ADVAITA ESTATE DEVELOPMENT P.LTD, MUMBAI V. ITO 9(1)(1), MUMBAI

ITA 4192/MUM/2010

• Counselvise Citation: 419219914 RSA 2010
• Duration Of Justice: 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 24-05-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: NITESH JOSHI
• Keywords: Unexplained cash credit; Additional evidence; Onus to prove
• Section: 68

Judgement Text

1 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) 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 BEFORE SHRI BEFORE SHRI BEFORE SHRI R S SYAL, AM & R S SYAL, AM & R S SYAL, AM & R S SYAL, AM & SHRI SHRI SHRI SHRI VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM ITA NO. ITA NO. ITA NO. ITA NO. 419 419 419 4192 22 2/MUM/2010 /MUM/2010 /MUM/2010 /MUM/2010 (ASST YEAR (ASST YEAR (ASST YEAR (ASST YEAR 2006 2006 2006 2006- -- -07 0707 07 ) )) ) ADVAITA ESTATE DEVELOPMENT P LTD AAVISHKAR BLDG OFFICE NO.9 GROUND FLOOR PRATAP NAGAR, OFF JOGESHWARI VIKHROLI LINK ROAD MUMBAI 60 VS THE INCOME TAX OFFICER 9(1)(1), MUMBAI ( (( ( APPELLANT APPELLANT APPELLANT APPELLANT ) )) ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) PAN NO. PAN NO. PAN NO. PAN NO. AAMFA 6807H AAMFA 6807H AAMFA 6807H AAMFA 6807H A SSESSEE BY SHRI NITESH JOSHI REVENUE BY SHRI RAGEEV AGARWAL/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 ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 5.3.2010 OF THE CIT(A) -19, MUMBAI FOR THE AY 200 6-07. 2 THE ASSESSEE RAISED VARIOUS GROUNDS; HOWEVER, THE ONLY ISSUE ARISES FOR OUR CONSIDERATION AND ADJUDICATION IS WHETHER IN TH E FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) IS JUSTIFIED IN CONFIRMING THE ADDITION OF UNSECURED LOAN OF RS 2,73,00,000/- U/S 68 OF THE I T ACT, 1961. 3 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS TAKEN A LOAN OF RS. 2.73 CROR ES FROM M/ KUBER DEVELOPERS. THE ASSESSEE FILED CONFIRMATION LETTER FOR THE SAME . THE ASSESSEE WAS ASKED TO EXPLAIN THE PURPOSE OF THE LOAN AS WELL AS TO FURNI SH THE COMPLETE DETAILS AND 2 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) ADDRESS OF THE LOAN CREDITOR BECAUSE THE CONFIRMATI ON LETTER DID NOT HAVE THE COMPLETE DETAILS AND ADDRESS OF THE LOAN CREDITOR. THE ASSESSEE EXPLAINED BEFORE THE ASSESSING OFFICER THAT THE LOAN WAS TAKE N FROM M/S KUBER DEVELOPERS, A PROPRIETARY CONCERN AND SHRI MAHENDRA MANSINGH AR ORA IS THE PROPRIETOR. THE ASSESSEE HAS GIVEN THE PAN NUMBER OF THE LOAN CREDI TOR. IT WAS FURTHER EXPLAINED THAT THE SAID LOAN WAS RECEIVED TOWARDS O N ACCOUNT OF ADVANCE PAYMENT FOR THE PROPRIETARY DEAL THAT WAS BEING N EGOTIATED WITH ASSESSEES CLIENT. THE SAID LOAN AMOUNT WAS UTILIZED FOR GIVIN G BUSINESS LOAN TO VARIOUS PARTIES. THE ASSESSEE HAS ALSO FURNISHED THE ADDRE SS OF M/S KUBER