VASANT RAMJI SAVLA, MUMBAI V. ASST CIT 18(1), MUMBAI

ITA 6123/MUM/2017

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 8156 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2011-2012
• Appeal Filed On: 05-10-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJEEV GUBGOTRA
• Assessee Lawyers: MANOJ MAKADIA
• Section: 133(6); 131; 68

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI BEFORE HONBLE SH. SANDEEP GOSAIN , J M & HONBLE SH. MANOJ KUMAR AGGARWAL, A M ./ I.T.A. NO . 6123 /MUM/201 7 ( / ASSESSMENT YEAR: 2011 - 12 ) SHRI VASANT RAMJI SALVA PLOT NO. 170, RAWAL SEA VIEW 1ST FLOOR, M.B. RAUT ROAD SHIVAJI PARK, DADAR MUMBAI 400028 / VS. A C I T - 18(1) PIRAMAL CHAMBERS LALBAUGH, PAREL, MUMBAI ./ ./ PAN NO. A MKPS7067B ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI MANOJ MAKADIA , A R / RESPONDENTBY : SHRI RAJEEV GUBGOTRA , DR / DATE OF HEARING : 27.12 .2018 / DATE OF PRONOUNCEMENT : 27/12/2018 / O R D E R PER SANDEEP GOSAIN, J UDICIAL MEMBER : THE P RESENT APPE AL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF LD. CIT (APPEAL) 33, MUMBAI DATED 12.07 .17 F OR AY 20 11 - 12 . 2 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA 2 . THE SOLITARY GROUND RAISED BY THE ASSESSEE RELATES TO CHALLENGING THE ORDER OF LD. CIT (A) IN CONFIRMING THE ACTION OF AO DISALLOWING INTEREST PAID DURING THE YEAR ON UNSECURED LOANS WHICH WERE ALLEGEDLY ADDED TO THE INCOME OF THE APPELLANT U/S 68 OF THE ACT DURING AY 2010 - 11. 3 . LD. AR APPEARING ON BEHALF OF THE ASSES SEE SUBMITTED BEFORE US THAT THIS GROUND IS COVERED BY THE ORDER OF HONBLE ITAT IN ITA NO. 1633, 1634 & 1637/MUM/17 FOR AY 2010 - 11, 2012 - 13 AND 2013 - 14 IN ASSESSEES OWN CASE , WHEREIN THE IDENTICAL GROUND RA ISED IN THE PRESENT APPEAL HAS ALREADY BEEN DECIDED ON MERITS. 4 . ON THE OTHER HAND, LD. DR FAIRLY AGREED TO THE CONTENTION OF LD. AR THAT THE ISSUE IS COVERED IN FAVOUR OF ASSESSEE. 5 . WE HAVE HEARD BOTH THE PARTIES AND WE HAVE ALSO PERUSED THE MATERIAL PLACED ON RECORD AS WELL AS THE ORDERS PASSED BY REVENUE AUTHORITI ES. WE FIND THAT THE IDENTICAL GROUND HAS ALREADY BEEN DECIDED BY THE COORDINATE BENCH OF HONBLE ITAT 3 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA IN ITA NO. 1633, 1634 & 1637/MUM/17 FOR AY 2010 - 11, 2012 - 13 AND 2013 - 14 IN ASSESSEES OWN CASE . THE OPERATIVE PORTION OF THE ORDER OF HONBLE ITAT PASSE D IN I T A NO. CONTAINED IN PARA NO. 8 TO 12 , WHICH IS REPRODUCED BELOW: - 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORDS CAREFULLY INCLUDING THE IMPUGNED ORDER AND VARIOUS CASE LAWS CITED BY THE ASSESSEE. WE FIND THAT THE ASSESSEE HAS FILED C OPIES OF CONFIRMATION LETTERS, BANK STATEMENT, LENDERS ITRS, PAN AND ADDRESSES, SO THE PRIMARY ONUS BY THE ASSESSEE WAS DULY DISCHARGED AND THEREAFTER THE ONUS SHIFTS TO REVENUE AUTHORITIES TO CARRY OUT NECESSARY INVESTIGATIONS, WHICH WE OBSERVE THAT HAS NOT BEEN DONE. WE FURTHER FIND THAT THE NOTICES ISSUED UNDER SECTION 133(6) OF THE ACT IN ORDER TO VERIFY THE LOAN TRANSACTIONS WERE RESPONDED AND REPLIED BY THE LENDERS, COPIES OF WHICH WERE PLACED IN THE PAPER BOOK . A PERUSAL OF THE ORDER OF THE CIT(A) REVEALS THAT THE VARIOUS REASONS CITED BY THE CIT(A) IN PARA 20 OF THE APPELLATE ORDER WERE SPECIFICALLY REBUTTED BY THE LEARNED A.R. WHICH APPEARS TO BE QUITE JUSTIFIABLE. OUT OF THE TOTAL LENDERS 16 WERE FROM GHATKOPAR BUT CIT(A) DOUBTED THE TRASACTIONS ON THIS BASIS ALSO. MOREOVER, OPENING OF ACCOUNT IN ONE BANK COULD NOT BE A BASIS FOR DOUBTING THE TRANSACTIONS. WE FURTHER OBSERVE THAT THE REVENUE AUTHORITIES HAVE NOT 4 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA DISPUTED THE INTEREST PAID DURING THE YEAR WHICH IS DULY PAID/DISCHARGED BY THE ASSESS EE AFTER DEDUCTING TAX AT SOURCE. IT IS VERY SURPRISING AND STRANGE THAT THE REVENUE HAS ACCEPTED INTEREST ON LOAN BUT THE GENUINENESS WAS DOUBTED WHICH APPEARS TO BE FALLACIOUS AND WRONG. THE CASE OF THE ASSESSEE IS SUPPORTED BY A SERIES OF DECISIONS SUCH AS IN THE CASE OF CIT VS. ORISSA CORPORATION PVT. LTD. (SUPRA) WHEREIN THE HON'BLE SUPREME COURT HAS HELD THAT WHERE THE ASSESSEE HAS GIVEN NAMES AND ADDRESSES OF THE ALLEGED CREDITORS AND THE SAID CREDITORS WERE IN THE KNOWLEDGE OF THE REVENUE AUTHORITIE S TO BE INCOME TAX ASSESSEES AND THEIR INDEX NUMBERS WERE IN THE FILE OF REVENUE, THE REVENUE DID NOT PURSUE THE MATTER FURTHER APART FROM ISSUING NOTICES UNDER SECTION 131 OF THE ACT. THE HON'BLE COURT HAS HELD THAT THE REVENUE DID NOT EXAMINE THE SOURCE OF INCOME OF THE SAID ALLEGED CREDITORS TO FIND OUT WHETHER THEY WERE CREDITWORTHY OR WERE SUCH WHO COULD ADVANCE THE ALLEGED LOANS. THUS THERE WAS NO EFFORT MADE TO PURSUE THE SO CALLED ALLEGED CREDITORS. THE COURT FURTHER HELD THAT IF TRIBUNAL CAME TO TH E CONCLUSION THAT THE ASSESSEE HAS DISCHARGED THE BURDEN THEY LAY ON HIM, THEN IT COULD NOT BE SAID THAT SUCH A CONCLUSION WAS UNREASONABLE OR PERVERSE OR BASED ON NO EVIDENCE. 5 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA 9. IN THE CASE OF RANCHHOD JIVABHAI NAKHAVA (SUPRA) THE HON'BLE GUJARAT HIGH C OURT HAS HELD THAT ONCE THE ASSESSEE HAS ESTABLISHED THAT HE HAS TAKEN MONEY BY WAY OF ACCOUNT PAYEE CHEQUES FROM THE LENDERS WHO ARE ALL INCOME TAX ASSESSEES WHOSE PAN HAVE BEEN DISCLOSED, THE INITIAL ONUS UNDER SECTION 68 OF THE ACT WAS DISCHARGED. THEN IT IS THE DUTY OF THE AO TO FIND OUT WHETHER IN THEIR RESPECTIVE RETURNS THEY HAS SHOWN EXISTENCE OF SUCH AMOUNT OF MONEY AND HAD FURTHER SHOWN THAT THOSE AMOUNT OF MONEY HAD BEEN LENT TO THE ASSESSEE. 10. SIMILARLY IN THE CASE OF LABCHAND BOHRA (SUPRA) T HE HON'BLE RAJASTHAN HIGH COURT HAS HELD THAT WHERE THE IDENTITY OF THE CREDITOR HAVE BEEN ESTABLISHED AND THEY HAVE CONFIRMED THE CREDITS BY MAKING STATEMENTS ON OATH AND AMOUNT HAS BEEN ADVANCED BY ACCOUNT PAYEE CHEQUE, THE ADDITION IN RESPECT OF THE ENT RIES CANNOT BE SUSTAINED. 11. IN THE CASE OF GOLDEN REMEDIES P. LTD. (SUPRA) THE DELHI BENCH OF THE TRIBUNAL HELD THAT WHERE THE LOANS WERE ACCEPTED THROUGH ACCOUNT PAYEE CHEQUES AND HAD BEEN REPAID THROUGH ACCOUNT PAYEE CHEQUES, WHICH WERE ALSO CONFIRMED BY THE PARTIES AND THE ASSESSEE HAS ALSO PRODUCED BANK ACCOUNT AND PAN OF EACH PARTY TO SUPPORT HIS CASE, THE AO IS NOT JUSTIFIED IN 6 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA TREATING THE TRANSACTIONS AS NON GENUINE AND NO ADDITION CAN BE MADE UNDER SECTION 68 OF THE ACT. 12. CONSIDERING THE FAC TS IN TOTALITY IN THE LIGHT OF VARIOUS JUDICIAL DECISIONS WHICH SQUARELY COVER THE CASE OF THE ASSESSEE WE ARE INCLINED TO SET ASIDE THE ORDER OF THE CIT(A) BY HOLDING THAT THE ASSESSEE HAS DULY DISCHARGED THE ITS ONUS BY FILING THE NECESSARY EVIDENCES BEF ORE THE AUTHORITIES BELOW AND THEREFORE ADDITION BY THE AO U/S 68 OF THE ACT IS ORDERED TO BE DELETED. THE APPEAL OF THE ASSESSEE IS ALLOWED. 6. AFTER HAVING GONE THROUGH THE FACTS OF THE PRESENT CASE AS WELL AS CONSIDERING THE ORDERS PASSED BY REVENUE A UTHORITIES AND HONBLE ITAT AS MENTIONED ABOVE IN ASSESSEES OWN CASE , W E FIND THAT THE IDENTICAL ISSUE HAS ALREADY BEEN DECIDED BY THE HONBLE ITAT IN ITA NO. 1633, 1634 & 1637/MUM/17 FOR AY 2010 - 11, 2012 - 13 AND 2013 - 14 IN ASSESSEES OWN CASE . T HEREFORE , RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH OF HONBLE ITAT AND IN ORDER TO MAINTAIN JUDICIAL CONSISTENCY , WE APPLY THE SAME FINDINGS IN THE PRESENT CASE WHICH ARE APPLICABLE MUTATIS MUTANDIS IN THE PRESENT CASE. 7 I.T.A. NO. 6123 /MUM/201 7 SHRI VASANT RAMJI SALVA 7 . IN THE NET RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS A LLOWED WITH NO ORDER AS TO COST. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH DEC , 2018 . SD/ - SD/ - ( MANOJ KUMAR AGGARWAL ) (SANDEEP GOSAIN) / A COUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 27 . 12 .201 8 SR.PS . DHANANJAY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F I LE / BY ORDER, . / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI