The ITO, Ward-11(4), Ahmedabad V. M/s. Sinhal Brothers, Ahmedabad

ITA 369/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9321 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 16-12-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 08-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ITA NO AHD ASSESSM EN; S N SOPARKAR
• Keywords: Unexplained cash credit; Additional evidence; Onus to prove
• Section: 143(3); 133A; 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, A HMEDABAD , (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI S. S. GOD ARA, J.M.) ( , !'# ' $' $%& , ! '( ) ITA NO. 368/AHD/2012 (ASSESSM ENT YEAR: 2008-09) INCOME-TAX OFFICER, WARD-11(4), AHMEDABAD VS. M/S. SYNWAVE INDUSTRIES 242, NEW CLOTH MARKET, O/S RAIPUR GATE, RAIPUR, AHMEDABAD 380001 PAN NO. AAUFS0675H (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI KEYUR PATEL, SR. D.R. RESPONDENT BY : SHRI S. N. SOPARKAR, A.R. & ITA NO. 369/AHD/2012 (ASSESSM ENT YEAR: 2008-09) INCOME-TAX OFFICER, WARD-11(4), AHMEDABAD VS. M/S. SINHAL BROTHERS, 242, NEW CLOTH MARKET, O/S RAIPUR GATE, RAIPUR, AHMEDABAD 380001 PAN NO. AAMFS8786M (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SANJAY AGRAWAL, CIT D.R. RESPONDENT BY : SHRI S. N. SOPARKAR, A.R. DATE OF HEARING : 16 -12-201 5 DATE OF PRONOUNCEMENT : 16-02-2016 ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 2 ( )/ ORDER PER ANIL CHATURVEDI, ACCOUNTANT MEMBER THESE TWO APPEALS FILED BY TWO DIFFERENT ASSESSEES ARE AGAINST THE ORDERS OF CIT(A)-XVI, AHMEDABAD, DATED NOVEMBER 17, 2011 FOR A.Y.2008-09. 2. BEFORE US, AT THE OUTSET, LD. A.R. SUBMITTED THA T THOUGH THE TWO APPEALS OF THE ASSESSEE PERTAIN TO DIFFERENT ASSESSEES BUT THE BOT H ASSESSEE BELONG TO SAME GROUP, THE ASSESSMENT YEAR ARE SAME AND SOME OF THE ISSUES ARE ALSO IDENTICAL AND THEREFORE THE SUBMISSION MADE BY HIM ON THE COMMON ISSUES, WOULD BE APPLICABLE TO BOTH APPEALS. LD. D.R. DID NOT OBJECT TO THE AF ORESAID SUBMISSION OF LD. A.R. WE, THEREFORE, FOR THE SAKE OF CONVENIENCE PROCEED TO DISPOSE OF BOTH THE APPEALS BY A COMMON ORDER AND PROCEED WITH THE FACTS OF ITA NO.368/AHD/2012 IN CASE OF M/S.SYNWAVE INDUSTRIES. 3. ASSESSEE IS A PARTNERSHIP FIRM HAVING PROCESS HO USE AND STATED TO BE ENGAGED IN THE BUSINESS OF DOING PROCESSING ON JOB WORK BAS IS. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2008-09 ON 24-11-2008 DECLARING TOT AL INCOME AT RS. NIL. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE A SSESSMENT WAS FRAMED UNDER SECTION 143(3) VIDE ORDER DATED 27.12.2010 AND THE TOTAL INCOME WAS DETERMINED AT RS. 30,14,630/-. AGGRIEVED BY THE ORDER OF A.O., AS SESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 17.11.2011 G RANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE AFORESAID ORDER OF LD. C IT(A), REVENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUN DS:- 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 27,00,000/- MADE ON ACCOUNT OF UNEXPLAINED CASH CRE DITS U/S.68 OF THE ACT. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 10,63,688/- BEING INTEREST PAID WITHOUT DEDUCTION O F TAX U/S.194A OF THE ACT. ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 3 3.1 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, A. O. NOTICED THAT ASSESSEE HAD HAS RECEIVED UNSECURED LOANS FROM VARIOUS PARTIES ( THE LIST OF WHICH IS LISTED AT PAGE 2 OF THE ASSESSMENT ORDER) AND HAD ALSO PAID INTERE ST ON THOSE UNSECURED LOANS. A.O. NOTED THAT A SURVEY WAS CONDUCTED IN THE CASE OF LALITKUMAR SHARMA AND OTHERS ON 31.08.2009 WHEREIN THE STATEMENT OF SHRI RAM DINESH SHARMA WAS RECORDED WHERE HE HAD ADMITTED THAT HE WAS MANAGING BUSINESS AFFAIRS AND THE BANK ACCOUNTS OF 61 PERSONS. THE NAMES OF THE PERS ONS FROM WHOM ASSESSEE HAD OBTAINED IMPUGNED DEPOSIT ALSO APPEARED IN THE LIST OF THE PERSONS FOUND AT THE TIME OF SURVEY AT LALITKUMAR SHARMA AND OTHERS. THE ASS ESSEE WAS THEREFORE ASKED TO PROVE THE IDENTITY, CREDITWORTHINESS AND GENUINENES S OF THE TRANSACTION AND WAS ALSO ASKED TO PRODUCE THE PERSONS. A.O. NOTED THAT ASSESSEE DID NOT COME FORWARD TO PRODUCE THE DEPOSITORS. A.O., THEREFORE, FOR TH E REASONS NOTED IN THE ORDER CONCLUDED THAT THE CASH CREDIT APPEARING IN THE NAM E OF DEPOSITORS AND UNSECURED LOANS STANDING IN THEIR NAMES REMAINED UNEXPLAINED AND, ACCORDINGLY, CONSIDERED THE AGGREGATE AMOUNT OF RS.25LACS AS UNEXPLAINED CA SH CREDIT AND ADDED IT TO THE INCOME OF ASSESSEE. HE FURTHER HELD THAT SINCE THE CASH CREDITS WERE HELD TO BE NON- GENUINE, THE INTEREST OF RS.2,07,390/- COULD ALSO N OT BE ALLOWED. HE, ACCORDINGLY, DISALLOWED THE INTEREST ALSO. AGGRIEVED BY THE OR DER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO DELETED THE ADDITION B Y HOLDING AS UNDER:- 3.6 I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE LD. COUNSEL AND ALSO GONE THROUGH THE FINDING RECORDED BY THE ASSESSING OFFIC ER IN PARA-4 OF THE ASSESSMENT ORDER. IT IS EVIDENT FROM RECORD THAT THE ASSESSEE HAD RAI SED LOAN FROM TEN PERSONS DURING THE YEAR UNDER CONSIDERATION AS SHOWN IN THE TABLE IN P ARA-3.0 ABOVE. THE DEPOSITS WERE FOUND RECORDED IN THE BOOKS OF ACCOUNT OF THE APPEL LANT. ALL OF THE DEPOSITS WERE TAKEN BY A/C PAYEE CHEQUES AND CREDITED TO THE BANK ACCOUNT OF THE ASSESSEE. DETAILED CONFIRMATIONS OF THE DEPOSITORS WERE FILED DURING T HE COURSE OF ASSESSMENT PROCEEDINGS CONTAINING NAME AND COMPLETE ADDRESS, PAN, AMOUNT O F LOAN, DATE OF GIVING LOAN, THE CHEQUE NUMBERS, NAME OF BANK, DATE OF REPAYMENTS OF LOAN ETC. ETC. ALL THE DEPOSITORS ARE INCOME-TAX ASSESSEE AND REGULARLY FILING THEIR RETU RNS OF INCOME. EACH OF THE DEPOSITORS HAD CERTIFIED IN THE CONFIRMATIONS THAT THEY HAD NE ITHER RECEIVED ANY CASH FROM THE PARTY AT THE TIME OF GRANTING OF LOAN NOR GIVEN ANY CASH TO THE PARTY AT THE TIME OF GRANTING OF LOAN NOR GIVEN ANY CASH TO THE PARTY AT THE TIME OF RECEIPT OF LOAN. THE ASSESSEE HAD THUS PRIMA FACIE ESTABLISHED THE GENUINENESS OF THE CASH CREDITS. THE ASSESSING OFFICER HAD NOT ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 4 BROUGHT ANY ADVERSE MATERIAL ON RECORD TO SUGGEST T HAT ANY CASH WAS GIVEN BY THE ASSESSEE TO THE DEPOSITORS OR TO SHRI RAMDINESH SHA RMA AND THE SAID CASH WAS DEPOSITED IN THE BANK ACCOUNTS OF THE DEPOSITORS. THE ASSESSI NG OFFICER HAD ALSO NOT GIVEN ANY JUSTIFICATION AS TO WHAT WAS REQUIRED TO BE VERIFIE D AFTER FILING OF DETAILED CONFIRMATIONS FOR WHICH THE PRESENCE OF THE DEPOSITORS WAS NECESS ARY. IT IS EVIDENT FROM RECORD THAT THE LOAN WAS REPAID IN THE YEAR 2008 AND 2009 AND THUS IT WAS NOT POSSIBLE FOR THE ASSESSEE TO PRODUCE THE DEPOSITORS. EVEN IF ANY SPECIFIC VER IFICATION WAS REQUIRED FROM THE DEPOSITORS, THE ASSESSING OFFICER COULD HAVE SUMMON ED THOSE DEPOSITORS WHICH WAS NOT DONE BY THE ASSESSING OFFICER. THIS SHOWS THAT NOTH ING SPECIFIC WAS REQUIRED TO BE VERIFIED. 3.7 THE PROVISIONS OF SEC. 68 SAY THAT 'WHERE ANY SUM IS FOUND CREDITED IN THE BOOKS OF AN ASSESSEE MAINTAINED FOR ANY PREVIOUS YEAR, AN D THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE THEREOF OR THE EXPLANAT ION OFFERED BY HIM IS NOT, IN THE OPINION OF THE ASSESSING] OFFICER, SATISFACTORY, TH E SUM SO CREDITED MAY BE CHARGED TO INCOME-TAX AS THE INCOME OF THE ASSESSEE OF THAT PR EVIOUS YEAR.' THOUGH, THERE ARE NUMBER OF DECISIONS OF THE HON'BLE SUPREME COURT, T HE HIGH COURTS AND THE VARIOUS TRIBUNALS FOR AND AGAINST THE ASSESSEE ON THE ISSUE OF CASH CREDITS BUT THE SETTLED POSITION OF LAW IS THAT IT IS NECESSARY FOR THE ASSESSEE TO PROVE PRIMA FACIE THE TRANSACTIONS WHICH RESULTS IN A CASH CREDIT IN HIS BOOKS OF ACCOUNT. S UCH PROOF INCLUDES PROOF OF THE IDENTITY OF HIS CREDITOR, THE CAPACITY OF SUCH CREDITOR TO A DVANCE THE MONEY AND, LASTLY, THE GENUINENESS OF THE TRANSACTION. THESE THINGS MUST B E PROVED PRIMA FACIE BY THE ASSESSEE AND ONLY AFTER THE ASSESSEE HAS ADDUCED EVIDENCE TO ESTABLISH PRIMA FACIE THE AFORESAID, THE ONUS SHIFTS ON THE DEPARTMENT. THE HON'BLE DELH I HIGH COURT IN A RECENT DECISION (RELATING TO SHARE CAPITAL) IN THE CASE OF CIT VS. OASIS HOSPITALITIES (P.) LTD. [2011] 333 ITR 119 (DELHI) HAS OBSERVED THAT: 'THE PLAIN LANGUAGE OF SECTION 68 SUGGESTS THAT WHE N THE ASSESSEE IS TO GIVE SATISFACTORY EXPLANATION ABOUT RECEIPTS, BURDEN OF PROOF IS ON THE ASSESSEE TO PROVIDE NATURE AND SOURCE OF THOSE RECEIPTS. [PARA 5] IN ORDER TO DISCHARGE THIS BURDEN, THE ASSESSEE IS REQUIRED TO PROVE: ( A )IDENTITY OF THE SHAREHOLDER; ( B )GENUINENESS OF THE TRANSACTION; AND ( C )CREDITWORTHINESS OF THE SHAREHOLDERS. [PARA 11 ] IN CASE THE INVESTOR/SHAREHOLDER IS AN INDIVIDUAL, SOME DOCUMENTS WILL HAVE TO BE FILED OR THE SAID SHAREHOLDER WILL HAVE TO BE PRODUCED BE FORE THE ASSESSING OFFICER TO PROVE HIS IDENTITY. IF THE CREDITOR/SUBSCRIBER IS A COMPA NY, THEN THE DETAILS IN THE FORM OF ITS REGISTERED ADDRESS OR PAN IDENTITY, ETC., CAN BE FU RNISHED. [PARA 12] GENUINENESS OF THE TRANSACTION IS TO BE DEMONSTRATE D BY SHOWING THAT THE ASSESSEE HAD, IN FACT, RECEIVED MONEY FROM THE SAID SHAREHOLDER A ND IT HAD COME FROM THE COFFERS OF THAT VERY SHAREHOLDER. WHEN THE MONEY IS RECEIVED B Y CHEQUE AND IS TRANSMITTED THROUGH BANKING OR OTHER INDISPUTABLE CHANNELS, GEN UINENESS OF THE TRANSACTION WOULD BE PROVED. OTHER DOCUMENTS SHOWING THE GENUINENESS OF THE TRANSACTION CAN BE THE COPIES OF THE SHAREHOLDERS' REGISTER, SHARE APPLICA TION FORMS, SHARE TRANSFER REGISTER, ETC. [PARA 13] ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 5 AS FAR AS THE CREDITWORTHINESS OR FINANCIAL STRENGT H OF THE CREDITOR/SUBSCRIBER IS CONCERNED, THAT CAN BE PROVED BY PRODUCING THE BANK STATEMENT OF THE CREDITORS/SUBSCRIBERS SHOWING THAT IT HAD SUFFICIEN T BALANCE IN ITS ACCOUNTS TO / ENABLE IT TO SUBSCRIBE TO THE SHARE CAPITAL. ONCE THESE DOCUM ENTS ARE PRODUCED, THE ASSESSEE WOULD HAVE SATISFACTORILY DISCHARGED THE ONUS CAST UPON HIM. THEREAFTER, IT IS FOR THE ASSESSING OFFICER TO SCRUTINIZE THE SAME AND IN CAS E HE NURTURES ANY DOUBT ABOUT THE VERACITY OF THESE DOCUMENTS, TO PROBE THE MATTER FU RTHER. HOWEVER, TO DISCREDIT THE DOCUMENTS PRODUCED BY THE ASSESSEE ON THE AFORESAID ASPECTS, THERE HAS TO BE SOME COGENT REASONS AND MATERIALS FOR THE ASSESSING OFFI CER AND HE CANNOT GO INTO THE REALM OF SUSPICION.' 3.8 IF THE CASE OF THE ASSESSEE IS EXAMINED IN THE LIGHT OF THE PROVISIONS OF SEC. 68 OF THE ACT, THE SETTLED POSITION OF LAW AS AFORESAID A ND IN VIEW OF THE ABOVE OBSERVATIONS OF THE DECISION OF THE HON'BLE DELHI HIGH COURT, IT WI LL BE SEEN THAT THE ASSESSEE HAD ESTABLISHED THE IDENTITY OF ALL THE CREDITORS BY FI LING DETAILED CONFIRMATIONS. THE ASSESSEE HAD ESTABLISHED THE GENUINENESS OF THE TRANSACTIONS AS ALL THE CREDITS WERE RECEIVED BY ACCOUNT PAYEE CHEQUES AND THIS FACT WAS NOT DISPUTE D BY THE ASSESSING OFFICER. THE CHEQUES WERE DEPOSITED IN THE BANK ACCOUNT OF THE A SSESSEE AND WERE CLEARED THROUGH THE BANKING CHANNEL. THE CREDITWORTHINESS OF ALL THE CR EDITORS WAS ALSO ESTABLISHED BY DECLARING THAT ALL THE DEPOSITORS ARE INCOME-TAX AS SESSES AND REGULARLY FILING THEIR RETURNS OF INCOME AND THE AMOUNT OF DEPOSITS WERE B Y ACCOUNT PAYEE CHEQUES. THE COPIES OF BANK ACCOUNTS OF THE DEPOSITORS WERE CALLED FOR FROM THE LD. COUNSEL FOR VERIFICATION AND IT WAS NOTICED THAT NO CASH WAS DEPOSITED IN TH E ACCOUNTS IMMEDIATELY BEFORE THE ISSUE OF CHEQUES FOR LOAN. THE BANK ACCOUNT NUMBERS , THE COMPLETE ADDRESSES OF THE ACCOUNT HOLDERS AND THE CLEARING DETAILS OF THE CHE QUES BY WHICH THE DEPOSITS WERE GIVEN ARE AVAILABLE IN THE COPIES OF SUCH BANK ACCOUNTS. THE COPIES OF BANK ACCOUNTS WERE NECESSARILY REQUIRED TO ASCERTAIN THE RELEVANT ENT RIES AND THESE CANNOT BE TREATED AS AN ADDITIONAL EVIDENCE AS PER PROVISIONS OF RULE-46A(4 ) OF THE INCOME-TAX RULES, 1962. 3.9 CONSIDERING THE FACTS OF THE CASE AND THE SUBMI SSION OF THE ASSESSEE FILED BEFORE THE ASSESSING OFFICER, I AGREE WITH THE CONTENTION OF THE LD. COUNSEL THAT THE ASSESSING OFFICER HAD HEAVILY RELIED UPON THE MATERIAL AVAILA BLE WITH HIM AS COLLECTED DURING THE COURSE OF SURVEY IN CASE OF SHRI LALIT SHARMA BUT U NLESS THE SAID MATERIAL WAS MADE AVAILABLE TO THE APPELLANT AND ALLOWED TO CROSS-EXA MINE THE PARTIES, THE SAME CANNOT BE USED AGAINST THE APPELLANT OR NO ADVERSE INFERENCES COULD BE DRAWN AGAINST THE ASSESSEE. LIKEWISE, THE ASSESSING OFFICER HAD RELIED UPON THE STATEMENT OF SHRI RAM DINESH SHARMA WITHOUT ALLOWING THE APPELLANT THE OPPORTUNI TY TO CROSS-EXAMINE HIM. THE APPELLANT VIDE PARA-5 OF ITS LETTER DATED 19.12.201 0 HAD BROUGHT TO THE NOTICE OF THE ASSESSING OFFICER THAT THE STATEMENT OF SHRI RAMDIN ESH SHARMA IS SELF-CONTRADICTORY STATEMENT AND THEREFORE REQUESTED THE ASSESSING OFF ICER TO SUMMON SHRI RAMDINESH SHARMA U/S 131 OF THE INCOME-TAX ACT 1961 FOR CROSS -EXAMINATION BY FIRM'S AUTHORIZED REPRESENTATIVE. HOWEVER, NO ANY OPPORTUNITY TO CROS S EXAMINE SHRI RAMDINESH SHARMA WAS ALLOWED TO THE ASSESSEE BY THE ASSESSING OFFICE R FOR THE REASONS BEST KNOWN TO HIM. IT IS THE SETTLED POSITION OF LAW THAT THE MATERIAL CO LLECTED AT THE BACK OF THE ASSESSEE CANNOT BE USED AGAINST THE ASSESSEE UNLESS HE/SHE IS CONFR ONTED WITH THE MATERIAL SO COLLECTED. APART FROM IT, THE LD. COUNSEL HAD RELIED UPON AND BROUGHT ON RECORD THE APPELLATE ORDER OF MY PREDECESSOR IN THE CASE OF BABULAL RAMPRASAD AGARWAL, HUF, IN WHICH THE SAME ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 6 ASSESSING OFFICER HAD MADE AN ADDITION OF RS. 15 LA KHS ON SIMILAR REASONING AND THAT APPELLANT HAD ASKED THE ASSESSING OFFICER AN OPPORT UNITY TO CROSS EXAMINE SHRI. RAMDINESH SHARMA BUT NO OPPORTUNITY WAS GIVEN BY TH E ASSESSING OFFICER. THE CIT (APPEALS) XVI, AHMEDABAD HAD ALLOWED THE APPEAL OF THAT ASSESSEE AND DELETED THE ADDITION. THE RELEVANT FINDING GIVEN VIDE PARA-2.3. 1 OF APPELLATE ORDER DATED 08.11.2010 IN APPEAL NO. CIT(A)-XVI/WD.11(4)/156/09-10 IS AS U NDER: I HAVE CONSIDERED THE SUBMISSION MADE BY THE APPEL LANT AND OBSERVATION OF THE AO. FROM THE ABOVE DISCUSSION, IT IS CLEAR THAT THE APPELLANT HAS FILED COPIES OF CONFIRMATIONS GIVING NAMES, ADDRESSES, PAN NUMBER, INCOME-TAX RETURN COPIES OF THESE PARTIES AND INITIALLY DISCHARGED ITS ONUS. FR OM THE REMAND REPORT, IT IS ALSO CLEAR THAT THE AO HAS FAILED TO GIVE CROSS EXAMINAT ION TO THE APPELLANT. AND HENCE THE STATEMENT RELIED UPON BY THE AO CANNOT BE MADE FOR THE ADDITION. THE PAPER ON WHICH THE AO HAS RELIED ALSO DOES NOT SPEAK ABOU T THE LOAN BEING BOGUS OR ONLY AN ARRANGEMENT OR ACCOMMODATION ENTRY. IN VIEW OF THIS REASON, I