GIRISH PURAVANKARA, BANGALORE V. DCIT CIR 2, MUMBAI

ITA 5756/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55852 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 22-11-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 16-07-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: HARISH RAO
• Keywords: Unexplained cash credit; Additional evidence
• Section: 153A; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G, MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER I.T.A. NO. 5756/MUM/2010 ASSESSMENT YEAR : 2002-03. GIRISH PURAVANKARA, DY. COMMISSIONER OF INCOME-TAX, C-1005, PURVA HEIGHTS, V S. CIRCLE-2, MUMBAI. BILEKANAHALLI, BANNERGHATTA ROAD, BANGLORE 560 076. PAN AGOPP 9361P APPELLANT. RESPONDENT APPELLANT BY : SHRI HARISH RAO. RESPONDENT BY: SHRI PAVAN VED. DATE OF HEARING : 22-11-2011. DATE OF PRONOUNCEMENT : 30-11-2011. O R D E R. PER P.M. JAGTAP, A.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LEARNED CIT(APPEALS)-36, MUMBAI DATED 28-04-2010 AND THE SO LITARY ISSUE ARISING OUT OF THE SAME RELATES TO THE ADDITION OF RS.2 LAKHS MADE BY THE AO AND CONFIRMED BY THE LEARNED CIT(APPEALS) ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L WHO WAS RELATED TO M/S PURAVANKARA PROJECTS LTD. A SEARCH U/S 132(1) WAS C ONDUCTED IN THE CASES BELONGING TO PURAVANKARA PROJECTS LTD. GROUP ON 15- 11-2007 INCLUDING THE CASE OF 2 ITA NO. 5756/MUM/2010 ASSESSMENT YEAR:2002-03. THE ASSESSEE. SUBSEQUENT TO THE SEARCH, A NOTICE U/ S 153A WAS ISSUED BY THE AO IN RESPONSE TO WHICH A RETURN WAS FILED BY THE ASSESSE E ON 13-08-2009 DECLARING TOTAL INCOME OF RS.4,38,500/-. IN THE BALANCE SHEET FURNI SHED BY THE ASSESSEE, A LOAN OF RS. 2 LAKHS TAKEN FROM ONE SHRI KISHORE SUVARNA WAS REFLECTED. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS REQUIRE D BY THE AO TO ESTABLISH THE IDENTITY AND THE CAPACITY OF THE SAID CREDITOR AS W ELL AS THE GENUINENESS OF THE LOAN TRANSACTION. THE ASSESSEE, HOWEVER, COULD NOT COMPL Y WITH THE SAID REQUIREMENT DESPITE SUFFICIENT OPPORTUNITY HAVING BEEN AFFORDED BY THE AO AND ALSO COULD NOT PRODUCE CONFIRMATION OF THE CONCERNED CREDITOR. THE AO, THEREFORE, INVOKED THE PROVISIONS OF SECTION 68 AND ADDED THE AMOUNT OF LO AN OF RS.2 LAKHS TO THE TOTAL INCOME OF THE ASSESSEE TREATING THE SAME AS UNEXPLA INED CASH CREDIT. BEFORE THE LEARNED CIT(APPEALS), THE ASSESSEE FILED A CONFIRMA TION LETTER ISSUED BY ONE SHRI KISHORE ATTAVAR. THIS ADDITIONAL EVIDENCE FILED BY THE ASSESSEE WAS FORWARDED BY THE LEARNED CIT(APPEALS) TO THE AO WHO OBJECTED TO THE ADMISSION THEREOF. THE AO ALSO POINTED OUT THAT THE SAID CONFIRMATION LETT ER WAS FILED BY SHRI KISHORE ATTAVAR WHEREAS THE LOAN WAS REFLECTED IN THE BALA NCE SHEET OF THE ASSESSEE IN THE NAME OF SHRI KISHORE SUVARNA. HE ALSO EXPRESSED HIS OPINION IN THE REMAND REPORT SUBMITTED TO THE LEARNED CIT(APPEALS) THAT THE SAID LOAN CONFIRMATION EVEN OTHERWISE WAS NOT SUFFICIENT TO ESTABLISH THE CREDI T WORTHINESS OF THE CONCERNED CREDITOR. THE LEARNED CIT(APPEALS) FOUND MERIT IN T HE OBJECTIONS RAISED BY THE AO IN HIS REMAND REPORT IN RESPECT OF CONFIRMATION LET TER FILED BY THE ASSESSEE AS ADDITIONAL EVIDENCE BEFORE HIM. HE HELD THAT THE PR IMARY ONUS THAT LAY ON THE ASSESSEE TO EXPLAIN THE CASH CREDIT WAS NOT SATISFA CTORILY DISCHARGED AND ACCORDINGLY THE ADDITION OF RS.2 LAKHS MADE BY THE AO U/S 68 ON ACCOUNT OF UNEXPLAINED CASH CREDIT WAS CONFIRMED BY HIM. AGGRI EVED BY THE ORDER OF THE LEARNED CIT(APPEALS), THE ASSESSEE HAS PREFERRED TH IS APPEAL BEFORE THE TRIBUNAL. 3 ITA NO. 5756/MUM/2010 ASSESSMENT YEAR:2002-03. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS WELL SETTLED THAT THE PRI MARY ONUS TO EXPLAIN THE CASH CREDIT BY ESTABLISHING THE IDENTITY AND CAPACITY OF THE CO NCERNED CREDITOR AS WELL AS THE GENUINENESS OF THE RELEVANT TRANSACTION IS ON THE ASSESSEE AND IF HE FAILS TO DISCHARGE THE SAME, THE RELEVANT CASH CREDIT MAY BE ADDED TO HIS TOTAL INCOME AS UNEXPLAINED CASH CREDIT. IT IS, THEREFORE, RELEVANT TO FIND OUT WHETHER THE ASSESSEE HAS BEEN ABLE TO DISCHARGE THIS ONUS IN THE PRESENT CASE. IN THIS REGARD, IT IS OBSERVED THAT THE ONLY EVIDENCE FILED BY THE ASSESS EE FOR THE FIRST TIME BEFORE THE LEARNED CIT(APPEALS) IS THE CONFIRMATION LETTER OF THE CONCERNED CREDITOR. A COPY OF THE SAID CONFIRMATION LETTER IS PLACED ON RECORD BEFORE US AND A PERUSAL OF THE SAME SHOWS THAT NOTHING IS CONTAINED THEREIN EXCEPT A PERMANENT ACCOUNT NO. TO SHOW THE CAPACITY OF THE CONCERNED CREDITOR TO GIVE A LOAN OF RS.2 LAKHS TO THE ASSESSEE. EVEN THE SOURCE OF INCOME OF THE SAID CRE DITOR HAS NOT BEEN INDICATED IN THE SAID CONFIRMATION LETTER. ALTHOUGH IT HAS BEEN CLAIMED ON BEHALF OF THE ASSESSEE THAT THE LOAN OF RS.2 LAKHS WAS RECEIVED FROM THE C REDITOR BY CHEQUE, THERE IS NOTHING IN THE SAID CONFIRMATION LETTER TO SUPPORT AND SUBSTANTIATE THE SAME. THE RELEVANT DETAILS SUCH AS MODE OF PAYMENT ARE ALSO N OT GIVEN IN THE SAID CONFIRMATION. IN OUR OPINION, THE SAID CONFIRMATION , THEREFORE, IS NOT SUFFICIENT TO ESTABLISH THE CAPACITY OF THE CONCERNED CREDITOR TO GIVE A LOAN OF RS.2 LAKHS TO THE ASSESSEE AND IT, THEREFORE, CANNOT BE SAID THAT THE ASSESSEE HAS SATISFACTORILY DISCHARGED THE ONUS THAT LAY ON HIM TO EXPLAIN THE RELEVANT CASH CREDIT IN TERMS OF SECTION 68. THE RELIANCE OF THE LEARNED COUNSEL FOR THE ASSESSEE IN SUPPORT OF THE ASSESSEES CASE ON THIS ISSUE ON THE DECISION OF HO NBLE SUPREME COURT IN THE CASE OF CIT VS. SMT. P.K. NOORJAHAN 237 ITR 570 IS ALS O MISPLACED AS THE FACTS INVOLVED IN THE SAID CASE WERE ENTIRELY DIFFERENT F ROM THE FACTS INVOLVED INS THE PRESENT CASE. WE, THEREFORE, FIND NO MERIT IN THIS APPEAL FILED BY THE ASSESSEE AND DISMISS THE SAME. 4 ITA NO. 5756/MUM/2010 ASSESSMENT YEAR:2002-03. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 30 TH DAY OF NOV.,2011. SD/- SD/ - (V. DURGA RAO) (P.M. J AGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED : 30 TH NOV., 2011. COPY TO : 1. APPELLANT 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR, G-BENCH. 6. GUARD FILE. (TRUE COPY ) BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI. WAKODE