ADESHWAR ENTERPRISES, MUMBAI V. ITO WD 12(1)(1), MUMBAI

ITA 6038/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 4133 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-02-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-10-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Unexplained cash credit
• Section: 68

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A, MUMBAI .. , , , BEFORE, SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NO.6038/MUM/2013 ASSESSMENT YEAR: 2009-10 M/S AADESHWAR ENTERPRISES 2-C, BAHADUR MANZIL, S.A. BRELVI ROAD, FORT, MUMBAI-400001 / VS. ITO, WARD-12(1)(1), MUMBAI ( !'#$ /ASSESSEE) ( % / REVENUE) PAN. NO. AAGFA 9400J !'#$ / ASSESSEE BY SHRI ANANT N. PAI % / REVENUE BY SHRI AARSI PRASAD & %'($) / DATE OF HEARING : 08/02/2016 ($) / DATE OF ORDER: 09/02/2016 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER D ATED 22/02/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. ITA NO.6038/MUM/2013 M/S AADESHWAR ENTERPRISES 2 2. DURING HEARING OF THIS APPEAL, THE LD. COUNSEL FOR THE ASSESSEE, SHRI ANANT N. PAI DID NOT PRESS GROUN D NO.3 WITH RESPECT TO DIRECTION TO THE ASSESSING OFFICER TO TAKE APPROPRIATE ACTION IN ASSESSMENT YEAR 2006-07 ON T HE ADVANCES RECEIVED BY THE ASSESSEE. THE LD. DR, SHRI AARSI PRASAD HAD NO OBJECTION TO THE REQUEST OF THE LD. C OUNSEL FOR THE ASSESSEE, THEREFORE, THIS GROUND IS DISMISSED A S NOT PRESSED. 2.1. THE ONLY GROUND ARGUED BY THE LD. COUNSEL FOR THE ASSESSEE IS WITH RESPECT TO CONFIRMING THE AMOUNT O F RS.19,29,904/- TREATING THE SAME AS UNEXPLAINED CAS H CREDIT U/S 68 OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT) AS THERE WAS NO SUCH RECEIPT OR PAYMENT IN THE CURRENT YEAR. THE LD. COUNSEL FOR THE ASSESSEE ADVANCED ARGUMENTS WHICH IS IDENTICAL TO THE GROUND RAISED BY SUBMITTING THA T CONFIRMATION FROM THE CONCERNED PARTIES WERE DULY S UBMITTED BY THE ASSESSEE, THEREFORE, THE ADDITION WAS ARBITR ARILY MADE BY THE ASSESSING OFFICER. ON THE OTHER HAND, THE LD . DR DEFENDED THE ADDITION. 2.2. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THE ASSESSEE PARTNERSHIP FIRM, AT THE RELE VANT TIME, WAS ENGAGED IN THE BUSINESS OF BUILDER AND DEVELOPE R DECLARED LOSS OF RS.6,501/- ON 30/03/2010 AND CAPIT ALIZE ALL OTHER EXPENSES AS LOWER PAREL PROJECTS. FROM THE DE TAILS, FILED BY THE ASSESSEE, IT WAS NOTICED BY THE LD. ASSESSIN G OFFICER ITA NO.6038/MUM/2013 M/S AADESHWAR ENTERPRISES 3 THAT THE ASSESSEE HAD SHOWN RS.13,84,47,219/- AS LOANS/FUNDS FROM THE PARTNERS AND RELATIVES AND FUR THER SHOWN RS.13,65,17,315/- AS LOANS GIVEN. THE ASSESSI NG OFFICER OBSERVED FROM THE CONFIRMATION, FILED BY TH E ASSESSEE THAT NOT A SINGLE PARTNER OR RELATIVES NAMES IS APP EARING IN THE LIST OF UNSECURED LOANS. HE HELD THAT ASSESSEE WAS HOLDING CASH WORTH RS.13 CRORES WHICH WAS NEVER UTI LIZED FOR DEVELOPMENT NOR GAVE LOAN TO ANYBODY, THEREFORE, TH E AMOUNT OF RS.19,29,904/- WAS TREATED AS UNEXPLAINED CASH C REDIT. ON APPEAL, THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) AFFIRMED THE STAND OF THE LD. ASSESSING OFFICER AGA INST WHICH THE ASSESSEE IS IN FURTHER APPEAL BEFORE THIS TRIBU NAL. 2.3. IF THE OBSERVATION MADE IN THE ASSESSMENT ORD ER, LEADING TO ADDITION MADE TO THE TOTAL INCOME, CONCL USION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, IT IS NOTED FROM THE ST ATEMENT OF FACTS, EVEN FILED BEFORE THE LD. COMMISSIONER OF IN COME TAX (APPEALS), THE ASSESSEE HAS CHALLENGED THE ADDITION MADE U/S 68 OF THE ACT. IT IS FURTHER NOTED FROM THE ASSESSM ENT ORDER THAT THE LOAN CONFIRMATIONS WERE DULY FILED BY THE ASSESSEE. IT IS ALSO NOTED THAT THE LD. ASSESSING OFFICER MADE T HE ADDITION OF RS.19,29,404/- AS UNEXPLAINED CASH CREDIT ON EST IMATE BASIS BEING THE DIFFERENCE BETWEEN THE TOTAL AMOUNT OF UNSECURED LOANS AND ADVANCES RECOVERABLE IN CASH OR KIND. THE DETAILS OF UNSECURED LOANS IS AVAILABLE AT PAGE -4 OF THE ITA NO.6038/MUM/2013 M/S AADESHWAR ENTERPRISES 4 IMPUGNED ORDER. IT SEEMS THAT THE ONLY BASIS OF AD DITION BY THE ASSESSING OFFICER IS THAT CONFIRMATION WERE NOT FILED BY THE ASSESSEE, HOWEVER, IN PARA 6 OF THE ASSESSMENT ORDER, THE LD. ASSESSING OFFICER HIMSELF HAS MENTIONED THAT I T HAS BEEN SEEN FROM THE DETAILS FILED BY THE ASSESSEE AND FU RTHER SINCE NO OTHER DETAILS OTHER THAN LOAN CONFIRMATIONS OF F OUR PARTIES AS FURNISHED BY THE ASSESSEE, I ESTIMATE RS.19,29,9 04/- , THE DIFFERENCE BETWEEN THE TOTAL AMOUNT OF UNSECURED LO ANS AND ADVANCES RECOVERABLE IN CASH OR KIND . AS UNEXPLA INED CASH CREDIT. SUCH A APPROACH OF THE LD. ASSESSING OFFICER CANNOT BE SAID TO BE JUSTIFIED AS THE ADDITION WAS MADE MERELY ON THE BASIS OF ESTIMATION. IT IS ALSO NOTE D THAT THE ASSESSEE VIDE LETTER DATED 19/12/2011 (PAGE -1 OF T HE PAPER BOOK) SUBMITTED THE DETAILS SUCH AS COPY OF INCOME TAX RETURN (PAGE-2), COPY OF BALANCE SHEET OF PROFIT & LOSS ACCOUNT (PAGES 3 TO 5 OF THE PAPER BOOK), DETAILS OF LOANS AND BORROWING (PAGE-6), CONFIRMATION FOR NEW LOANS TAKE N GIVEN (PAGES 7 & 8), DETAILS OF LOANS AND ADVANCES ACCOU NT, SHOWN ASSET SIDE OF THE BALANCE SHEET (PAGES 9 TO 11) AND BANK SUMMARY (PAGES 12 TO 14 OF THE PAPER BOOK). THIS FA CTUAL MATRIX WAS NOT CONTROVERTED BY THE REVENUE. IN VIEW OF THIS FACT, WE ARE OF THE VIEW THAT THE ADDITION MADE AS UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT CANNOT SA ID TO BE JUSTIFIED. THE ASSESSEE HAS DISCHARGED ITS ONUS CAS T UPON IT AND IF THE LD. ASSESSING OFFICER WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE, HE IS EXPECTED TO PROV E OTHERWISE. AS PER SECTION 68 OF THE ACT, THE BURDE N IS UPON ITA NO.6038/MUM/2013 M/S AADESHWAR ENTERPRISES 5 THE ASSESSEE TO PROVE THE SOURCE OF RECEIPT AND ONC E IT IS DISCHARGED, NO ADDITION IS EXPECTED TO BE MADE U/S 68 OF THE ACT. THE TOTALITY OF FACTS, CLEARLY INDICATES THAT THE ADDITION WAS MADE MERELY ON ESTIMATE BASIS, WHICH CANNOT BE SUSTAINED, THUS, THIS GROUND OF THE ASSESSEE IS ALL OWED. FINALLY, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOW ED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 08/02/2016. SD/- SD/- ( G.S. PANNU ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER & ' MUMBAI; + DATED : 09/02/2016 F{X~{T? P.S/. .. %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. , -. / THE APPELLANT 2. /0-. / THE RESPONDENT. 3. 11 & 2$ ( , ) / THE CIT, MUMBAI. 4. 11 & 2$ / CIT(A)- , MUMBAI 5. 4%5/$! , 1, ),!6 , & ' / DR, ITAT, MUMBAI 6. 7'8' / GUARD FILE. / BY ORDER, 04$/$ //TRUE COPY// / (DY./ASSTT. REGISTRAR) , & ' / ITAT, MUMBAI