AGREE WITH THE APPELLANT AND THE ADDITION OF THE LOAN, AS WELL AS DISALLOWANCE OF CONSEQUENT INTEREST IS DELETED. THESE GROUNDS OF APPEAL AN ALL OWED.' 3.10 SINCE THE FACTS OF THE CASE DECIDED BY ME PRED ECESSOR ARE EXACTLY SIMILAR TO THE APPELLANTS CASE, I HAVE NO HESITATION IN FOLLOWING THE ORDER OF MY P REDECESSOR. APART FROM IT, II VARIOUS SUCH CASES, THE ADDITIONS MADE U/S 68 OF THE ACT ON THE BASIS OF THE STATEMENT OF SHI RAMDINESH SHARMA WERE DELETED BY M E WHERE THE THREE BASIC INGREDIENTS I.E. IDENTITY OF THE CREDITORS, GENUINENESS OF THE TRANSACTIONS AND CREDITWORTHINESS WERE ESTABLISHED. IN THOSE CASES, I HAVE RELIED UPON THE DECISIONS OF THE HON'BLE GUJRAT HIGH COURT IN THE CASE OF DY.CIT VS. ROHINI BUILDERS [20 03] 256 ITR 360 (GUJ.) AND THE HON'BLE AHMEDABAD TRIBUNAL IN THE CASE OF DIMCO SIL K MILLS VS. ITO 107 TAXMAN 41 (AHD.) ALONGWITH VARIOUS OTHER DECISIONS. THOUGH TH E LD. COUNSEL HAD NOT RELIED UPON SUCH DECISIONS BUT THE SAME ARE CLEARLY APPLICABLE IN THIS CASE ALSO. THE HON'BLE GUJRAT HIGH COURT IN THE CASE OF DY.CIT VS. ROHINI BUILDER S [2003] 256 ITR 360 (GUJ.) HAD EVEN HELD THAT MERELY BECAUSE SUMMONS ISSUED TO SOME OF CREDITORS COULD NOT BE SERVED OR THEY FAILED TO APPEAR BEFORE ASSESSING OFFICER, COULD NO T BE GROUND TO TREAT THOSE CREDITS AS NON-GENUINE. THE HON'BLE AHMEDABAD TRIBUNAL IN THE CASE OF DIMCO SILK MILLS VS. ITO 107 TAXMAN 41 (AHD.)(MAG.) HAD HELD THAT WHERE ASSE SSEE RECEIVED AMOUNTS APPEARING AS DEPOSITS IN ACCOUNTS OF THIRD PARTIES THROUGH AC COUNT PAYEE CHEQUES AND FILED CONFIRMATION AND OTHER MATERIALS TO SUPPORT GENUINE NESS OF THOSE PARTIES, ADDITION MADE OR ACCOUNT OF UNEXPLAINED CASH CREDITS IN THOSE ACC OUNTS COULD NOT BE SUSTAINED. IT HAD ALSO BEEN HELD BY THE HON'BLE GUJARAT HIGH COURT, B Y THE HON'BLE GAUHATI HIGH COURT AND BY THE HON'BLE RAJASTHAN HIGH COURT THAT THE AS SESSEE CAN BE ASKED TO PROVE SOURCE OF CREDITS IN ITS BOOKS OF ACCOUNT BUT NOT SOURCE O F SOURCE. THE DECISIONS OF THE ABOVE HIGH COURTS ARE EQUALLY APPLICABLE IN THIS CASE ALS O. 3.11 CONSIDERING THE DISCUSSION IN PARA-3.6 TO PARA -3.10 AS ABOVE AND RELYING UPON THE LAW LAID DOWN BY VARIOUS HIGH COURTS INCLUDING THE HON'BLE GUJRAT HIGH COURT, THE AHMEDABAD TRIBUNAL AND ALSO FOLLOWING THE APPELLATE ORDER OF MY PREDECESSOR, I AM OF THE OPINION THAT THE ASSESSING OFFICER WAS NOT JUST IFIED IN TREATING THE CASH CREDIT OF RS. 53,25,000/- AS UNEXPLAINED. THE ADDITION SO MADE FO R RS. 53,25,000/- IS HEREBY DELETED. THE SECOND, THIRD AND FOURTH GROUNDS OF APPEAL ARE ACCORDINGLY ALLOWED. ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 7 4.0 THE FIFTH GROUND OF APPEAL IS REGARDING THE ADD ITION OF RS.2,07,390/- MADE BY DISALLOWING THE INTEREST PAID TO THE 8 DEPOSITORS O N UNSECURED LOANS. THE ASSESSING OFFICER HAD DISCUSSED THIS ISSUE IN PARA-4 OF THE A SSESSMENT ORDER. THE ASSESSING OFFICER WAS OF THE VIEW THAT SINCE THERE WERE NO GENUINE CA SH CREDITS, THE ENTIRE INTEREST TOTALING TO RS.2,07,390/- IS DISALLOWED AND ADDED TO TOTAL I NCOME OF THE ASSESSEE. 