Rajesh Kumar Bhardwaj, New Delhi V. ITO, New Delhi

ITA 6239/DEL/2015

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 3995 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 24-11-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: V K TIWARI SENIOR
• Keywords: Unexplained cash credit
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI KULDIP SINGH, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.6239/DEL./2015 (ASSESSMENT YEAR : 2010-11) SHRI RAJESH KUMAR BHARDWAJ, VS. ITO, WARD 2 (3), R 72, EAST VINOD NAGAR, NEW DELHI. DELHI 110 091. (PAN : AFIPB8448L) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RUCHESH SINHA, CA REVENUE BY : SHRI V.K. TIWARI, SENIOR DR DATE OF HEARING : 18.09.2018 DATE OF ORDER : 08.10.2018 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : THE APPELLANT, SHRI RAJESH KUMAR BHARDWAJ (HEREINA FTER REFERRED TO AS THE ASSESSEE) BY FILING THE PRESE NT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 09.09.2015 PASS ED BY LD. CIT (APPEALS)-2, NEW DELHI QUA THE ASSESSMENT YEAR 2010 -11 ON THE GROUNDS INTER ALIA THAT:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [CIT (A)] IS BAD BOTH IN THE EYE OF L AW AND ON FACTS. ITA NO.6239/DEL./2015 2 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.5,05,70,641/- OUT OF THE TOTAL ADDITION OF RS.1,94,54,460/- MADE BY THE AO O N ACCOUNT OF UN-EXPLAINED UNSECURED LOANS. 3(I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LEARNED CIT (A) HAS ERRED BOTH ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.1,01,62,085/- MADE BY THE AO ON ACCOUNT OF CURRENT LIABILITIES/ADVANCES RECEI VED BY THE APPELLANT, UNDER SECTION 68 OF THE INCOME TA X ACT, 1961. 3(II). ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN NO T CONSIDERING THAT THE PROVISIONS OF SECTION 68 OF TH E INCOME TAX ACT, 1961 ARE NOT APPLICABLE TO FACTS OF THE CASE, AS THE APPELLANT HAS PROVED THE CREDITWORTHIN ESS, GENUINENESS AND IDENTITY OF THE PARTIES FROM WHOM T HE AMOUNTS HAS BEEN RECEIVED AS ADVANCE. 4. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITION OF RS.12,40,000/- OUT OF TH E TOTAL ADDITION OF RS.15,49,000/- MADE BY THE AO ON ACCOUNT OF UN-EXPLAINED CASH DEPOSITS. 5. THAT LD. CIT (A) HAS CONFIRMED THE AFORESAID ADDITIONS WITHOUT CONSIDERING THE MATERIALS, DOCUME NTS AND EVIDENCES SUBMITTED BY THE APPELLANT TO PROVE A ND SUBSTANTIATE THE TRANSACTIONS. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICA TION OF THE CONTROVERSY AT HAND ARE : ASSESSEE DECLARED TOTAL I NCOME OF RS.13,63,060/- FROM BUSINESS AND PROFESSION AND FRO M OTHER SOURCES. ASSESSING OFFICER NOTICED FROM SCHEDULE B FORMING PART OF THE BALANCE SHEET THAT THE ASSESSEE HAS CLAIMED UNSECURED LOAN TO THE TUNE OF RS.1,94,54,460/- FROM VARIOUS PERSONS A S ON 31.03.2010 ITA NO.6239/DEL./2015 3 AND ON FAILURE OF THE ASSESSEE TO FILE DOCUMENTARY EVIDENCE IN ORDER TO DISCHARGE THE ONUS OF PROVING GENUINENESS, IDENT ITY AND CREDITWORTHINESS OF THE CREDITORS TREATED THE SAME AS UNEXPLAINED CREDITS U/S 68 OF THE INCOME-TAX ACT, 1961 (FOR SHO RT THE ACT) AND MADE ADDITION THEREOF TO THE TOTAL INCOME OF THE AS SESSEE. AO ALSO NOTICED CASH DEPOSITS IN THE BANK TO THE TUNE OF RS .15,49,000/-. ON FAILURE OF THE ASSESSEE TO PROVE THE SOURCE OF THE SAME, AO MADE ADDITION THEREOF TO THE TOTAL INCOME OF THE ASSESSE E. 3. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT ( A) BY WAY OF FILING AN APPEAL WHO HAS PARTLY ALLOWED THE APPEAL BY CONFIRMING THE ADDITION OF RS.5,00,000/- OUT OF TOTAL ADDITION OF RS.1,94,54,460/- MADE BY THE AO ON ACCOUNT OF UNEXP LAINED UNSECURED LOAN; AND FURTHER CONFIRMING THE ADDITION OF RS.1,01,62,085/- AS AGAINST ADDITION OF RS.2,10,47, 087/- MADE BY THE AO ON ACCOUNT OF CURRENT LIABILITIES/ADVANCES; AND CONFIRMING THE ADDITION OF RS.12,40,000/- OUT OF THE TOTAL ADD ITION OF RS.15,49,000/- MADE BY THE AO ON ACCOUNT OF UNEXPLA INED CASH DEPOSIT. FEELING AGGRIEVED, THE ASSESSEE HAS COME U P BEFORE THE TRIBUNAL BY WAY OF FILING THE PRESENT APPEAL. 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ITA NO.6239/DEL./2015 4 ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. GROUND NO.1 5. GROUND NO.1 NEEDS NO FINDING BEING GENERAL IN NA TURE. GROUND NO.2 6. LD. CIT (A) CONFIRMED THE ADDITION OF RS.5,00,00 0/- AS AGAINST ADDITION OF RS.1,94,54,460/- MADE BY THE AO ON ACCOUNT OF UNEXPLAINED UNSECURED LOAN, WHICH ARE UNDER CHALLEN GE BY THE ASSESSEE. UNDISPUTEDLY, ASSESSEE CLAIMED TO HAVE T AKEN LOAN OF RS.1,94,54,460/- FROM 8 PERSONS, DETAILED AS UNDER :- NAME OF THE PERSON AMOUNT (RS.) ARVIND KUMAR 7,90,000 GOPI CHAND 62,00,000 NAVEEN GUPTA 55,00,000 PAWAN KUMAR PACHORI 20,00,000 PAWAN KUMAR TYAGI 2,00,000 RAMESH / RAJIV KHATRI 5,00,000 TARKESHWAR PACHORI 27,64,460 VIPIN 15,00,000 TOTAL AMOUNT 1,94,54,460 7. PARAS 5.3, 5.4.1, 5.4.2 & 5.4.3 OF THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) GO TO PROVE THAT ON THE BASIS OF CONTENTIONS OF THE ASSESSEE, THE CASE HAS BEEN THRASHED AT LENGTH. ITA NO.6239/DEL./2015 5 8. SO FAR AS QUESTION OF CONFIRMING THE ADDITION OF RS.3,00,000/- IN CASE OF SHRI ARVIND KUMAR FROM WHO M ASSESSEE HAS SHOWN TO HAVE AVAILED LOAN OF RS.7,90,000/- IS CONCERNED, SHRI ARVIND KUMAR HAS APPEARED BEFORE THE AO ON 19.08.20 14 AND GOT RECORDED THE STATEMENT PURSUANT TO THE SUBMISSIONS ISSUED U/S 131 OF THE ACT THAT HE HAS GIVEN THE LOAN OF RS.4,90,00 0/- TO THE ASSESSEE. ON THE BASIS OF WHICH REMAINING AMOUNT O F RS.3,00,000/- HELD TO BE UNVERIFIED BY LD. CIT (A) WHO HAS CONFIRMED THE ADDITION THEREOF. 9. THE LD. CIT (A) HAS RIGHTLY DECLINED TO CONSIDER THE CONFIRMATION OF CREDIT OF RS.3,00,000/- FROM ACCOUN T OF SHRI ARVIND KUMAR IN THE FACE OF STATEMENT RECORDED BY S HRI ARVIND KUMAR BEFORE AO. WHEN THREE IS NOT AN IOTA OF EVID ENCE ON FILE IF THE STATEMENT RECORDED BY SHRI ARVIND KUMAR ON 19.0 8.2014 IS RESULT OF COERCION OR UNDUE INFLUENCE, THE SAME IS HAVING THE EVIDENTIARY VALUE. SO, LD. CIT (A) HAS RIGHTLY CON FIRMED THE BALANCE AMOUNT OF RS.3,00,000/- IN CASE OF SHRI ARV IND KUMAR. 10. SO FAR AS CONFIRMING THE AMOUNT OF RS.2,00,000/ - ALLEGED TO HAVE BEEN TAKEN BY THE ASSESSEE FROM SHRI PAWAN KUM AR TYAGI IS CONCERNED, PARA 5 OF THE REMAND REPORT AVAILABLE AT PAGE 178 OF THE PAPER BOOK IS VERY CATEGORIC WHICH IS EXTRACTED FOR READY PERUSAL AS UNDER :- ITA NO.6239/DEL./2015 6 5. PAWAN KUMAR TYAGI IN RESPONSE TO SUMMONS U/S 131, SHRI PAWAN KUMAR TYAGI VIDE ITS LETTER ALONG WITH AFFIDAVIT RECEIVED IN THIS OFFICE BY SPEED POST ON 03.09.2014 HAS STATED THAT HE HAS GIV EN AN AMOUNT OF RS.2,00,000/- TO SHRI RAJESH BHARDWAJ BY CHEQUE FOR PURCHASING AN EWS FLAT BUT DUE TO SOME REASON THE D EAL COULD NOT BE FINALIZED AND IT WAS STATED THAT HE HAS RECE IVED BACK THE SAID AMOUNT. NOTHING IS DUE FROM SHRI BHARDWAJ AS ON DATE. BUT NO BANK DETAILS SHOWING THE SAID TRANSACTIONS W AS FURNISHED BY SHRI PAWAN KUMAR TYAGI. FURTHER, NO INCOME TAX DETAILS/COPY OF RETURN ETC. WAS FILED BY HIM. 11. SHRI PAWAN KUMAR TYAGI STATED IN HIS AFFIDAVIT THAT HE HAS GIVEN THE AMOUNT OF RS.2,00,000/- TO THE ASSESSEE F OR PURCHASING AN EWS FLAT BUT THE SAID DEAL COULD NOT BE MATERIALIZE D AND THEN HE HAD RECEIVED BACK THE SAID AMOUNT. SINCE SHRI PAWA N KUMAR TYAGI HAS MERELY FIELD THE AFFIDAVIT AND NO SUPPORT ING DOCUMENT AS TO THE PURCHASE OF EWS FLAT NOR ANY BANK DETAIL NOR ANY INCOME-TAX DETAIL HAS BEEN FILED, HIS AFFIDAVIT CANNOT BE RELI ED UPON. SINCE THE ASSESSEE HAS FAILED TO DISCHARGE THE ONUS, AO/CIT ( A) HAVE RIGHTLY MADE/CONFIRMED THE ADDITION OF RS.2,00,000/-. SO, GROUND NO.2 IS DETERMINED AGAINST THE ASSESSEE. GROUND NO.3 12. OUT OF THE TOTAL ADDITION OF RS.2,10,47,087/- M ADE BY THE AO ON ACCOUNT OF CURRENT LIABILITIES, THE LD. CIT (A) DELETED AN AMOUNT OF RS.1,08,85,000/- BY TREATING THE SAME AS EXPLAIN ED. HOWEVER, IN CASE OF REMAINING AMOUNT OF RS.1,01,62,085/-, A REM AND REPORT WAS CALLED FROM THE AO. ASSESSEE CLAIMED TO HAVE TAKEN ADVANCE OF ITA NO.6239/DEL./2015 7 DIFFERENT AMOUNTS FROM 40 PERSONS STATED TO BE AGRI CULTURISTS TO WHOM NOTICES U/S 133 (6) WERE ISSUED. AO HAS GIVEN DETAILED REMAND REPORT, AVAILABLE AT PAGES 201 TO 203 OF THE PAPER BOOK, WHEREIN IT IS CATEGORICALLY RECORDED THAT OUT OF 40 PERSONS, 11 PERSONS PERSONALLY APPEARED AND FIELD REPLY ALONG W ITH AFFIDAVITS AND REMAINING 29 PERSONS SENT THE AFFIDAVITS ONLY. 13. IN NUTSHELL ALL THE 40 PERSONS HAVE FILED VOTIN G I-CARD ALONG WITH AFFIDAVITS ONLY. THERE IS NOT AN IOTA OF EVID ENCE ON FILE IF THE AFORESAID PERSONS ARE AGRICULTURISTS HAVING HUGE FU NDS IN THEIR POSSESSION TO LEND THE SAME TO THE ASSESSEE AS IN C ASE OF POORAN SINGH, VISHMBER, BHOOP SINGH, KARAN SINGH, LAL SING H, BHOLA SINGH AND CHAKHAN SINGH, WHOSE AFFIDAVITS ARE AVAIL ABLE AT PAGES 74 TO 80 OF THE PAPER BOOK AND STATED TO HAVE GIVEN RS.3,37,000/-, RS.6,50,000/-, RS.35,000/-, RS.1,80,000/-, RS.1,35, 000/-, RS.1,80,000/- AND RS.6,35,000/- RESPECTIVELY, THERE IS NO JAMABANDI NOR J-FORM SHOWING RECEIPT OF