ITO 22(1)-2, NAVI MUMBAI V. FENIL RASIKLAL SHAH, MUMBAI

ITA 5696/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55666 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: F
• Next Hearing Date: 05-09-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 14-07-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MANISH KANOJLA
• Keywords: Unexplained cash credit; Additional evidence
• Section: 143(3); 68

Judgement Text

1 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES F : MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA. NO.4038/MUM/2010 ASSESSMENT YEAR 2006 - 2007 FENIL RASIKLAL SHAH, 3/9 JAI LAXMI BUILDING, MG ROAD, GHATKOPAR (WEST) MUMBAI 400 086 PAN: AAGPS 7890-A VS. INCOME TAX OFFICER 22(1)-2 MUMBAI (APPELLANT) (RESPONDENT) ITA. NO.5696/MUM/2010 ASSESSMENT YEAR 2006 - 2007 INCOME TAX OFFICER 22(1)-2 MUMBAI VS. FENIL RASIKLAL SHAH, 3/9 JAI LAXMI BUILDING, MG ROAD, GHATKOPAR (WEST) MUMBAI 400 086 PAN: AAGPS 7890-A (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI MANDAR VAIDYA, ADVOCATE FOR DEPARTMENT : SHRI MANISH KANOJLA, SR.DR DATE OF HEARING : 13/10/2011 DATE OF PRONOUNCEMENT: 21/10/2011 ORDER PER P.M. JAGTAP, A.M: 1. THESE TWO APPEALS, ONE FILED BY THE ASSESSEE BEI NG ITA NO.4038/MUMBAI/ 2010 AND THE OTHER FILED BY THE REVENUE BEING ITA N O.5696/MUMBAI/2010, ARE CROSS APPEALS WHICH ARE DIRECTED AGAINST THE ORDER OF THE LD CIT (A)-33 MUMBAI DATED 16/04/2010. 2 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI 2. FIRST WE SHALL TAKE UP THE APPEAL OF THE ASSESSE E WHICH INVOLVES A SOLITARY ISSUE RELATING TO THE ADDITION OF ` 45,61,600/- MADE BY THE A.O. AND CONFIRMED BY THE LD CIT (A) ON ACCOUNT OF ALLEGED UNACCOUNTED CASH S ALES. 3. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L WHO IS ENGAGED IN THE BUSINESS OF TRADING IN CHEMICALS. THE RETURN OF INC OME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY HIM ON 31/10/2006 DECLAR ING A TOTAL INCOME OF ` 1,08,828/-. AS PER THE AIR INFORMATION RECEIVED BY THE AO, THE ASSESSEE HAD DEPOSITED A TOTAL SUM OF ` 15,80,200/- IN CASH IN THE BANK ACCOUNT MAINTAINED WITH HDFC BANK, GHATKOPAR BRANCH. THE AO ALSO GATHERED I NFORMATION FROM THE INQUIRIES MADE FROM OTHER BANKS THAT THE ASSESSEE HAD DEPOSIT ED A TOTAL SUM OF ` 4,31,500/- IN THE BANK ACCOUNT WITH ICICI BANK AND A SUM OF ` 25,49,900/- IN HIS BANK ACCOUNT WITH JAN KALYANA SAHAKARI BANK IN CASH DURING THE YEAR U NDER CONSIDERATION. AS REGARD THE CASH DEPOSITS MADE IN HDFC BANK, THE ASSESSEE MADE AN ATTEMPT TO EXPLAIN THE SOURCES THEREOF BY SUBMITTING THAT THE SAME WERE MA DE OUT OF CASH BALANCE AVAILABLE AS PER THE CASH BOOK AS WELL AS WITHDRAWALS MADE IN CASH FROM OTHER BANKS. ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEE HO WEVER COULD NOT OFFER ANY EXPLANATION/JUSTIFICATION IN REGARD TO THE CASH DEP OSITS MADE IN ICICI BANK AND JANA KALYANA SAHAKARI BANK. ACCORDING TO HIM, THE ASSESS EE ALSO DID NOT PRODUCE THE RELEVANT BOOKS OF ACCOUNT SUCH CASH BOOKS, BANK BOO K ETC., TO SUPPORT AND SUBSTANTIATE HIS EXPLANATION IN REGARD TO THE CASH DEPOSITS MADE IN HDFC BANK. HE, THEREFORE, TREATED THE CASH DEPOSITS MADE BY THE AS SESSEE IN HIS BANK ACCOUNTS AGGREGATING TO ` 45,61,600/- AS SALES MADE BY THE ASSESSEE IN CASH O UTSIDE THE BOOKS OF ACCOUNT AND THE SAID AMOUNT WAS ADDED BY HIM TO THE TOTAL INCOME OF THE ASSESSEE IN THE ASSESSMENT COMPLETED U/S 143(3) VID E AN ORDER DATED 30/12/2008. 3 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI 4. AGAINST THE ORDER PASSED BY THE AO U/S 143(3), A N APPEAL WAS PREFERRED BY THE ASSESSEE BEFORE THE LEARNED CIT (A). DURING THE COURSE OF THE APPELLATE PROCEEDINGS BEFORE THE LEARNED CIT (A), CERTAIN DOC UMENTS WERE FILED BY THE ASSESSEE IN SUPPORT OF HIS CASE WHICH HAD NOT BEEN FILED BEF ORE THE AO AS NOTED BY THE LEARNED CIT (A). THE LEARNED CIT (A), THEREFORE, FORWARDED THE SAID DOCUMENTS TO THE AO WITH A DIRECTION TO EXAMINE THE SAME AND SUBMIT REMAND R EPORTS. AS PER THE DIRECTION OF THE LEARNED CIT (A), REMAND REPORTS WERE FILED BY T HE AO WHICH WERE CONFRONTED BY THE LEARNED CIT (A) TO THE ASSESSEE GIVING AN OPPOR TUNITY TO MAKE SUBMISSION THEREIN. AFTER TAKING INTO CONSIDERATION THE REMAND REPORTS SUBMITTED BY THE AO, THE REPLIES FILED BY THE ASSESSEE AS WELL AS OTHER MATERIALS AV AILABLE ON THE RECORD, THE LD CIT (A) FOUND THE EXPLANATION OFFERED BY THE ASSESSEE AS RE GARDS BUSINESS NECESSITY OF MAKING THE CASH DEPOSITS IN THE BANK ACCOUNT TO BE SATISFACTORY. HE HOWEVER FOUND THAT THE DEPOSITS MADE BY THE ASSESSEE IN HIS BANK ACCOUNT WITH JANA KALYANA SAHAKARI BANK WERE ACTUALLY MORE THAN THE WITHDRAWA LS MADE IN CASH FROM THE SAID BANK WHICH WAS CONTRARY TO THE EXPLANATION OFFERED BY THE ASSESSEE IN RESPECT OF BUSINESS NECESSITY OF MAKING THE CASH DEPOSITS IN J ANA KALYANA SAHAKARI BANK. HE ALSO NOTED THAT THE ASSESSEE COULD NOT EXPLAIN SUBSTANTI AL CASH WITHDRAWALS MADE FROM HIS BANK ACCOUNTS WITH HDFC AND ICICI BANKS. ACCORD ING TO HIM, THE ASSESSEE HAD FAILED TO EXPLAIN THAT THE CASH DEPOSITS AND CASH W ITHDRAWALS WERE INTERRELATED OR THAT THERE WAS A NEXUS BETWEEN THE CASH DEPOSITS AN D CASH WITHDRAWALS. HE, THEREFORE, AGREED WITH THE ASSESSING OFFICER THAT N O SATISFACTORY EXPLANATION WAS OFFERED BY THE ASSESSEE IN REGARD TO THE CASH DEPOS ITS MADE IN HIS BANK ACCOUNTS AND CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICE R ON THIS ISSUE TREATING SUCH 4 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI UNEXPLAINED CASH DEPOSITS AS UNACCOUNTED SALES MADE BY THE ASSESSEE IN CASH. AGGRIEVED BY THE ORDER OF THE LEARNED CIT (A) ON TH IS ISSUE, THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. THE LEARNED COUNSEL FOR THE ASS ESSEE HAS FILED VOLUMINOUS DOCUMENTS TO SHOW THAT THERE WERE WITHDRAWALS MADE BY THE ASSESSEE IN CASH FROM HIS BANK ACCOUNT FROM TIME TO TIME DURING THE YEAR UNDER CONSIDERATION IN ORDER TO SUPPORT AND SUBSTANTIATE THE ASSESSEES EXPLANATION THAT THE CASH DEPOSITS IN QUESTION MADE IN THE BANK ACCOUNTS WERE FROM THE SA ID CASH WITHDRAWALS. IT IS, HOWEVER, OBSERVED THAT