITS UNEXPLAINED INVESTMENT. THE LD. CIT(A) HAS DELETED RS. 1,01,65,1 40/ - AND HAS SUSTAINED THE REMAINING. BOTH PARTIES ARE AGGRIEVED. 4. WE HAVE CAREFULLY CONSIDERED RIVAL SUBMISSIONS MADE IN THIS REGARD. THE LD. CIT(DR) HAS REPEATED THE REASONS GIVEN FOR MAKING ADDITION IN THE ASSESSMENT ORDER AND HAS ALSO RELIED ON HIS WRITTEN SUBMISSIONS. ON THE OTHER HAND LD. A.R. HAS RELIED ON HIS WRITTEN SUBMISSIONS , COPY ENCLOSED AT PAPER BOOK PAGE 19 , AND HAS ALSO REFERRED TO THE AOS R.R. ENCLOSED AT PAPER BOOK PAGE 27 AND 29.WE HAVE CAREFULLY TREATED THROUGH ALL THE FACTS AND FI GURES OF RIVAL SUBMISSIONS. WE HAVE FOUND THAT THE A.O. HAS ADDED THIS AMOUNT ON A WRONG PREMISE THAT THE ASSESSEE HAS NOT SHOWN THESE ASSETS IN ITS 10 TRADING ACCOUNT. IN FACT THE FIRM CAME INTO EXISTENCE ONLY DURING THE RELEVANT F.Y. AND THERE BEING, ADMITT EDLY, NO TRADING ACTIVITY DURING THIS YEAR, THE PURCHASE OF PROPERTIES WERE DIRECTLY SHOWN AS STOCK IN THE BALANCE SHEET. OTHERWISE ALSO THIS ACCOUNTING WILL HAVE NO IMPACT ON THE PROFIT AS PURCHASE WILL CAME ON EXPENSES SIDE AND STOCK ON CREDIT SIDE. WE H AVE ALSO SEEN COPIES OF ROI ENCLOSED AT PAGES 111 TO 113 AND PAPER BOOK PAGE 27 TO 30. IN RELATION TO BOTH THESE PROPERTIES, THE ASSESSEE HAS PRODUCED FOLLOWING EVIDENCES : - IN RELATION TO PURCHASE OF PROPERTY THE DOCUMENTS WERE FOUN D DURING SEARCH AND REFERENCE OF PAGES OF SEIZED DOCUMENTS WAS DULY SUBMITTED, AND THE SAME ARE EVEN VERIFIABLE FROM THE SAME. KINDLY REFER P.25 OF THE ORDER OF CIT(A) WHERE SUCH DETAILS WERE GIVEN ARE REPRODUCED. THE AO HAD ALSO MENTIONED THE SAME IN REM AND REPORT REPRODUCED IN CIT(A) ORDER AT PAGE 28. PLOT NO. 100, NEW POWER HOUSE ROAD RS. 59,50,000/ - : COPY OF AGREEMENT IN RELATIO N TO PURCHASE OF PROPERTY AT NEW POWER HOUSE FOUND AT THE TIME OF SEARCH AND COPIES OF CHEQUES IN RELATION TO PAYMENTS BEING MADE. (P.B. 144 - 185. COPY OF REGISTERED SALE DEED AT P.B. 152 - 165). 11 IN REMAND PROCEEDINGS THE LD. AO ACCEPTED THAT THE DIFFERENCE TO THE TUNE OF RS. 50,890/ - ON ACCOUNT OF STAMP DUTY REMAINS UNEXPLAINED, AND THE LD. CIT CONFIRMED THE ADDITION TO THIS EXTENT AND DELETED TH E BALANCE AMOUNT. ACCOUNT STATEMENT IN RELATION TO PURCHASE OF PROPERTY AT P.B. 91 92. THE INVESTMENT WAS DULY VERIFIED BY THE LD. A.O. EVEN DURING THE REMAND PROCEEDINGS AND N OTHING WAS FOUND. EVEN IN THE REMAND REPORT THE LD. AO HAD NOT MENTIONED ANYTHING IN RELATION TO THIS PROPERTY. COPY OF BANK STATEMENT OF THE ASSESSEE, AND PARTNERS WERE ALSO SUBMITTED IN SUPPORT OF PAYMENTS BEING MADE. (P.B. 103 106). LETTER DATED 7.1.2014 TO AO POINTI NG OUT THE REFERENCE TO SEIZED DOCUMENTS WHERE SUCH AGREEMENTS/SALE DEEDS WERE FOUND AND SEIZED DURING SEARCH PROCEEDINGS. COMPLETE COPIES OF BOOKS OF ACCOUNTS WERE BEING ALSO SUBMITTED TO THE AO (P.B. 214 224). THE AMOUNT OF RS. 50,890/ - ON ACCOUNT OF STAMP DUTY WAS