4. AGGRIEVED BY THE ORDER OF LD. CIT(A), REVENUE I S NOW IN APPEAL BEFORE US. 4.1 BEFORE US, LD. D.R. SUPPORTED THE ORDER OF A.O. LD. A.R. ON THE OTHER HAND REITERATED THE SUBMISSIONS MADE BEFORE A.O. AND LD. CIT(A) AND FURTHER SUBMITTED THAT LD. CIT(A) WHILE DELETING THE ADDITION HAD ALS O CONSIDERED THE DECISION RENDERED IN THE CASE OF BABULAL RAMPRASAD AGARWAL ( HUF) (SUPRA) WHEREIN THE ADDITION WAS DELETED BY THE HONBLE TRIBUNAL IN ITA NO. 3494/AHD/2010 ORDER DATED 30.05.2014. HE ALSO PLACED ON RECORD THE COP Y OF THE AFORESAID DECISION AT PAGE 11 TO 18 OF THE PAPER BOOK. HE, THEREFORE, SU BMITTED THAT SINCE THE FACTS OF THE CASE IN PRESENT CASE ARE IDENTICAL TO THAT OF BABU LAL RAMPRASAD AGARWAL (HUF) THE ADDITION NEEDS TO BE DELETED AND THAT NO INTERF ERENCE TO THE ORDER OF LD. CIT(A) IS CALLED FOR. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO ADDITI ON MADE U/S 68 OF THE ACT. WE FIND THAT THE ADDITION HAS BEEN MADE BY THE A.O. BY MAINLY RELYING ON THE STATEMENT OF SHRI RAMDINESH SHARMA WHICH WAS RECOR DED DURING THE COURSE OF SURVEY CONDUCTED IN THE CASE OF LALITKUMAR SHARMA AND ORS. WE FIND THAT LD. CIT(A) WHILE DELETING THE ADDITION HAS NOTED THAT M ATERIAL COLLECTED AT THE TIME OF SURVEY IN CASE OF LALITKUMAR SHARMA WAS NOT MADE AV AILABLE TO ASSESSEE, ASSESSEE WAS NOT ALLOWED TO BE CROSS EXAMINE THE PARTIES AND ASSESSEE WAS ALSO NOT GRANTED ANY OPPORTUNITY TO CROSS EXAMINE SHRI RAMDINESH SHA RMA. WE FURTHER FIND THAT SIMILAR ADDITION ON IDENTICAL FACTS WAS MADE IN CAS E OF BABULAL RAMPRASAD ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 8 AGARWAL (HUF) (SUPRA) WHEREIN THE CO-ORDINATE BENCH OF TRIBUNAL DELETED THE ADDITION BY HOLDING AS UNDER:- 6. WE HAVE HEARD BOTH THE SIDES. WE HAVE NOTED THA T THE MAIN REASON OF THE IMPUGNED ADDITION IN THE HANDS OF THE ASSESSEE BY I NVOKING THE PROVISIONS OF SECTION 68 WAS A STATEMENT OF ONE SHRI RAMDINESH RANJIT SHARMA . UNDISPUTEDLY THAT STATEMENT WAS RECORDED DURING THE SURVEY PROCEEDINGS WHICH WERE C ONDUCTED U/S. 133A ON 31.08.2009 ON ONE SRI LALIT S. SHARMA. DURING THE SURVEY PROCE EDINGS, STATEMENT OF SRI RAMDINESH RANJIT SHARMA WAS RECORDED WHO HAS GIVEN A LONG LIS T OF THE PARTIES AND INFORMED THAT THE ACCOUNTS OF THOSE PARTIES HAVE BEEN MANAGED AND THE LOAN ENTRIES WERE PROVIDED BY HIM. IN THAT LIST, THERE WERE NAMES OF THE FIVE DEP OSITORS WHO HAVE ADVANCED LOAN TO THE ASSESSEE; THE AMOUNTS AS LISTED ABOVE. SO, THE QUES TION WAS THAT THE IMPUGNED ADDITION U/S.68 WAS CORRECTLY MADE IN THE HANDS OF THE ASSES SEE BY PLACING RELIANCE ON A STATEMENT WHICH WAS RECORDED OF A PERSON DURING THE SURVEY PR OCEEDINGS HELD IN THE CASE OF AN ANOTHER PERSON. THIS QUESTION WAS DULY ADDRESSED BY THE RESPECTED CO-ORDINATE BENCH IN THE CASE OF SRI AMIT KUMAR S. AGARWAL, RELEVANT PAR AGRAPHS REPRODUCED SUPRA. AT THIS JUNCTURE, IT IS WORTH TO MENTION THAT IN THE CASE O F AMIT KUMAR S. AGARWAL (SUPRA) ALMOST ON IDENTICAL SITUATION THE PROVISIONS OF SECTION 68 WERE INVOKED AND THE AO HAD MADE THE ADDITION. IN THAT CASE AS WELL THE PROCEEDINGS WERE INITIATED ON THE BASIS OF THE STATEMENT OF SRI RAMDINESH RANJIT SHARMA. THAT STATEMENT WAS RECORDED CONSEQUENCES UPON A SURVEY CONDUCTED ON SRI LALIT S. SHARMA, AS DISCUSS ED BY THE AO IN THE APPEAL IN HAND. IN SHORT, WE CAN CONCLUDE THAT ON IDENTICAL FACTS AND CIRCUMSTANCES WHEN A VIEW HAS BEEN TAKEN IN ASSESSEE'S FAVOUR THEN THERE IS NO OCCASIO N TO DEPART FROM THAT VIEW BUT TO FOLLOW THE SAME. MOREOVER, WE HAVE NOTED THAT THE ASSESSEE HAS DULY DISCHARGED HIS PRIMARY ONUS OF PLACING ON RECORD THE CONFIRMATION LETTERS, PAN DETAILS, CHEQUE DETAILS, BANK TRANSACTIONS THROUGH WHICH THE LOANS TAKEN. THE ASS ESSEE HAS INFORMED THAT THOSE PARTIES WERE EXISTING TAX PAYERS. IMPORTANTLY, IT HAS ALSO BEEN INFORMED THAT THE INTEREST WAS PAID TO THOSE PARTIES BY THE ASSESSEE AND THE TDS WAS DE DUCTED. FURTHER THE LOANS WERE REPAID IN A SUBSEQUENT YEARS THROUGH CITY BANK TRANSACTION . UNDER THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE THEREFORE UPHOLD THE VIEW OF LEARNED CIT(A) AND DISMISS THIS GROUND OF THE REVENUE. 5.1 BEFORE US, REVENUE HAS NOT POINTED OUT ANY DIST INGUISHING FEATURE IN THE FACTS OF THE PRESENT CASE AND THAT OF BABULAL RAMP RASAD AGRAWAL (HUF) (SUPRA) NOR HAS POINT OUT ANY FALLACY IN THE FINDINGS OF LD . CIT(A) . IN VIEW OF THE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WIT H THE ORDER OF LD. CIT(A) AND THUS THIS GROUND OF REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. ITA NOS.368 & 369/AHD/12 A.Y. 2008-09 9 ITA NO.369/AHD/2012 IN CASE OF M/S. SINHAL BROTHERS 7. THE GROUND RAISED BY REVENUE READS AS UNDER: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS. 53,25,000/- MADE ON ACCOUNT OF UNEXPLAINED CASH CRE DITS AND ADDITION OF RS. 80,679/- BEING INTEREST THEREON. 8. IN THE PRESENT CASE, SINCE BOTH THE PARTIES HAVE ADMITTED THAT THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE IS IDENTICAL TO THAT OF M/S. SYNWAVE INDUSTRIES IN ITA NO. 368/AHD/2012 WHICH WE HAVE DECIDED HEREINAB OVE, WE THEREFORE FOR THE SIMILAR REASONS STATED HEREINABOVE WHILE DECIDING T HE APPEAL FOR A.Y. 2008-09 IN ITA NO. 368/AHD/2012 (SUPRA) AND FOR SIMILAR REASON S DISMISS THE GROUND OF REVENUE IN THE PRESENT APPEAL. THUS, THE APPEAL OF REVENUES IS DISMISSED. 9. IN THE RESULT, BOTH THE APPEALS OF REVENUE ARE D ISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 16 - 02 - 2016. SD/- SD/- (S. S. GODARA) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED 16/02/2016 TRUE COPY S K SINHA COPY OF THE ORDER FORWARDED TO:- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD