I.T.O Wd - 40(1),kolkata, Kolkata V. Sri Bijay Kr Jaiswal, Kolkata

ITA 642/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 100054 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2015
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 25-03-2013
• Court: TRIBUNAL
• Department Lawyers: RAJENDRA PRASAD
• Assessee Lawyers: N O N E
• Keywords: Unexplained cash credit
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOL KATA [BEFORE SHRI MAHAVIR SINGH, JM & SHRI M. BALAGANES H, AM] I.T.A NO. 642/KOL/2013 ASSESSMENT YEAR: 2006-07 INCOME-TAX OFFICER, WD-40(1), KOLKATA. VS. BIJOY KR. JAISWAL (PAN: ACTPJ6927E) ( APPELLANT ) ( RESPONDENT ) DATE OF HEARING: 17.11.2015 DATE OF PRONOUNCEMENT: 20.11.2015 FOR THE APPELLANT: SHRI RAJENDRA PRASAD, JCIT, SR. DR FOR THE RESPONDENT: N O N E ORDER PER SHRI MAHAVIR SINGH, JM: THIS APPEAL BY REVENUE IS ARISING OUT OF ORDER OF C IT(A)-XIX, KOLKATA IN APPEAL NO. 93/CIT(A)-XIX/ACIT CIR-31/KOL/11-12 DATED 11.01 .2013. ASSESSMENT WAS FRAMED BY ITO, WARD-40(1), KOLKATA U/S. 143(3)(II) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR AY 2006-07 VIDE ITS O RDER DATED 29.12.2008. 2. THE TWO INTER-CONNECTED ISSUES IN THIS APPEAL OF REVENUE IS AGAINST THE ORDER OF CIT(A) DELETING THE ADDITION OF UNEXPLAINED CASH CR EDIT OF RS.21.90 LACS AND DELETION OF CONSEQUENTIAL INTEREST PAID AGAINST THESE LOANS AT RS.1,40,870/-. FOR THIS, REVENUE HAS RAISED FOLLOWING TWO GROUNDS: 1. LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACT IN DELETING THE ADDITION OF RS.21,90,000/- ON ACCOUNT OF UNEXPLAINED CASH CREDI T. 2. LD. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACT I N DELETING THE ADDITION OF RS.1,40,817/- ON ACCOUNT OF INTEREST PAID AGAINST FRESH LOANS. 3. BRIEFLY STATED FACTS ARE THAT THE ASSESSEE IS EN GAGED IN THE PROPRIETARY BUSINESS OF TRADING IN IRON AND SCRAP UNDER THE NAME AND STY LE OF M/S. SHREE BASUKI TRADING CO. THE AO DURING THE COURSE OF ASSESSMENT PROCEED INGS NOTICED FROM THE ACCOUNTS OF THE ASSESSEE THAT HE HAS TAKEN FRESH UNSECURED L OAN OF RS.21.90 LACS FOR ITS PROPRIETARY BUSINESS FROM THE FOLLOWING: NAME OF LOAN CREDITOR LOAN & DATE SUBHAS CHAND JAISWAL HUF 2,00,000/- ON 2/12/05 ASHOK KUMAR JAISWAL HUF 2,00,000/- ON 9/12/05 RAJESH KUMAR JAISWAL HUF 1,50,000/- ON 9/12/05 POONAM JAISWAL 1,00,000/- ON 2/12/05 PRADIP SHAW 1,50,000/- ON 3/12/05 ANIL KUMAR JHA 1,00,000/- ON 12/12/05 SITA JAISWAL 2,00,000/- ON 26/11/05 RAM NIWAS YADAV 1,50,000/- ON 8/8/05 2 ITA NO. 642/KOL/2013 SHRI BIJAY KR. JAISWAL AY 2006-07 1,00,000/- ON 6/12/05 RAM CHANDRA PRASAD HUF 2,00,000/- ON 2/12/05 RAM CH. PRASAD JAISWAL 1,00,000/- ON 4/6/05 SUDHA JAISWAL 2,00,000/- ON 4/6/05 OM PRAKASH JAISWAL 90,000/- ON 13/1/06 OM PRAKASH JAISWAL HUF 50,000/- ON 13/1/06 MIRA DEVI JAISWAL 1,00,000/- ON 4/6/05 1,00,000/- ON 20/3/06 4. THE AO REQUIRED THE ASSESSEE TO PROVE THE IDENTI TY, GENUINENESS AND CREDITWORTHINESS OF THESE UNSECURED LOAN CREDITORS. THE AO NOTICED FROM THE BANK ACCOUNT OF THESE PERSONS THAT THEY HAVE DEPOSITED T HE MONEY ON THE SAME DATE AND GAVE LOAN TO THE ASSESSEE. ALL THESE CREDITORS ARE INCO ME TAX ASSESSEE, BUT ACCORDING TO AO, THEIR CREDITWORTHINESS YET TO BE ESTABLISHED. AS T HE ASSESSEE FAILED TO PROVE IDENTITY, GENUINENESS OF TRANSACTION AND CREDITWORTHINESS OF THESE LOAN CREDITORS HE ADDED THESE UNSECURED LOANS AMOUNTING TO RS.21.90 LACS AS UNEXP LAINED CASH CREDITS U/S. 68 OF THE ACT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE C IT(A). THE CIT(A) AFTER TAKING REMAND REPORT FROM THE ASSESSEE HAS EXAMINED THE EN TIRE DETAILS I.E. THE IDENTITY OF THE CREDITORS, GENUINENESS OF THE LOAN TRANSACTIONS AND CAPACITY OF THE CREDITORS SUBMITTED THE FOLLOWING REMAND REPORT DATED 10.10.2012. DURING THE COURSE OF SCRUTINY PROCEEDINGS, ASSESS EE HAS FILED BEFORE THE A.O. COPY OF BALANCE SHEET, BANK STATEMENT ALONG WITH LOAN CONFI RMATION LETTER FOR ALL THE LOAN CREDITORS, BUT HE HAS ONLY FILED CASH FLOW STATEMEN T OF (1) ASHOK KR. JAISWAL (HUF), (2) PUNAM JAISWAL (3) PRADIP SHAW, (4)ANIL KR. JHA, (5) RAM NIVASH YADAV (6) RAM CH,. PRASAD (HUF), (7) ARNAB PAUL AND (8) NAVEEN AGARWAL . ASSESSEE HAS ALSO DEDUCTED TAX (TDS) ON INTEREST ON SAID UNSECURED LOAN DURING THE F.Y. 2005-06. THEREFORE, IDENTITY OF LOAN CREDITORS IS WELL ESTABLISHED. HOWEVER, ONE OF THE REASONS FOR ADDITION REGARDING UNEXPLAINED CASH CREDIT FOR NON- PRODUCTION OF VOTER ID CARD APPEARS TO BE CONTRADIC TORY IN NATURE. BECAUSE IN THE ASSESSMENT ORDER, A.O. HIMSELF WRITE DOWN YEARLY IN COME OF ALL THE LOAN CREDITORS IN A CHART, WHICH MEANS THAT IDENTITY OF THE LOAN CREDIT ORS ARE WELL ESTABLISHED BEFORE THE A.O. IN VIEW OF THE REMAND REPORT, THE CIT(A) DELETED TH E ADDITION OF UNSECURED LOANS AS THE AO HIMSELF ADMITTED THE GENUINENESS AND CREDITWORTH INESS OF THESE LOAN CREDITORS. AGGRIEVED, NOW REVENUE IS IN SECOND APPEAL BEFORE T RIBUNAL. 5. WE HAVE HEARD LD. SR. DR AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. AT THE TIME OF HEARING, ON A QUERY FROM THE BENCH, LD. SR. DR COULD NOT REPLY AS TO WHY THE REVENUE HAS FILED APPEAL BEFORE TRIBUNAL WHEN T HE AO HIMSELF ADMITTED THE IDENTITY, CREDITWORTHINESS AND GENUINENESS OF LOAN TRANSACTIO NS IN RESPECT TO THESE LOAN CREDITORS AMOUNTING TO RS.21.90 LACS. WE HAVE PERUSED THE RE MAND REPORT DATED 10.10.2012 OF THE 3 ITA NO. 642/KOL/2013 SHRI BIJAY KR. JAISWAL AY 2006-07 AO AND NOTICED THAT THE AO HIMSELF HAS ADMITTED THE INGREDIENTS OF SECTION 68 OF THE ACT IN RESPECT TO THESE LOAN CREDITORS ARE FULFILLED AN D ONCE THIS IS THE POSITION, THIS CANNOT BE ADDED. ACCORDINGLY, WE DISMISS THIS ISSUE OF REVEN UES APPEAL. IN RESPECT TO INTEREST ON UNSECURED LOANS, THE ASSESSEE HAS DEDUCTED TDS ON T HESE LOANS AND ASSESSEE HAS USED THESE CASH CREDITS IN ASSESSEES BUSINESS OF TRADIN G OF IRON AND SCRAP. WE FIND NO INFIRMITY IN THE ORDER OF CIT(A) DELETING THE DISALLOWANCE OF INTEREST. ACCORDINGLY, THESE TWO INTER- CONNECTED ISSUES OF REVENUES APPEAL ARE DISMISSED. 6. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSE D. 7. ORDER IS PRONOUNCED IN THE OPEN COURT ON 20.11.2 015 SD/- SD/- (M. BALAGANESH) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 20TH NOVEMBER, 2015 JD. SR. P.S COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT ITO, WARD-40(1), KOLKATA. 2 RESPONDENT SHRI BIJAY KR. JAISWAL, FLAT NO. 3A, 1 03, RAJA DINENDRA STREET, KOLKATA-6. 3 . THE CIT(A), KOLKATA 4. 5. CIT KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, ASSTT. REGISTRAR .