SHRI SANJAY SHANTILAL JAIN, MUMBAI V. JCIT, CENTRAL RANGE-8, MUMBAI

ITA 6140/MUM/2018

AI Insights

The case involves multiple appeals by Shri Sanjay Shantilal Jain against the orders of the Commissioner of Income Tax (Appeals) concerning search assessments for the assessment years 2011-12 to 2014-15. The appeals primarily challenged the additions made under various sections of the Income Tax Act, including sections 68, 69C, and 271D. The tribunal examined issues such as the applicability of deemed dividend under section 2(22)(e), the treatment of unexplained cash credits, and the penalties imposed for these violations. The tribunal's decision involved a detailed analysis of the legal provisions and precedents, leading to the restoration of several issues to the Assessing Officer for re-evaluation.

• Counselvise Citation: [2022] 140 COUNSELVISE.COM (IT) 123657 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 11-10-2022
• Assessment Year: misc
• Appeal Filed On: 28-12-2018
• Other Referred Cases: Advantage Moti (India) P. Ltd. v. ITO, PCIT v. Lodha Developers, DCIT v. Shri Narendra Mithailal Agarwal, Hynoup Food and Oil Industries Ltd. v. CIT, M/s. Diza Holdings Pvt. Ltd v. CIT, Durga Prasad More v. CIT, Smt. Tarulata Shyam v. CIT, P.K. Badiani v. CIT, Navnit Lal C. Jhaveri v. K.K. Sen
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Unexplained investment; Unexplained expenditure; Business expenditure; Search and seizure; Salary income; Loose papers; Reasonable cause; Deemed dividend; Set aside
• Section: 69C; 40A(3); 273B; 143(3); 153A; 2(22)(e); 271D; 143(2); 2(A)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “G” MUMBAI BEFORE SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) AND SHRI SANDEEP SINGH KARHAIL (JUDICIAL MEMBER) ITA No. 6140/MUM/2018 Assessment Year: 2011-12 & ITA No. 6125/MUM/2018 Assessment Year: 2011-12 & ITA No. 6126/MUM/2018 Assessment Year: 2012-13 & ITA No. 6127/MUM/2018 Assessment Year: 2013-14 & ITA No. 6128/MUM/2018 Assessment Year: 2014-15 Shri Sanjay Shantilal Jain B-72, 7, Kalpataru Residency, Sion Koliwada Road Mumbai-400 022 Vs. DCIT Central Range-8 (3), 6 th Floor, Aayakar Bhavan, Maharshi Karve Road, Mumbai-400 020. PAN No. AABPJ3761A Appellant Respondent Assessee by : Mr. Rushabh Mehta Revenue by : Mr. Manoj Kumar, CIT-DR Date of Hearing : 12/10/2022 Date of pronouncement : 30/11/2022 PER OM PRAKASH KANT, AM These appeals by the assessee are directed against separate orders passed by the ld. Commissioner of Income Tax – (Appeals) A.Y. 2011-12 to 2014 passed in search assessments. The appeal by the assessee against the order dated by the Ld CIT(A) in relation to penalty Tax Act, 1961 [for short, the Act] for A.Y. 2011 being connected with on circumstances, therefore, same of this consolidated order for convenience and avoid repetition of facts. 2. First of all, we take up the appeal of the assessee for A.Y. 2011 12 arising from the assessment order passed by the Assessing Officer u/s/ 143(3) r.w.s. 153A of the Act. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 ORDER PER OM PRAKASH KANT, AM These appeals by the assessee except ITA No. 6140/Mum/2010 are directed against separate orders passed by the ld. Commissioner (Appeals) -50, Mumbai [in short, the ld. CIT(A)] for 12 to 2014-15 , which are arising from assessment order passed in search assessments. The ITA No. 6140/Mum/2010 is appeal by the assessee against the order dated 23/08/2018 passed in relation to penalty levied u/s. 271D of the Income Tax Act, 1961 [for short, the Act] for A.Y. 2011-12. being connected with one assessee and having identical facts and circumstances, therefore, same were together and disposed of by way of this consolidated order for convenience and avoid repetition of First of all, we take up the appeal of the assessee for A.Y. 2011 arising from the assessment order passed by the Assessing Officer u/s/ 143(3) r.w.s. 153A of the Act. 2 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 except ITA No. 6140/Mum/2010, are directed against separate orders passed by the ld. Commissioner 50, Mumbai [in short, the ld. CIT(A)] for , which are arising from assessment order ITA No. 6140/Mum/2010 is 23/08/2018 passed u/s. 271D of the Income 12. All these appeals e assessee and having identical facts and together and disposed of by way of this consolidated order for convenience and avoid repetition of First of all, we take up the appeal of the assessee for A.Y. 2011- arising from the assessment order passed by the Assessing Officer 3. The grounds raised by the assessee are reproduced as under: 1 On facts and circumstances of the case, the Ld CIT(A) 50 Mumbai erred in not holding that the order passed u/s 271D by the Ld. J Commissioner of Income Tax is without jurisdiction. invalid and bad in law 2 (a) The Ld CIT(A) erred in facts and law in upholding the penalty imposed of Rs. 12.00.000/ u/s 271D without appreciating the explanatio evidences placed on record (b) The Ld CIT(A) erred in facts and law in upholding the conclusion that the provisions of section 269SS were contravened without bringing on record any cogent evidences on record 3. Without prejudice lo above the Ld. appreciating the reasonable cause involved as envisaged u/s. 273B of the Act 4. The grounds of appeal raised above are without prejudice to one another 5. Your appellant craves leave to add amend delete or modify the grounds of appeal 4. Briefly stated, the facts of the case are that the assessee individual, was earning income from salary as per the return income filed. For the year under consideration, the assessee filed return of income on 3,85,290/- under regular provisions of the Act. Subsequently, a search and seizure action u/s. 132 the premises of the assessee on 11/06/2013 along with the search action at the premises of ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The grounds raised by the assessee are reproduced as under: 1 On facts and circumstances of the case, the Ld CIT(A) 50 Mumbai erred in hat the order passed u/s 271D by the Ld. J Commissioner of Income Tax is without jurisdiction. invalid and bad in law 2 (a) The Ld CIT(A) erred in facts and law in upholding the penalty imposed of Rs. 12.00.000/ u/s 271D without appreciating the explanatio evidences placed on record (b) The Ld CIT(A) erred in facts and law in upholding the conclusion that the provisions of section 269SS were contravened without bringing on record any cogent evidences on record 3. Without prejudice lo above the Ld. CIT(A) erred in facts and law in not appreciating the reasonable cause involved as envisaged u/s. 273B of the 4. The grounds of appeal raised above are without prejudice to one another 5. Your appellant craves leave to add amend delete or modify the grounds of appeal Briefly stated, the facts of the case are that the assessee earning income from salary as per the return income filed. For the year under consideration, the assessee filed return of income on 3/08/2011 declaring total income of Rs. under regular provisions of the Act. Subsequently, a search and seizure action u/s. 132(1) of the Act was carried the premises of the assessee on 11/06/2013 along with the search action at the premises of ‘RSBL’ Group and certain incriminating 3 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The grounds raised by the assessee are reproduced as under:- 1 On facts and circumstances of the case, the Ld CIT(A) 50 Mumbai erred in hat the order passed u/s 271D by the Ld. J Commissioner of Income Tax is without jurisdiction. invalid and bad in law 2 (a) The Ld CIT(A) erred in facts and law in upholding the penalty imposed of Rs. 12.00.000/ u/s 271D without appreciating the explanations and (b) The Ld CIT(A) erred in facts and law in upholding the conclusion that the provisions of section 269SS were contravened without bringing on record CIT(A) erred in facts and law in not appreciating the reasonable cause involved as envisaged u/s. 273B of the 4. The grounds of appeal raised above are without prejudice to one another 5. Your appellant craves leave to add amend delete or modify all or any of Briefly stated, the facts of the case are that the assessee, an earning income from salary as per the returns of income filed. For the year under consideration, the assessee filed declaring total income of Rs. under regular provisions of the Act. Subsequently, a of the Act was carried out at the premises of the assessee on 11/06/2013 along with the search and certain incriminating documents were found and seized. Consequently, notice u/s. 153A of the Act was issued on income. In response, the assessee filed the return of income on 21.08.2015 declaring total income of Rs. 3,80,290/ considering the submission of the assessee, the Assessing Officer assessed the total income Rs. 21,96,72,611/- after making certain additions/disallowances. 5. On further appeal, the ld. CIT(A) upheld the additions/ disallowances made by the Assessing Officer and dismissed the appeal of the assessee vide order dated 21.08.2018. Aggrieved, the assessee is in appeal before the Income Tax Appellate Tribunal (ITAT) by way of raising grounds as reproduced above. 6. Before us, the ld. Counsel of the assessee filed a paper book containing pages 1 to 64. 7. The ground no. 1 therefore same is dismissed as infructuous. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 documents were found and seized. Consequently, notice u/s. 153A of the Act was issued on 7/10/2014 asking the assessee to file return of income. In response, the assessee filed the return of income on ring total income of Rs. 3,80,290/ considering the submission of the assessee, the Assessing Officer assessed the total income u/s. 143(3) r.w.s. 153A on 31.03.2016 after making certain additions/disallowances. appeal, the ld. CIT(A) upheld the additions/ disallowances made by the Assessing Officer and dismissed the appeal of the assessee vide order dated 21.08.2018. Aggrieved, the assessee is in appeal before the Income Tax Appellate Tribunal (ITAT) ising grounds as reproduced above. Before us, the ld. Counsel of the assessee filed a paper book 1 to 64. The ground no. 1(a) of the appeal is general in nature and therefore same is dismissed as infructuous. 4 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 documents were found and seized. Consequently, notice u/s. 153A of asking the assessee to file return of income. In response, the assessee filed the return of income on ring total income of Rs. 3,80,290/-. After considering the submission of the assessee, the Assessing Officer u/s. 143(3) r.w.s. 153A on 31.03.2016 at after making certain additions/disallowances. appeal, the ld. CIT(A) upheld the additions/ disallowances made by the Assessing Officer and dismissed the appeal of the assessee vide order dated 21.08.2018. Aggrieved, the assessee is in appeal before the Income Tax Appellate Tribunal (ITAT) Before us, the ld. Counsel of the assessee filed a paper book is general in nature and 8. In ground no. 1(b) telescoping of the undisclosed income against the undisclosed expenditure. The Ld. counsel of assessee submitted that during the course of the assessment proceeding, the assessee had submitted a cash flow statement of undisclosed investment and therefore addition sh made only for one side i.e. either the undisclosed receipt or undisclosed investment following the real income theory. The Ld. counsel of assessee accepted unsecured loans of No. 3 and 4 of Annexure A the assessee at 96/106, Abhushan House, Sheikh Memon Street, Zaveri Bazar, Mumbai. undisclosed income against unexplained investment without correlation of receipt and expenditure. 9. We have heard rival submission of the parties on the issue dispute and perused the relevant material ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 In ground no. 1(b) of the appeal, the assessee is seeking telescoping of the undisclosed income against the undisclosed expenditure. The Ld. counsel of assessee submitted that during the course of the assessment proceeding, the assessee had submitted a cash flow statement of undisclosed receipt to explain the source of estment and therefore addition sh made only for one side i.e. either the undisclosed receipt or undisclosed investment following the real income theory. The Ld. counsel of assessee particularly stated that assessee has already accepted unsecured loans of ₹1.10 crores appearing in seized pages No. 3 and 4 of Annexure A-1, impounded from business premises of the assessee at 96/106, Abhushan House, Sheikh Memon Street, bai. The DR objected to grant telescoping of the undisclosed income against unexplained investment without correlation of receipt and expenditure. We have heard rival submission of the parties on the issue dispute and perused the relevant material on record. 5 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 of the appeal, the assessee is seeking telescoping of the undisclosed income against the undisclosed expenditure. The Ld. counsel of assessee submitted that during the course of the assessment proceeding, the assessee had submitted a undisclosed receipt to explain the source of estment and therefore addition should have been made only for one side i.e. either the undisclosed receipt or undisclosed investment following the real income theory. The Ld. particularly stated that assessee has already 1.10 crores appearing in seized pages 1, impounded from business premises of the assessee at 96/106, Abhushan House, Sheikh Memon Street, The DR objected to grant telescoping of the undisclosed income against unexplained investment without We have heard rival submission of the parties on the issue-in- on record. Identical issue in the case of the assessee for 6123/Mum/2018 has been restored to the file of the Assessing Officer for deciding after considering entries of cash flow statement and wherever the source of unexplained investment is explained by way of the undisclosed i unexplained investment should be made. the appeal is accordingly 10. The ground No. 2(a) of the appeal relates to addition of ₹11,02,43,800/ CIT(A) is unaccounted cash the Act, whereas represents sale proceeds 11. We have heard rival submission of the party on the issue in dispute and perused th identical issue has been for assessment year 2010 the issue disputes are identical ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 n the case of the assessee for assessment year 2010 6123/Mum/2018 has been restored to the file of the Assessing Officer for deciding after considering entries of cash flow statement and wherever the source of unexplained investment is explained by way of the undisclosed income, then no separate addition for unexplained investment should be made. The ground accordingly allowed for statistical ground No. 2(a) of the appeal relates to 11,02,43,800/- which according t CIT(A) is unaccounted cash credit in terms of section68 whereas according to the assessee proceeds received in cash. We have heard rival submission of the party on the issue in dispute and perused the relevant material on record. W has been decided by us in ITA no. 6123 for assessment year 2010-11 in ground no. 2 (two). S are identical to issues in dispute 6 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 assessment year 2010-11 in ITA No. 6123/Mum/2018 has been restored to the file of the Assessing Officer for deciding after considering entries of cash flow statement and wherever the source of unexplained investment is explained by ncome, then no separate addition for ground No.1(b) of statistical purposes. ground No. 2(a) of the appeal relates to the which according to the ld. in terms of section68 of assessee the amount We have heard rival submission of the party on the issue in relevant material on record. We find that the in ITA no. 6123/Mum/2018 . Since the facts of to issues in dispute for A.Y. 2011-12, decision therein shall mutatis mutandis apply here also. Accordingly, this ground of appeal no. 2(a) is accordingly allowed for statistical purposes. 