Amarjeet Beeton HUF, Sangrur V. ITO, Malerkotla

ITA 458/CHANDI/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9975 (ITAT-CHANDIGARH)
• Duration Of Justice: 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 29-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTALDR
• Assessee Lawyers: N K GARG; VAIBHAV GARG
• Keywords: Unexplained cash credit; Opportunity of being heard
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA NO. 458/CHD/2016 ASSESSMENT YEAR : 2009-10 SHRI AMARJEET BEETON,HUF, VS THE ITO, PROP. M/S SHIVA UDYOG, WARD IV(3), 10-B/210, SHIVPURI MOHALLA, MALERKOTLA. DHURI. PAN: AAFHA3569R (APPELLANT) (RESPONDENT) APPELLANT BY: S/SHRI N.K.GARG & VAIBH AV GARG RESPONDENT BY : SHRI S.K.MITTAL,DR DATE OF HEARING : 18.05.2016 DATE OF PRONOUNCEMENT : 18.05.2016 O R D E R THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS)-2, LUDHIANA DATED 02.02.2016 FOR ASSESSMENT YEAR 2009-10. 2. IN THIS APPEAL ASSESSEE CHALLENGED THE ADDITION OF RS. 5,20,000/- UNDER SECTION 68 OF THE ACT ON ACCOU NT OF UNEXPLAINED CASH CREDIT RECEIVED FROM SMT. KANTA DE VI (RS. 1,50,000/-) SHRI RAM LAL ( RS. 1,05,000/-) AND SHRI RAM RATAN (RS. 2,65,000/-) AND DISALLOWANCE OF INTE REST OF RS. 29,750/- ON THE SAME CREDITS. 3. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SING OFFICER FOUND THAT ASSESSEE HAS INTRODUCED CASH CRE DITS 2 UNDER THE GARB OF UNSECURED LOANS IN THE NAMES OF S MT. KANTA DEVI, SHRI RAM LAL AND SHRI RAM RATAN WHO ARE THE FAMILY MEMBERS AND CLOSE RELATIVES OF THE ASSES SEE FOR THE SUM MENTIONED ABOVE. THERE WERE ALSO OPENI NG BALANCES AGAINST THEIR NAMES. THE INTEREST WAS ALS O PAID TO THEM. THE ASSESSING OFFICER ON EXAMINATION OF T HE RECORD FOUND THAT THESE CASH CREDITORS HAVE TAKEN COMMODITY PROFITS FROM M/S SATYAM COMMODITIES AND M/S B.K. COMMODITY AND IN ORDER TO FIND OUT THE GENUINENESS OF THE TRANSACTIONS OF COMMODITY PROFIT S TAKEN, THESE CREDITORS WERE SUMMONED UNDER SECTION 131 OF THE ACT FOR THEIR EXAMINATION AND TO FIND OUT TH E TRUTH IN THE MATTER. THE ASSESSEE, HOWEVER, EXPLAINED TH AT IT HAS ALREADY FILED CONFIRMATIONS FROM THE CREDITORS, THEIR PAN NUMBERS, IT RETURNS AND COPY OF THE BANK ACCOUN TS AND CREDITORS ARE ASSESSED TO TAX. THEREFORE, BURD EN UPON ASSESSEE HAVE BEEN DISCHARGED TO PROVE THE GEN UINE CREDITS IN THE MATTER. THE ASSESSING OFFICER, HOWE VER, NOTED THAT ASSESSEE FAILED TO PRODUCE THESE CREDITO RS FOR EXAMINATION UNDER SECTION 131 OF THE ACT AND ALSO T O FIND OUT THE GENUINENESS OF THE TRANSACTION WITH RE GARD TO PROFITS RECEIVED BY THE CREDITORS ON ACCOUNT OF COMMODITY PROFITS TAKEN FROM THE ABOVE COMPANIES. SINCE, ASSESSEE FAILED TO PRODUCE THE CREDITORS BEF ORE ASSESSING OFFICER, THEREFORE, ASSESSING OFFICER MAD E BOTH THE ABOVE ADDITIONS. THE LD. CIT(APPEALS) DISMISSE D THE APPEAL OF THE ASSESSEE. 