BEING PAID BY THE PARTNERS AND THEREFORE THE ADDITION IN THE HANDS OF THE FIRM IS NOT JUSTIFIED. FURTHER THERE IS NO ACTIVITY AND ANY SOURCE OF INCOME OF THE FIRM. ALTERNATIVELY TELESCOPING EFFECT OF THE OTHER INCOME ALREADY SURRENDER ED BY THE PARTNERS MAY KINDLY BE GRANTED AGAINST THIS SHORTFALL. PLOT NO. 2 : POLO FOR RS. 42,66,030/ - : 12 ACCOUNT STATEMENT FOR INVESTMENT IN PLOT NO. 2 (P.B. 78) COPY OF REGISTERED SALE DEED AT P.B. 79 89. ALL THE PAYMENT MADE BY ACCOUNT PAYEE CHEQUES AND ARE FULLY VERIFIABLE. BANK STATEMENT WAS ALSO SUBMITTED AT P.B. 210 - 213. SALE DEED WERE FOUND IN SEARCH PROCEEDINGS (P.B. 214). BOOKS OF ACC OUNTS WERE ALSO DULY SUBMITTED. ADMITTEDLY, NO INCRIMINATE EVIDENCE WAS FOUND DURING SEARCH. FROM TH E PERUSAL OF THE ABOVE EVIDENCE WE ARE SATISFIED AND THE ENTIRE INVESTMENT STANDS EXPLAINED. IT WAS SUBMITTED THAT THE ASSESSEE HAS MADE A HUGE SURRENDER DURING SEARCH AND THE SMALL AMOUNT OF RS. 50,890/ - STANDS EXPLAINED UNDER THAT SURRENDERED AMOUNT. WE ARE IN AGREEMENT WITH LD. A.R. THE SURRENDER HAS NOT BEEN DISPUTED BY THE DEPARTMENT. THEREFORE, WE DISMISS GROUND NO. (2) OF REVENUES APPEAL AND ALLOW GROUND NO. (2) OF ASSESSEES APPEAL. 5. THE GROUND NO. (3) OF REVENUES APPEAL RELATES TO DELETION OF ADDITION MADE BY THE A.O. ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT, SHOWN IN THE NAME OF SMT. INDU CHAJJER AT RS. 15 LAKHS; IN THE NAME OF M/S. SHARMA INDUSTRIES AT RS. 7 LAKHS, IN THE NAME OF SHRIMOTI RAM KULERIA AT RS. 5.5 LAKHS AND SHRI S UKHRAM JA NGID AT RS. 2.5 LAKHS. THE FACT S OF THIS ISSUE ARE THAT THE ASSESSEE - FIRM HAS SHOWN 13 TAKING UNSECURED LOANS OF RS. 25,10,850/ - FROM VARIOUS PERSONS DETAILS OF WHICH IS AS UNDER: - SL. NO. NAME OF PERSON AMOUNT 1. ASHOK CHHAJER 15,00,000/ - 2. JAGD ISH JANGID 65,000/ - 3. SHARMA INDUSTRIES 7,00,000 / - 4. MOTI RAM KULERIYA 5,50,000 / - 5. SUKHRAM JANGID 2,50,000 / - 30,65,000/ - THE A.O. DEMANDED PROOF OF THESE DEPOSITS IN TERMS OF SECTION 68 OF ACT AND BEING NOT SATISFIED HE HAS ADDED TOTAL A MOUNT OF RS. 30,65,000/ - U/S 68 OF THE ACT. THE LD. CIT(A), HAS DELETED THIS ADDITION. BOTH PARTIES HAVE REITERATED THE ARGUMENTS TAKEN BEFORE. IN EFFECT THE LD. CIT(DR) HAS ARGUED THAT THE CREDITWORTHINESS OF THE CASH CREDITORS DONT STAND PROVED ON RECOR D. THE LD. A.R. HAS SUPPORTED THE ORDER OF LD. CIT(A). 6. AFTER COGITATING ENTIRE RECORD, WE HAVE FOUND THAT THE IDENTITY AND THE CREDITWORTHINESS OF THE CASH CREDITORS STAND PROVED FROM THE FOLLOWING EVIDENCE PRODUCED BY THE ASSESSEE AND VERIFIED BY THE A.O., IN REMAND PROCEEDINGS. THE GENUINITY OF TRANSACTIONS ALSO STAND ESTABLISHED. THESE EVIDENCES IN EACH CASE ARE DETAILED AS UNDER: - 14 A. INDU CHAJJER 15,00,000/ - : ACCOUNT CONFIRMATION P.B. 114. ELECTION COMMISSION CARD P.B. 115 PAN CARD COPY P.B 116 BA NK STATEMENT P.B. 117, 258 IN RELATION TO SOURCE OF DEPOSIT COPY OF SALE DEED BY DEPOSIT O R WAS ALSO SUBMITTED AT P.B. 226 233. B. SHARMA INDUSTRIES RS. 7,00,000/ - : ACCOUNT CONFIRMATION AT P.B. 70 COPY OF BANK STATEMENT P.B. 71 COPY OF INCOME TAX RETURN P. 72 BALANCE SHEET AND ANNEXURES P. 259 260. D. SUKH RAM JANGID RS. 2,50,000/ - : ACCOUNT CONFIRMATION P.B. 77 COPY OF INCOME TAX RETURN P. 127 132 ELECTION CARD P. 133. COPY OF SALE DEED TO PROVE THE SOURCE OF MONEY AT P.B. 134 138. REGULAR ASSESSEE, AND ALL TRANSACTION THROUGH ACCOUNT PAYEE CHEQUES. C. MOTI RAM KULERIA RS. 5,50,000/ - : ACCOUNT CONFIRMATION P.B. 73 EX SERVICE MAN IDENTITY CARD P. 122 COPY OF BANK STATEMENT P. 123 126 IN RELATION TO SOURCE OF MONEY COPY OF SALE DEED P.B. 74 - 76 NO INCRIMINATING MATERIAL FOUND DURING SEARCH. 15 WE DONT FIND ANY CONTRARY EVIDENCE ON RECORD. NO INCRIMINATING EVIDENCE WAS FOUND DURING SEARCH. ALL THE ENTRIES ARE REFLECTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. NO EVIDENCE WAS FOUND DURING PO ST SEARCH PROCEEDINGS AS WELL. THE DETAILED REPLY OF THE ASSESSEE IS ENCLOSED AT PAGE 31 AND 35 OF ARS PAPER BOOK. MAJOR PAYMENTS ARE THROUGH CHEQUE . ACCORDINGLY, WE CONFIRM THE IMPUGNED DELETION AND DISMISS GROUND NO. (3) OF REVENUES APPEAL. 7. GROUND NO. (1) OF ASSESSEES APPEAL IS REGARDING SUSTAINED ADDITION OF RS. 65,000/ - ADDED U/S 68 IN RESPECT OF UNSECURED LOAN FROM JAGDISH JANGID. IN THIS REGARD ALSO THE FOLLOWING EVIDENCE, CLEARLY EXPLAIN THIS LOAN IN TERMS OF SECTION 68 OF THE ACT. THE FOLLOW ING DOCUMENTS ARE ENOUGH TO EXPLAIN THIS LOAN : - A. CONFIRMATION OF ACCOUNT STATEMENT P.B. 69 B. REGULAR ASSESSEE AND PAN SUBMITTED C. COPY OF BANK STATEMENT P.B. 234 D. DRIVING LICENSE COPY P.B. 121 E. COPY OF I.T. RETURN FOR 2007 - 08 OF CREDITOR P.B. 118 120. F. RELIA NCE ON JUDGMENT OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF JAI STEEL INDIA V. ACIT REPORTED IN (2013) 259 CTR (RAJ) 281 DEFINING SCOPE OF ASSESSMENT U/S 153A TO BE CONFINED ONLY 16 TO MATERIAL FOUND DURING SEARCH. NOTHING FOUND TO SUGGEST CREDIT WAS NOT GENUINE. G. RELY ON OTHER DECISIONS AT P.B. 12 - 19 . THEREFORE, WE ORDER DELETION OF SUSTAINED ADDITION OF RS. 65,000/ - AND ALLOW GROUND NO. (1) OF ASSESSEES APPEAL. 8. GROUND NO. (2) ALREADY STANDS DECIDED ALONGWITH GROUND NO. (2) OF REVENUES APPEAL. 9. GROUND NO. (4) IS IN RESPECT OF CHARGING OF INTEREST U/S 234B AND 234C OF THE ACT. THIS GROUND CANT BE ALLOWED AS CHARGING OF INTEREST IS MANDATORY. ACCORDINGLY, WE PARTLY ALLOW ASSESSEES APPEAL AND DISMISS REVENUES APPEAL. 10. IN THE RESULT, APP EAL OF THE ASSESSEE IS ALLOWED AND THAT OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 25 TH SEPTEMBER , 2014. SD/ - SD/ - (N.K.SAINI) [HARI OM MARATHA] ACCOUNTAN T MEMBER JUDICIAL MEMBER DATED : 25 TH SEPTEMBER, 2014. 17 VL/ - COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR ASSISTANT REGISTRAR ITAT, JODHPUR