12. The ground no. 2(b) relates to the application of the provision of section 40A(3) of the Act making the cash sales. In this regard, the ld. Counsel of the assessee submitted that once the profit element @0.5% of the sales is accepted by the Assessing Officer, then in no case, he may invoke any provisions to disallow the income which can be taxed. Moreover, ld. Counsel of the assessee submitted that the provisions of section 40A(3) places burden on the revenue to prove with the cogent evidences that payments exceeding Rs. 20,000/- are made by the assessee the assessee relied on the decision of the jurisdictional High Court in the case of PCIT v. Lodha Developers (W.P. no. 2562 of 2015) relied on the decision of Hon’ble Pune ITAT in the case of DCIT v. Shri Narendra Mithailal Agarwal (ITA no. 808 & 811/PN/2010) ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 sion therein shall mutatis mutandis apply here also. Accordingly, this ground of appeal no. 2(a) is accordingly allowed for statistical The ground no. 2(b) relates to the application of the provision of section 40A(3) of the Act in respect of purchases made in cash for making the cash sales. In this regard, the ld. Counsel of the assessee submitted that once the profit element @0.5% of the sales is accepted by the Assessing Officer, then in no case, he may invoke any provisions to disallow the business expenditure as it is only the net income which can be taxed. Moreover, ld. Counsel of the assessee submitted that the provisions of section 40A(3) places burden on the revenue to prove with the cogent evidences that payments exceeding are made by the assessee. In this context, ld. Counsel of the assessee relied on the decision of the jurisdictional High Court in PCIT v. Lodha Developers (W.P. no. 2562 of 2015) relied on the decision of Hon’ble Pune ITAT in the case of DCIT v. Shri Narendra Mithailal Agarwal (ITA no. 808 & 811/PN/2010) 7 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 sion therein shall mutatis mutandis apply here also. Accordingly, this ground of appeal no. 2(a) is accordingly allowed for statistical The ground no. 2(b) relates to the application of the provision of purchases made in cash for making the cash sales. In this regard, the ld. Counsel of the assessee submitted that once the profit element @0.5% of the sales is accepted by the Assessing Officer, then in no case, he may invoke any business expenditure as it is only the net income which can be taxed. Moreover, ld. Counsel of the assessee submitted that the provisions of section 40A(3) places burden on the revenue to prove with the cogent evidences that payments exceeding In this context, ld. Counsel of the assessee relied on the decision of the jurisdictional High Court in PCIT v. Lodha Developers (W.P. no. 2562 of 2015) and also relied on the decision of Hon’ble Pune ITAT in the case of DCIT v. Shri Narendra Mithailal Agarwal (ITA no. 808 & 811/PN/2010) submitting that the decision of the Hon’ble Gujarat High Court in the case of Hynoup Food and Oil Industries Ltd. (290 ITR 272 (G by AO is already considered and distinguished by the Hon’ble Pune ITAT which is squarely applicable 13. On the contrary, the ld. Departmental Representative relied on the order of the Assessing Officer sta cash financing is to be treated as cash sales, then the corresponding purchases are obviously made in cash only and accordingly, the provisions of section 40A(3) should be applied to disallow the same in entirety. 14. We have considered the rival submissions made before us and perused the material placed on record. Firstly, we have decided in ground no. 2(a) that the assessee have carried out cash sales however, in this case, there is no evidence at all being found either i the course of search or in the course of the assessment proceedings , regarding the quantum of purchases. It is also not clear whether the passages corresponding to the sales are consolidated or separate. the ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 that the decision of the Hon’ble Gujarat High Court in the case of Food and Oil Industries Ltd. (290 ITR 272 (G by AO is already considered and distinguished by the Hon’ble Pune ITAT which is squarely applicable to the present facts of the case. On the contrary, the ld. Departmental Representative relied on the order of the Assessing Officer stating that if the transactions of is to be treated as cash sales, then the corresponding purchases are obviously made in cash only and accordingly, the provisions of section 40A(3) should be applied to disallow the same in ve considered the rival submissions made before us and perused the material placed on record. Firstly, we have decided in ground no. 2(a) that the assessee have carried out cash sales however, in this case, there is no evidence at all being found either i the course of search or in the course of the assessment proceedings , regarding the quantum of purchases. It is also not clear whether the passages corresponding to the sales are consolidated or separate. the 8 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 that the decision of the Hon’ble Gujarat High Court in the case of Food and Oil Industries Ltd. (290 ITR 272 (Guj.) relied upon by AO is already considered and distinguished by the Hon’ble Pune to the present facts of the case. On the contrary, the ld. Departmental Representative relied on ting that if the transactions of is to be treated as cash sales, then the corresponding purchases are obviously made in cash only and accordingly, the provisions of section 40A(3) should be applied to disallow the same in ve considered the rival submissions made before us and perused the material placed on record. Firstly, we have decided in ground no. 2(a) that the assessee have carried out cash sales. however, in this case, there is no evidence at all being found either in the course of search or in the course of the assessment proceedings , regarding the quantum of purchases. It is also not clear whether the passages corresponding to the sales are consolidated or separate. the issue of any addition in respect of unexplain corresponding to sales recorded in seized material has already been restored to the file of the Assessing Officer while adjudicating ground No. 2(a) and the issue of i decided consequently for statistical purposes 15. The ground no. 3 of the appeal relates to the addition of alleged advances given of Rs. 3,83,50,000/ 69 of the Act and ground no. 4 of the appeal relates to t income of Rs. 25,02,188/ 16. The brief facts in this regard is that during the course of search, from the residence of the assessee, Annexure A has been inferred by the R to various parties and interest earned of Rs. 1,4,75,000/ During the course of search, statement of assessee was recorded u/s. 132(4) of the Act wherein he stated that the same is not written in his handwriting and that he ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 issue of any addition in respect of unexplain corresponding to sales recorded in seized material has already been restored to the file of the Assessing Officer while adjudicating ground No. 2(a) and the issue of invoking section 40 A(3) of the A decided consequently, therefore this ground no. 2(b) is for statistical purposes. The ground no. 3 of the appeal relates to the addition of alleged advances given of Rs. 3,83,50,000/- as unexplained investment u/s. 69 of the Act and ground no. 4 of the appeal relates to t income of Rs. 25,02,188/- on such alleged loans given. The brief facts in this regard is that during the course of search, from the residence of the assessee, Annexure A-3 was seized has been inferred by the Revenue as loans given of Rs. 3,82,50,000/ to various parties and interest earned of Rs. 1,4,75,000/ During the course of search, statement of assessee was recorded u/s. 132(4) of the Act wherein he stated that the same is not written in his handwriting and that he was not aware of the contents of the same. 9 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 issue of any addition in respect of unexplained purchase corresponding to sales recorded in seized material has already been restored to the file of the Assessing Officer while adjudicating ground nvoking section 40 A(3) of the Act is to be ground no. 2(b) is also allowed The ground no. 3 of the appeal relates to the addition of alleged as unexplained investment u/s. 69 of the Act and ground no. 4 of the appeal relates to the interest on such alleged loans given. The brief facts in this regard is that during the course of search, 3 was seized which Rs. 3,82,50,000/- to various parties and interest earned of Rs. 1,4,75,000/- thereon. During the course of search, statement of assessee was recorded u/s. 132(4) of the Act wherein he stated that the same is not written in his ot aware of the contents of the same. 17. In this regard, the ld. Counsel us that the assessee could not explain the contents during the search due to high mental pressure and in any case, have later explained these pages during the course of assessment proceedings. The ld. Counsel submitted that the page no. 1 and 2 of Annexure A recording of certain interest calculations related to 10 parties. The period of interest worked out for all the parties is from 25.10.2010 24.10.2022. The principal amount aggregated to Rs. 3,82,50,000/ and total interest thereon worked out to be Rs. 1,14,75,000/ which an amount of Rs. 25,02,188/ explained before the Assessing Officer that the as friend – Mr. Jitendra Jain (referred to as “Jitu Sai” in the notings) had entered into a deal with G.M. Group of concern of Mr. G.M.Kakde for the purchase of an area of 15000 sq. ft. at the 5 th , 6 th and 7 th total consideration agreed in relation to the same was Rs. 10.05 crores of which only a sum of Rs. 2.50 crores was payable till the end of January 2011 and the balance of Rs. 7.55 crores were to be paid ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 In this regard, the ld. Counsel of the assessee us that the assessee could not explain the contents during the search due to high mental pressure and in any case, have later explained during the course of assessment proceedings. The ld. Counsel submitted that the page no. 1 and 2 of Annexure A recording of certain interest calculations related to 10 parties. The period of interest worked out for all the parties is from 25.10.2010 24.10.2022. The principal amount aggregated to Rs. 3,82,50,000/ and total interest thereon worked out to be Rs. 1,14,75,000/ which an amount of Rs. 25,02,188/- pertained to A.Y. 2011 explained before the Assessing Officer that the as Mr. Jitendra Jain (referred to as “Jitu Sai” in the notings) had entered into a deal with G.M. Group of realtors, a proprietorship concern of Mr. G.M.Kakde for the purchase of an area of 15000 sq. ft. th floor at Naigaon division, Mumbai 400012. The ation agreed in relation to the same was Rs. 10.05 crores of which only a sum of Rs. 2.50 crores was payable till the end of January 2011 and the balance of Rs. 7.55 crores were to be paid 10 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 of the assessee submitted before us that the assessee could not explain the contents during the search due to high mental pressure and in any case, have later explained during the course of assessment proceedings. The ld. Counsel submitted that the page no. 1 and 2 of Annexure A-3 are recording of certain interest calculations related to 10 parties. The period of interest worked out for all the parties is from 25.10.2010 to 24.10.2022. The principal amount aggregated to Rs. 3,82,50,000/- and total interest thereon worked out to be Rs. 1,14,75,000/-, out of pertained to A.Y. 2011-12. It is explained before the Assessing Officer that the assessee and his Mr. Jitendra Jain (referred to as “Jitu Sai” in the notings) had , a proprietorship concern of Mr. G.M.Kakde for the purchase of an area of 15000 sq. ft. floor at Naigaon division, Mumbai 400012. The ation agreed in relation to the same was Rs. 10.05 crores of which only a sum of Rs. 2.50 crores was payable till the end of January 2011 and the balance of Rs. 7.55 crores were to be paid later on. Out of the total consideration of Rs. 10.05 crores, a sum of Rs. 6.21 crores were to be borne by the assessee and the balance Rs.3.84 crores was to be borne /arranged by his friend. The ld. Counsel further emphasized that even the Assessing Officer has accepted that Rs. 3.84 crores is Jitu Sai at page no. 3 of Annexure A when read with the MOU entered into between the said Mr. G.M.Kakde, the assessee and Mr. Jitendra Jain absence of possession of flat within a period of 24 months from the execution of the MOU dated shall be entitled to interest at the rate of 15% p.a. on the amount paid to the builder. The ld. Counsel explaine course of search relate to these calculations and that since the possession in relation to 5 none of the investors turned up for making investments and accordingly these are mere pr and interest has been earned. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 on. Out of the total consideration of Rs. 10.05 crores, a sum of Rs. 6.21 crores were to be borne by the assessee and the balance was to be borne /arranged by his friend. The ld. Counsel further emphasized that even the Assessing Officer has accepted that Rs. 3.84 crores is appearing against the name of Mr. Jitu Sai at page no. 3 of Annexure A-3 seized in the course of search read with the MOU entered into between the said Mr. G.M.Kakde, the assessee and Mr. Jitendra Jain. It was agreed absence of possession of flat within a period of 24 months from the execution of the MOU dated 05.10.2010, the assessee and his friend shall be entitled to interest at the rate of 15% p.a. on the amount paid to the builder. The ld. Counsel explained that the noting found in the course of search relate to these calculations and that since the possession in relation to 5 th , 6 th and 7 th floor could not be obtained, none of the investors turned up for making investments and accordingly these are mere proposals and not that any loans are given and interest has been earned. 11 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 on. Out of the total consideration of Rs. 10.05 crores, a sum of Rs. 6.21 crores were to be borne by the assessee and the balance was to be borne /arranged by his friend. The ld. Counsel further emphasized that even the Assessing Officer has appearing against the name of Mr. 3 seized in the course of search read with the MOU entered into between the said Mr. . It was agreed that in absence of possession of flat within a period of 24 months from the , the assessee and his friend shall be entitled to interest at the rate of 15% p.a. on the amount paid d that the noting found in the course of search relate to these calculations and that since the floor could not be obtained, none of the investors turned up for making investments and oposals and not that any loans are given 18. On other side, the ld. Departmental Representative argued that the assessee failed to explain initially at the time of search and further, even now the assessee has not substantiate explanations. Further, the content of the seized material found should be considered as true and that of the assessee as per section 132(4A) and hence, the addition of the cash loan given and interest income earned by the assessee should be upheld. 19. We have considered the rival submissions and perused the material on record. It is the fact that initially, the assessee had not explained the relevant seized material and denied to be aware of the same. However, at the time of assessment proceedings, t filed the MOU dated Mr. Jitendra Jain was to bring Rs. 3.84 crores in the project of Mr. G.M.Kakde for which various proposals were made for the prospective buyers with attractive interest rates o if possession of flats are not received within 24 months from the execution of the MOU. We find force in the argument of the ld. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 On other side, the ld. Departmental Representative argued that the assessee failed to explain initially at the time of search and further, even now the assessee has not substantiate explanations. Further, the content of the seized material found should be considered as true and that of the assessee as per section 132(4A) and hence, the addition of the cash loan given and interest income earned by the assessee should be upheld. We have considered the rival submissions and perused the material on record. It is the fact that initially, the assessee had not explained the relevant seized material and denied to be aware of the same. However, at the time of assessment proceedings, t filed the MOU dated 05.10.2010 and explained that Mr. Jitendra Jain was to bring Rs. 3.84 crores in the project of Mr. G.M.Kakde for which various proposals were made for the prospective buyers with attractive interest rates of 15% p.a. on their investments if possession of flats are not received within 24 months from the execution of the MOU. We find force in the argument of the ld. 12 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 On other side, the ld. Departmental Representative argued that the assessee failed to explain initially at the time of search and further, even now the assessee has not substantiated his explanations. Further, the content of the seized material found should be considered as true and that of the assessee as per section 132(4A) and hence, the addition of the cash loan given and interest We have considered the rival submissions and perused the material on record. It is the fact that initially, the assessee had not explained the relevant seized material and denied to be aware of the same. However, at the time of assessment proceedings, the assessee and explained that one of his friend Mr. Jitendra Jain was to bring Rs. 3.84 crores in the project of Mr. G.M.Kakde for which various proposals were made for the prospective f 15% p.a. on their investments if possession of flats are not received within 24 months from the execution of the MOU. We find force in the argument of the ld. Counsel that merely because a seized material could not be explained in the course of search, h altogether ignoring his explanations given in the course of assessment proceedings. We find that the assessee has placed on record the MOU dated 05.10.2010 entered between the assessee, his friend Mr. Jitendra Jain and Mr G.M. Kakde for the possession of 5 floor for an area of 15000 sq ft. The Assessing Officer has not made any enquiries in the matter whereas the MOU is duly signed by all the parties. The claim of the assesee floor is not given by Mr. G.M. Kakde presumption u/s section 132(4A) of the Act are rebuttable presumptions. Once the assessee has given explanations along with the MOU and the commencem assessing Officer to verify those facts and decide the issue in the light of verification. Hence, verification at the end of the Assessing officer in the light of the MO and commencement Officer shall be at liberty to carry out any enquiry which deemed fit in ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Counsel that merely because a seized material could not be explained in the course of search, he cannot be fastened with the tax liability altogether ignoring his explanations given in the course of assessment proceedings. We find that the assessee has placed on record the MOU entered between the assessee, his friend Mr. in and Mr G.M. Kakde for the possession of 5 floor for an area of 15000 sq ft. The Assessing Officer has not made any enquiries in the matter whereas the MOU is duly signed by all the claim of the assesee that the possession of 5 floor is not given by Mr. G.M. Kakde also needs verification section 132(4A) of the Act are rebuttable . Once the assessee has given explanations along with nd the commencement certificate, the onus shifts to the assessing Officer to verify those facts and decide the issue in the light Hence, the noting in the seized material verification at the end of the Assessing officer in the light of the MO certificate filed by the assessee Officer shall be at liberty to carry out any enquiry which deemed fit in 13 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Counsel that merely because a seized material could not be explained e cannot be fastened with the tax liability altogether ignoring his explanations given in the course of assessment proceedings. We find that the assessee has placed on record the MOU entered between the assessee, his friend Mr. in and Mr G.M. Kakde for the possession of 5 th , 6 th and 7 th floor for an area of 15000 sq ft. The Assessing Officer has not made any enquiries in the matter whereas the MOU is duly signed by all the that the possession of 5 th , 6 th and 7 th needs verification. The section 132(4A) of the Act are rebuttable . Once the assessee has given explanations along with , the onus shifts to the assessing Officer to verify those facts and decide the issue in the light in the seized material need further verification at the end of the Assessing officer in the light of the MOU certificate filed by the assessee. The Assessing Officer shall be at liberty to carry out any enquiry which deemed fit in the facts and circumstances including directing the assessee to produce the concerned parties for verification . no. 3 and 4 of the appeal are allowed 20. The ground no. 5 relates to the addition of Rs. 3.71 crores as undisclosed income of the assessee for making alleged cash payment to Mr. G.M. Kakde. 21. The brief facts premises of the assessee and that at page no.3 of amounts was stated. In this regard, the ld. Counsel of the assessee submitted that out of the total consideration of Rs. 10.05 crores, a sum of Rs. 6.21 crores was to be borne by the Rs. 3.84 crores by Mr. Jitendra Jain which the Assessing Officer has accepted. The ld. Counsel submits that only the sum of Rs. 2.5 crores was paid to Mr. G.M.Kakde through regular banking channel and nothing over and above has been paid. In f Rs. 3,71,00,000/- is still payable as no area has been provided in return. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 the facts and circumstances including directing the assessee to the concerned parties for verification . Accordingly, ground no. 3 and 4 of the appeal are allowed for statistical purposes The ground no. 5 relates to the addition of Rs. 3.71 crores as undisclosed income of the assessee for making alleged cash payment The brief facts are that Annexure A-3 was seized from the essee and that at page no.3 therein certain noting stated. In this regard, the ld. Counsel of the assessee submitted that out of the total consideration of Rs. 10.05 crores, a of Rs. 6.21 crores was to be borne by the assesee Rs. 3.84 crores by Mr. Jitendra Jain which the Assessing Officer has accepted. The ld. Counsel submits that only the sum of Rs. 2.5 crores was paid to Mr. G.M.Kakde through regular banking channel and nothing over and above has been paid. In fact, the balance amount of is still payable as no area has been provided in 14 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 the facts and circumstances including directing the assessee to cordingly, ground for statistical purposes. The ground no. 5 relates to the addition of Rs. 3.71 crores as undisclosed income of the assessee for making alleged cash payment 3 was seized from the erein certain noting stated. In this regard, the ld. Counsel of the assessee submitted that out of the total consideration of Rs. 10.05 crores, a assesee and balance Rs. 3.84 crores by Mr. Jitendra Jain which the Assessing Officer has accepted. The ld. Counsel submits that only the sum of Rs. 2.5 crores was paid to Mr. G.M.Kakde through regular banking channel and act, the balance amount of is still payable as no area has been provided in 22. On other side, the ld. Departmental Representative argued that the seized material needs to be read as a whole and that once the whole amount of Rs. only Rs. 2.5 crores have been paid and not the balance. Accordingly, since the assessee has failed to explain the source of the balance payment of Rs. 3,71,00,000/ 23. We have heard the rival submissions and carefully perused the material on record. In this regard, the issue arising out of the page no. 3 of Annexure A- of Rs. 6.71 crores is to be interpreted as paid or payab Counsel of the assessee entered with Mr. G.M. Kakde for providing possession of area of 15000 sq. ft. on 5 th , 6 such possession was given, there does not making further payments after the initial payment of Rs. 2.5 crores. Further, the seized material shows that Total Cash/Cheque is stated besides the amount of 6,21,00,000/ ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 On other side, the ld. Departmental Representative argued that the seized material needs to be read as a whole and that once the whole amount of Rs. 6.71 crores is stated, one cannot assume that only Rs. 2.5 crores have been paid and not the balance. Accordingly, since the assessee has failed to explain the source of the balance payment of Rs. 3,71,00,000/-, the addition made thereof be upheld. We have heard the rival submissions and carefully perused the material on record. In this regard, the issue arising out of the page -3 of the seized material is that whether amount of Rs. 6.71 crores is to be interpreted as paid or payab Counsel of the assessee stated that the MOU dated 05.10.2010 was entered with Mr. G.M. Kakde for providing possession of area of , 6 th and 7 th floor in the project; however, since no such possession was given, there does not arise any question of making further payments after the initial payment of Rs. 2.5 crores. Further, the seized material shows that Total Cash/Cheque is stated besides the amount of 6,21,00,000/- and accordingly, the assessee 15 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 On other side, the ld. Departmental Representative argued that the seized material needs to be read as a whole and that once the 6.71 crores is stated, one cannot assume that only Rs. 2.5 crores have been paid and not the balance. Accordingly, since the assessee has failed to explain the source of the balance , the addition made thereof be upheld. We have heard the rival submissions and carefully perused the material on record. In this regard, the issue arising out of the page 3 of the seized material is that whether amount of Rs. 6.71 crores is to be interpreted as paid or payable. The ld. that the MOU dated 05.10.2010 was entered with Mr. G.M. Kakde for providing possession of area of floor in the project; however, since no arise any question of making further payments after the initial payment of Rs. 2.5 crores. Further, the seized material shows that Total Cash/Cheque is stated and accordingly, the assessee was to make the payment either contention of the ld. Counsel of the assessee that no cash of Rs. 3,71,00,000/- is paid at all as alleged by the revenue and only cheques aggregating to Rs. 2,50,00,000/ appreciation of the materia recorded, itis inferred either enter amount of been paid or payable payment as paid ( by cheue) , there is no reason, why the balance part of the amount might not be treated as paid. The assessee has not brought on record any evidence to rebut the presumption that balance amount has also been paid. able to demonstrate therefore the finding of the Ld. CIT(A) on the issue in dispute are justified. Accordingly, the ground no. 5 is dismissed. 24. The ground no. 6 of appeal relates to the interest of Rs. 13,63,333/- as unexplained interest u/s. 69C of the Act on the alleged cash loan of Rs. 1,10,00,000/ ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 was to make the payment either in cash or cheque. However, it is the contention of the ld. Counsel of the assessee that no cash of Rs. is paid at all as alleged by the revenue and only cheques aggregating to Rs. 2,50,00,000/- is paid. On proper the material, we are of the view that from the entries recorded, itis inferred either enter amount of ₹ 6, 21, 00, been paid or payable. Once , the assessee is accepting part of the payment as paid ( by cheue) , there is no reason, why the balance the amount might not be treated as paid. The assessee has not brought on record any evidence to rebut the presumption that balance amount has also been paid. since the assessee has source of balance amount of Rs. 3,71,00,000/ therefore the finding of the Ld. CIT(A) on the issue in dispute are . Accordingly, the ground no. 5 is dismissed. no. 6 of appeal relates to the interest of Rs. as unexplained interest u/s. 69C of the Act on the cash loan of Rs. 1,10,00,000/-. Identical issue 16 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 in cash or cheque. However, it is the contention of the ld. Counsel of the assessee that no cash of Rs. is paid at all as alleged by the revenue and only is paid. On proper we are of the view that from the entries 6, 21, 00, 000/- has . Once , the assessee is accepting part of the payment as paid ( by cheue) , there is no reason, why the balance the amount might not be treated as paid. The assessee has not brought on record any evidence to rebut the presumption that since the assessee has not been of balance amount of Rs. 3,71,00,000/- therefore the finding of the Ld. CIT(A) on the issue in dispute are . Accordingly, the ground no. 5 is dismissed. no. 6 of appeal relates to the interest of Rs. as unexplained interest u/s. 69C of the Act on the . Identical issue has already decided in ITA no. 6123 2010-11 while deciding ground no. 3 apply in this case also as the facts are identical. Accordingly, the Assessing Officer has not considered the Cash Flow of unaccounted income and expenditure submitted by the assessee, this issue is also restored 25. The ground no. 7,8 and 9 relates to the issues which are u/s. 68 of the Act along with the commission expense Assessing Officer but without any incriminating material found in the course of search. 26. The issue relating to ground no. 7 is that 1,50,00,000/- taken from M/s. Maniratnam E as an accommodation entry and addition is made u/s. 68 of the Act. 27. The issue relating to ground no. 8 is that commission @2.4% is estimated on the above loan of Rs. 1,50,00,000/ Maniratnam Exim Pvt. Ltd. conse 3,60,000/- is made by the revenue. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 decided in ITA no. 6123/Mum/2018 in assessee’s own case for A.Y. deciding ground no. 3, which shall mutatis mutandis apply in this case also as the facts are identical. Accordingly, the Assessing Officer has not considered the Cash Flow of unaccounted income and expenditure submitted by the assessee, this d to the file of the Assessing Officer. The ground no. 7,8 and 9 relates to the issues which are u/s. 68 of the Act along with the commission expense Assessing Officer but without any incriminating material found in the The issue relating to ground no. 7 is that taken from M/s. Maniratnam Exim Pvt. Ltd. is treated as an accommodation entry and addition is made u/s. 68 of the Act. The issue relating to ground no. 8 is that commission @2.4% is estimated on the above loan of Rs. 1,50,00,000/- Maniratnam Exim Pvt. Ltd. consequent to which addition of Rs. is made by the revenue. 17 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 in assessee’s own case for A.Y. which shall mutatis mutandis apply in this case also as the facts are identical. Accordingly, since the Assessing Officer has not considered the Cash Flow of unaccounted income and expenditure submitted by the assessee, this to the file of the Assessing Officer. The ground no. 7,8 and 9 relates to the issues which are added u/s. 68 of the Act along with the commission expenses by the Assessing Officer but without any incriminating material found in the The issue relating to ground no. 7 is that loan of Rs. xim Pvt. Ltd. is treated as an accommodation entry and addition is made u/s. 68 of the Act. The issue relating to ground no. 8 is that commission @2.4% is taken from M/s. quent to which addition of Rs. 28. The issue relating to ground no. 9 is relating to the addition us/. 68 of the Act in respect of various parties from whom loans aggregating to Rs. 1,45,00,000/ 29. The search and seizure action was conducted on 11.06.2013 whereas the due date of issuing notice u/s.143(2) for A.Y. 2011 expired on 30.09.2012. Since no proceedings were pending as on date of search, the Assessing Officer ought to have made additions which arose out of the incriminating material only. Since all the above issues does not arise from any incriminating material found during search and that the assessment for the A.Y. 2011 unabated year, such additions deserves to be deleted in view binding decisions of the Hon’ble jurisdictional High court in the case of CITv. ContinentalWarehousing inITANo.523 of 2013 (Bom HC). Accordingly, ground no. 7, 8 and 9 are allowed. 30. Ground no. 10 and 11 require any adjudication and are accordingly dismissed. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The issue relating to ground no. 9 is relating to the addition us/. 68 of the Act in respect of various parties from whom loans aggregating to Rs. 1,45,00,000/- had been taken. earch and seizure action was conducted on 11.06.2013 whereas the due date of issuing notice u/s.143(2) for A.Y. 2011 expired on 30.09.2012. Since no proceedings were pending as on date of search, the Assessing Officer ought to have made additions which arose out of the incriminating material only. Since all the above issues does not arise from any incriminating material found during search and that the assessment for the A.Y. 2011 unabated year, such additions deserves to be deleted in view binding decisions of the Hon’ble jurisdictional High court in the case CITv. ContinentalWarehousing inITANo.523 of 2013 (Bom HC). Accordingly, ground no. 7, 8 and 9 are Ground no. 10 and 11 being general in nature, do ny adjudication and are accordingly dismissed. 18 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The issue relating to ground no. 9 is relating to the addition us/. 68 of the Act in respect of various parties from whom loans earch and seizure action was conducted on 11.06.2013 whereas the due date of issuing notice u/s.143(2) for A.Y. 2011-12 expired on 30.09.2012. Since no proceedings were pending as on date of search, the Assessing Officer ought to have made additions which arose out of the incriminating material only. Since all the above issues does not arise from any incriminating material found during search and that the assessment for the A.Y. 2011-12 is already unabated year, such additions deserves to be deleted in view of the binding decisions of the Hon’ble jurisdictional High court in the case CITv. ContinentalWarehousing inITANo.523 of 2013 (Bom HC). Accordingly, ground no. 7, 8 and 9 are being general in nature, do not ny adjudication and are accordingly dismissed. 31. Now we take up the appeal of the assessee bearing ITA No. 6126 /Mum/2018 for assessment year of the assessee are reproduce 1. (a) On facts and circumstances erred in not holding that the order passed u/s. 143[3] r.ws. 153A by the DCT, CC-813). Mumbai (Assessing Officer) is without jurisdiction, invalid and bad in law. (b) The Ld. CITIA) has grossly erred in facts and law explanations and material placed on record as well as true content of the seized material and taking the wholistic view of the matter by telescoping the real income of the assessee. 2. The Ld. CIT(A) erred in facts and law in uphold amounting to Rs. 57.37.500/ 3,82.50,000/- in AY. 2011 substance of the loose papers and completely ignoring the evidences and explanations placed on record. 3. The Ld. CIT(A) erred in facts and law in upholding the addition of unaccounted interest payment of Rs. 13.10.367/ expenditure u/s. 69C of the Act on the alleged cash loan taken of Rs. 1,10,00,000/- and not taking the wholist 4. The Ld. CIT(A) erred in facts and law in upholding the addition of unsecured loan taken from various parties aggregating to Rs. 1,50,00,000/ as unexplained cash credit u/s. 68 of the Act. 5. All the above grounds are independent a other. 6. Your appellant craves leave to add, offler, cxeind, late modify any or all the grounds of appeal ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Now we take up the appeal of the assessee bearing ITA No. 6126 /Mum/2018 for assessment year 2012-13. The grounds of the appeal reproduced as under:’ 1. (a) On facts and circumstances of the case, the Ld. CIT(A) erred in not holding that the order passed u/s. 143[3] r.ws. 153A by the 813). Mumbai (Assessing Officer) is without jurisdiction, invalid (b) The Ld. CITIA) has grossly erred in facts and law in not appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view of the matter by telescoping the real income of the assessee. 2. The Ld. CIT(A) erred in facts and law in upholding the addition of interest amounting to Rs. 57.37.500/- on the alleged advance given of Rs. in AY. 2011-12 without appreciating the true contents and substance of the loose papers and completely ignoring the evidences and d on record. 3. The Ld. CIT(A) erred in facts and law in upholding the addition of unaccounted interest payment of Rs. 13.10.367/- expenditure u/s. 69C of the Act on the alleged cash loan taken of Rs. and not taking the wholistic view of the matter 4. The Ld. CIT(A) erred in facts and law in upholding the addition of unsecured loan taken from various parties aggregating to Rs. 1,50,00,000/ as unexplained cash credit u/s. 68 of the Act. 5. All the above grounds are independent and without prejudice to 6. Your appellant craves leave to add, offler, cxeind, late modify any or all ds of appeal. 19 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Now we take up the appeal of the assessee bearing ITA No. 6126 . The grounds of the appeal of the case, the Ld. CIT(A)-50. Mumbai erred in not holding that the order passed u/s. 143[3] r.ws. 153A by the 813). Mumbai (Assessing Officer) is without jurisdiction, invalid in not appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view of the matter by telescoping ing the addition of interest on the alleged advance given of Rs. 12 without appreciating the true contents and substance of the loose papers and completely ignoring the evidences and 3. The Ld. CIT(A) erred in facts and law in upholding the addition of as unexplained expenditure u/s. 69C of the Act on the alleged cash loan taken of Rs. ic view of the matter 4. The Ld. CIT(A) erred in facts and law in upholding the addition of unsecured loan taken from various parties aggregating to Rs. 1,50,00,000/- nd without prejudice to each 6. Your appellant craves leave to add, offler, cxeind, late modify any or all 32. The ground No. 1(a) being general in nature, therefore we are not required to adjudicate upon specifically and henc infructuous. 33. The ground No. 1(b) of the appeal under consideration, is identically worded to ground No. 1(b) of the appeal for assessment year 2011-12, and therefore following o 2011-12, the ground No. 1(b) allowed for statistical purposes. 34. The ground No. 2 of the appeal of the assessee relates to of ₹ 57, 37, 500/-on alleged advance of Rs. 3, 82, 50,000/ previous year relevant to assessment year 2011 advance of ₹ 3, 82, 50,000/ assessment year 2011 the learned Assessing Officer for deciding finding in assessment year 2011 ground No. two of the appeal for the year under consideration is also restored to the file of the Assessing Officer for ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 he ground No. 1(a) being general in nature, therefore we are not required to adjudicate upon specifically and henc The ground No. 1(b) of the appeal under consideration, is identically worded to ground No. 1(b) of the appeal for assessment 12, and therefore following our finding in 12, the ground No. 1(b) of the year under consideration is allowed for statistical purposes. The ground No. 2 of the appeal of the assessee relates to on alleged advance of Rs. 3, 82, 50,000/ previous year relevant to assessment year 2011-12. This issue of 3, 82, 50,000/-has been dealt in ground No. 3 for assessment year 2011-12 , wherein it has been restored to the f Assessing Officer for deciding afresh. Following our n assessment year 2011-12 on the issue in dispute, the ground No. two of the appeal for the year under consideration is also restored to the file of the Assessing Officer for deciding in the light of 20 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 he ground No. 1(a) being general in nature, therefore we are not required to adjudicate upon specifically and hence, dismissed as The ground No. 1(b) of the appeal under consideration, is identically worded to ground No. 1(b) of the appeal for assessment in assessment year of the year under consideration is The ground No. 2 of the appeal of the assessee relates to interest on alleged advance of Rs. 3, 82, 50,000/- given in 12. This issue of has been dealt in ground No. 3 for 12 , wherein it has been restored to the file of afresh. Following our 12 on the issue in dispute, the ground No. two of the appeal for the year under consideration is also deciding in the light of the decision which will be taken in assessment year 2011 ground of the appeal of the assessee is also allowed for statistical purposes. 35. The ground No. three of the appeal of the assessee relates to addition of interest payment of expenditure under section 6 00, 000/-. 36. We find that identical issue of addition of interest payment on the alleged cash loan of 12 has been restored to the file of the deciding afresh. Following our finding, in assessment year 2011 the issue in dispute in the year under consideration is also restore to the file of the learned view our finding in assessment year 2011 appeal of the assessee 37. The ground No. four of the appeal relates to addition of 00, 000/-as unexplai ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 the decision which will be taken in assessment year 2011 ground of the appeal of the assessee is also allowed for statistical The ground No. three of the appeal of the assessee relates to t payment of ₹ 13, 10, 367/ expenditure under section 69C on alleged cash loan taken of We find that identical issue of addition of interest payment on the alleged cash loan of ₹ 1, 10, 00, 000/-in assessment year 20 12 has been restored to the file of the learned Assessing Officer for deciding afresh. Following our finding, in assessment year 2011 the issue in dispute in the year under consideration is also restore to learned Assessing Officer for deciding afre n assessment year 2011-12. The ground of the appeal of the assessee is accordingly allowed for statistical purposes. The ground No. four of the appeal relates to addition of as unexplained cash credit under section 68 of the act. The 21 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 the decision which will be taken in assessment year 2011-12. This ground of the appeal of the assessee is also allowed for statistical The ground No. three of the appeal of the assessee relates to 13, 10, 367/-as unexplained 9C on alleged cash loan taken of ₹ 1, 10, We find that identical issue of addition of interest payment on in assessment year 2011- Assessing Officer for deciding afresh. Following our finding, in assessment year 2011-12, the issue in dispute in the year under consideration is also restore to or deciding afresh keeping in 12. The ground of the accordingly allowed for statistical purposes. The ground No. four of the appeal relates to addition of ₹ 1, 50, ned cash credit under section 68 of the act. The Assessing Officer ha order. The relevant finding of the Assessing Officer is reproduced as under: The assessee has shown the following loans received during Name of the party Jitendra jain Rajesh Jain HUF L S Jain Sanjeev Jain Amit jain Babulal Shah Total The assessee has not submitted any documents to establish genuineness fan except confirmation of the party confirmation of the party only without any supporting documents. As per the provisions of section 68 at the Income Tax Act, onus is on the assessee to explain cash credit appearing provisions of section 68 of the Income Tax Act that is to establish identity of the party, genuineness of transaction and creditworthiness of the party. The assessee failed to offer any explanation at all on this liability as appearing in his balance sheet. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. Ltd 120 Taxmann 539 has held as under On the terms of section 66, the burden is on the assesse to offer a satisfactory explanation about the nahare and so in the books of the asset is also clear that the mere mishing of particular is not enough. The mere fact that payment is by way of account payor cheque is also not conclusive Therefore, the Assessing Officer was added to consider whether notwithstanding the fact that the payments were not ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Assessing Officer has dealt the addition in para 9 of the assessment order. The relevant finding of the Assessing Officer is reproduced as The assessee has shown the following loans received during Amount (Rs.) 10000000 1100000 700000 800000 2000000 400000 15000000 The assessee has not submitted any documents to establish genuineness fan except confirmation of the party. The assessee has submitted confirmation of the party only without any supporting documents. As per the provisions of section 68 at the Income Tax Act, onus is on the assessee to explain cash credit appearing in his books of accounts. As per the provisions of section 68 of the Income Tax Act that is to establish identity of the party, genuineness of transaction and creditworthiness of the party. The assessee failed to offer any explanation at all on this liability as appearing in his balance sheet. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. Ltd 120 Taxmann 539 has held as under On the terms of section 66, the burden is on the assesse to offer a satisfactory explanation about the nahare and source of the amount wed in the books of the asset is also clear that the mere mishing of particular is not enough. The mere fact that payment is by way of account payor cheque is also not conclusive Therefore, the Assessing Officer was added ther notwithstanding the fact that the payments were not 22 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 s dealt the addition in para 9 of the assessment order. The relevant finding of the Assessing Officer is reproduced as The assessee has shown the following loans received during the year. The assessee has not submitted any documents to establish genuineness of The assessee has submitted confirmation of the party only without any supporting documents. As per the provisions of section 68 at the Income Tax Act, onus is on the assessee books of accounts. As per the provisions of section 68 of the Income Tax Act that is to establish identity of the party, genuineness of transaction and creditworthiness of the party. The assessee failed to offer any explanation at all on this liability as appearing in his balance sheet. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. Ltd 120 Taxmann 539 has held as under: On the terms of section 66, the burden is on the assesse to offer a urce of the amount wed in the books of the asset is also clear that the mere mishing of particular is not enough. The mere fact that payment is by way of account payor cheque is also not conclusive Therefore, the Assessing Officer was added ther notwithstanding the fact that the payments were not made by the ques, whether the assessee had satisfactionly explained the nature and source of the amounts found credited in the books of the assessee. The Assessing Officer was satisfied that the so depositors did not have that r The assessee has claimed loan of Rs.1,50,00,000/ from the above parties. But except for confirmation letter, no other evidences are furnished to establish genuineness of loan and the Hon'ble Supreme Court in the case of Durga Prasad More reported in 82 ITR, such documents are self serving documents unless they are supported by evidences. Hence, the assessee failed to satisfactorily explain l Rs.1,50,00,000/+ taken from the above parties within the meaning of section 68 of the Income Tax Act. Hence, this amount is added u/s.68 of the Income Tax Act. Penalty proceedings is initiated u/s.271(1)(c) of the Income Tax Act for furnishing inacc 38. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that this is the year of unabated assessment as limitation for issuing notice under section 143(2) o of the search and therefore no addition could have been made qua the issue in dispute without any incriminating material found in seized from the premises of the assessee. On perusal of assessment order, we do materials for making this addition of unexplained cash credit under section 68 of the Act. Identical addition has been deleted by us in assessment year 2011 ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 ques, whether the assessee had satisfactionly explained the nature and source of the amounts found credited in the books of the assessee. The Assessing Officer was satisfied that the so did not have that resources to make such deposits. The assessee has claimed loan of Rs.1,50,00,000/ from the above parties. But except for confirmation letter, no other evidences are furnished to establish genuineness of loan and creditworthiness of the party As held by the Hon'ble Supreme Court in the case of Durga Prasad More reported in 82 ITR, such documents are self serving documents unless they are supported by evidences. Hence, the assessee failed to satisfactorily explain l Rs.1,50,00,000/+ taken from the above parties within the meaning of section 68 of the Income Tax Act. Hence, this amount is added u/s.68 of the Income Tax Act. Penalty proceedings is initiated u/s.271(1)(c) of the Income Tax Act for furnishing inaccurate particulars of income. e have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that this is the year of unabated assessment as limitation for issuing ce under section 143(2) of the Act already expired as on the date of the search and therefore no addition could have been made qua the issue in dispute without any incriminating material found in om the premises of the assessee. On perusal of assessment order, we do not find any reference of any incriminating materials for making this addition of unexplained cash credit under ct. Identical addition has been deleted by us in assessment year 2011-12, following the finding of the Hon’ble 23 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 ques, whether the assessee had satisfactionly explained the nature and source of the amounts found credited in the books of the assessee. The Assessing Officer was satisfied that the so-called esources to make such deposits. The assessee has claimed loan of Rs.1,50,00,000/ from the above parties. But except for confirmation letter, no other evidences are furnished to creditworthiness of the party As held by the Hon'ble Supreme Court in the case of Durga Prasad More reported in 82 ITR, such documents are self serving documents unless they are supported by evidences. Hence, the assessee failed to satisfactorily explain loan of Rs.1,50,00,000/+ taken from the above parties within the meaning of section 68 of the Income Tax Act. Hence, this amount is added u/s.68 of the Income Tax Act. Penalty proceedings is initiated u/s.271(1)(c) of the Income e have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. We find that this is the year of unabated assessment as limitation for issuing ct already expired as on the date of the search and therefore no addition could have been made qua the issue in dispute without any incriminating material found in om the premises of the assessee. On perusal of the not find any reference of any incriminating materials for making this addition of unexplained cash credit under ct. Identical addition has been deleted by us in 12, following the finding of the Hon’ble Bombay High Court in the case of Continental warehousing Corporation (supra). Following our finding in assessment year 2011 12, the addition made under section 68 of the A unabated assessment without any incriminating material qua the issue in dispute, is d allowed. 39. The ground No. five and six of the appeal, being general in nature, same are dismissed as infructuous. 40. Now we take up the appeal of the assessee bearing ITA No. 6127/Mum/2018 for assessment appeal of the assessee 1 On facts and circumstance in not holding that the order passed u/s 143(3) r.ws. 153A by the DCIT CC 8(3), Mumbai ("Assessing law (b) The Ld. CIT(A) has grossly erred in facts and law in not appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view o telescoping the real income of the assessee 2. The Ld. CIT(A) erred in facts and law in upholding the addition of interest amounting to Rs. 32.35,313/ on the alleged advance given of Rs. 3,82,50,000/- in AY 2011 substance of the loose papers and completely ignoring the evidences and explanations placed on record ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 urt in the case of Continental warehousing (supra). Following our finding in assessment year 2011 n made under section 68 of the A unabated assessment without any incriminating material qua the , is deleted. The ground of the appeal is The ground No. five and six of the appeal, being general in dismissed as infructuous. Now we take up the appeal of the assessee bearing ITA No. 6127/Mum/2018 for assessment year 2013-14. The grounds of the appeal of the assessee are reproduced as under: 1 On facts and circumstances of the case, the Ld CIT(A)- in not holding that the order passed u/s 143(3) r.ws. 153A by the DCIT CC 8(3), Mumbai ("Assessing Officer) is without jurisdiction, invalid and bad in law (b) The Ld. CIT(A) has grossly erred in facts and law in not appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view o telescoping the real income of the assessee 2. The Ld. CIT(A) erred in facts and law in upholding the addition of interest amounting to Rs. 32.35,313/ on the alleged advance given of Rs. in AY 2011-12 without appreciating the) substance of the loose papers and completely ignoring the evidences and explanations placed on record 24 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 urt in the case of Continental warehousing (supra). Following our finding in assessment year 2011- n made under section 68 of the Act in case of unabated assessment without any incriminating material qua the appeal is accordingly The ground No. five and six of the appeal, being general in Now we take up the appeal of the assessee bearing ITA No. 14. The grounds of the -50, Mumbai erred in not holding that the order passed u/s 143(3) r.ws. 153A by the DCIT CC- Officer) is without jurisdiction, invalid and bad in law (b) The Ld. CIT(A) has grossly erred in facts and law in not appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view of the matter by 2. The Ld. CIT(A) erred in facts and law in upholding the addition of interest amounting to Rs. 32.35,313/ on the alleged advance given of Rs. true contents and substance of the loose papers and completely ignoring the evidences and 3. The Ld. CIT(A) erred in facts and law in upholding the addition of unaccounted interest payment of Rs. 39.000/ u/s. 69C of the Act on the alleged cash loan taken of Rs. 1,10,00,000/ not taking the wholistic view of the matter 4. (a) The Ld. CIT(A) erred in facts and law in upholding the addition of Rs. 48.03.763/ as deemed dividend u/s. 2(22)(e) of the erred in not appreciating the case law of the jurisdictional ITAT in the case of Advantage Moti (India) P. Ltd. v. ITO (ITA No. 7379/M/2012) relied upon by the assessee. 5. The Ld. CIT(A) erred in facts and law in upholding the addit aggregating to Rs. 11,00,000/ Act. 6. All the above grounds are independent and without prejudice to each other 7. Your appellant craves leave to add aller, amend, delete or modify any or all the grounds of appeal. 41. We find that ground under consideration are identically worded to grounds of the appeal of the assessee for assessment year 2012 amount, therefore following our finding in as the ground No. one to 3 of the appeal are decided mutasis mutandis. The ground No 1(a) is accordingly dismissed whereas ground numbers 1(b) to 3 of the appeal are allowed for statistical purposes. 42. The ground No. four of the appeal relates to addition of deemed dividend of ₹ 40, 03, 763/ ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 3. The Ld. CIT(A) erred in facts and law in upholding the addition of unaccounted interest payment of Rs. 39.000/- as unexplained expen u/s. 69C of the Act on the alleged cash loan taken of Rs. 1,10,00,000/ not taking the wholistic view of the matter 4. (a) The Ld. CIT(A) erred in facts and law in upholding the addition of Rs. 48.03.763/ as deemed dividend u/s. 2(22)(e) of the Act (b) The Ld. CIT(A) erred in not appreciating the case law of the jurisdictional ITAT in the case of Advantage Moti (India) P. Ltd. v. ITO (ITA No. 7379/M/2012) relied upon 5. The Ld. CIT(A) erred in facts and law in upholding the addit aggregating to Rs. 11,00,000/- as unexplained cash credit u/s. 68 of the 6. All the above grounds are independent and without prejudice to each 7. Your appellant craves leave to add aller, amend, delete or modify any or ds of appeal. e find that ground Nos.1 (one) to 3 of the appeal for the year under consideration are identically worded to grounds of the appeal of the assessee for assessment year 2012-13 except change of amount, therefore following our finding in assessment year 2012 the ground No. one to 3 of the appeal are decided mutasis mutandis. The ground No 1(a) is accordingly dismissed whereas ground 1(b) to 3 of the appeal are allowed for statistical purposes. The ground No. four of the appeal relates to addition of deemed 40, 03, 763/-. 25 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 3. The Ld. CIT(A) erred in facts and law in upholding the addition of as unexplained expenditure u/s. 69C of the Act on the alleged cash loan taken of Rs. 1,10,00,000/- and 4. (a) The Ld. CIT(A) erred in facts and law in upholding the addition of Rs. Act (b) The Ld. CIT(A) erred in not appreciating the case law of the jurisdictional ITAT in the case of Advantage Moti (India) P. Ltd. v. ITO (ITA No. 7379/M/2012) relied upon 5. The Ld. CIT(A) erred in facts and law in upholding the addition of loan as unexplained cash credit u/s. 68 of the 6. All the above grounds are independent and without prejudice to each 7. Your appellant craves leave to add aller, amend, delete or modify any or to 3 of the appeal for the year under consideration are identically worded to grounds of the appeal 13 except change of sessment year 2012-13, the ground No. one to 3 of the appeal are decided mutasis mutandis. The ground No 1(a) is accordingly dismissed whereas ground 1(b) to 3 of the appeal are allowed for statistical purposes. The ground No. four of the appeal relates to addition of deemed 43. The brief facts qua the issue in dispute are that the Assessing Officer observed loan of from the company Limited, wherein he had shareholding of 95.45% during the relevant year under consideration. According to the company to its shareholder section 2(22)E of the A hands of the company. As no reply was filed by the assessee in response to specific queries raised, the Assessing Officer mad addition under section 2(22)(e)of the A profit of ₹ 48, 03, 763 44. The Ld. CIT(A) refer Court in the case of highlight the conditions for satisfying loan or advances under the definition of deemed dividend and thereafter observed conditions set out in the decision of the Hon’ble Supreme Court were ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The brief facts qua the issue in dispute are that the Assessing Officer observed loan of ₹ 93, 77, 811/-accepted by the assessee from the company namely M/s Abhushan ornaments Private Limited, wherein he had shareholding of 95.45% during the relevant year under consideration. According to the AO, loan advanced by the company to its shareholder, amounts to deemed dividend under of the Act to the extent of accumulated profit in the hands of the company. As no reply was filed by the assessee in response to specific queries raised, the Assessing Officer mad addition under section 2(22)(e)of the Act to the extent of 48, 03, 763/-. The Ld. CIT(A) referred to the decision of the Hon’ble Supreme Court in the case of Navnit lal C Jhaveri Vs KK Sen (supra) highlight the conditions for satisfying loan or advances under the definition of deemed dividend and thereafter observed conditions set out in the decision of the Hon’ble Supreme Court were 26 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The brief facts qua the issue in dispute are that the Assessing accepted by the assessee bhushan ornaments Private Limited, wherein he had shareholding of 95.45% during the relevant , loan advanced by the ed dividend under xtent of accumulated profit in the hands of the company. As no reply was filed by the assessee in response to specific queries raised, the Assessing Officer made ct to the extent of accumulated to the decision of the Hon’ble Supreme Navnit lal C Jhaveri Vs KK Sen (supra) to highlight the conditions for satisfying loan or advances under the definition of deemed dividend and thereafter observed that all the five conditions set out in the decision of the Hon’ble Supreme Court were satisfied in the case of the assessee and therefore he upheld the addition made by the Assessing Officer observing as under: 18.3 The Hon'ble Supreme Court in Navnit Lal 56 ITR 198has noted that there could be three kinds of payments, L.e. (a) payments made to the shareholder by a company by way of advance or loan; (b) payments made on behalf of the assessee and (c) payments made for the benefit of the assessee. The Hon'ble Apex Court then analyzed the parimateria provision and said that 5 conditions are to be met for its applicability, firstly that the company should be one in which the public is not interested within the meaning of the expre which loan is Secondly, the buyer should be a shareholder at the date when the loan was advanced regardless of the extent of shareholding. Thirdly, the loan to the shareholder by the company can be deemed to be dividend only to the extent to which it is shown that the company possessed accumulated profit at the date of the loan; fourthly, the loan should not be advanced by the company in its course of business and lastly that the loan should remain outstanding at the instance of previous year in relation to the concerned assessment year The Supreme Court also clarified the fourth condition by importantly holding that in other words, this provision would not apply to cases where the company which advances the loan to its shareholder carries on the business of lending itself 18.4 I have noted that all the 5 conditions, as mandated by the Hon'ble Supreme court are satisfied in the present case 18.5 The Supreme Court in the case of P.K. Badiani v. CIT [1976] 'profits' appearing in section 2(6A)(e) of the Indian Income which corresponds to section 2(22)(e) of the 1961 Act, means profits in the commercial sense, Le, profits made by the company in the usual and true sense of the term. 18.6 In the case of Smt. TarulataShyam v. CIT [1977] 108 ITR 345 (SC), the Hon'ble Supreme Court had held that the position reflected in the books at the end of the year is not conclusive and that if funds are actually given by the company to its shareholder, which answers the description under the provision, it would be treated as "deemed dividend" to say that similarly ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 satisfied in the case of the assessee and therefore he upheld the addition made by the Assessing Officer observing as under: 18.3 The Hon'ble Supreme Court in Navnit Lal C. Jhaveri v. K.K. Sen [1965] 56 ITR 198has noted that there could be three kinds of payments, L.e. (a) payments made to the shareholder by a company by way of advance or loan; (b) payments made on behalf of the assessee and (c) payments made fit of the assessee. The Hon'ble Apex Court then analyzed the parimateria provision and said that 5 conditions are to be met for its applicability, firstly that the company should be one in which the public is not interested within the meaning of the expression in law, in the year in which loan is Secondly, the buyer should be a shareholder at the date when the loan was advanced regardless of the extent of shareholding. Thirdly, the loan to the shareholder by the company can be deemed to be the extent to which it is shown that the company possessed accumulated profit at the date of the loan; fourthly, the loan should not be advanced by the company in its course of business and lastly that the loan should remain outstanding at the instance of previous year in relation to the concerned assessment year The Supreme Court also clarified the fourth condition by importantly holding that in other words, this provision would not apply to cases where the company which n to its shareholder carries on the business of 18.4 I have noted that all the 5 conditions, as mandated by the Hon'ble Supreme court are satisfied in the present case 18.5 The Supreme Court in the case of P.K. Badiani v. CIT [1976] 105 ITR 642 has held that the term 'profits' appearing in section 2(6A)(e) of the Indian Income which corresponds to section 2(22)(e) of the 1961 Act, means profits in the commercial sense, Le, profits made by the company in the usual and true 18.6 In the case of Smt. TarulataShyam v. CIT [1977] 108 ITR 345 (SC), the Hon'ble Supreme Court had held that the position reflected in the books at the end of the year is not conclusive and that if funds are actually given by any to its shareholder, which answers the description under the provision, it would be treated as "deemed dividend" to say that similarly 27 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 satisfied in the case of the assessee and therefore he upheld the addition made by the Assessing Officer observing as under: C. Jhaveri v. K.K. Sen [1965] 56 ITR 198has noted that there could be three kinds of payments, L.e. (a) payments made to the shareholder by a company by way of advance or loan; (b) payments made on behalf of the assessee and (c) payments made fit of the assessee. The Hon'ble Apex Court then analyzed the parimateria provision and said that 5 conditions are to be met for its applicability, firstly that the company should be one in which the public is ssion in law, in the year in which loan is Secondly, the buyer should be a shareholder at the date when the loan was advanced regardless of the extent of shareholding. Thirdly, the loan to the shareholder by the company can be deemed to be the extent to which it is shown that the company possessed accumulated profit at the date of the loan; fourthly, the loan should not be advanced by the company in its course of business and lastly that the loan should remain outstanding at the instance of the shareholder's previous year in relation to the concerned assessment year The Supreme Court also clarified the fourth condition by importantly holding that in other words, this provision would not apply to cases where the company which n to its shareholder carries on the business of money 18.4 I have noted that all the 5 conditions, as mandated by the Hon'ble Supreme court are satisfied in the present case 18.5 The Supreme Court in 5 ITR 642 has held that the term 'profits' appearing in section 2(6A)(e) of the Indian Income-tax Act, 1922, which corresponds to section 2(22)(e) of the 1961 Act, means profits in the commercial sense, Le, profits made by the company in the usual and true 18.6 In the case of Smt. TarulataShyam v. CIT [1977] 108 ITR 345 (SC), the Hon'ble Supreme Court had held that the position reflected in the books at the end of the year is not conclusive and that if funds are actually given by any to its shareholder, which answers the description under the provision, it would be treated as "deemed dividend" to say that similarly loans camouflaged as trading advances fall within the mischief of "deemed dividend" provision. 18.7 In CIT v. Sunil Ch (Delhi), the Hon'ble Delhi High Court has held that the true nature of a transaction, discerned by the AO needs to be upheld and the ITAT's reasoning was set aside. 18.8 In the case of Miss P. Sarada Vs CIT, 2 Supreme Court has held that advances made by company to assessee would have to be treated as deemed dividends paid on dates when withdrawals were allowed to be made and subsequent adjustment of account made on very last day of a that assessee received notional dividends on various dates. 18.9 I have noted that the appellant has taken loan from M/s Abhushan Ornaments Pvt Ltd, and said loans attract the provisions of section 2(22) (e) of the Act In view of these facts and circumstances of the case and the various judicial decisions cited above, the Ground of Appeal No. 5 of the present appeal is dismissed. 45. Before us, the learned of assessee’s ledger account page 34 to 36 of the paperbook and submitted that there are instances where amount has been advanced by the assessee over and above the outstanding balances company and the extra amount received assessee was utilized us the learned Counsel ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 loans camouflaged as trading advances fall within the mischief of "deemed 18.7 In CIT v. Sunil Chopra [2011] 12 taxmann.com 496/201 Taxman 316 (Delhi), the Hon'ble Delhi High Court has held that the true nature of a transaction, discerned by the AO needs to be upheld and the ITAT's reasoning was set aside. 18.8 In the case of Miss P. Sarada Vs CIT, 229 ITR 444(SC), the Hon'ble Supreme Court has held that advances made by company to assessee would have to be treated as deemed dividends paid on dates when withdrawals were allowed to be made and subsequent adjustment of account made on very last day of accounting year would not alter position that assessee received notional dividends on various dates. 18.9 I have noted that the appellant has taken loan from M/s Abhushan Ornaments Pvt Ltd, and said loans attract the provisions of section 2(22) (e) ct In view of these facts and circumstances of the case and the various judicial decisions cited above, the Ground of Appeal No. 5 of the present appeal is dismissed. Before us, the learned Counsel of the assessee referred to r account in the books of the company page 34 to 36 of the paperbook and submitted that there are instances where amount has been advanced by the assessee over and above the outstanding balances as standing in the books of the said he extra amount received by the company from the utilized for meeting working capital requirement. Counsel of the assessee submitted 28 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 loans camouflaged as trading advances fall within the mischief of "deemed opra [2011] 12 taxmann.com 496/201 Taxman 316 (Delhi), the Hon'ble Delhi High Court has held that the true nature of a transaction, discerned by the AO needs to be upheld and the ITAT's 29 ITR 444(SC), the Hon'ble Supreme Court has held that advances made by company to assessee would have to be treated as deemed dividends paid on dates when withdrawals were allowed to be made and subsequent adjustment of ccounting year would not alter position that assessee received notional dividends on various dates. 18.9 I have noted that the appellant has taken loan from M/s Abhushan Ornaments Pvt Ltd, and said loans attract the provisions of section 2(22) (e) ct In view of these facts and circumstances of the case and the various judicial decisions cited above, the Ground of Appeal No. 5 of the of the assessee referred to a copy the books of the company, placed on page 34 to 36 of the paperbook and submitted that there are instances where amount has been advanced by the assessee over and standing in the books of the said company from the for meeting working capital requirement. Before submitted that the transactions has resulted in the mutual benefit to the assessee as well as to the company by assisting each other in their working capital needs, and therefore in such a scenario the dimming fiction of section 2(22)€ should not be invoked. In support of the contention, he relied on the decision of the Coordinate Bench of the T case of ITO Vs Sm 151/Kol/2013, wherein it has been held as under: "It is pertinent to note here that when dividends are declared by a company, it is solely the shareholders who benefit from the accrue to the company by way of dividend distribution. Thus, section 2(22) (e) of the Act covers only such situations, where the shareholder alone benefits from the loan transaction, because if the company also benefits from the said transaction, it will fake the character of a commercial transaction and hence will not qualify to be dividend. In the case of the assessee, by giving and taking financial assistance from each other, both the assessee and the company were benefited and s between them were nothing but commercial IT(SS)A No.60 76/KoV/2011 A. Ys.06 Das Mimani. v. DCIT CC attributable to the shareholder is nothing to transaction. From the above discussions it can be said that sec. 2(22)(e) of the Act covers only those transactions which benefit the shareholder alone and results in no benefit to the company. On the other hand, if the transaction is mutual by which both sides are benefited, it is undoubtedly outside the purview of provisions of sec. 2(22)(e) of the Act. From the above, it is clear that the loan account differs from current account and the provisions of section 2(22)(e) of the Act, be applied to current account. In such circumstances, we delete the addition and this common issue of assessee's appeals is allowed." ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 transactions has resulted in the mutual benefit to the assessee as he company by assisting each other in their working capital needs, and therefore in such a scenario the dimming fiction of € should not be invoked. In support of the contention, he relied on the decision of the Coordinate Bench of the T case of ITO Vs Smt Gayatri Chakraborty (Kolkatta 151/Kol/2013, wherein it has been held as under: "It is pertinent to note here that when dividends are declared by a company, it is solely the shareholders who benefit from the transaction. No benefits accrue to the company by way of dividend distribution. Thus, section 2(22) (e) of the Act covers only such situations, where the shareholder alone benefits from the loan transaction, because if the company also benefits id transaction, it will fake the character of a commercial transaction and hence will not qualify to be dividend. In the case of the assessee, by giving and taking financial assistance from each other, both the assessee and the company were benefited and s between them were nothing but commercial IT(SS)A No.60 76/KoV/2011 A. Ys.06-07 to 08-09 and 02-03 to 05-06 Mr. Purushoffam Das Mimani. v. DCIT CC-V Kol Page 5 fransactions and dividend attributable to the shareholder is nothing to do with such business transaction. From the above discussions it can be said that sec. 2(22)(e) of the Act covers only those transactions which benefit the shareholder alone and results in no benefit to the company. On the other hand, if the mutual by which both sides are benefited, it is undoubtedly outside the purview of provisions of sec. 2(22)(e) of the Act. From the above, it is clear that the loan account differs from current account and the provisions of section 2(22)(e) of the Act, being a deeming section, cannot be applied to current account. In such circumstances, we delete the addition and this common issue of assessee's appeals is allowed." 29 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 transactions has resulted in the mutual benefit to the assessee as he company by assisting each other in their working capital needs, and therefore in such a scenario the dimming fiction of € should not be invoked. In support of the contention, he relied on the decision of the Coordinate Bench of the Tribunal in the t Gayatri Chakraborty (Kolkatta) in ITA No. "It is pertinent to note here that when dividends are declared by a company, transaction. No benefits accrue to the company by way of dividend distribution. Thus, section 2(22) (e) of the Act covers only such situations, where the shareholder alone benefits from the loan transaction, because if the company also benefits id transaction, it will fake the character of a commercial transaction and hence will not qualify to be dividend. In the case of the assessee, by giving and taking financial assistance from each other, both the assessee and the company were benefited and such transactions between them were nothing but commercial IT(SS)A No.60-62 & 73- 06 Mr. Purushoffam V Kol Page 5 fransactions and dividend do with such business transaction. From the above discussions it can be said that sec. 2(22)(e) of the Act covers only those transactions which benefit the shareholder alone and results in no benefit to the company. On the other hand, if the mutual by which both sides are benefited, it is undoubtedly outside the purview of provisions of sec. 2(22)(e) of the Act. From the above, it is clear that the loan account differs from current account and the ing a deeming section, cannot be applied to current account. In such circumstances, we delete the addition and this common issue of assessee's appeals is allowed." 46. Without prejudice to the above, the learned that accumulated profit sh accumulated up to the preceding assessment year and not of the current year’s. 47. On the other ha authorities. 48. We have rival submission of the parties on the issue in dispute and perused the relevant material on record. There is no dispute on satisfaction of the conditions for a loan nature of deemed dividend a the case of Navnit Lal C Jhaveri Vs KK Sen (supra) referred by the Ld. CIT(A). The only issue is whether the transactions between the assessee and the company are in the nature of business transactions or nonbusiness advances. the assessee has clai the assessee to the company were for the purpose of capital contribution. In our opinion, the company and its shareholder are two separate legal entity and the amounts extended by the assessee ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 judice to the above, the learned Counsel that accumulated profit should be restricted to the profit up to the preceding assessment year and not of the On the other hand learned DR relied on the order of the We have rival submission of the parties on the issue in dispute and perused the relevant material on record. There is no dispute on satisfaction of the conditions for a loan or advance to be in nature of deemed dividend as held by the Hon’ble Supreme C the case of Navnit Lal C Jhaveri Vs KK Sen (supra) referred by the Ld. CIT(A). The only issue is whether the transactions between the assessee and the company are in the nature of business transactions or nonbusiness advances. the assessee has claimed that advances by the assessee to the company were for the purpose of capital contribution. In our opinion, the company and its shareholder are two separate legal entity and the amounts extended by the assessee 30 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Counsel submitted ould be restricted to the profit up to the preceding assessment year and not of the DR relied on the order of the lower We have rival submission of the parties on the issue in dispute and perused the relevant material on record. There is no dispute on advance to be in the s held by the Hon’ble Supreme Court in the case of Navnit Lal C Jhaveri Vs KK Sen (supra) referred by the Ld. CIT(A). The only issue is whether the transactions between the assessee and the company are in the nature of business transactions med that advances by the assessee to the company were for the purpose of capital contribution. In our opinion, the company and its shareholder are two separate legal entity and the amounts extended by the assessee to the company cannot be termed as capital in dispute before us is regarding the advances which have been received by the assessee for which assessee has not substantiated whether those advances company. In the absence of any such doc loans and advances are liable to be considered as deemed dividend within the provision of section 2(22)(e) of the A contention of accumulated profit is concerned, the assessee has referred to the decision of the of Advantage Moti (India) P Ltd Vs ITO in ITA No. 7379/Mum/2012 wherein it is held that for the purpose of deem dividend under section 2(22)(e) of the A preceding assessment year should be considered and not current year’s profit. In view of above, the quantification of deemed dividend is restored to the file of the accumulated profit in accordance wi appeal of the assessee is accordingly partly allowed for statistical purposes. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 to the company cannot be termed as capital contribution. The issue in dispute before us is regarding the advances which have been received by the assessee for which assessee has not substantiated whether those advances were for purpose of the business of the company. In the absence of any such documentary evidence, the loans and advances are liable to be considered as deemed dividend the provision of section 2(22)(e) of the Act. As regard to the contention of accumulated profit is concerned, the assessee has referred to the decision of the Tribunal Coordinate B Advantage Moti (India) P Ltd Vs ITO in ITA No. wherein it is held that for the purpose of deem dividend under section 2(22)(e) of the Act the accumulated preceding assessment year should be considered and not current year’s profit. In view of above, the quantification of deemed dividend is restored to the file of the Assessing Officer subject to verification of accumulated profit in accordance with law . The ground of the appeal of the assessee is accordingly partly allowed for statistical 31 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 contribution. The issue in dispute before us is regarding the advances which have been received by the assessee for which assessee has not substantiated purpose of the business of the umentary evidence, the loans and advances are liable to be considered as deemed dividend ct. As regard to the contention of accumulated profit is concerned, the assessee has ribunal Coordinate Bench in the case Advantage Moti (India) P Ltd Vs ITO in ITA No. wherein it is held that for the purpose of deemed accumulated profit of preceding assessment year should be considered and not current year’s profit. In view of above, the quantification of deemed dividend subject to verification of The ground of the appeal of the assessee is accordingly partly allowed for statistical 49. The ground No. five of the appeal relates to addition of 000/-as unexplained cash 50. The assessee had shown loans of HUF and ₹ 5 lakh from Ms Madhu Mehta received during the year under consideration, however neither any confirmation nor any evidence to establish identity , credit worthiness and genuineness of the transactions were filed before the Assessing Officer and therefore he held the said loans as unexplained cash of the Act. 51. The Ld. CIT(A) observed that this year being the Assessing Officer could consider addition based on material other than incriminating material. Further on merit he noted the finding of the Assessing Officer that no documentary evidence in support of discharging the onus CIT(A) also referred to various seized document to highlight that loans shown to have accommodation entries. Accordingly upheld the addition made by ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The ground No. five of the appeal relates to addition of as unexplained cash credit under section 68 of the A had shown loans of ₹ 6 lakh from sh Abhisek Jain 5 lakh from Ms Madhu Mehta received during the year under consideration, however neither any confirmation nor any evidence to establish identity , credit worthiness and genuineness of ons were filed before the Assessing Officer and therefore he held the said loans as unexplained cash credit under section 68 The Ld. CIT(A) observed that this year being abated the Assessing Officer could consider addition based on material other than incriminating material. Further on merit he noted the finding of the Assessing Officer that no documentary evidence in support of the onus under section 68 were filed by the assessee. Ld. CIT(A) also referred to various seized document to highlight that have been received were in the nature of the accommodation entries. Accordingly upheld the addition made by 32 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 The ground No. five of the appeal relates to addition of ₹ 11, 00, credit under section 68 of the Act. 6 lakh from sh Abhisek Jain 5 lakh from Ms Madhu Mehta received during the year under consideration, however neither any confirmation nor any evidence to establish identity , credit worthiness and genuineness of ons were filed before the Assessing Officer and therefore credit under section 68 abated assessment, the Assessing Officer could consider addition based on material other than incriminating material. Further on merit he noted the finding of the Assessing Officer that no documentary evidence in support of were filed by the assessee. Ld. CIT(A) also referred to various seized document to highlight that been received were in the nature of the accommodation entries. Accordingly upheld the addition made by the Assessing Officer relying on va improved assessment order. 52. Before us, the learned addition under section 68 can be made if any sum is found credited in the books of account maintained by the assessee. He submitted that in the case, the and therefore he was not maintaining any books of accounts, therefore addition made accordance with law. 53. We have heard rival submission of the p dispute and perused the relevant material on record. The contention of the assessee that no books of accounts contradictory to the stand taken in relation to the addition of deemed dividend. In relation to the under consideration by the company was for the mutual benefit of capital contribution of the assessee as well as the company. Various seized records referred ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 the Assessing Officer relying on various decisions cited in the improved assessment order. Before us, the learned Counsel of the assessee contended addition under section 68 can be made if any sum is found credited in the books of account maintained by the assessee. He submitted the assessee was having only income from salary and therefore he was not maintaining any books of accounts, therefore addition made under the section 68 of the A accordance with law. We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. The contention of the assessee that no books of accounts are contradictory to the stand taken in relation to the addition of deemed dividend. In relation to the issue of deemed dividend under consideration, the assessee submitted that money advanced by the company was for the mutual benefit of capital contribution of the assessee as well as the company. Various seized records referred 33 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 rious decisions cited in the of the assessee contended that addition under section 68 can be made if any sum is found credited in the books of account maintained by the assessee. He submitted having only income from salary and therefore he was not maintaining any books of accounts, the section 68 of the Act is not in arties on the issue in dispute and perused the relevant material on record. The contention are maintained is contradictory to the stand taken in relation to the addition of deemed deemed dividend in the year , the assessee submitted that money advanced by the company was for the mutual benefit of capital contribution of the assessee as well as the company. Various seized records referred by the lower authoriti was engaged in business activity accounts was required himself has admitted the entries recorded in seized document purchase and sale of bullion. Muchhala V CIT (2017) 85 taxmann.com 306 High Court upheld the ad absence of books of accounts . In the said case also the taken the plea for the first time before the Hon’ble High Court th section 68 was not applicable applicability of section 68 has been raised Tribunal. In the circumstances learned consul of the assessee that no addition could have been made under section 68 of the Act. We find that assess discharged his onus genuineness in respect of the loan transactions of therefore, accordingly we uphold the finding of the ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 authorities in the impugned orders shows that assessee was engaged in business activity for which maintenance of required. In assessment year 2011- admitted the entries recorded in seized document d sale of bullion. In the case of Muchhala V CIT (2017) 85 taxmann.com 306, the Hon’ble Bombay the addition under section 68 of the A absence of books of accounts . In the said case also the taken the plea for the first time before the Hon’ble High Court th not applicable. In the instant case also section 68 has been raised first time before the In the circumstances, we reject this conte consul of the assessee that no addition could have been made under section 68 of the Act. We find that assess discharged his onus of justifying identity, creditworthiness and genuineness in respect of the loan transactions of accordingly we uphold the finding of the 34 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 es in the impugned orders shows that assessee for which maintenance of books of -12, the assessee admitted the entries recorded in seized document are of In the case of Arun Kumar J he Hon’ble Bombay dition under section 68 of the Act even in absence of books of accounts . In the said case also the assessee taken the plea for the first time before the Hon’ble High Court that . In the instant case also plea of non- first time before the we reject this contention of the consul of the assessee that no addition could have been made under section 68 of the Act. We find that assessee has not of justifying identity, creditworthiness and genuineness in respect of the loan transactions of ₹ 11 lakh, accordingly we uphold the finding of the lower authorities on the issue in dispute. The ground of the appeal of the assessee is accordingly dismissed 54. The ground No. six and seven of the appeal being general in nature, same are dismissed as infructuous. 55. Now we take up the appeal of the assessee 6128Mum/2018 for assessment year 2014 grounds have been raised by the assessee: 1. (a) The Ld CIT(A) erred in facts and law in upholding the addition of 23.30.274/- as deemed dividend u/s 2(22)(e) of the Act. (b) The Ld. CIT(A) erred in facts and law in not appreciating the case law of the Hon ble jurisdictional ITAT in the case of Advantage Mofi (India) P Ltd v ITO (ITA No. 7379/M/2012) relied upon by 2. The Ld CIT(A) erred in facts and law in upholding the addition of loan aggregating to Rs. 61.00.000/ 3. All the above grounds are independent and without prejudice to each other 4. Your appellant craves leave to add, alter, amend, delete or all the grounds of appeal. 56. The ground No. the ground No. four of the appeal for assessment year 2013 therefore following our finding in in dispute in the year under consideration is also restored to the file ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 on the issue in dispute. The ground of the appeal of the assessee is accordingly dismissed No. six and seven of the appeal being general in smissed as infructuous. Now we take up the appeal of the assessee 6128Mum/2018 for assessment year 2014-15, wherein following grounds have been raised by the assessee: 1. (a) The Ld CIT(A) erred in facts and law in upholding the addition of as deemed dividend u/s 2(22)(e) of the Act. (b) The Ld. CIT(A) erred in facts and law in not appreciating the case law of the Hon ble jurisdictional ITAT in the case of Advantage Mofi (India) P Ltd v ITO (ITA No. 7379/M/2012) relied upon by the assessee 2. The Ld CIT(A) erred in facts and law in upholding the addition of loan aggregating to Rs. 61.00.000/- as unexplained cash credit u/s 68 of the Act 3. All the above grounds are independent and without prejudice to each nt craves leave to add, alter, amend, delete or all the grounds of appeal. No. one of the appeal of the assessee is identical to the ground No. four of the appeal for assessment year 2013 therefore following our finding in assessment year 2013 in dispute in the year under consideration is also restored to the file 35 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 on the issue in dispute. The ground of the appeal of the assessee is No. six and seven of the appeal being general in Now we take up the appeal of the assessee in ITA No. 15, wherein following 1. (a) The Ld CIT(A) erred in facts and law in upholding the addition of Rs. as deemed dividend u/s 2(22)(e) of the Act. (b) The Ld. CIT(A) erred in facts and law in not appreciating the case law of the Hon ble jurisdictional ITAT in the case of Advantage Mofi (India) P Ltd v ITO (ITA No. 2. The Ld CIT(A) erred in facts and law in upholding the addition of loan as unexplained cash credit u/s 68 of the Act 3. All the above grounds are independent and without prejudice to each nt craves leave to add, alter, amend, delete or modify any or one of the appeal of the assessee is identical to the ground No. four of the appeal for assessment year 2013-14, assessment year 2013-14, the issue in dispute in the year under consideration is also restored to the file of the Assessing Officer for deciding following our finding in assessment year 2013 appeal of the asses purposes. 57. The ground No. unexplained cash credit of namely sh Ashok Sancheti ( Rs. 11 lakh ) and Angel Trading Co. (Rs. 50.00 lakhs). The Assessing Officer in the year under consideration has noted that no documentary evidence for discharging of it under section 68 of the Act had CIT(A) has also upheld the addition with identical finding in case of unsecured learn of ₹ 58. We find that facts and circumstances in respect of the loan of 61 lakh in the year under consideration are identical to the addition of ₹ 11 lakh upheld by us as unexplained cash credit in assessment year 2013-14 and therefore following our finding in assessment year 2013-14 on the issue in dispute, we uphold the fi ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 of the Assessing Officer for deciding following our finding in assessment year 2013-14 on the issue in dispute. The ground of the appeal of the assessee is accordingly allowed party for statistical No. two of the appeal relates to addition of unexplained cash credit of ₹ 61 lakh in respect of the two parties namely sh Ashok Sancheti ( Rs. 11 lakh ) and Angel Trading Co. (Rs. 50.00 lakhs). The Assessing Officer in the year under consideration noted that no documentary evidence for discharging of it 68 of the Act had been filed by the assessee. The Ld. CIT(A) has also upheld the addition with identical finding in case of ₹ 11 lakh upheld in assessment year 2013 We find that facts and circumstances in respect of the loan of 61 lakh in the year under consideration are identical to the addition 11 lakh upheld by us as unexplained cash credit in assessment 14 and therefore following our finding in assessment year 14 on the issue in dispute, we uphold the fi 36 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 of the Assessing Officer for deciding following our finding in The ground of the see is accordingly allowed party for statistical two of the appeal relates to addition of 61 lakh in respect of the two parties namely sh Ashok Sancheti ( Rs. 11 lakh ) and Angel Trading Co. (Rs. 50.00 lakhs). The Assessing Officer in the year under consideration noted that no documentary evidence for discharging of its onus been filed by the assessee. The Ld. CIT(A) has also upheld the addition with identical finding in case of 11 lakh upheld in assessment year 2013-14. We find that facts and circumstances in respect of the loan of ₹ 61 lakh in the year under consideration are identical to the addition 11 lakh upheld by us as unexplained cash credit in assessment 14 and therefore following our finding in assessment year 14 on the issue in dispute, we uphold the finding of the Ld. CIT(A) on the issue in dispute. The ground No. two of the appeal of the assessee is accordingly dismissed. 59. The ground No. nature and therefore 60. As far as appeal of the assessee in assessment year 2011 of the Act is concerned Additional Commissioner of income provisions of section 269SS of the A dispute of levy of pen restored to the file of the learned income (Range Officer) for deciding a The relevant finding in ITA No. reproduced as under: 17 Before us, the Ld Counsel of the assessee submitted that there was no material before the Ld Addl/Commissioner of Income tax to substantiate that cash loan in reference were exceeding 120,00,000/ those authorities have levied the penalty cash loans are exceeding 120 00,000/ the onus on the authority who has levied the penalty to establish that loans ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 CIT(A) on the issue in dispute. The ground No. two of the appeal of the assessee is accordingly dismissed. No. three and four of the appeal nature and therefore, same are dismissed as infructuous. as appeal of the assessee in ITA No. 6140/Mum/2018 for assessment year 2011-12, in relation to penalty under section 271D ct is concerned, the penalty has been levied by the Joint/ dditional Commissioner of income-tax, for violation o sions of section 269SS of the Act. We find that identic penalty under section 271D of the A restored to the file of the learned Joint/additional Commissioner of income (Range Officer) for deciding afresh in the case The relevant finding in ITA No. 6123 & 6124 4/Mum/2018 is under: 17 Before us, the Ld Counsel of the assessee submitted that there was no material before the Ld Addl/Commissioner of Income tax to substantiate that cash loan in reference were exceeding 120,00,000/ those authorities have levied the penalty mainly on the presumption that cash loans are exceeding 120 00,000/- According to the Ld. Counsel it was the onus on the authority who has levied the penalty to establish that loans 37 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 CIT(A) on the issue in dispute. The ground No. two of the appeal of three and four of the appeal are general in dismissed as infructuous. No. 6140/Mum/2018 for ion to penalty under section 271D has been levied by the Joint/ for violation of the ct. We find that identical issue in alty under section 271D of the Act has been ional Commissioner of in the case of assessee. 6124 4/Mum/2018 is 17 Before us, the Ld Counsel of the assessee submitted that there was no material before the Ld Addl/Commissioner of Income tax to substantiate that cash loan in reference were exceeding 120,00,000/- and therefore mainly on the presumption that According to the Ld. Counsel it was the onus on the authority who has levied the penalty to establish that loans in question were exceeding 120,00,000/ is liable to be deleted However, we do not agree with the above contention of the Ld Counsel of the assessee. The details of the loan entries found during the course of the search have been referred by the Ld CIT(A) in para 7.1 of the impugned order where assessee was having any evidence that those entries are combined loan having each entry below 120,00,000/ assessee to forward the name and address of the parties along with relevant evidences justifying identity, creditworthiness and genuineness of transaction. If the assessee did not provide any details of the entry of loan of 198,00,000/- (7,00,000/ inference is that the amount been assessed u/s 68 of the Act by the Assessing Officer and in that case, it is not being explained unsecured loan, having no name and address of the of parties, no penalty for violation of 269SS/T can be ini beyond the seized record is known to the assessee and therefore, the onus in on the assessee to substantiate the same In view of the above discussion, we are of the view that the penalty levied u/s 271D of the Act is not justified. Since th amount of unsecured loan claimed by the assessee has already been restored back to the file of the Assessing Officer in ITA No. 6123/Mum/2018, while deciding the issue of addition of 16,25,01,000/ the basis of pages of seized diary, we feel appropriate to restore this issue of levy of penalty u/s 271D of the Act to the file of the Ld. Joint/Addl. Commissioner for deciding afresh after adjudication by the Assessing Officer whether the amount of u unexplained cash credit or explained unsecured Joan. The grounds of the appeal of the assessee are accordingly allowed for statistical purpose. 61. The issue in dispute in the instant appeal being identical to the issue in dispute invol following the same, the iss Act is restored to the file of the concerned Joint/A ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 in question were exceeding 120,00,000/- and therefore, the penalty levied is liable to be deleted However, we do not agree with the above contention of the Ld Counsel of the assessee. The details of the loan entries found during the course of the search have been referred by the Ld CIT(A) in para 7.1 of the impugned order where each entry is exceeding 120,00,000/ If the assessee was having any evidence that those entries are combined loan having each entry below 120,00,000/- then it was the responsibility of the assessee to forward the name and address of the parties along with elevant evidences justifying identity, creditworthiness and genuineness of transaction. If the assessee did not provide any details of the entry of loan (7,00,000/-, €8,00,000/-, 10,00,000/-etc, then the logical inference is that the amount is unexplained cash credit, which should have been assessed u/s 68 of the Act by the Assessing Officer and in that case, it is not being explained unsecured loan, having no name and address of the of parties, no penalty for violation of 269SS/T can be ini beyond the seized record is known to the assessee and therefore, the onus in on the assessee to substantiate the same In view of the above discussion, we are of the view that the penalty levied u/s 271D of the Act is not justified. Since the issue of addition of section 68 of the Act in respect of amount of unsecured loan claimed by the assessee has already been restored back to the file of the Assessing Officer in ITA No. 6123/Mum/2018, while deciding the issue of addition of 16,25,01,000/ the basis of pages of seized diary, we feel appropriate to restore this issue of levy of penalty u/s 271D of the Act to the file of the Ld. Joint/Addl. Commissioner for deciding afresh after adjudication by the Assessing Officer whether the amount of unsecured loan in consideration is unexplained cash credit or explained unsecured Joan. The grounds of the appeal of the assessee are accordingly allowed for statistical purpose. The issue in dispute in the instant appeal being identical to the dispute involved in ITA No. 6124/Mum/2018, therefore following the same, the issue of penalty under section 271D of the d to the file of the concerned Joint/A 38 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 and therefore, the penalty levied is liable to be deleted However, we do not agree with the above contention of the Ld Counsel of the assessee. The details of the loan entries found during the course of the search have been referred by the Ld CIT(A) in para each entry is exceeding 120,00,000/ If the assessee was having any evidence that those entries are combined loan then it was the responsibility of the assessee to forward the name and address of the parties along with elevant evidences justifying identity, creditworthiness and genuineness of transaction. If the assessee did not provide any details of the entry of loan etc, then the logical is unexplained cash credit, which should have been assessed u/s 68 of the Act by the Assessing Officer and in that case, it is not being explained unsecured loan, having no name and address of the of parties, no penalty for violation of 269SS/T can be initiated. What is beyond the seized record is known to the assessee and therefore, the onus in on the assessee to substantiate the same In view of the above discussion, we are of the view that the penalty levied u/s 271D of the Act is e issue of addition of section 68 of the Act in respect of amount of unsecured loan claimed by the assessee has already been restored back to the file of the Assessing Officer in ITA No. 6123/Mum/2018, while deciding the issue of addition of 16,25,01,000/- on the basis of pages of seized diary, we feel appropriate to restore this issue of levy of penalty u/s 271D of the Act to the file of the Ld. Joint/Addl. Commissioner for deciding afresh after adjudication by the Assessing nsecured loan in consideration is unexplained cash credit or explained unsecured Joan. The grounds of the appeal of the assessee are accordingly allowed for statistical purpose. The issue in dispute in the instant appeal being identical to the No. 6124/Mum/2018, therefore ue of penalty under section 271D of the d to the file of the concerned Joint/Additional Commissioner of income Officer. The ground of the appeal of the assessee is accordingly allowed for statistical purposes. 62. In the result, the appeals of the assessee for assessment year 2011-12 (ITA No. 6125/Mum/2018) No.6126/Mum/2018) allowed party for statistical purposes, where the appeal assessment year 2014 The appeal bearing ITA No. 6140/Mum/2018 in relat under section 271D is allowed for statistical purposes. Order pronounced in the open Court in of the ITAT Rules, 1963. Sd/- (SANDEEP SINGH KARHAIL JUDICIAL MEMBER Mumbai; Dated: 30/11/2022 Rahul Sharma, Sr. P.S. ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Commissioner of income-tax, having jurisdiction over the Assessing r. The ground of the appeal of the assessee is accordingly allowed for statistical purposes. In the result, the appeals of the assessee for assessment year 12 (ITA No. 6125/Mum/2018), AY 12 6126/Mum/2018), and AY 13-14 (ITA No. 6127/Mum/2018) are allowed party for statistical purposes, where the appeal assessment year 2014 – 15 (ITA No. 6128/Mum/2018) is dismissed. The appeal bearing ITA No. 6140/Mum/2018 in relat 1D is allowed for statistical purposes. Order pronounced in the open Court in 30/11/2022 of the ITAT Rules, 1963. Sd/ SANDEEP SINGH KARHAIL) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER 39 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 tax, having jurisdiction over the Assessing r. The ground of the appeal of the assessee is accordingly In the result, the appeals of the assessee for assessment year Y 12-13 (ITA ITA No. 6127/Mum/2018) are allowed party for statistical purposes, where the appeal for ITA No. 6128/Mum/2018) is dismissed. The appeal bearing ITA No. 6140/Mum/2018 in relation to penalty 1D is allowed for statistical purposes. 2022 Rule 34 (4) Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. The CIT(A)- 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 Copy of the Order forwarded to : DR, ITAT, Mumbai BY ORDER, (Sr. Private Secretary) ITAT, Mumbai 40 SHRI SANJAY SHANTILAL JAIN ITA No.6140,6125,6126,6127,6127,6128/MUM/2018 BY ORDER, (Sr. Private Secretary) ITAT, Mumbai