DEVELOPERS AT 140 LAXMI PLAZA, LINK ROAD, ANDHERI (EAST), MUMBAI 400 053 . THE ASSESSING OFFICER SENT SUMMONS TO THE LOAN CREDITOR AT THE GI VEN ADDRESS, WHICH WAS RECEIVED BACK WITH THE POSTAL REMARKS NOT KNOWN. THE ASSESSEE WAS AGAIN ASKED TO FURNISH THE CORRECT ADDRESS OF THE SHRI MA HENDRA MANSINGH ARORA OR PRODUCE HIM FOR EXAMINATION AS THE ADDRESSED PROVID ED WAS NOT CORRECT. THE ASSESSEE, VIDE LETTER DATED 21.7.2008 AGAIN FURNISH ED THE FRESH ADDRESS. SUMMONS WAS AGAIN ISSUED AT THE GIVEN ADDRESS AND A GAIN RETURNED BACK BY THE POSTAL AUTHORITIES WITH THE REMARKS NOT KNOWN. T HE ASSESSING OFFICER OBSERVED THAT EVEN PAN QUERIES PROVED FUTILE AS EVEN ON TWO OTHER ADDRESSES, THE IDENTITY OF THE PERSONS, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS COULD NOT BE ESTABLISHED. THE ASSESSING OFFICER AGAIN ASKED TO PRODUCE SHRI MAHENDA MANSINGH ARORA FOR EXAMINATION OR SUBMIT THE PROOF OF THE IDENTITY, THE CAPACITY AND GENUINENESS OF THE TRANSACTION. SINCE THE AS SESSEE COULD NOT PROVE THE IDENTITY OF THE LOAN CREDITOR, CAPACITY OF THE CRED ITORS TO ADVANCE THE MONEY AND GENUINENESS OF THE TRANSACTION, THE ASSESSING OFFIC ER TREATED THE AMOUNT OF RS. 2.73 CRORES AS UN-EXPLAINED CASH CREDIT U/S 68 OF T HE I T ACT AND ADDED THE SAME TO THE TOTAL INCOME OF THE ASSESSEE. WHILE DOING SO , THE ASSESSING OFFICER HAS PLACED RELIANCE ON THE DECISION OF THE HONBLE CALC UTTA HIGH COURT IN THE CASE OF 3 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) CIT VS PRECISION FINANCE (P) LTD REPORTED IN 208 I TR 465; THE DECISION OF THE HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS R S RATHOD REPORTED IN 212 ITR 390 AND THE DECISION OF THE HONBLE SUPREME COU RT IN THE CASE OF ROSHAN DI HATTI VS CIT REPORTED IN 107 ITR 938 AS WELL AS IN THE CASE OF KALEKHAN MOHAMMAED HANIF VS CIT REPORTED IN 50 ITR 1 (SC). 4 ON APPEAL, THE CIT(A) ISSUED REMAND ORDER AND AFT ER RECEIVING THE REMAND REPORT, CONFIRMED THE ADDITION MADE BY THE ASSESSI NG OFFICER ON THIS ACCOUNT. 5 BEFORE US, THE LD AR OF THE ASSESSEE SUBMITTED TH AT THE ASSESSEE HAS DISCHARGED ITS PRIMARY ONUS TO PROVE THE IDENTITY, SOURCE OF THE LOAN AND GENUINENESS OF THE TRANSACTION BY PRODUCING THE CON FIRMATION LETTER, PAN NO BANK STATEMENT OF THE ASSESSEE SHOWING THE RECEIPT OF THE LOAN. THE LD AR HAS FURTHER SUBMITTED THAT DURING THE REMAND PROCEEDING S, SHRI MAHENDA MANSINGH ARORA HAS APPEARED BEFORE THE ASSESSING OFFICER A ND THE ASSESSING OFFICER HAS EXAMINED THE CREDITOR; THEREFORE, THE ASSESSEE HAS DISCHARGED ITS ONUS. HE, FURTHER CONTENDED THAT THE LD CIT(A) WITHOUT GIVING PROPERTY OPPORTUNITY TO THE ASSESSEE TO DEFEND ITS CASE AGAINST THE REMAND REPO RT, DECIDED THE APPEAL. HE HAS POINTED OUT THAT THE CIT(A), IN PARA 5.4 OF THE