3 4. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL ON RECORD. THE LD. COUNSE L FOR THE ASSESSEE ADMITTED THAT ALL THE CREDITORS ARE CL OSE RELATIVES AND FAMILY MEMBERS OF THE ASSESSEE. HE H AS, HOWEVER, FILED A COPY OF THE ORDER-SHEET TO SHOW TH AT SUMMONS UNDER SECTION 131 WERE NOT ISSUED. THE ASSESSING OFFICER DIRECTED THE ASSESSEE TO PRODUCE THESE PERSONS FOR EXAMINATION. THE LD. COUNSEL FOR THE ASSESSEE UNDERTOOK BEFORE ME THAT HE WOULD PRODUCE ALL THE ABOVE THREE CREDITORS BEFORE ASSESSING OFFICER FOR EXAMINATION UNDER SECTION 131 OF INCOME TAX ACT. 5. CONSIDERED THE FACTS OF THE CASE IN THE LIGHT OF MATERIAL ON RECORD I.E. THE ASSESSEE FILED CONFIRMA TIONS, BANK STATEMENTS, IT RETURNS OF THE CREDITORS TO SUP PORT THE EXPLANATION OF THE ASSESSEE THAT ASSESSEE HAS RECEIVED CREDITS FROM THESE PARTIES. HOWEVER, THE ASSESSING OFFICER FOUND THAT CREDITORS WERE NOT HAV ING ANY REGULAR INCOME AND THEY HAVE TAKEN COMMODITY PROFITS FROM M/S SATYAM COMMODITIES AND M/S B.K. COMMODITY. THEREFORE, IN ORDER TO VERIFY THE FACTS REGARDING THE CREDIT WORTHINESS OF THE CREDITORS AN D GENUINENESS OF THE TRANSACTION, ASSESSING OFFICER W ANTED TO EXAMINE THEM UNDER SECTION 131 OF THE ACT IN ORD ER TO FIND OUT TRUTH IN THE MATTER. SINCE LD. COUNSEL FO R THE ASSESSEE UNDERTOOK BEFORE ME TO PRODUCE ALL THE THR EE CREDITORS BEFORE ASSESSING OFFICER FOR EXAMINATION THEREFORE, I AM OF THE VIEW INTEREST OF JUSTICE REQ UIRES 4 THAT ONE MORE CHANCE MAY BE GIVEN TO THE ASSESSEE T O PRODUCE THESE CREDITORS BEFORE ASSESSING OFFICER FO R EXAMINATION IN ORDER TO FIND OUT THE TRUTH IN THE M ATTER. 6. IN VIEW OF THE ABOVE DISCUSSION AND FACTS OF THE CASE AND UNDERTAKING GIVEN BEFORE ME, I SET ASIDE T HE ORDERS OF AUTHORITIES BELOW AND RESTORE THE MATTER IN ISSUE TO THE FILE OF ASSESSING OFFICER WITH DIRECTI ON TO RE- DECIDE THIS ISSUE IN ACCORDANCE WITH LAW BY GIVING REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THE ASSESSEE IS DIRECTED TO PRODUCE ALL THE THREE CREDITORS BEFORE ASSESSING OFFICER WITHOUT SE EKING FURTHER ADJOURNMENT IN THE MATTER ON THE DATES SO F IXED BY THE ASSESSING OFFICER FOR THEIR EXAMINATION UNDE R SECTION 131 OF THE ACT. IN CASE ASSESSEE FAILS TO PRODUCE THE CREDITORS BEFORE ASSESSING OFFICER, AS DIRECTED ABOVE, ASSESSING OFFICER MAY DRAW ANY ADVERSE INFERENCE AG AINST THE ASSESSEE AND SHALL PASS THE ORDER ACCORDINGLY. 7. WITH THESE OBSERVATIONS AND DIRECTIONS, THE APPE AL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 18 TH MAY, 2016. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT/CHD