AGRICULTURAL PRODUCE NOR ANY BANK ACCOUNT NOR PAN CARD. 14. IN ANY CASE, BANKS STATEMENT COULD HAVE BEEN DU LY BROUGHT ON RECORD AS ALL THE AGRICULTURISTS USED TO AVAIL O F AGRICULTURE CREDIT FACILITY FOR THEIR DAY-TO-DAY AGRICULTURE ACTIVITIE S OR J FORM IN OTHER CASES. KEEPING IN VIEW THE OVERALL FINANCIAL CONDITIONS OF THE FARMERS IN INDIA WHO ARE UNDER-HUGE DEBT, IT IS DIF FICULT TO DIGEST IF ITA NO.6239/DEL./2015 8 THEY WERE IN POSSESSION OF HUGE AMOUNT TO BE LENT T O THE ASSESSEE. SO, THE LD. CIT (A) HAS RIGHTLY CONFIRMED THE ADDIT ION OF RS.1,01,62,085/-. CONSEQUENTLY, GROUND NO.3 IS DET ERMINED AGAINST THE ASSESSEE. GROUND NO.4 15. OUT OF THE ADDITION OF RS.15,49,000/- MADE BY T HE AO ON ACCOUNT OF UNEXPLAINED CASH DEPOSIT, LD. CIT (A) DE LETED THE ADDITION OF RS.3,49,000/- AND CONFIRMED THE BALANCE ADDITION OF RS.12,40,000/-. IT IS THE CASE OF THE ASSESSEE THA T HE HAS FIELD AFFIDAVIT/SALE AGREEMENT BETWEEN ASSESSEE AND KAPIL BADHANA, AVAILABLE AT PAGES 212 & 213 OF THE PAPER BOOK, FOR PURCHASE OF PROPERTY NO. SHAKTI KHAND 1/333/4, INDIRAPURAM, GHA ZIABAD FOR WHICH THE ASSESSEE HAD DEPOSITED AN AMOUNT OF RS.12 ,40,000/- WITH GHAZIABAD DEVELOPMENT AUTHORITY (GDA) AGAINST DUES OF THE SAID PROPERTY BUT THE DEAL COULD NOT BE MATERIALIZED AND KAPIL BADHANA REFUNDED THE AMOUNT BY DEPOSITING THE CASH IN SYNDI CATE BANK OF THE ASSESSEE. 16. PERUSAL OF THE IMPUGNED ORDER PASSED BY LD. CIT (A) SHOWS THAT NO FINDINGS HAVE BEEN RETURNED REGARDING AGREE MENT TO SELL APPEARS TO HAVE BEEN DULY ENTERED INTO BETWEEN ASSE SSEE AND KAPIL BADHANA IN PRESENCE OF WITNESSES ON A STAMP PAPER W ORTH RS.50/-. WHEN THE ASSESSEE HAS STATED TO HAVE DEPOSITED RS.1 2,40,000/- WITH ITA NO.6239/DEL./2015 9 GDA QUA THE PROPERTY OWNED BY KAPIL BADHANA, THE AM OUNT OF RS.12,40,000/- ALLEGEDLY DEPOSITED IN CASH BY KAPIL BADHANA IN ACCOUNT OF ASSESSEE COULD HAVE BEEN DULY VERIFIED F ROM THE ACCOUNT OF GDA AND FROM KAPIL BADHANA. MOREOVER, CIT (A) H AS ALSO RECORDED IN PARA 7.4 OF THE IMPUGNED ORDER THAT DES PITE NUMEROUS OPPORTUNITIES, ASSESSEE HAS FAILED TO PROVE THE SOU RCE OF CASH DEPOSIT OF RS.12,40,000/- ALLEGEDLY RECEIVED FROM K APIL BADHANA. ALL THESE FACTS SHOW THAT THE ASSESSEE HAS NOT BEEN PROVIDED WITH ADEQUATE OPPORTUNITY ON THIS ISSUE AND HE IS ENTITL ED TO BE REHEARD ON THIS ISSUE. SO, WE REMAND THIS ISSUE BACK TO TH E AO TO DECIDE AFRESH AFTER PROVIDING AN OPPORTUNITY OF BEING HEAR D TO THE ASSESSEE. GROUND NO.4 IS DECIDED IN FAVOUR OF THE ASSESSEE FOR STATISTICAL PURPOSES. GROUND NO.5 17. GROUND NO.5 NEEDS NO FINDING BEING GENERAL IN N ATURE. 18. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE I S PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 8 TH DAY OF OCTOBER, 2018. SD/- SD/- (PRASHANT MAHARISHI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 8 TH DAY OF OCTOBER , 2018/TS ITA NO.6239/DEL./2015 10 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-2, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.