THE NEXUS BETWEEN THESE CASH WITHDRAWALS AND CORRESPONDING CASH DEPOSITS WAS NOT ESTABLISHED BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW AS NOTED BY THEM IN THEIR RESPECT IVE ORDERS. IF AT ALL THE CASH DEPOSITS MADE IN THE BANK ACCOUNTS WERE FROM THE CA SH WITHDRAWALS MADE FROM OTHER BANK ACCOUNTS AS CLAIMED BY THE ASSESSEE, THE SAME CAN BE DULY ESTABLISHED BY PRODUCING THE CASH BOOK SHOWING THE CASH WITHDRAWAL S MADE FROM THE BANK ACCOUNT AND AVAILABILITY OF SUFFICIENT CASH ON THE DATE OF CORRESPONDING DEPOSITS IN THE BANK ACCOUNTS. INSTEAD, THE ASSESSEE HAS FILED VARIOUS D OCUMENTS INCLUDING SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW WHICH, IN OUR OPI NION, WOULD NOT SERVE THE PURPOSE. THE SAID DOCUMENTS NO DOUBT SHOW THAT THER E WAS SUBSTANTIAL WITHDRAWAL MADE IN CASH BY THE ASSESSEE FROM HIS BANK ACCOUNT DURING THE YEAR UNDER CONSIDERATION. HOWEVER, THE AVAILABILITY OF CASH SO WITHDRAWN AT THE TIME OF MAKING CORRESPONDING DEPOSITS IN BANK ACCOUNTS CAN ONLY BE ESTABLISHED ON THE BASIS OF CASH BOOK MAINTAINED BY THE ASSESSEE WHEREIN SUCH CASH W ITHDRAWALS AND CASH DEPOSITS 5 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI ARE RECORDED. WE, THEREFORE, SET ASIDE THE IMPUGNED ORDER OF THE LEARNED CIT (A) AND RESTORE THE MATTER TO THE FILE OF THE AO FOR DECIDI NG THE SAME AFRESH AFTER GIVING THE ASSESSEE ONE MORE OPPORTUNITY TO EXPLAIN THE CASH D EPOSITS IN BANK ACCOUNTS ON THE BASIS OF CASH BOOK. THE APPEAL OF THE ASSESSEE IS A CCORDINGLY TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 6. NOW WE SHALL TAKE UP THE REVENUES APPEAL, GROUN D NO.1 OF WHICH RELATES TO THE TRADING ADDITION OF ` 9,38,044/- MADE BY THE AO WHICH HAS BEEN DELETED BY THE LD CIT (A). 7. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE GP RATE DECLARED BY THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION WAS LOWER THAN THE GP RATE DECLARED F OR THE IMMEDIATELY PRECEDING YEAR. SINCE THE ASSESSEE COULD NOT OFFER ANY EXPLAN ATION FOR THE SAID FALL IN GP TO THE SATISFACTION OF THE ASSESSING OFFICER, THE LATER RE JECTED THE BOOK RESULTS SHOWN BY THE ASSESSEE AND ESTIMATED THE INCOME OF THE ASSESSEE B Y APPLYING A HIGHER GP RATE OF 10% WHICH RESULTED IN TREATING ADDITION OF RS.9,38, 044/-. WHILE DOING SO, THE ASSESSING OFFICER ALSO TOOK NOTE OF THE DEFECTS POI NTED OUT BY HIM IN THE BOOKS OF ACCOUNT OF THE ASSESSEE INCLUDING MAINLY THE UNEXPL AINED CASH DEPOSITS MADE IN THE BANK ACCOUNTS AMOUNTING TO RS.45,61,600/- WHICH WER E TREATED BY HIM AS UNACCOUNTED CASH SALES OF THE ASSESSEE. ON APPEAL, THE LEARNED CIT (A) DELETED THE TRADING ADDITION MADE BY THE ASSESSING OFFICER HOLD ING THAT SUCH ADDITION COULD NOT BE MADE MERELY ON THE BASIS OF FALLING GP RATE ESPE CIALLY WHEN THERE WAS NOTHING 6 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI FOUND TO SHOW ANY EXPENDITURE INFLATED BY THE ASSES SEE OR ANY INSTANCES OF SALE MADE BY THE ASSESSEE OUTSIDE THE BOOKS OF ACCOUNT. 8. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. AS ALREADY NOTED BY US, THE MAJ OR DEFECT POINTED OUT BY THE ASSESSING OFFICER WAS IN RESPECT OF CASH SALES OF ` 45,61,600/- ALLEGEDLY MADE BY THE ASSESSEE OUTSIDE THE BOOKS OF ACCOUNT. THE ACTION O F THE ASSESSING OFFICER IN TREATING UNEXPLAINED CASH DEPOSITS MADE BY THE ASSESSEE IN H IS BANK ACCOUNTS AS UNACCOUNTED SALES WAS UPHELD BY THE LEARNED CIT (A) VIDE HIS I MPUGNED ORDER. HE HOWEVER, STILL DELETED THE TRADING ADDITION MADE BY THE ASSESSING OFFICER OBSERVING THAT THERE WAS NO INSTANCE OF SALES MADE BY THE ASSESSEE OUTSIDE T HE BOOKS OF ACCOUNT. THE FINDINGS RECORDED BY THE ASSESSING OFFICER WHILE GIVING RELI EF TO THE ASSESSEE ON THIS ISSUE THUS ARE SELF CONTRADICTORY AND WE THEREFORE FIND IT DIF FICULT TO UPHOLD HIS IMPUGNED ORDER DELETING THE TRADING ADDITION MADE BY THE ASSESSING OFFICER. HOWEVER, KEEPING IN VIEW THAT THE ISSUE RELATING TO UNEXPLAINED CASH DE POSITS WHICH WERE TREATED AS UNACCOUNTED CASH SALES OF THE ASSESSEE HAS BEEN RES TORED BY US TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING THE SAME AFRESH AND THE FINAL DECISION ON THE SAID ISSUE WILL HAVE DIRECT BEARING ON THE ISSUE RELATING TO T RADING ADDITION, WE ALSO RESTORE THE ISSUE RELATING TO TRADITION ADDITION TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING THE SAME AFRESH DEPENDING ON THE FINAL DECISION ON THE ISSUE OF CASH SALES MADE BY THE ASSESSEE. GROUND NO.1 OF THE REVENUES APPEAL IS AC CORDINGLY TREATED AS ALLOWED FOR STATISTICAL PURPOSES. 7 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI 9. IN GROUND NO.2, THE REVENUE HAS CHALLENGED THE A CTION OF THE LEARNED CIT (A) IN DELETING THE ADDITION OF ` 1,12,000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CAPITAL CONTRIBUTION. 10. DURING THE YEAR UNDER CONSIDERATION, THE ASSESS EE HAD INTRODUCED CAPITAL OF ` 1,12,000/- IN CASH. DURING THE COURSE OF THE ASSESS MENT PROCEEDINGS, THE SAID CAPITAL INTRODUCTION WAS SOUGHT TO BE EXPLAINED BY THE ASSE SSEE ON THE BASIS OF WITHDRAWALS MADE IN THE EARLIER YEARS. THIS EXPLANATION OF THE ASSESSEE, HOWEVER, WAS NOT FOUND ACCEPTABLE BY THE ASSESSING OFFICER IN THE ABSENCE OF ANY EVIDENCE TO SUPPORT AND SUBSTANTIATE THE SAME AND THE AMOUNT OF ` 1,12,000/- WAS ADDED BY HIM TO THE TOTAL INCOME OF THE ASSESSEE AS UNEXPLAINED CAPITAL CONTR IBUTION. BEFORE THE LEARNED CIT (A), THE ASSESSEE HOWEVER TOOK A NEW STAND THAT THE AMOUNT INTRODUCED AS CAPITAL WAS TRANSFERRED FROM HIS OTHER BANK ACCOUNT. A COPY OF THE SAID BANK ACCOUNT SHOWING TRANSFER OF FUNDS WAS ALSO FILED BY THE ASS ESSEE BEFORE THE LEARNED CIT (A) AND RELYING ON THE SAME, THE LEARNED CIT (A) DELETE D THE ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED CAPITAL CONTRIBUTION. 11. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES A ND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. THE ONLY CONTENTION RAISED BY T HE LD DR BEFORE US IS THAT THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE IN THE FO RM OF COPY OF BANK ACCOUNT SHOWING TRANSFER OF FUNDS TOWARDS CAPITAL WAS RELIE D UPON BY THE LEARNED CIT (A) TO GIVE RELIEF TO THE ASSESSEE ON THIS ISSUE WITHOUT C OMPLYING WITH THE PROVISIONS OF RULE 46A OF INCOME TAX RULES. IT IS HOWEVER OBSERVED THA T ALL THE DETAILS FILED BY THE ASSESSEE INCLUDING COPY OF BANK ACCOUNTS WERE FORWA RDED BY THE LD CIT (A) TO THE AO 8 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI FOR HIS EXAMINATION AS CLEARLY NOTED IN PARAGRAPH N O.8 OF THE IMPUGNED ORDER. AS FURTHER NOTED BY THE LEARNED CIT (A), THE ASSESSING OFFICER HOWEVER DID NOT MAKE ANY COMMENTS THEREON AND REMAINED SILENT IN HIS REMAND REPORT. IT THEREFORE CANNOT BE SAID THAT THE ADDITIONAL EVIDENCE FILED BY THE ASSE SSEE IN THE FORM OF COPY OF HIS BANK ACCOUNT WAS RELIED UPON BY THE LEARNED CIT (A) TO G IVE RELIEF TO THE ASSESSEE ON HIS WITHOUT COMPLYING WITH THE PROVISIONS OF RULE 46A O F IT RULES. IT IS ALSO OBSERVED THAT THE COPY OF BANK ACCOUNT FILED BY THE ASSESSEE SHOW ING THE TRANSFER OF FUNDS TOWARDS CAPITAL CONTRIBUTION WAS DULY EXAMINED BY THE LEARN ED CIT (A) AND ONLY AFTER HAVING SATISFIED THAT THE SOURCE OF CAPITAL CONTRIBUTION W AS PROPERLY EXPLAINED BY THE ASSESSEE, THE ADDITION MADE BY THE ASSESSING OFFICE R ON THIS ISSUE WAS DELETED BY HIM. WE, THEREFORE, FIND NO INFIRMITY IN THE IMPUGN ED ORDER OF THE LEARNED CIT (A) GIVING RELIEF TO THE ASSESSEE ON THIS ISSUE AND UPH OLDING THE SAME, WE DISMISS GROUND NO.2 OF THE REVENUES APPEAL. 12. IN GROUND NO.3, THE REVENUE HAS CHALLENGED THE ACTION OF THE LEARNED CIT (A) IN DELETING THE ADDITION OF RS.59,349/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BANK CHARGES AND BANK INTERESTS. 13. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PER USAL OF THE RELEVANT MATERIAL ON RECORD, IT IS OBSERVED THAT THE BANK CHARGES AND BA NK INTERESTS PAID BY THE ASSESSEE WERE DISALLOWED BY THE ASSESSING OFFICER ON THE GRO UND THAT THE SAME WERE PERTAINING TO PERSONAL LOAN TAKEN BY THE ASSESSEE. BEFORE THE LEARNED CIT (A), THE ASSESSEE HOWEVER ESTABLISHED ON EVIDENCE THAT BANK INTEREST OF RS.22,589/- WAS PAID ON OVERDRAFT FACILITY TAKEN FROM JANA KALYANA SAHAK ARI BANK FOR HIS BUSINESS PURPOSE 9 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI AND BANK CHARGES OF RS.46,016/- WERE PAID TOWARDS C HEQUE BOOK CHARGES ETC., REGULARLY AND ROUTINELY LEVIED BY THE BANK. IT WAS THUS ESTABLISHED BY THE ASSESSEE ON EVIDENCE THAT THE BANK INTEREST AND BANK CHARGES DI D NOT PERTAIN TO THE PERSONAL LOANS TAKEN BY THE ASSESSEE AS ALLEGED BY THE ASSES SING OFFICER AND THE SAME WERE ACTUALLY INCURRED FOR THE PURPOSE OF HIS BUSINESS. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BANK INTERESTS AND BANK CHARGES, THEREFORE, WAS DELETED BY THE LEARNED CIT (A) AND HAVING REGARD TO THE FACTS OF THE CASE, WE FIND NO INFIRMITY IN THE IMPUGNED ORDER OF THE LD CIT (A) G IVING RELIEF TO THE ASSESSEE ON THIS ISSUE. THE SAME IS THEREFORE UPHELD DISMISSING GROU ND NO.3 OF THE REVENUES APPEAL. 14. IN GROUND NO.4, THE REVENUE HAS CHALLENGED THE ACTION OF THE LEARNED CIT (A) IN DELETING THE ADDITION OF ` .4,55,000/- MADE BY THE ASSESSING OFFICER ON ACCOUN T OF CASH LOANS TAKEN BY THE ASSESSEE FROM THIRTY PARTIE S. 15. DURING THE YEAR UNDER CONSIDERATION, THE ASSESS EE HAD TAKEN SMALL LOANS IN CASH FROM 30 PERSONS AGGREGATING TO ` 4,55,000/-. ALTHOUGH CONFIRMATION LETTERS OF THE SAID PERSONS WERE FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER, HE COULD NOT PRODUCE THE SAID PERSONS FOR EXAMINATION AS REQUIRE D BY THE ASSESSING OFFICER. THE ASSESSING OFFICER, THEREFORE, TREATED THE LOAN AMOU NTS AS UNEXPLAINED CASH CREDITS AND ADDED THE AMOUNT OF ` 4,55,000/- TO THE TOTAL INCOME OF THE ASSESSEE U/S 68. ON APPEAL, THE LEARNED CIT (A) DELETED THE SAID ADDITI ON HOLDING THAT THE ASSESSEE HAVING FILED CONFIRMATION OF THE CONCERNED CREDITORS, PRIM ARY ONUS THAT LAY ON THE ASSESSEE WAS DULY DISCHARGED. HE ALSO NOTED THAT THERE WAS N O ADVERSE MATERIAL BROUGHT ON 10 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI RECORD BY THE ASSESSING OFFICER TO SHOW THAT THE LO ANS TAKEN BY THE ASSESSEE WERE NOT GENUINE. 16. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES A ND ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. THE LEARNED COUNSEL FOR THE ASS ESSEE HAS INVITED OUR ATTENTION TO THE COPIES OF CONFIRMATION LETTERS OF THE CONCERNED CREDITORS PLACED IN HIS PAPER BOOK WHICH CLEARLY SHOW THAT THE RELEVANT INFORMATION TO DISCHARGE THE PRIMARY ONUS THAT LAY ON THE ASSESSEE IN TERMS OF SEC.68 WAS DULY DIS CHARGED. AS RIGHTLY OBSERVED BY THE LEARNED CIT (A), THE ONUS WAS THUS SHIFTED TO THE D EPARTMENT AND SINCE THERE WAS NOTHING BROUGHT OUT BY THE ASSESSING OFFICER TO DOU BT THE GENUINENESS OF THE CONCERNED LOAN AMOUNTS TAKEN BY THE ASSESSEE, WE AG REE THAT HIS CONCLUSIONS THAT THE ADDITION MADE U/S 68 TREATING THE SAID LOAN AMO UNTS AS UNEXPLAINED CASH CREDITS WAS NOT SUSTAINABLE. WE THEREFORE, UPHOLD THE IMPUG NED ORDER OF THE LEARNED CIT (A) ON THIS ISSUE AND DISMISS GROUND NO.4 OF THE REVENU ES APPEAL. 17. IN THE RESULT, APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES AND THE APPEAL OF THE REVENUE IS TREATED A S PARTLY ALLOWED . PRONOUNCED IN THE OPEN COURT ON THIS 21 ST DAY OF OCTOBER, 2011. SD/- SD/- (V. DURGA RAO) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED 21 ST OCTOBER, 2011 VNODAN/SPS 11 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT (A) CONCERNED 4. THE CIT CONCERNED 5. DR G BENCH 6. GUARD FILE. //TRUE COPY// BY ORDER ASSISTANT REGISTRAR, ITAT, MUMBAI B ENCHES 12 ITA NOS.4038 & 5696 OF 2010 FENIL RASIKLAL SHAH MUM BAI DATE INITIAL DRAFT DICTATED ON 19- 10-2011 SR. P.S. DRAFT PLACED BEFORE THE AUTHOR 19-10-2011 SR. P.S . DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER AM/JM DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM APPROVED DRAFT COMES TO THE SR. PS 20-10-2011 SR. P.S. KEPT FOR PRONOUNCEMENT ON 21-10-2011 SR. P.S. FILE SENT TO THE BENCH CLERK 21-10-2011 SR. P.S. DATE ON WHICH FILE GOES TO THE HEAD CLERK DATE ON WHICH FILE GOES TO THE ASSTT. REGISTRAR FOR SIGNATURE ON THE ORDER. DATE OF DISPATCH