IMPUGNED ORDER HAS STATED THAT A NOTICE WAS ISSUED ON 21.1.2010 BUT THERE WAS NO RESPONSE TO THE SAID NOTICE WHEREAS THE ASSESSEE HAS NOT RECEIVED ANY SU CH NOTICE OF HEARING. HE FURTHER SUBMITTED THAT THE CIT(A) HAS AGAIN STATED IN THE SAID PARA THAT THE CASE WAS AGAIN FIXED FOR HEARING ON 4.3.2010 BUT AGAIN T HE ASSESSEE FAILED TO RESPOND, WHEREAS THE ASSESSEE HAD NOT RECEIVED ANY NOTICE AN D NO PROPER OPPORTUNITY OF HEARING WAS GIVEN TO THE ASSESSEE TO MAKE ITS SUBMI SSION ON THE REMAND REPORT 4 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) AND THE CIT(A) HAS CONSIDERED THE REMAND REPORT IN THE BACK OF THE ASSESSEE. THE LD AR OF THE ASSESSEE HAS EMPHASIZED THAT THE A SSESSING OFFICER RECORDED IN THE ASSESSMENT ORDER THAT PAN ENQUIRES PROVED FUTIL E WHEREAS IN THE REMAND REPORT PAN WAS FOUND AS CORRECT. THEREFORE, THE B ASIS OF THE DISALLOWANCE HAS BEEN PROVED AS INCORRECT. HE FURTHER CONTENDED THAT WHEN THE ASSESSEE HAS DISCHARGED ITS PRIMARY ONUS OF PRODUCING THE PAN NO , CONFIRMATION FROM THE LOAN CREDITOR AND BANK STATEMENT THEN THE ONUS IS SHIFTE D ON THE REVENUE TO PROVE THE CONTRARY. IN THE ABSENCE OF ANY MATERIAL TO SHOW T HAT THE LOAN CREDITOR IS BOGUS OR THE ASSESSEES OWN AMOUNT HAS SHOWN AS LOAN, THE SAME CANNOT BE ADDED. HE RELIED ON THE DECISION OF THE HONBLE SUPREME C OURT IN THE CASE OF CIT VS ORISSA CORPORATION P LTD REPORTED IN 159 ITR 78 A ND THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS CRE ATIVE WORLD TELEFILMS LTD REPORTED IN 333 ITR 100. 5.1 THE LD AR OF THE ASSESSEE HAS SUBMITTED THAT I N THE REMAND REPORT, THE ASSESSING OFFICER HAS TAKEN OBJECTION THAT THE LOAN CREDITOR HAS FAILED TO PRODUCE THE BOOKS OF ACCOUNT SPECIFICALLY P&L ACCOUNT AND B ALANCE SHEET TO SHOW THE GENUINENESS OF THE TRANSACTIONS AND SOURCE OF THE L OAN TO MEET THE SAID OBJECTIONS, THE ASSESSEE HAS NOW FILED COPIES OF T HE STATEMENT OF THE ACCOUNTS ALONG WITH THE RETURN OF INCOME WHICH WERE PLACED A T PAGES 38 TO 40 OF THE PAPER BOOK ALONG WITH AN APPLICATION UNDER RULES 29 , 30 & 31 OF THE ITAT RULES 1963 FOR ADMISSION OF THE ADDITIONAL EVIDENCE. HE HAS PLEADED THAT THE TRIBUNAL SHOULD ADMIT THE ADDITIONAL EVIDENCES IN THE SHAPE OF STATEMENT OF INCOME AND RETURN OF INCOME FILED BY THE LOAN CREDITOR M/S K UBER DEVELOPERS AND REMAND THE MATTER TO THE RECORDS OF THE ASSESSING OFFICER FOR VERIFICATION AND EXAMINATION AND DECIDE THE SAME. 5 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) 5.2 ON THE OTHER HAND, THE LD DR HAS SUBMITTED THAT THE ENTIRE ARGUMENTS OF THE ASSESSEE IS BASED ON THE FACTS THAT THE ASSESS EE HAS PRODUCED THE PAN NO OF THE CREDITOR AND THE ASSESSING OFFICER HAS GIVEN A WRONG OBSERVATION THAT ENQUIRES REGARDING PAN OF THE CREDITOR PROVED FU TILE. THE LD DR HAS SUBMITTED THAT AFTER THE ASSESSEE HAS FILED CONFIRMATION LET TER, PAN NUMBER OF THE CREDITOR, THE ASSESSING OFFICER MADE EFFORTS TO VERIFY THE CORRECTNESS OF THE CONFIRMATION , GENUINENESS OF THE TRANSACTION AND CREDITWORTHIN ESS OF THE CREDITOR. HE HAS POINTED OUT THAT THE ASSESSEE WAS GIVEN MORE THAN S UFFICIENT OPPORTUNITIES DURING THE ASSESSMENT PROCEEDINGS TO PRODUCE THE LO AN CREDITOR FOR EXAMINATION SO THAT THE GENUINENESS, CREDITWORTHINESS OF THE CR EDITOR SHOULD HAVE BEEN VERIFIED; BUT THE ASSESSEE FAILED TO PRODUCE THE SA ME. EVEN THE ASSESSEE DID NOT FILE ANY MATERIAL OR EVIDENCE TO PROVE THE CREDIT W ORTHINESS OF THE CREDITOR AND THE GENUINENESS OF THE TRANSACTIONS. HE HAS FURTHER SUBMITTED THAT THE ASSESSEE WAS AGAIN GIVEN FURTHER OPPORTUNITY DURING THE REMA ND PROCEEDINGS TO PRODUCE THE LOAN CREDITOR AND PROVE THE CREDITWORTHINESS OF THE CREDITOR AND GENUINENESS OF THE TRANSACTION; BUT EVEN DURING THE REMAND PROC EEDINGS, NO EVIDENCE WAS FILED DESPITE SPECIFIC REQUESTS OF THE ASSESSING OF FICER TO PRODUCE THE P&L ACCOUNT AND BALANCE SHEET AND RETURN OF INCOME OF T HE LOAN CREDITOR. THE ASSESSING OFFICER HAS NOTED IN THE REMAND REPORT TH AT THE LOAN CREDITORS DID NOT FILE THEIR RETURN OF INCOME FOR THE LAST THREE YEAR S; THEREFORE, THE ASSESSEE FAILED TO DISCHARGE ITS ONUS TO PROVE THE CLAIM DESPITE AV AILING MORE THAN SUFFICIENT OPPORTUNITIES. AS RECORDS NOTICE OF REMAND REPORT GIVEN BY THE CIT(A), THE LD DR SUBMITTED THAT THE CIT(A) IN PARA 5.4 HAS SPECIFI CALLY RECORDED THAT THE NOTICE WAS DULY SERVED ON THE ASSESSEE BY THE ACKNOWLEDGE MENT SLIP PLACED ON RECORD. ONCE THE NOTICE WAS SERVED ON THE ASSESSEE THEN THE ASSESSEE CANNOT TAKE A PLEA THAT SUFFICIENT OPPORTUNITY WAS NOT GIVEN TO T HE ASSESSEE. THE LD DR FURTHER 6 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) SUBMITTED THAT ONCE IT WAS FOUND THAT THE LOAN CRED ITOR DID NOT FILE ITS RETURN OF INCOME FOR THE LAST THREE YEARS, THE PAN BECOMES IR RELEVANT FOR THE PURPOSE OF PROVING THE CREDITWORTHINESS OF THE CREDITOR AND GE NUINENESS OF THE TRANSACTIONS. HE HAS RELIED ON THE ORDERS OF THE LOWER AUTHORITIE S AND THE DECISION IN THE CASE OF PRECISION FINANCE P LTD (SUPRA) AS RELIED UPON B Y THE ASSESSING OFFICER. 5.3 IN REBUTTAL, THE LD AR HAS SUBMITTED THAT THE P AN NO, STATEMENT OF BANK ACCOUNT ARE RELEVANT FOR THE PURPOSE OF ADDITION MA DE U/S 68 AS HELD BY THE HONBLE SUPREME COURT IN THE CASE OF ORISSA CORPOR ATION P LTD (SUPRA) AND THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CA SE OF CREATIVE WORLD TELEFILMS LTD, (SUPRA) AS RELIED UPON BY THE LD AR OF THE A SSESSEE. 6 WE HAVE CONSIDERED THE RIVAL CONTENTIONS ADVANCED BY BOTH THE PARTIES AND CAREFULLY PERUSED THE RELEVANT MATERIAL AVAILAB LE ON RECORD. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS PRODUCED CONFIRMATION AND PAN NO OF THE LOAN CREDITOR IN SUPPORT OF THE CLAIM OF LOAN AMOUNTING OF RS. 2.73 CRORES. SINCE THE CONFIRMATION LETTER DID NOT HAVE THE ADDRESS OF THE LOAN CREDITOR, THE ASSESSEE WAS SPECIFICALLY ASKED TO FU RNISH THE ADDRESS OF THE LOAN CREDITOR. THE ASSESSEE RESPONDS TO THE REQUEST OF THE ASSESSING OFFICER AND PRODUCED THE ADDRESS OF THE LOAN CREDITOR, WHICH WE RE FOUND INCORRECT. SUBSEQUENTLY, THE ASSESSEE FURNISHED FRESH ADDRESS OF THE LOAN CREDITOR BUT THE SUMMONS ISSUED TO THE LOAN CREDITOR, AT THE FRESH ADDRESS GIVEN, WAS ALSO RETURN BACK UN-SERVED WITH THE REMARKS OF THE POSTA L AUTHORITIES NOT KNOWN. IN THOSE CIRCUMSTANCES, THE ASSESSING OFFICER ASKED TH E ASSESSEE TO PRODUCE THE LOAN CREDITOR FOR EXAMINATION OR SUBMIT THE PROOF O F IDENTIFY OF THE LOAN CREDITOR, 7 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) CAPACITY OF THE LOAN CREDITOR AND GENUINENESS OF TH E TRANSACTIONS. THE ASSESSEE NEITHER PRODUCED THE LOAN CREDITOR NOR SUBMITTED THE REQUIRED MATERIAL EVIDENCE IN SUPPORT OF THE CLAIM EXCEPT THE CONFIRM ATION LETTER. IT IS SETTLED PROPOSITION OF LAW THAT WHEN THE ASSESSEE HAS CLAIM ED THAT THE LOAN RECEIVED FROM THE CREDITOR THAN THE ONUS IS ON THE ASSESSEE TO PROVE THAT THE THREE INGREDIENTS REGARDING TRANSACTIONS I.E. IDENTITY, C REDITWORTHINESS OF THE CREDITOR AND THE GENUINENESS OF THE TRANSACTIONS. MERELY FI LING OF CONFIRMATION ALONE IS NOT ENOUGH TO SATISFY THE REQUIREMENT TO PROVE THE CLAIM OF THE ASSESSEE. THE CONFIRMATION IS ALSO SUBJECT TO VERIFICATION OF THE CORRECTNESS AND GENUINENESS OF THE TRANSACTION. WHEN THE ASSESSEE HAS FAILED TO P RODUCE THE LOAN CREDITOR DURING THE COURSE OF ASSESSMENT PROCEEDINGS OR FILE ANY OTHER CORROBORATIVE EVIDENCE TO SUBSTANTIATE ITS CLAIM THEN MERELY FILI NG OF CONFIRMATION WOULD NOT DISCHARGE THE ASSESSEE OF ITS ONUS TO PROVE THE CLA IM. EVEN OTHERWISE, IF THE ASSESSEE HAS DISCHARGED THE PRIMARY ONUS IN SUPPORT OF THE CLAIM AND THE EVIDENCE FILED BY THE ASSESSEE IN SUPPORT OF THE CLAIM HAS TO BE VERIFIED BY THE ASSESSING OFFICER BY CONDUCTING AN ENQUIRY. 6.1 IN THE CASE IN HAND, THE EFFORTS MADE BY THE AS SESSING OFFICER PROVED FUTILE BECAUSE NEITHER THE SUMMONS ISSUED TO THE LO AN CREDITOR WAS SERVED NOR THE ASSESSEE PRODUCED THE LOAN CREDITOR FOR EXAMINA TION SO THAT THE CLAIM OF THE ASSESSEE CAN BE EXAMINED. THUS, DESPITE SUFFICIEN T OPPORTUNITIES WERE GIVEN BY THE ASSESSING OFFICER, THE ASSESSEE FAILED TO DISCH ARGE ITS ONUS AS WELL AS THE BURDEN TO PROVE THE CLAIM. THE CIT(A), DURING THE A PPELLATE PROCEEDINGS, HAD AGAIN GIVEN OPPORTUNITY TO THE ASSESSEE TO PROVE IT S CLAIM BY ISSUING REMAND ORDER. DURING THE REMAND PROCEEDINGS, THE LOAN CRE DITOR SHRI MAHENDRA MANSINGH ARORA WAS ASKED TO APPEAR ALONG WITH THE B ALANCE SHEETS, P& L 8 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) ACCOUNT AND THE RETURN OF INCOME FOR THE AY 2007-08 . AFTER AVAILING SEVERAL OPPORTUNISTS, HESITANTLY SHRI MAHENDRA MANSINGH ARO RA APPEARED BEFORE THE ASSESSING OFFICER BUT DID NOT FILE THE BALANCE SHEE T, P&L ACCOUNT AND THE RETURN OF INCOME. IT WAS STATED THAT THE BALANCE SHEET, P &L ACCOUNT AND THE COPY OF THE RETURN OF MAHENDRA MANSINGH ARORA WERE NOT READ ILY AVAILABLE. THE ASSESSING OFFICER CALLED A REPORT FROM THE CONCERNED ITO TO A SCERTAIN THE POSITION OF THE INCOME TAX RETURN OF SHRI MAHENDRA MANSINGH ARORA. IT WAS FOUND THAT SHRI MAHENDRA MANSINGH ARORA HAS NOT FILED RETURN OF INC OME FOR THE AYS 2005-06, 06- 07 AND 07-08. IN THOSE CIRCUMSTANCES, THE ASSESSIN G OFFICER COMMENTED THAT IDENTITY OF THE LENDER IS PROVED, BUT THE GENUINEN ESS AND CREDITWORTHINESS OF THE LENDER CANNOT BE VERIFIED IN THE ABSENCE OF THE FIN ANCIAL STATEMENTS. 7.2 AFTER RECEIVING THE REMAND REPORT, THE CIT(A) I SSUED NOTICE TO THE ASSESSEE FOR THE HEARING ON 21.1.2010 AND WHEN THE ASSESS EE DID NOT RESPOND TO THE NOTICE, SECOND OPPORTUNITY WAS ALSO GRANTED TO THE ASSESSEE AND THE CASE WAS FIXED FOR HEARING ON 4.3.2010. WHEN THE ASSESSEE HA S FAILED TO RESPOND, THE APPEAL HAS BEEN DECIDED AFTER CONSIDERING THE REMAN D REPORT BY PASSING THE IMPUGNED ORDER. THE RELEVANT PORTION OF THE ORDER O F THE LD CIT(A) IN PARA 5.4 READS AS UNDER: 5.4 ON RECEIPT OF THE REMAND REPORT OF THE ASSESSI NG OFFICER DATED 4.1.2010, THE APPELLANT WAS FURNISHED WITH A COPY O F THE SAID REPORT AND A NOTICE WAS ISSUED FIXING THE CASE FOR HEARING ON 21 .1.2010 BUT THERE WAS NO RESPONSE TO THE SAID NOTICE; THE SAID NOTICE HAD INDEED BEEN SERVED ON THE APPELLANT AS IS EVIDENCED BY THE ACKNOWLEDGEMEN T SLIP PLACED ON RECORD. A SECOND OPPORTUNITY WAS ALSO GRANTED TO TH E APPELLANT AND THE CASE AGAIN FIXED FOR HEARING ON 4.3.2010 BUT THE AP PELLANT FAILED TO RESPOND. UNDER THE CIRCUMSTANCES, IT HAS TO BE GATH ERED THAT THE APPELLANT HAS NO COMMENTS TO OFFER ON THE REMAND REPORT OF TH E ASSESSING OFFICER. 9 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) 7.3 IT IS EVIDENT FROM THE ABOVE FINDINGS OF THE LD CIT(A) THAT NOTICE WAS DULY RECEIVED BY THE ASSESSEE AS PER THE ACKNOWLEDGMEN T SLIP, WHICH IS PLACED ON RECORD BY THE CIT(A). THUS, WE DO NOT FIND ANY SUBS TANCE IN THE CONTENTION OF THE LD AR OF THE ASSESSEE THAT THE ASSESSEE WAS NOT GIV EN SUFFICIENT OPPORTUNITY TO COMMENT ON THE REMAND REPORT. 8 AS REGARDS THE ADDITIONAL EVIDENCE, WE FIND THAT THE RETURN OF INCOME AT PAGES 38 TO 40 OF THE PAPER BOOK WAS FILED BY THE LOAN CREDITOR ON 30.3.2010 I.E SUBSEQUENT TO THE IMPUGNED ORDER OF THE CIT(A). IT APPEARS THAT AFTER THE ORDER OF THE LD CIT(A), THE LOAN CREDITOR HAS FILED ITS R ETURN OF INCOME FOR THE AY 2006- 07 ON THE BEHEST AND INSTANCES OF THE ASSESSEE TO C REATE AND MANUFACTURE THE EVIDENCE IN SUPPORT OF CLAIM OF THE ASSESSEE. WHE N THE ASSESSEE HAS ALREADY AVAILED SUFFICIENT OPPORTUNITY BEFORE THE ASSESSING OFFICER AS WELL AS DURING THE REMAND PROCEEDINGS AND FAILED TO PRODUCE ANY MATERI AL EVIDENCE THEN THE RETURN OF INCOME FILED SUBSEQUENT TO THE ORDER PAS SED BY THE CIT(A) DOES NOT APPEAR TO BE BONAFIDE AND THEREFORE, THE CONDUCT OF THE ASSESSEE DOES NOT INSPIRE CONFIDENCE. ACCORDINGLY, WE DECLINE TO A DMIT THE ADDITIONAL EVIDENCES IN THE SHAPE OF RETURN OF INCOME FILED BY THE LOAN CRE DITOR. 9 AS REGARDS THE DECISION RELIED UPON BY THE ASSESS EE IN THE CASE OF ORISSA CORPORATION P LTD (SUPRA) THE LOAN AMOUNT WAS SHOWN TO HAVE BEEN RECEIVED BY WAY OF LOANS FROM THE INDIVIDUAL CREDITORS UNDER HUNDIS. THE ASSESSEE EXPLAINED AND PRODUCED BEFORE THE ASSESSING OFFICER THE LOAN CONFIRMATION AND DETAILS OF HUNDI AND PARTICULARS OF THOSE CREDITORS WHO ARE ASSESSED AND SHOWN GENERAL INDEX NUMBERS WERE WITH THE DEPORTMENT. THE ONLY FAILURE ON THE PART OF 10 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) THE ASSESSEE IS THAT THE ASSESSEE COULD NOT PRODUCE THE CREDITORS. IN THOSE CIRCUMSTANCES, IT WAS HELD THAT WHEN THE CREDITORS WERE INCOME TAX ASSSSEES AND NO EFFORTS WERE MADE TO PURSUE THE SO CALLED ALLEGE D CREDITORS THEN THE ASSESSEE HAD DISCHARGED THE BURDEN THAT LAY ON IT. 9.1 IN THE CASE OF THE CREATIVE WORLD TELEFILMS LT D (SUPRA), THE ISSUE WAS SHARE APPLICATION MONEY AND NOT TO LOAN AND THEREFO RE, THE DECISIONS RELIED UPON BY THE ASSESSEE ARE NOT APPLICABLE ON THE FACTS OF THE CASE IN HAND WHERE THE ASSESSING OFFICER WANTED TO VERIFY THE CREDITWORTH INESS OF THE CREDITOR, GENUINENESS OF THE TRANSACTIONS BY CALLING P&L ACC OUNT, BALANCE SHEET AND RETURN OF INCOME AND IT WAS FOUND THAT THE LOAN CRE DITORS HAD NOT FILED EVEN THE RETURN OF INCOME FOR THE LAST THREE YEARS THEN THE REVENUE HAS VERY MUCH PROVED THE FACT THAT THE ASSESSEE FAILED TO ESTABLI SH THAT THE CREDITOR WAS HAVING CAPACITY TO GIVE LOANS AND THE LOAN TRANSACTION IS GENUINE. ACCORDINGLY, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDER OF TH E LD CIT(A) IN CONFIRMING THE ADDITION ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 OF THE I T ACT. THE GROUND RAISED BY THE ASSESSEE IS ACCORDINGLY DISMISSED. 10 IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THE 20 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: 20 TH , MAY 2011 RAJ* 11 ITA NO. 4192/MUM/2010 (ASST YEAR 2006-07 ) COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI