ITO 25(2)(1), MUMBAI V. KETAN N.SHAH, MUMBAI

ITA 3883/MUM/2010

• Counselvise Citation: 388319914 RSA 2010
• Duration Of Justice: 1 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 13-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: PRAKASH PANDIT
• Keywords: Unexplained cash credit; Bonafide mistake
• Section: 68

Judgement Text

1 ITA NO. 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007- -- -08) 08) 08) 08) IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI MUMBAI MUMBAI MUMBAI A AA A BENCH BENCH BENCH BENCH MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI BEFORE SHRI R S SYAL & BEFORE SHRI R S SYAL & BEFORE SHRI R S SYAL & BEFORE SHRI R S SYAL & SHRI SHRI SHRI SHRI VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007- -- -08) 08) 08) 08) THE INCOME TAX OFFICER WARD 25(2)(1), MUMBAI VS SHRI KETAN N SHAH A-901 MAHAVINDEH BLDG CHANDAVARKAT LANE BORIVALI (W) MUMBAI 92 ( (( (APPELLANT APPELLANT APPELLANT APPELLANT) )) ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) PAN NO. AADPS5125J A SSESSEE BY SHRI PRAKASH PANDIT REVENUE BY SHRI R S ARNEJA/DR PER PER PER PER VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER DATED 10.3.2010 OF THE CIT(A)-35, MUMBAI RELATING TO AY 2 007-08. 2 THE ONLY GROUND RAISED BY THE REVENUE IN THIS APP EAL READS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) ERRED IN DELETING THE ADDITION OF RS. 40,00, 000/- MADE U/S 68 OF THE ACT AS UNEXPLAINED CASH CREDIT WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE FAILED TO PROVIDE THE DETAILS CALLED FOR T IME AND AGAIN DURING THE COURSE OF ASSESSMENT PROCEEDINGS REGARDING THE LOAN TAKEN FROM M/S JESONS CORPORATION. 2.1 THE ASSESSING OFFICER NOTICED FROM THE PERSONAL BALANCE SHEET OF THE ASSESSEE THAT AN AMOUNT OF RS. 40,00,000/- WAS OUTS TANDING AS UNSECURED LOAN IN THE NAME OF M/S JESONS CORPORATION. ON THE QUER Y FROM THE ASSESSING OFFICER, THE ASSESSEE EXPLAINED THAT ACTUALLY THE LOAN WAS T AKEN FROM M/S JESONS INDUSTRIES LTD BUT THE SAME WAS ACCOUNTED WRONGLY I N THE NAME OF M/S JESONS CORPORATION. THE ASSESSING OFFICER WAS NOT SATISFIE D WITH THE REPLY GIVEN BY THE 2 ITA NO. 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007- -- -08) 08) 08) 08) ASSESSEE AND TREATED THE LOAN AS UNEXPLAINED CASH C REDIT AND MADE THE ADDITION U/S 68 OF THE ACT. 2.2 ON APPEAL, THE ASSESSEE HAS FURTHER EXPLAINED T HAT THE CHEQUE RECEIVED FROM M/S JESONS INDUSTRIES WERE EN-CASHED THROUGH H DFC BANK AND BANK OF BARODA. A COPY OF THE BANK STATEMENT OF M/S JESONS INDUSTRIES LTD WITH CENTRAL BANK OF INDIA AS WELL AS THE COPY OF THE BANK ACCO UNT OF THE ASSESSEE WITH HDFC BANK AND BANK OF BARODA WERE ALSO FURNISHED. THE LD CIT(A), AFTER CONSIDERING THE DETAILS AND THE EXPLANATION FILED BY THE ASSESS EE, DELETED THE ADDITION. 3 BEFORE US, THE LD DR HAS SUBMITTED THAT THE ASSES SEE FAILED TO DISCHARGE HIS PRIMARY ONUS OF PROVING THE GENUINENESS OF THE TRANSACTION BEFORE THE ASSESSING OFFICER. HE FURTHER CONTENDED THAT THE A SSESSEE DID NOT PROVIDE PRIMARY DETAILS SUCH AS ADDRESS OF THE LOAN CREDITO R AND CONFIRMATION FROM THEM. THEREFORE, WHEN THE ASSESSEE FAILED TO DISCHARGE HI S ONUS, THE ASSESSING OFFICER IS JUSTIFIED IN MAKING THE ADDITION. HE RELIED ON THE ORDER OF THE ASSESSING OFFICER. 3.1 THE LD AR OF THE ASSESSEE, ON THE OTHER HAND, S UBMITTED THAT THE ASSESSEE FILED LETTER DATED 10.12.2009 BEFORE THE ASSESSING OFFICER WHEREBY EXPLAINED THE DISCREPANCY AS BASICALLY THE BONAFIDE MISTAKE I N ACCOUNTING THE LOAN AMOUNT IN THE NAME OF M/S JESONS CORPORATION INSTEAD OF M/ S JESONS INDUSTRIES LTD. THE LD AR OF THE ASSESSEE FILED A COPY OF THE SAID LETT ER DATED 10.12.2009 BEFORE US. HE HAS ALSO FILED THE DETAILS OF ACCOUNTS IN THE BO OKS OF M/S IMPEX DYECHEM, PERSONAL ACCOUNT OF THE ASSESSEE IN M/S JESONS COR PORATION AND M/S JESONS INDUSTRIES LTD AND EXPLAINED THAT IN FACT THE LOAN WAS TAKEN FROM M/S JESONS INDUSTRIES THROUGH VARIOUS CHEQUES, WHICH WERE EN-C ASHED BY THE ASSESSEE IN ITS 3 ITA NO. 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 3883/MUM/2010 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007 (ASST YEAR 2007- -- -08) 08) 08) 08) BANK ACCOUNT WITH HDFC BORIVALI (W) BRANCH AND BAN K OF BARODA, BORIVALI (W) BRANCH. 4 AFTER GOING THROUGH THE DETAILS AS WELL AS THE OR DERS OF THE AUTHORITIES BELOW, WE FIND THAT CONFUSION REGARDING THE LOAN OF RS. 40 LACS IS ONLY DUE TO THE MISTAKE OF ACCOUNTING THE AMOUNT IN THE NAME OF M/S JESONS CORPORATION INSTEAD OF M/S JESONS INDUSTRIES LTD. FROM THE DETAILS AND EVIDENCES PRODUCED BY THE ASSESSEE, IT IS ESTABLISHED THAT THE LOAN WAS ACTUA LLY OBTAINED FROM M/S JESONS INDUSTRIES LTD AND THEREFORE, THERE IS NO JUSTIFICA TION IN TREATING THE SAID LOAN AS UNEXPLAINED CASH CREDIT. THE LD CIT(A) HAS DULY AN ALYZED AND VERIFIED THE VARIOUS DETAILS AND RELEVANT MATERIAL WHILE PASSI NG THE IMPUGNED ORDER ON THIS ISSUE AND WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF THE LD CIT(A) IN DELETING THE ADDITION. ACCORDINGLY, WE CONFIRM THE ORDER OF THE LD CIT(A). THE GROUND RAISED BY THE REVENUE IS ACCORDINGLY DISMISS ED. 5 IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THE 27 TH , DAY OF MAY 2011. SD/- SD/- ( ( ( ( R S SYAL R S SYAL R S SYAL R S SYAL ) )) ) ACCOUNTANT MEMBER ( ( ( ( VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO ) )) ) JUDICIAL MEMBER PLACE: MUMBAI : DATED: 27 TH , MAY 2011 RAJ* COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI