ITO, W-4(2), Ludhiana V. M/s Swaran Fastners, Ludhiana

ITA 729/CHANDI/2018

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 2219 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 28-01-2021
• Assessment Year: 2013-2014
• Appeal Filed On: 18-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDIP DAHIYA CIT
• Keywords: Unexplained cash credit; Gift; Income from undisclosed sources; Principle of natural justice; Set aside
• Section: 143(3); 133(6); 143(1); 13; 147

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH B, CHANDIGARH .., ! '# .. , $ %& BEFORE: SHRI. N.K.SAINI, VP & SHRI , R.L. NEGI, JM ITA NO. 729/CHD/2018 ASSESSMENT YEAR : 2013-14 THE ITO WARD-4(2), LUDHIANA M/S SWARAN FASTNERS SHOP NO. 03, SHIV MARKET, SATSANG ROAD, LUDHIANA PAN NO: AADFS3860R APPELLANT RESPONDENT !' ASSESSEE BY : SHRI SUDHIR SEHGAL, ADVOCATE #!' REVENUE BY : SHRI SANDIP DAHIYA, CIT $ %! & DATE OF HEARING : 28/01/2021 '()*! & DATE OF PRONOUNCEMENT : 18/02/2021 %'/ ORDER PER N.K. SAINI, VICE PRESIDENT THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE ORD ER DT. 07/03/2018 OF LD. CIT(A)-2 LUDHIANA. 2. FOLLOWING GROUNDS HAS BEEN RAISED IN THIS APPEAL : I. WHETHER ON THE FACTS AND THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE CIT(A)-2, LUDHIANA WAS JUSTIFIED IN DELETING THE AD DITION OF RS. 20,50,000/-WHEREAS THE ASSES SEE COULD NOT EXPLAIN THE SOURCE OF THIS AMOUNT CREDITED IN THE CAPITAL ACCOUNT OF SMT. SWARAN KANTA TO THE SATISFACTION OF THE ASSESSING OFFICER. II. WHETHER ON THE FACTS AND THE CIRCUMSTANCES OF T HE CASE AND IN LAW, THE CIT(A)-2, LUDHIANA WAS JUSTIFIED IN DELETING THE AD DITION OF RS. 40,50,000/-WHEREAS THE ASSESSEE HAS FAILED TO EXPLAIN THE GENUINENESS OF THE SUMS RECEIVED FROM SH. ANKUSH GUPTA PARTICULARLY WHEN HIS CREDIT WORTHINES S WAS NOT ESTABLISHED BEYOND DOUBT. III. WHETHER ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A)-2, LUDHIANA WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 3,88,82,000/- WHEREAS THE ASSESSEE FAILED TO EXPLAIN THE CREDIT W ORTHINESS OF M/S SHREE RADHA COMMODITY SERVICES TO THE EXTENT OF RS. 3,88,82,000 /- TO THE SATISFACTION OF THE ASSESSING OFFICER. IV. THAT THE ORDER OF THE CIT(A) ON THE ABOVE ISSU ES RAISED IN THIS APPEAL BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESOR TED TO. 2 V. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROUNDS OF APPEAL BEFORE IT IS FINALLY DISPOSED OFF. 3. VIDE GROUND NO. (I) THE GRIEVANCE OF THE DEPARTM ENT RELATES TO THE DELETION OF ADDITION OF RS. 20,50,000/- MADE BY THE A.O. ON ACCOUNT OF THE AMOUNT CREDITED IN THE CAPITAL ACCOUNT OF SMT. SWAR AN KANTA. 4. FACTS RELATED TO THIS ISSUE IN BRIEF ARE THAT TH E ASSESSEE FILED THE RETURN OF INCOME ON 21/09/2013 DECLARING AN INCOME OF RS. 1,2 8,240/- WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX AC T, 1961 (HEREINAFTER REFERRED TO AS ACT). SUBSEQUENTLY THE CASE WAS SE LECTED FOR SCRUTINY. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE A.O. NOTI CED THAT IN THE CAPITAL ACCOUNT OF SMT. SWARAN KANTA PARTNER, A SUM OF RS 2 0,50,000/- WAS CREDITED AS PER FOLLOWING DETAILS: 29/06/2012 CHEQUE NO. 858646 8,00,000/- 26/07/2012 CHEQUE NO. 858647 50,000/- 11/08/2012 CHEQUE NO. 858648 7,00,000/- 13/08/2012 CHEQUE NO. 858649 5,00,000/- TOTAL 20,50,000/- THE A.O. ASKED THE ASSESSEE TO FURNISH THE EXPLANAT ION FOR THE SAID ADDITION. ACCORDING TO THE A.O. THE ASSESSEE DID NOT FILE THE EVIDENCE, HE THEREFORE TREATED THE SAID AMOUNT AS UNEXPLAINED INCOME OF TH E ASSESSEE AND MADE THE ADDITION. 5. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED AS UNDER: THE FIRST GROUND OF APPEAL IN THIS CASE IS THAT THE ADDITIONS HAVE BEEN MADE OF SMT. SWARAN KANTA WHO IS PARTNER IN THE FIRM AT RS. 2050000/- BEING THE CAPITAL INTRODUCED DURING THE YEAR UNDER CONSIDERATION. THE SUBMISSIONS TO THIS REPLY ARE AS UNDER: A) SMT. SWARANKANTA RECEIVED THE AMOUNT FROM HER SON S H. PUNEET GUPTA WHO IS NON RESIDENT AND LIVING IN U.K. THE PHOTOCOP Y OF THE NRE SAVING ACCOUNT OF SH. PUNEET GUPTA BEING MAINTAINED WITH CITI BANK, F EROZE GANDHI MARKET, 3 LUDHIANA IS ATTACHED. THE AMOUNT OF RS.8 LAKH HAS B EEN RECEIVED FROM CITI BANK THROUGH RTGS IN THE SAVINGS ACCOUNT OF SMT. SWARANK ANTA HAVING ACCOUNT NO.00000010007210393 WITH STATE BANK OF INDIA, AGGA R NAGAR, LUDHIANA AND THE SAME AMOUNT WAS INTRODUCED ON 29.06.2012 AS CAPITAL IN THE FIRM. RS.50000/- WAS TRANSFERRED TO THE CAPITAL ACCOUNT ON 26.07.2012 FR OM THE OUTSTANDING BALANCE WITH STATE BANK OF INDIA. AGAIN SHE RECEIVED FROM S H. PUNEET GUPTA, HER SON ON 11.08.2012 THROUGH RTGS FROM NRE ACCOUNT TO HER SAV ING ACCOUNT ON 11.08.2012. THE AMOUNT OF RS.7 LAKH WAS GIVEN TO M/S SWARANFAST NERSAAS CAPITAL ON 11.08.2012 AND RS.5 LAKH WAS GIVEN ON 13.08.2012 TO M/S SWARANFASTNERS. THE TOTAL AMOUNT OF RS.20 LAKH WAS RECEIVED FROM HER SON WHO IS NON RESIDENT. THE BALANCE AMOUNT OF RS. 50000/- WAS INTRODUCED AS CAPITAL BEI NG THE AMOUNT OUTSTANDING IN HER ACCOUNT. THE PHOTOCOPY OF THE CAPITAL ACCOUNT O F SMT. SWARANKANTA, HER SAVING BANK ACCOUNT WITH SBI AND SAVING BANK ACCOUN T OF SH. PUNEET GUPTA, NRE ARE PLACED IN THE PAPER BOOK PAGE NO. 6 TO 8. B) THE COMPLETE EXPLANATIONS WAS GIVEN TO THE A.O. DURI NG THE PROCEEDINGS ALONG WITH COMPLETE EVIDENCE BUT THE A.O. HAS MADE A DDITIONS IN THE HANDS OF FIRM WITHOUT CONSIDERING THIS FACT THAT THE AMOUNT BELONGS TO SMT. SWARANKANTA AND IF AT ALL ANY ADDITIONS WAS TO BE MADE IT SHOUL D HAVE BEEN MADE IN THE HANDS OF SMT. SWARANKANTA. HOWEVER THE COMPLETE EVI DENCES HAVE BEEN PROVIDED TO YOUR GOOD SELF ALONG WITH SOURCE OF SOU RCE HENCE THE ADDITIONS OF RS. 2050000/- MADE IN THE FIRM'S HAND BEING PARTNER'S C APITAL ADDITION SHOULD BE DELETED. C) FURTHER YOUR KIND ATTENTION IS INVITED TO THE ORDER SHEET ENTRIES WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE NO. 1 TO 3. Y OUR HONOR WILL FIND THAT IN THE ORDER SHEET ENTRIES, THE PROCEEDINGS WERE STARTED O N 23.12.2015 AND THE LAST PROCEEDINGS ARE DATED ON 19.02.2016 ON WHICH DATE T HE CASE WAS ADJOURNED TO 26.02.2016. FROM THE ORDER SHEET ENTRIES YOUR HONOR WILL FIND THAT NO SHOW CAUSE NOTICE HAS BEEN ISSUED TO THE ASSESSEE BEFORE MAKIN G ANY ADDITIONS ON ACCOUNTS OF UNEXPLAINED CREDITS IN THE NAME OF SMT. SWARANKA NTA WHICH VIOLATES THE PRINCIPLES OF NATURAL JUSTICE AND ADDITIONS BASED O N THIS ISSUE SHOULD BE DELETED AND ASSESSMENT SHOULD BE QUASHED. 5.1 THE AFORESAID SUBMISSION WERE FORWARDED TO THE A.O. BY THE LD. CIT(A) FOR THE REMAND REPORT. IN RESPONSE THE A.O. SUBMITTED A S UNDER: KINDLY REFER TO REPLY FILED BY THE COUNSEL OF THE A SSESSEE DATED 26.09.2017 ADDRESSED TO YOU. 2. IN THIS REGARD, IT IS SUBMITTED THAT ASSESSMENT IN THE CASE WAS COMPLETED U/S 143(3) OF THE INCOME TAX ACT, 1961 ON 23.03.2016 AT AN INCOME OF RS. 4,51,50,218/- AGAINST THE RETURNED INCOME OF RS. 1,28,240/- BY MA KING FOLLOWING ADDITIONS :- I. UNEXPLAINED PARTNER'S CAPITAL 20,50,000/- II. UNEXPLAINED CREDIT OF SH. ANKUSH GUPTA 40,50,00 0/- III. UNEXPLAINED CREDIT OF M/S SHRIRADHA COMMODITY SERVI CES 3,88,82,000/- IV. PERSONAL NATURE EXPENSES DISALLOWED 39,978/- 4 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED THAT SMT. SWARANKANTA RECEIVED THE AMOUNT FROM HER SON SHRI P UNEET GUPTA WHO IS NON RESIDENT AND LIVING IN U.K. THE PHOTOCOPY OF THE NR E SAVING ACCOUNT OF SH. PUNEET GUPTA BEING MAINTAINED WITH C1TI BANK WAS ALSO FURN ISHED BY THE ASSESSEE. BUT, THE SOURCE OF INCOME OF SHRI PUNEET GUPTA WAS NOT P RODUCED BEFORE THE THEN A.O. A SHOW CAUSE NOTICE WAS ALSO ISSUED TO THE ASSE SSEE ON 09.03.2016 WHICH WAS DULY SERVED UPON THE ASSESSEE ON 10.03.2016(COP Y ENCLOSED). HENCE, AN ADDITION OF RS. 20,50,000/- WAS MADE BY THE A.O. DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS. 5.2 THE SAID REMAND REPORT WAS FORWARDED BY THE LD. CIT(A) TO THE ASSESSEE FOR ITS COUNTER COMMENT. IN RESPONSE THE ASSESSEE I N ITS COUNTER COMMENT SUBMITTED AS UNDER: THE COMPLETE COMMENTS ON THE REMAND REPORT DATED 21 .11.2017 SUBMITTED BY THE INCOME TAX OFFICER, WARD 4(2), LUDHIANA ARE BEIN G GIVEN AS UNDER: 1. PARTNERS CAPITALRS. 20,50,000/-: IN THIS CASE THERE IS ADDITION OF RS. 20,50,000/- I N THE CASE OF PARTNER SMT. SWARANKANTA. THE COMPLETE DETAILS WERE GIVEN TO YOUR GOOD SELF VIDE WRITTEN SUBMISSIONS DATED 26.02.2017 AND EACH AND EVERY ENTRY WAS EXPLAINED ALONG WITH EVIDENCE AND THE SOURCE OF SOURCE WAS ALSO EXPLAINED. THE A.O. HAS NOT GIVEN ANY COMMENTS AFTER HAVING VER IFIED EACH AND EVERY ENTRY, SIMPLY, THE A.O. HAS STATED THAT THE AMOUNT OF RS. 2 0,00,000/- HAS BEEN RECEIVED FROM NRE SAVING ACCOUNT NUMBER 5- 102915-161 BEING MAINTAINED WITH CITI BANK FOR WHICH THE COMPLETE DETAILS HAS BEEN GIVEN IN TH E WRITTEN SUBMISSIONS. HOWEVER AGAIN TO REPEAT RS. 8,00,000/- HAS BEEN REC EIVED ON 29.06.2012 THROUGH RTGS FROM THE SAVING ACCOUNT OF SH. PUNEET GUPTA NR E WHO IS THE SON OF ASSESSEE. THE AMOUNT WAS TRANSFERRED THROUGH RTGS I N THE SAVING ACCOUNT OF SMT. SWARANKANTA BEING MAINTAINED WITH STATE BANK OF IND IA. FURTHER, AGAIN TO REPEAT RS. 12,00,000/- HAS BEEN RECEIVED ON 11.08.2012 THR OUGH RTGS FROM THE SAVING ACCOUNT OF SH. PUNEET GUPTA NRE WHO IS THE SON OF A SSESSEE. THE AMOUNT WAS TRANSFERRED THROUGH RTGS IN THE SAVING ACCOUNT OF S MT. SWARANKANTA BEING MAINTAINED WITH STATE BANK OF INDIA. PLEASE NOTE TH AT HIS SON IS WORKING IN U.K. AND HE HAS MAINTAINED NRE ACCOUNT WITH CITI BANK, LUDHI ANA AND THE PHOTOCOPY OF THE BANK STATEMENT IS PLACED IN THE PAPER BOOK AT P AGE NUMBER 8 WHICH MAY PLEASE BE REFERRED. IT IS FURTHER SUBMITTED THAT RS . 50,000/- HAS BEEN INTRODUCED IN THE CAPITAL ACCOUNT FROM THE SAVING ACCOUNT NUMBER 6010007210393 WITH STATE BANK OF INDIA, AGGAR NAGAR, LUDHIANA ON 26.07.2012 FROM THE BALANCE OUTSTANDING IN HER SAVING ACCOUNT. THE PHOTOCOPY OF BANK SAVING ACCOUNT IS PLACED IN THE PAPER BOOK AT PAGE NUMBER 7 WHICH MAY PLEASE BE REFERRED. IT MAY BE MENTIONED HERE THAT THE A.O. IN HIS REMAND RE PORT HAS MENTIONED THAT THE AMOUNT OF RS. 20.50,000/- HAS BEEN RECEIVED FRO M NRE SAVING ACCOUNT OF SH. PUNEET GUPTA BUT THE CORRECT FACTS ARE THAT RS. 20, 00,000/- WAS RECEIVED FROM NRE SAVING ACCOUNT BY THE PARTNER SMT. SWARANKANTA. THE ONLY ALLEGATION MADE BY THE A.O. IN HIS REMAND R EPORT THAT THE SOURCE OF INCOME OF SH. PUNEET GUPTA WAS NOT PRODUCED BEFO RE THE THEN A.O. IN THIS CONNECTION IT IS SUBMITTED THAT HE IS WORKING IN U. K. AND SH. PUNEET GUPTA HAS TRANSFERRED THE FUNDS FROM U.K. IN HIS SAVING ACCOU NT AND THEREAFTER HE HAS 5 TRANSFERRED THROUGH RTGS TO SAVING ACCOUNT OF SMT. SWARANKANTA. THE AMOUNTS ARE TRANSFERRED TO STATE BANK OF INDIA IN HER SAVIN G ACCOUNT. FROM THE SAVING ACCOUNT OF STATE BANK OF INDIA THE AMOUNTS WERE TRA NSFERRED THROUGH CHEQUES TO THE FIRM FOR WHICH THE COMPLETE DETAILS HAVE BEEN G IVEN IN THE WRITTEN SUBMISSIONS AND THE PHOTOCOPY OF SAVING ACCOUNT MAI NTAINED WITH STATE BANK OF INDIA IS PLACED IN PAPER BOOK AT PAGE NUMBER 7 AND SAVING ACCOUNT OF SH. PUNEET GUPTA NRE IS PLACED IN THE PAPER BOOK AT PAG E NUMBER 8. THE ASSESSEE HAS GIVEN THE SOURCE OF SOURCE FOR THE ADDITIONS IN THE CAPITAL ACCOUNT OF SWARANKANTA ALONG WITH DOCUMENTARY EVIDENCES OF BAN K ACCOUNTS FOR WHICH THE A.O. HAS NOT GIVEN ANY ADVERSE REMARKS. THE A.O. HAS SIMPLY STATED THAT THE INCOME OF SH. PUNEET GUPTA WHO IS SON OF SMT. SWARA NKANTA AND LIVING AND WORKING IN U.K. HAS SENT THE MONEY FROM U.K. IN HIS NRE ACCOUNT. THE SAID AMOUNTS OF RS. 20,00,000/- FOR WHICH DETAILS HAVE ALREADY B EEN GIVEN ABOVE WERE TRANSFERRED THROUGH RTGS TO THE SAVING ACCOUNT OF H ER MOTHER FROM WHERE SHE HAS GIVEN AMOUNTS TO THE FIRM. THE CREDITS ARE FULLY EX PLAINED IN THIS CASE, THE CORRECT AMOUNT RECEIVED FROM NRE PUNEET GUPTA IS RS. 20,00, 000 NOT 20,50,000/- AS ASSUMED BY THE A.O. IN HIS REMAND REPORT. IT IS ALSO IMPORTANT TO MENTION HERE THAT SMT. SWARANKANTA IS BEING ASSESSED SEPARATELY AND S HE IS FILING SEPARATE RETURN OF INCOME FOR EACH ASSESSMENT YEAR. IT IS IMPORTANT TO MENTION HERE THAT THE A. O. ISSUE D THE NOTICE TO THE ASSESSEE FOR CLARIFICATION OF WRITTEN SUBMISSION GIVEN BY THE AS SESSEE VIDE LETTER NO.ITO/WARD(2)/LDH/1718/485 DATED 13.10.2017 AND LE TTER NO. ITO/WARD(2)/LDH/1718/540 DATED 13.11.2017 AND THE UN DERSIGNED ATTENDED AND CLARIFIED EACH AND EVERY ISSUE ON THE ISSUE OF INTR ODUCTION OF CAPITAL BY PARTNER SMT. SWARANKANTA. THE PHOTOCOPIES OF THE ENQUIRIES LETTER ISSUED BY THE A.O. ARE ALSO ATTACHED FOR YOUR KIND REFERENCE. THE A.O. HAS NOT UTTERED A SINGLE WORD ABOUT THE AMOUNTS RECEIVED BY SMT. SWARANKANTA FROM HER SON WHO IS LIVING AND WORKING IN U.K. AND HAS TRANSFERRED THE FUNDS THROU GH RTGS FROM HIS NRE ACCOUNT. THE ASSESSEE HAS GIVEN HIM ALL THE CLARIFICATIONS O F THE AMOUNTS RECEIVED FROM HER SON FROM HIS NRE ACCOUNT WHICH ITSELF PROVES OF SOU RCE ALSO. IN VIEW OF THE ABOVE FACTS IT IS REQUESTED AND PRAYED TO DELETED THE ADD ITION OF RS. 20,50,000/- IN THE HANDS OF THE FIRM UNDER THE WRONG NOTION OF LAW. 5.3 IT WAS FURTHER SUBMITTED AS UNDER: WRITTEN SUBMISSIONS DATED 12.02.2018 SH. PUNEET GUPTA, NRE HAS ALSO GIVEN THE FOLLOWING DOCUMENTS TO PROVE THAT THE AMOUNTS WERE SENT BY HIM FROM RELATION FOREIGN EXCH ANGE DEPARTMENT BEING CONFIRMATION OF TRANSACTIONS DONE BY SH. PUNEET GUP TA AND THE COMPLETE DETAILS ARE BEING GIVEN AS UNDER: A) THE FIRST TRANSACTION IS DATED 26.06.2012 OF 9000 G BP AND THE CONVERSION RATE IS 88.45 AND INDIAN RUPEES 796050 WHICH WAS TRANSFERRE D BY SH. PUNEET GUPTA, NRE FROM LONDON, BARCLAYS BANK, PLC, CANARY WHARF, LOND ON AS PER PHOTOCOPY OF THE DOCUMENT ATTACHED. B) THE SECOND TRANSACTION IS DATED 06.08.2012 OF 14000 GBP AND THE CONVERSION RATE IS 85.80 AND INDIAN RUPEES 1201200 WHICH WAS T RANSFERRED BY SH. PUNEET 6 GUPTA, NRE FROM LONDON, BARCLAYS BANK, PLC, CANARY WHARF, LONDON AS PER PHOTOCOPY OF THE DOCUMENT ATTACHED. C) THE NEXT TRANSACTION IS DATED 24.10.2012 OF 14000 G BP AND THE CONVERSION RATE IS 85.55 AND INDIAN RUPEES 1197700 WHICH WAS TRANSF ERRED BY SH. PUNEET GUPTA, NRE FROM LONDON, BARCLAYS BANK, PLC, CANARY WHARF, LONDON AS PER PHOTOCOPY OF THE DOCUMENT ATTACHED. D) THE NEXT TRANSACTION IS DATED 12.11.2012 OF 14000 G BP AND THE CONVERSION RATE IS 87.05 AND INDIAN RUPEES 1218700 WHICH WAS TRANSF ERRED BY SH. PUNEET GUPTA, NRE FROM LONDON, BARCLAYS BANK, PLC, CANARY WHARF, LONDON AS PER PHOTOCOPY OF THE DOCUMENT ATTACHED. E) THE NEXT TRANSACTION IS DATED 26.03.2013FOR RS. 123 1500 BEING SWIFT MESSAGE OF BARCLAYS CORPORATE IN WHICH THERE IS A MENTION THE NAME OF SH. PUNEET GUPTA AND THE PURPOSE MENTIONED IS GIFT TO FAMILY. THIS T RANSACTION IS DONE THROUGH RATIONAL FOREIGN EXCHANGE LIMITED, HOLLAND HOUSE, B URY STREET. LONDON AS PER PHOTOCOPY OF THE DOCUMENT ATTACHED. YOUR HONOR WILL FIND THAT ALL THE TRANSACTION HAD B EEN DONE FROM LONDON BY SH. PUNEET GUPTA WHO IS SON OF SMT. SWARANKANTA JAIN AN D BROTHER OF SH. ANKUSH GUPTA. THE ABOVE AMOUNTS HAVE BEEN TRANSFERRED BY SH. PUNE ET GUPTA IN HIS SAVINGS ACCOUNT BEING MAINTAINED WITH CITI BANK AND OUT OF THESE TRANSACTIONS THE AMOUNTS WERE TRANSFERRED THROUGH RTGS/CHEQUES TO HE R MOTHER AND HIS BROTHER. THIS WILL AGAIN PROVE THAT THE AMOUNTS HAD BEEN REC EIVED BY SH. PUNEET GUPTA FROM LONDON FROM THE ACCOUNTS MAINTAINED BY HIM AT LONDON WITH BANK. WRITTEN SUBMISSIONS DATED22.02.2018 THE FOLLOWING DOCUMENTS ARE ATTACHED: 1. THE COPY OF BANK STATEMENT WITH BARCLAYS BANK IN THE NAME OF SH. PUNEET GUPTA. IN THIS STATEMENT ON 26.06.2012, 9000 GBP WE RE TRANSFERRED TO RATIONAL FOREIGN EXCHANGE (FX) DEPARTMENT FOR TRANSFER OF AM OUNT OF RS. 796050/- IN HIS NRE ACCOUNT MAINTAINED IN INDIA. 2. THE COPY OF BANK STATEMENT WITH HSBC BANK OF RAD HAKRISH FINANCIALS, LONDON IN WHICH MR. PUNEET GUPTA WAS DIRECTOR HAVIN G 100% SHARE HOLDING IN THE COMPANY AS PER PHOTOCOPY OF THE LETTER DATED 29.05. 2014 ISSUED BY U.K. MANAGEMENT ACCOUNTANCY IS ATTACHED. FURTHER THE COM PANY INFORMATION FOR COMPANY NO.07102184 SHOWING THE DETAILS OF OFFICERS OF THE COMPANY HAVE ALSO BEEN ATTACHED. IN THIS STATEMENT ON 06.08.2012, 140 00 GBP WERE TRANSFERRED TO RATIONAL FOREIGN EXCHANGE (FX) DEPARTMENT FOR TRANS FER OF AMOUNT OF RS. 1201200/- IN HIS NRE ACCOUNT MAINTAINED IN INDIA. 3. THE COPY OF BANK STATEMENT WITH BARCLAYS BANK IN THE NAME OF SH. PUNEET GUPTA. IN THIS STATEMENT ON 24.10.2012, 14000 GBP W ERE TRANSFERRED TO RATIONAL FOREIGN EXCHANGE (FX) DEPARTMENT FOR TRANSFER OF AM OUNT OF RS. 1197700/- IN HIS NRE ACCOUNT MAINTAINED IN INDIA. 7 4. THE COPY OF BANK STATEMENT WITH BARCLAYS BANK IN THE NAME OF SH. PUNEET GUPTA. IN THIS STATEMENT ON 12.11.2012, 14000 GBP W ERE TRANSFERRED TO RATIONAL FOREIGN EXCHANGE (FX) DEPARTMENT FOR TRANSFER OF AM OUNT OF RS. 1218700/- IN HIS NRE ACCOUNT MAINTAINED IN INDIA. 5. THE COPY OF BANK STATEMENT WITH BARCLAYS BANK IN THE NAME OF SH. PUNEET GUPTA. IN THIS STATEMENT ON 22.03.2013, 15000 GBP W ERE TRANSFERRED TO RATIONAL FOREIGN EXCHANGE (FX) DEPARTMENT FOR TRANSFER OF AM OUNT OF RS.1231500/- IN HIS NRE ACCOUNT MAINTAINED IN INDIA. THE DOCUMENTS ARE BEING ATTACHED AND YOUR HONOR WIL L FIND THAT ALL THE TRANSACTIONS WERE CARRIED OUT BY SH. PUNEET GUPTA F ROM HIS BANK ACCOUNTS OR THROUGH HIS COMPANY IN WHICH HE WAS HAVING 100% SHA RE HOLDING. THESE BANK STATEMENTS WERE RECEIVED BY SH. PUNEET GUPTA THROUG H BARCLAY BANK ON 13.02.2018 AS PER COPIES OF BANK STATEMENTS RECEIVE D THROUGH EMAIL BY THE FAMILY MEMBERS OF SH. PUNEET GUPTA. THIS PROVES THE SOURCE OF SOURCE. IT IS REQUESTED AND PRAYED TO ACCEPT THE CONTENTION OF THE ASSESSEE SINCE THE COMPLETE SOURCE OF SOURCE HAS BEEN ESTABLISHED AND EVEN THE FUNDS H AVE BEEN TRANSFERRED FROM U.K. FROM THE BANK ACCOUNTS OF SH. PUNEET GUPTA. 6. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE DELETED THE IMPUGNED ADDITION BY OBSERVING IN PARA 6.5 OF T HE IMPUGNED ORDER AS UNDER: 6.5 I HAVE CONSIDERED THE OBSERVATIONS OF THE ASSES SING OFFICER AS MADE BY HIM/HER IN THE ASSESSMENT ORDER WHILE MAKING THE IM PUGNED ADDITION AS WELL AS IN THE REMAND REPORT. I HAVE ALSO CONSIDERED WRITTEN S UBMISSIONS FILED BY THE ASSESSEE FIRM THROUGH ITS LEARNED AR VIDE LETTERS D ATED 26.09.2017, 12.02.2018 AND 22.02.2018 ON THE ISSUE UNDER REFERENCE AS WELL AS COUNTER COMMENTS OF THE ASSESSEE FIRM IN CONNECTION WITH THE REMAND REPORT OF THE ASSESSING OFFICER. I HAVE FURTHER CONSIDERED OTHER MATERIAL PLACED BY TH E LEARNED AR OF THE ASSESSEE ON RECORD. ON CAREFUL CONSIDERATION OF THE ASSESSMEN T ORDER, IT HAS BEEN NOTICED THAT THE ASSESSING OFFICER HAS MADE THE IMPUGNED ADD ITION AS THE ASSESSEE FIRM IN THE OPINION OF THE ASSESSING OFFICER COULD NOT E XPLAIN THE SOURCE OF ADDITIONS TO THE CAPITAL ACCOUNT OF SMT. SWARNKANTA, PARTNER. ON THE OTHER HAND, THE LEARNED AR OF THE ASSESSEE HAD SUBMITTED THAT SMT. SWARNKAN TA, PARTNER RECEIVED AN AMOUNT OF RS.20,00,000/- FROM HIS SON SH. PUNEET GU PTA WHO IS NRI AND IS PRESENTLY SETTLED IN UK. IT HAS ALSO BEEN SUBMITTED THAT SH. PUNEET GUPTA HAS GIVEN THIS AMOUNT TO HIS MOTHER THROUGH HIS NRE ACCOUNT MAINTA INED BY HIM WITH CITY BANK, FEROZE GANDHI MARKET, LUDHIANA. IN SUPPORT OF HIS C ONTENTION, THE LEARNED AR OF THE ASSESSEE HAS ALSO ENCLOSED COPY OF NRE SAVING B ANK ACCOUNT OF SH. PUNEET GUPTA. IT HAS FURTHER BEEN SUBMITTED THAT AN AMOUNT OF RS.8,00,000/- HAS BEEN TRANSFERRED IN THE SAVING BANK ACCOUNT BEARING NO. 00000010007210393 OF SMT. SWARNKANTA MAINTAINED BY HER WITH SBI, AGAR NAGAR, LUDHIANA BY SH. PUNEET GUPTA THROUGH RTGS AND THE SAME WAS INTRODUCED IN H ER CAPITAL ACCOUNT ON 29.06.2012 AS CAPITAL IN THE ASSESSEE FIRM. IT HAS AGAIN BEEN SUBMITTED THAT AN AMOUNT OF RS. 12,00,000/- HAS AGAIN BEEN TRANSFERRE D IN THE SAVING BANK ACCOUNT BEARING NO. 00000010007210393 OF SMT. SWARNKANTA MA INTAINED BY HER WITH SBI. AGAR NAGAR. LUDHIANA BY SH. PUNEET GUPTA THROUGH RT GS ON 11.08.2012 AND THE 8 SAME WAS ALSO INTRODUCED IN HER CAPITAL ACCOUNT ON 11.08.2012 (RS.7,00,000/-) AND 13.08.2012 (RS.5,00,000/-) AS CAPITAL IN THE AS SESSEE FIRM. IT WAS AGAIN SUBMITTED THAT AN AMOUNT OF RS.50,000/- WAS AGAIN I NTRODUCED AS CAPITAL ON 26.07.2012 OUT OF OUTSTANDING BALANCE IN THE BANK A CCOUNT OF SMT. SWARNKANTA. IT HAS AGAIN BEEN SUBMITTED THAT THE ASSESSEE FIRM HAS GIVEN COMPLETE EXPLANATION TO THE ASSESSING OFFICER ALONG WITH DOCUMENTARY EVID ENCE BUT THE ASSESSING OFFICER HAS MADE IMPUGNED ADDITION IN THE HANDS OF T HE ASSESSEE FIRM WITHOUT CONSIDERING THE FACT THAT THE AMOUNT BELONGS TO SMT . SWARNKANTA AND IF AT ALL ANY ADDITION WAS TO BE MADE IT SHOULD HAVE BEEN MADE IN THE HANDS OF SMT. SWARNKANTA. IT HAS AGAIN BEEN SUBMITTED THAT THE AS SESSING OFFICER HAS NOT GIVEN ANY SHOW CAUSE NOTICE BEFORE MAKING THE ADDITION UN DER REFERENCE WHICH VIOLATES THE PRINCIPLES OF NATURAL JUSTICE. ON CAREF UL CONSIDERATION OF THE RIVAL CONTENTIONS, I AM OF THE OPINION THAT THE ASSESSEE FIRM HAS EXPLAINED EVEN THE SOURCE OF SOURCE IN RESPECT OF THE CAPITAL INTRODUC ED IN THE CAPITAL ACCOUNT OF SMT. SWARNKANTA BY PRODUCING COPY OF NRE ACCOUNT OF SH. PUNEET GUPTA. ON PERUSAL OF THE BANK ACCOUNTS OF SH. PUNEET GUPTA AN D SMT. SWARNKANTA, I AM CONVINCED THAT THE CAPITAL HAS BEEN INTRODUCED BY S MT. SWARNKANTA OUT OF EXPLAINED SOURCES. WHEN ASKED TO PROVE THE SOURCE O F SH. PUNEET GUPTA, THE LEARNED AR OF THE ASSESSEE ALSO PLACED ON RECORD TH E DOCUMENTS WHICH PROVE BEYOND DOUBT THAT THE AMOUNT IN HIS NRI ACCOUNT HAS BEEN TRANSFERRED BY SH. PUNEET GUPTA FROM HIS OWN EXPLAINED SOURCES AND THA T TOO IN POUNDS. UNDER SUCH CIRCUMSTANCES, THE ACTION OF THE ASSESSING OFFICER I N MAKING AN ADDITION OF RS.20,50,000/- ON ACCOUNT OF UNEXPLAINED CREDITS IN THE CAPITAL ACCOUNT OF SMT. SWARNKANTA, PARTNER CANNOT BE SAID TO BE JUSTIFIED AND AS SUCH THE ADDITION OF RS.20,50,000/- MADE BY THE ASSESSING OFFICER IN THIS CASE ON ACCOUNT OF UNEXPLAINED CREDITS IN THE CAPITAL ACCOUNT OF SMT. SWARNKANTA, PARTNER IS, THEREFORE, DIRECTED TO BE DELETED. IN THE RESULT, T HE GROUNDS NO. 2 AND 3 OF APPEAL TAKEN BY THE ASSESSEE FIRM ARE ALLOWED. 7. NOW THE DEPARTMENT IS IN APPEAL. 8. LD. CIT DR STRONGLY SUPPORTED THE ASSESSMENT ORD ER PASSED BY THE A.O. AND FURTHER SUBMITTED THAT THE ASSESSEE DID NOT PRO DUCE ANY EVIDENCE RELATING TO THE CREDIT IN THE PARTNER CAPITAL ACCOUNT, THERE FORE THE ADDITION OF RS. 20,50,000/- WAS RIGHTLY MADE IN THE HANDS OF THE AS SESSEE AND THE LD. CIT(A) WAS NOT JUSTIFIED IN DELETING THE SAME. 9. IN HIS RIVAL SUBMISSIONS THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT(A) AND FURTHER SUBMITTED THAT THE ASSESSEE EXPLAINED THE SOURCE FOR DEPOSITING THE AMOUNT IN P ARTNERS CAPITAL ACCOUNT. IT WAS FURTHER SUBMITTED THAT NO ADDITION IN THE HANDS OF THE FIRM WAS CALLED FOR ON ACCOUNT OF DEPOSIT IN THE PARTNERS CAPITAL ACCOUNT WHEN THE SOURCE OF THAT DEPOSIT WAS FULLY EXPLAINED. THE RELIANCE WAS PLACE D ON THE FOLLOWING CASE LAWS: 9 ITO VS. NAHAR SINGH SADHU SINGH [2001] 253 ITR 471( P&H) CIT VS. METACHEM INDUSTRIES [1999] 245 ITR 160 (M.P .) 10. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT IS NOTICED THAT THE ASSESSEE EXPLAINED THE SOURCE OF THE PARTNER SMT. S WARAN KANTA FOR DEPOSITING THE AMOUNT OF RS. 20,50,000/- IN THE CAPITAL ACCOUN T. THE SAID AMOUNT WAS RECEIVED BY THE PARTNER FROM HER SON SHRI PUNEET GU PTA WHO IS NRI, THE TRANSACTION WAS THROUGH BANKING CHANNEL OUT OF THE NRE SAVING BANK ACCOUNT OF SHRI PUNEET GUPTA, THEREFORE THE ADDITION MADE B Y THE A.O. WAS NOT JUSTIFIED. MOREOVER THE AMOUNT WAS RECEIVED BY THE ASSESSEE FI RM FROM THE PARTNER WHO EXPLAINED THE SOURCE FOR THE SAME AND IF AT ALL ANY ADDITION WAS CALLED FOR THAT WAS REQUIRED TO BE MADE IN THE HANDS OF THE PARTNER AND NOT IN THE HANDS OF ASSESSEE FIRM. ON AN IDENTICAL ISSUE THE HON'BLE JU RISDICTION HIGH COURT IN THE CASE OF ITO VS. NAHAR SINGH SADHU SINGH (SUPRA) HEL D THAT THE PARTNER HAD THE REQUISITE AMOUNT TO INVEST TOWARDS THE CAPITAL ACCO UNT OF THE FIRM. SINCE NO EVIDENCE HAD BEEN POINTED OUT AGAINST THAT FINDING THE AMOUNT COULD NOT BE ASSESSED AS INCOME FROM UNDISCLOSED SOURCES OF THE FIRM. 10.1 SIMILARLY THE HON'BLE M.P HIGH COURT IN THE CA SE OF CIT VS. METACHEM INDUSTRIES (SUPRA) HELD AS UNDER: ONCE IT IS ESTABLISHED THAT THE AMOUNT HAS BEEN I NVESTED BY A PARTICULAR PERSON, BE HE A PARTNER OR AN INDIVIDUAL , THEN THE RESPONSIBILITY OF THE ASSESSEE IS OVER. WHETHER THA T PERSON IS AN INCOME-TAX PAYER OR NOT AND WHERE HE HAD BROUGHT TH IS MONEY FROM, IS NOT THE RESPONSIBILITY OF THE FIRM. THE MO MENT THE FIRM GIVES A SATISFACTORY EXPLANATION AND PRODUCES THE PERSON WH O HAS DEPOSITED THE AMOUNT, THEN THE BURDEN OF THE FIRM I S DISCHARGED AND IN THAT CASE THAT CREDIT ENTRY CANNOT BE TREATE D TO BE THE INCOME OF THE FIRM FOR THE PURPOSES OF INCOME-TAX. 10 11. WE THEREFORE BY KEEPING IN VIEW THE AFORESAID D ISCUSSION AND THE RATIO LAID DOWN BY THE HON'BLE HIGH COURTS IN THE AFORESA ID REFERRED TO CASES ARE OF THE VIEW THAT THE IMPUGNED ADDITION WAS RIGHTLY DEL ETED BY THE LD. CIT(A). 12. THE NEXT ISSUE VIDE GROUND NO. (II) RELATES TO THE DELETION OF ADDITION OF RS. 40,50,000/- MADE BY THE A.O. ON ACCOUNT OF AMOUNT R ECEIVED FROM SHRI ANKUSH GUPTA. 13. THE FACTS RELATED TO THIS ISSUE IN BRIEF ARE TH AT THE A.O. DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE HA D RECEIVED A SUM OF RS. 41,50,000/- FROM ONE SHRI ANKUSH GUPTA AS PER FOLLO WING DETAILS : SR. NO. DATE AMOUNT 1 09/05/2015 1,00,000 2 31/10/2012 6,00,000 3 31/10/2012 4,00,000 4 15/11/2012 4,50,000 5 15/11/2012 5,50,000 6 19/11/2012 6,00,000 7 19/11/2012 4,00,000 8 21/11/2012 1,50,000 9 20/12/2012 7,00,000 10 28/12/2012 2,00,000 13.1 HE ASKED THE ASSESSEE TO FURNISH THE EVIDENCE OF SOURCE OF THOSE AMOUNT. THE ASSESSEE SUBMITTED COPY OF THE BANK ACCOUNT FRO M WHERE THE CHEQUES WERE ISSUED TO THE ASSESSEE ON THE FOLLOWING DATES: SR. NO. DATE AMOUNT 1 31/10/2012 10,00,000 2 14/11/2012 4,50,000 3 14/11/2012 1,50,000 4 14/11/2012 4,00,000 5 19/11/2012 11,50,000 11 13.2 THE A.O. AGAIN ASKED THE ASSESSEE TO FILE THE SOURCE OF CORRESPONDING DEPOSITS IN THE BANK ACCOUNT. IN RESPONSE THE ASSES SEE SUBMITTED AS UNDER: 'THE CREDIT APPEARING AT RS. 10,00,000/- DATED 31.1 0.2012 WAS RECEIVED BY ANKUSH GUPTA FROM HIS BROTHER PUNEET GUPTA . RS 1,50,000/- AND RS. 4,00,000/-DATED 14.11.2012 HAVE BEEN RECEIVED FROM SH. AAKASH BANSA L, BROTHER IN LAW , RS 11,50,000/- DATED 19.11.2012 HAS BEEN RECEIVED FROM HIS BROTHER SH. PUNEET GUPTA . FURTHER RS. 7,00,000/- DATED 20.12.2012 HAS BEEN GIVEN BY ANKUSH GUPTA TO SWARAN FASTNER . FURTHER RS. 2,00,000/- IS THE C ORRECT FIGURE INSTEAD OF RS 8,00,000/- AND THE CORRECT DATE IS 28.12.2012 INSTE AD OF23.12.2012 WHICH HAS ALSO BEEN GIVEN TO SWAM FASTNERS. ' 13.3 THE A.O. HOWEVER WAS NOT SATISFIED FROM THE SU BMISSIONS OF THE ASSESSEE AND MADE THE ADDITION OF RS. 40,50,000/- BY OBSERVI NG AS UNDER: I HAVE CONSIDERED THE REPLY OF THE ASSESSEE . HE HA S STATED THAT THE CREDITOR RECEIVED THE AMOUNTS FROM PUNEET GUPTA AND AAKASH B ANSAL , BUT NO EVIDENCE FOR THE SAME IS FILED. FURTHER NO SOURCE OF AMOUNTS OF RS. 7,00,000/- AND 2,00,000/- DEPOSITED ON 20.12.2012 AND 28.12.2012 HAS BEEN FIL ED. THE ASSESSEE, VIDE QUESTIONNAIRE DATED 9.03.2016 WAS AGAIN ASKED TO PR ODUCE EVIDENCE OF SOURCES OF AMOUNTS ADVANCED BY SH. ANKUSH GUPTA, BUT AGAIN THE SAME WERE NOT FILED. THE ASSESSEE SIMPLY STATED VIDE REPLY DATED 14.03.2 016 THAT THE SAME WERE ALREADY FILED ON 17.11.2015 ( WRONGLY MENTIONED AS 17.11.2015 IN PLACE OF 27.11.2015) WHEREAS IN THAT REPLY NO EVIDENCE IS FI LED. AS SUCH THE SOURCE OF AMOUNT OF RS. 40,50,000/-IS NOT PROVED. ACCORDINGLY CREDIT OF RS. 40,50,000/- IN THE BOOKS OF THE ASSESSEE, IN THE NAME OF SH. ANKUSH GU PTA IS TREATED AS NOT EXPLAINED AND THUS TREATED AS INCOME OF THE ASSESSE E. 14. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED AS UNDER: THE SECOND GROUND OF APPEAL IS THAT THE A.O. HAS MAD E ADDITION ON ACCOUNT OF RS. 4050000/- RECEIVED FROM SH. ANKUSH GUPTA WHO IS SON OF SMT. SWARANKANTA AND KUSHAL GUPTA. HE IS ALSO BROTHER OF SH. PUNEET GUPTA. THE ASSESSEE HAS GIVEN COMPLETE REPLY ON THIS ISSUE ON 27.11.2015 AND AGAI N THE SAME WAS MENTIONED ON 14.03.2016, PHOTOCOPY OF THE REPLY IS ATTACHED IN THE PAPER BOOK AT PAGE NO.4 AND 5. FURTHER YOUR KIND ATTENTION IS INVITED TO THE ORDER SHEET ENTRIES WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE NO.L TO 3 . YOUR HONOR WILL FIND THAT IN THE ORDER SHEET ENTRIES, THE PROCEEDINGS WERE START ED ON 23.12.2015 AND THE LAST PROCEEDINGS ARE DATED ON 19.02.2016 ON WHICH DATE T HE CASE WAS ADJOURNED TO 26.02.2016. FROM THE ORDER SHEET ENTRIES YOUR HONOR WILL FIND THAT NO SHOW CAUSE NOTICE HAS BEEN ISSUED TO THE ASSESSEE BEFORE MAKIN G ANY ADDITIONS ON ACCOUNTS OF UNEXPLAINED CREDITS IN THE NAME OF SH. ANKUSH GU PTA WHICH VIOLATES THE PRINCIPLES OF NATURAL JUSTICE AND ADDITIONS BASED O N THIS ISSUE SHOULD BE DELETED AND ASSESSMENT SHOULD BE QUASHED. THE REPLY ON MERI TS IS BEING SUBMITTED AS UNDER: 12 A) YOUR KIND ATTENTION IS INVITED TO PAPER BOOK PAG E 10 WHICH IS SAVING ACCOUNT OF ANKUSH GUPTA. THE AMOUNT OF RS.30513.39 AND RS.2 6499.29 WAS RECEIVED ON 26.04.2012 FROM THE SALE/MATURITY OF MUTUAL FUNDS. FURTHER AMOUNT OF RS.31260.15 DATED 30.04.2012 AND AMOUNT OF RS.31586.79 DATED 07 .05.2012 WERE ALSO RECEIVED ON SALE/MATURITY OF MUTUAL FUNDS. THERE WA S A BALANCE OF RS.197250.85 ON 07.05.2012 IN THE SAVING ACCOUNT OUT OF WHICH AM OUNT OF RS. 100000/- WAS GIVEN TO SWARANFASTNERS. THIS AMOUNT IS MENTIONED O N PAPER BOOK PAGE NO. 10. FURTHER THE RECEIPT OF RS.10 LAKH FROM SH. PUNEET G UPTA, HIS REAL BROTHER FROM HIS BROTHER'S NRE SAVING ACCOUNT. THE COPY OF NRE SAVIN G ACCOUNT IS PLACED IN THE PAPER BOOK PAGE NO. 16 TO 18. THE AMOUNT OF RS.10 L AKH IS MENTIONED IN THE SAVING ACCOUNT OF SH. PUNEET GUPTA IN THE PAPER BOO K PAGE 17 BEING MAINTAINED WITH C1TI BANK. THE AMOUNT WAS RECEIVED BY SH. ANKUSH GUPTA THROUGH RTGS. OUT OF WHICH RS.4 LAKH WAS GIVEN BY S H. ANKUSH GUPTA ON 31.10.2012 AND THE AMOUNT OF RS.6 LAKH WAS GIVEN TO SWARANFASTNERS ON 01.11.2012. THESE FACTS CAN BE VERIFIED FROM THE PA PER BOOK PAGE NO. 12 BEING SAVING ACCOUNT WITH STATE BANK OF INDIA OF SH. ANKU SH GUPTA. SH. ANKUSH GUPTA FURTHER RECEIVED THE AMOUNT OF, RS. 4 LAKH, RS.1.50 LAKH, RS.4 LAKH FROM SH. AKASHBANSAL ON 14.11.2012. THE SAVING ACCOUNTS OF S H. AKASHBANSAL WITH STATE BANK OF INDIA, ACCOUNT NO.30784612826, (JAITU) FARI DKOT FROM WHERE THE AMOUNT OF RS. 1.50 LAKH WAS RECEIVED BY SH. ANKUSH GUPTA. THE SAVING PASSBOOK IS PLACED IN THE PAPER BOOK PAGE NO. 19 AND 20. FURTHER SH. A KASHBANSAL IS ALSO MAINTAINING SAVING BANK ACCOUNT NO.30343633939 WITH STATE BANK OF INDIA, JAITU (FARDKOT) AND THIS SAVING ACCOUNT IS PLACED AT PAPER BOOK PAG E NO. 21 AND 22. FROM THE SAVING ACCOUNT OF SH. AKASHBANSAL, THE AMOUNT OF RS .4 LAKH WAS RECEIVED BY SH. ANKUSH GUPTA IN THE SAVING ACCOUNT AND THIS AMOUNT IS REFLECTED IN THE SAVING ACCOUNT OF SH. ANKUSH GUPTA AT PAPER BOOK PAGE NO. 12. FURTHER SH. AKASH BANSAL IS MAINTAINING SAVING ACCOUNT WITH HSBC BAN K, GURGAON FROM WHERE HE GAVE AMOUNT OF RS.450000/- TO ANKUSH GUPTA. SH. AKA SHBANSAL IS HIS COUSIN BROTHER. OUT OF THESE AMOUNTS RS. 550000/-AND RS.450 000/- WAS GIVEN TO SWARANFASTNERS ON 15.11.2012 AND THESE ENTRIES ARE REFLECTED IN THE SAVING BANK ACCOUNT IN PAPER BOOK PAGE NO. 12 AND 13. SH. ANKUS H GUPTA FURTHER RECEIVED AMOUNT OF RS. 1150000/- FROM HIS BROTHER SH. PUNEET GUPTA ON 19.11.2012, RS.2 LAKH ON 08.12.2012 AND RS. 50000/- ON 11.12.2012 AN D FURTHER AMOUNT OF RS.8 LAKH WAS RECEIVED FROM SH. PUNEET GUPTA ON 30.03.2013. A LL THESE ENTRIES ARE REFLECTED IN THE SAVING BANK ACCOUNT IN PAPER BOOK PAGE NO. 1 8. OUT OF RS. 1150000/- RS. 6 LAKH AND RS.4 LAKH WAS GIVEN TO SWARANFASTNERS ON 1 9.11.2012. FURTHER AMOUNT OF RS.150000/- WAS GIVEN ON 21.11.2012. THESE ENTRIES ARE REFLECTED IN PAPER BOOK PAGE NO.13 IN THE SAVING ACCOUNT WITH SBI. FURTHER THE AMOUNT OF RS.200000/- DATED 08.12.2012, 50000/- ON 11.12.2012 AND RS.8000 00/- DATED 30.03.2013 WERE RECEIVED BY SH. ANKUSH GUPTA IN THE SAVING ACCOUNT WITH AXIS BANK AND THIS SAVING BANK ACCOUNT STATEMENT IS PLACED IN THE PAPE R BOOK PAGE NO. 15. FURTHER THE AMOUNTS RECEIVED FROM SWARANFASTNERS ARE ALSO I NDICATED IN THE SAVING ACCOUNT WITH AXIS BANK AND THIS SAVING BANK ACCOUNT WITH AXIS BANK IS PLACED IN THE PAPER BOOK PAGE NO. 15. IT IS IMPORTANT TO MENT ION HERE THAT THE AMOUNT OF RS. 1050000/- DATED 11.12.2012 WAS RECEIVED BY SH. ANKUSH GUPTA AGAINST THE SALE OF IMMOVABLE PROPERTY AND THE PHOTOCOPY OF THE REGISTRATION DEED ALONG WITH PHOTOCOPIES OF THE CHEQUE IS PLACED IN THE PAP ER BOOK PAGE NO.24 TO 29 WHICH IS THE PHOTOCOPY OF THE CHEQUE RECEIVED FROM SALE OF PROPERTY. THE PHOTOCOPY OF THE REGISTRATION DEED WHICH IS PLACED IN THE PAPER BOOK PAGE NO. 25 TO 27. THE PHOTOCOPY OF THE POWER OF ATTORNEY WH ICH IS PLACED IN THE PAPER BOOK PAGE NO.28 TO29. THE PHOTOCOPY OF THE RETURN O F INCOME ALONG WITH COMPUTATION CHART IS PLACED IN THE PAPER BOOK PAGE NO. 30 TO 32 TO PROVE THE 13 CONTENTION AND THIS AMOUNT WAS RECEIVED IN THE AXIS BANK WHICH IS PLACED IN THE PAPER BOOK PAGE 15. B) FURTHER YOUR KIND ATTENTION IS INVITED TO THE OR DER SHEET ENTRIES WHICH HAS BEEN PLACED IN THE PAPER BOOK AT PAGE NO. 1 TO 3. YOUR H ONOR WILL FIND THAT IN THE ORDER SHEET ENTRIES, THE PROCEEDINGS WERE STARTED ON 23.1 2.2015 AND THE LAST PROCEEDINGS ARE DATED ON 19.02.2016 ON WHICH DATE T HE CASE WAS ADJOURNED TO 26.02.2016. FROM THE ORDER SHEET ENTRIES YOUR HONOR WILL FIND THAT NO SHOW CAUSE NOTICE HAS BEEN ISSUED TO THE ASSESSEE BEFORE MAKIN G ANY ADDITIONS ON ACCOUNTS OF UNEXPLAINED CREDITS IN THE NAME OF SH. ANKUSH GU PTA WHICH VIOLATES THE PRINCIPLES OF NATURAL JUSTICE AND ADDITIONS BASED O N THIS ISSUE SHOULD BE DELETED AND ASSESSMENT SHOULD BE QUASHED. 2. THE ASSESSEE HAS DISCHARGE THE ONUS BY PRODUCING THE FOLLOWING DOCUMENTS IN THE CASE OF SMT. SWARANKANTA AND SH. ANKUSH GUPTA: A) THE CONFIRMED COPY OF ACCOUNT SHOWING THE COMPLETE NAMES AND ADDRESSES, PAN NO. OF THE PERSONS FROM WHOM THE LOA N HAS BEEN RECEIVED B) THE COPIES OF BANK STATEMENTS FROM WHERE THE AMOUNT S WERE RECEIVED BY THE ASSESSEE FIRM ALONG WITH EXPLANATION IN BRIEF. C) THE COMPLETE DETAILS WHERE THE ASSESSEES ARE BEING ASSESSED FROM WHOM THE LOANS HAVE BEEN RECEIVED. EVEN SMT. SWARANKANTA JAIN WAS BEING ASSESSED BY THE SAME A.O., HENCE ONCE THE ONUS IS DISCHARGED BY THE ASSESSEE IT BECOMES THE DUTY OF THE A.O. TO PROVE THAT THE AMOUN TS ARE IN- GENUINE. D) THE A. O. HAS NOT FURTHER GONE TO VERIFY THE AMOUNTS RECEIVED FROM SUCH PERSONS TO COME TO THE CONCLUSION THAT THESE AMOUNT S INTRODUCED AS CAPITAL OR UNSECURED LOANS FROM HIS SON, ANKUSH GUPTA ARE NOT GENUINE. RATHER HE SHOULD HAVE VERIFIED FROM THESE PERONS BY ISSUING NOTICE U /S 133(6) OR U/S 131(1) BEFORE MAKING ANY ADDITIONS IN THE RETURNED INCOME OF THE ASSESSEE'S FIRM. E) EVEN THE ORDER SHEET ENTRIES ARE UPTO 19.02.2015 WH ICH ITSELF PROVES THAT NO QUESTION WAS ASKED BY THE A.O. DURING THE PROCEED INGS BEFORE MAKING ANY ADDITIONS ON THIS ACCOUNT, HENCE IT CLEARLY INDICAT ES THAT THE ADDITIONS ON ACCOUNT OF PARTNER CAPITAL ACCOUNT TO THE TUNE OF R S.2050000/- AND UNSECURED LOANS TO THE TUNE OF RS. 4050000/- HAS BEEN MADE FO R THE SAKE OF ADDITIONS ON THE BASIS OF ASSUMPTION, PRESUMPTION, SUPPOSITION AND S USPICIOUS BASIS. THE A.O. HAS NOT BROUGHT ANY MATERIAL ON RECORD TO PROVE THAT TH E AMOUNT OF CAPITAL INTRODUCED OR UNSECURED LOANS RECEIVED FROM SH. ANK USH GUPTA ARE NOT GENUINE IN SPITE OF THE FACT THAT THE COMPLETE REPLIES ALON G WITH DOCUMENTARY EVIDENCES WERE GIVEN TO THE A.O. DURING THE PROCEEDINGS TO PRO VE THIS CONTENTION. 14.1 THE AFORESAID SUBMISSIONS RECEIVED FROM THE AS SESSEE WERE FORWARDED BY THE LD. CIT(A) TO THE A.O. FOR THE REMAND REPORT. I N RESPONSE THE A.O. SUBMITTED AS UNDER: 14 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED THAT THE ASSESSEE HAS RECEIVED AMOUNTS TOTALING TO RS. 41,50,000/- FR OM ONE SHRIANKUSH GUPTA ON VARIOUS DATES AS UNDER:- SR. NO. DATE AMOUNT 1. 09.05.2015 1,00,000/- 2. 31.10.2012 6,00,000/- 3. 31.10.2012 4,00,000/- 4. 15.11.2012 4,50,000/- 5. 15.11.2012 5,50,000/- 6. 19.11.2012 6,00,000/- 7. 19.11.2012 4,00,000/- 8. 21.11.2012 1,50,000/- 9. 20.12.2012 7,00,000/- 10. 28.12.2012 2,00,000/- THE ASSESSEE VIDE QUESTIONNAIRE DATED 06.11.2015 WA S ASKED TO FILE EVIDENCE OF SOURCE OF CORRESPONDING DEPOSITS IN THE BANK ACCOUN T OF THE CREDITOR I.E. SOURCE OF DEPOSITS IN THE BANK ACCOUNT OF ANKUSH GUPTA IN SBI. IN THIS REGARD, THE ASSESSEE FILED REPLY DATED 14.0 3.2016(COPY ENCLOSED), BUT NO COMPLETE DETAILS HAVE BEEN FILED. HENCE, CREDIT OF RS. 40,50,000/- IN THE BOOKS OF THE ASSESSEE, IN THE NAME OF SHRIANKUSH GUPTA WAS T REATED AS NOT EXPLAINED AND THE SAME WAS TREATED AS INCOME OF THE ASSESSEE BY M Y PREDECESSOR EVEN AFTER CONSIDERING THE REPLY FILED BY THE ASSESSEE DATED 2 7.11.2015 IN WHICH THE ASSESSEE; HAS STATED THAT THE CREDITOR RECEIVED THE AMOUNTS FROM PUNEET GUPTA AND AAKASHBANSAL, BUT NO EVIDENCE FOR THE SAME WAS FILED. FURTHER NO SOURCE OF AMOUNTS OF RS. 7,00,000/- AND RS. 2,00,000/- DEPOSITED ON 20.12.2012 AND 28.12.2012 HAS BEEN FILED. 14.2 THE AFORESAID REMAND REPORT WAS FORWARDED BY T HE LD. CIT(A) TO THE ASSESSEE FIRM FOR ITS COUNTER COMMENTS. IN RESPONSE THE ASSESSEE SUBMITTED AS UNDER: 1. UNEXPLAINED CREDIT OF SH. ANKUSH GUPTA RS. 41,50 ,000/-: THE NEXT ISSUE RAISED BY THE A.O. IN HIS REMAND REPORT IN PARA 3 ON PAGE 2 OF THE REMAND REPORT SHOWS THE CREDITS RECEIVED FROM SH. ANKUSH GUPTA RS . 41,50,000/- FOR WHICH COMPLETE DETAILS HAVE BEEN GIVEN IN THE REMAND REPO RT IN PARA 3. IN THE REMAND REPORT THE A.O. HAS GIVEN REFERENCE OF QUESTIONNAIRE DATED 06.11.2015 IN WHICH IT HAS BEEN MENTIONED TO FILE EVIDENCE OF SOURCE OF CO RRESPONDING DEPOSITS IN THE BANK ACCOUNT OF CREDITORS OF SH. ANKUSH GUPTA IN TH E SBI. THE ASSESSEE HAS REPLIED ON 27.11.2015 ON THIS ISSUE AND THE COMPLETE SAVING ACCOUNTS OF SH. ANKUSH GUPTA AND SH. PUNEET GUPTA BROTHER OF THE CREDITOR ALONG WITH CONFIRMED COPY OF ACCOUNT WAS GIVEN TO THE A. O. AND THE EXPLANATIO N OF RECEIPT OF AMOUNTS WAS ALSO GIVEN. FURTHER IN THE REMAND REPORT IN NEXT PA RA THE A. O. HAS STATED THAT NO COMPLETE DETAILS HAVE BEEN FILED. THIS FACT IS NOT CORRECT IN VIEW OF REPLY ALREADY GIVEN TO THE A.O. 27.11.2015. THE A.O. HAS FURTHER ST ATED THAT THE ASSESSEE HAS NOT 15 FILED THE COMPLETE DETAILS OF CREDITS OF RS. 40,50, 000/- BUT THE CORRECT FIGURE IS RS. 41,50,000/-. THE A.O. HAS ATTACHED THE COPY OF LETTE R DATED 14.03.2015 IN WHICH THE ASSESSEE HAS MENTIONED THAT REPLY FILED BY THE ASSESSEE DATED 27.11.2015 WAS MENTIONED IN REPLY DATED 14.03.2015 IN PARA 1 AND T HE A. O. HAS ALSO MENTIONED IN HIS REMAND REPORT REGARDING REPLY FILED BY THE A SSESSEE DATED 27.11.2015. FURTHER HE HAS STATED THAT CREDITOR RECEIVED THE AM OUNT FROM SH. PUNEET GUPTA NRE, HIS BROTHER AND SH. AKASHBANSAL BUT NO EVIDENC E WAS FILED. THE AO. HAS SIMPLY STATED THAT THE NO SOURCE OF AMOUNT OF RS. 7 ,00,000/- DATED 20.12.2012 AND RS. 2,00,000/- DATED 28.12.2012 HAS BEEN FILED. THI S FACT IS ALSO NOT CORRECT. THE A.O. HAS NOT CONSIDERED THE AMOUNT OF REPAYMENT OF R S. 7,00,000/- DATED 4.12.2012 PAID BY THE FIRM TO ANKUSH GUPTA AND AMOU NT WAS DEPOSITED IN THE SAVING ACCOUNT NUMBER 912010063667577 WITH AXIS BAN K, AGGAR NAGAR, LUDHIANA. FURTHER, THE A.O. HAS NOT CONSIDERED THE AMOUNT OF R EPAYMENT OF RS. 7.00,000/- DATED 4.12.2012 PAID BY THE FIRM TO ANKUSH GUPTA AN D AMOUNT WAS DEPOSITED IN THE SAVING ACCOUNT NUMBER 912010063667577 WITH AXIS BANK, AGGAR NAGAR. LUDHIANA. FURTHER. THE A.O. HAS NOT CONSIDERED THE A MOUNT OF REPAYMENT OF RS. 6,00,000/- DATED 4.12.2012 PAID BY THE FIRM TO ANKU SH GUPTA AND AMOUNT WAS DEPOSITED IN THE SAVING ACCOUNT NUMBER 912010063667 577 WITH AXIS BANK, AGGAR NAGAR, LUDHIANA. FURTHER, THE A.O. HAS NOT CONSIDERE D THE AMOUNT OF REPAYMENT OF RS. 3,00,000/- DATED 10.12.2012 PAID BY THE FIRM TO ANKUSH GUPTA AND AMOUNT WAS DEPOSITED IN THE SAVING ACCOUNT NUMBER 91201006 3667577 WITH AXIS BANK, AGGAR NAGAR, LUDHIANA. FURTHER, THE A.O. HAS NOT CON SIDERED THE AMOUNT OF REPAYMENT OF RS. 8,00,000/- DATED 10.12.2012 PAID B Y THE FIRM TO ANKUSH GUPTA AND AMOUNT WAS DEPOSITED IN THE SAVING ACCOUNT NUMB ER 912010063667577 WITH AXIS BANK, AGGAR NAGAR, LUDHIANA. SH. ANKUSH GUPTA HAS GIVEN RS. 7,00,000/- FROM THE AXIS BANK ON 20.12.2012 AND RS. 2,00,000/- DATE D 28.12.2012 OUT OF THE AMOUNTS RECEIVED BACK FROM SWARANFASTNERS WHICH HAV E BEEN CREDITED IN HIS SAVING ACCOUNT. THE PHOTOCOPY OF SAVING BANK ACCOUN T NUMBER 00000030037410900 BEING MAINTAINED WITH STATE BANK OF INDIA PLACED IN PAPER BOOK FROM PAGE NUMBER 10 TO 14 AND SAVING ACCOUNT N UMBER 912010063667577 BEING MAINTAINED WITH AXIS BANK PLACED IN PAPER BOO K AT PAGE NUMBER 15 AND SAVING ACCOUNT NUMBER 5-102915-161 WITH CITI BANK O F PUNEET GUPTA NRE, HIS REAL BROTHER WHO IS WORKING IN U.K. IS PLACED IN PAPER B OOK FROM PAGE NUMBER 16 TO 18. FURTHER, THE SAVING ACCOUNT NUMBER 30784612826 WITH STATE BANK OF SH. AKASHBANSAL IS PLACED IN THE PAPER BOOK AT PAGE NUM BER 19 AND 20. FURTHER THE SAVING ACCOUNT NUMBER 30343633939 OF SH. AKASHBANSA L MAINTAINED WITH SBI IS PLACED IN THE PAPER BOOK AT PAGE NUMBER 21 AND 22. FURTHER THE COPY OF STATEMENT WITH HSBC BANK SAVING ACCOUNT NUMBER 054- 057047-006 IS ATTACHED ON PAPER BOOK PAGE 23 AND 24. FURTHER, THE AMOUNT OF R S. 10,50,000/- WAS RECEIVED THROUGH SALE OF PROPERTY BY ANKUSH GUPTA AND PHOTOC OPY OF ALL THE RELEVANT DOCUMENTS FOR SALE OF PROPERTY ALONG WITH POWER OF ATTORNEY ARE PLACED IN THE PAPER BOOK FROM PAGE NUMBER 24 TO 29. THE A. O. HAS NOT GIVEN ANY COMMENTS ON ALL THESE DOCUMENTS WHICH ITSELF PROVES THAT HE HAS ACCEPTED THE CONTENTION OF THE ASSESSEE. THE A.O. HAS FURTHER MENTIONED IN HIS REMAND REPORT REGARDING SOURCE OFRS. 7,00,000/- DATED 20.12.2012 AND RS. 2, 00,000/- DATED 28.12.2012 FOR WHICH IT HAS BEEN CLEARLY MENTIONED THAT THE AMOUNT WERE RECEIVED BACK FROM FIRM M/S SWARANFASTNERS BY THE ANKUSH GUPTA AND THE COPY OF ACCOUNT OF ANKUSH GUPTA IS PLACED IN THE PAPER BOOK AT PAGE NU MBER 9 AND THE SAME MAY PLEASE BE REFERRED. IT IS IMPORTANT TO MENTION HERE THAT THE CREDITWORTHINESS HAS BEEN PROVED BY THE ASSESSEE FIRM OF ANKUSH GUPTA AF TER EXPLAINING SOURCE OF SOURCE ALONG WITH DOCUMENTARY EVIDENCES, CONFIRMATI ONS, PAN NUMBER, PROVIDING SAVING BANK ACCOUNTS AND FURTHER PROVIDIN G SAVING ACCOUNTS OF OTHER 16 PERSONS FROM WHOM THE AMOUNTS HAVE BEEN RECEIVED WH ICH PROVES SOURCE OF SOURCE ALONG WITH RETURN OF INCOME. THE A. O. HAS NO T GIVEN ANY ADVERSE REMARKS ON THIS ISSUE WHICH CLEARLY SHOWS THAT THE A. O. HAS ACCEPTED THE CONTENTION OF THE ASSESSEE EXCEPT TWO AMOUNTS FOR WHICH THE COMPL ETE EXPLANATIONS HAVE BEEN GIVEN TO YOUR HONOR ON THIS ISSUE. IT IS REQUE STED AND PRAYED THAT THE ADDITIONS BASED ON SUSPICION AND SUPPOSITION OF UNE XPLAINED CREDIT OF SH. ANKUSH GUPTA WHO IS THE SON OF THE PARTNERS MAY PLEASE BE DELETED. IT IS ALSO IMPORTANT TO MENTION HERE THAT THE ANKUSH GUPTA IS BEING ASSE SSED SEPARATELY AND SHE IS FILING SEPARATE RETURN OF INCOME FOR EACH ASSESSMEN T YEAR. IF AT ALL THE EXPLANATION GIVEN BY THE ASSESSEE FIRM SEEMS TO BE INCORRECT TH E RIGHT COURSE WAS TO MAKE THE ADDITIONS IN THE HANDS OF SH. ANKUSH GUPTA WHO HAS ADMITTED THE CREDITS IN HIS ACCOUNT. IN VIEW OF THE ABOVE FACTS IT IS REQUESTED AND PRAYED TO DELETED THE ADDITION OF RS. 41,50,000/- IN THE HANDS OF THE FIR M UNDER THE WRONG NOTION OF LAW. IT IS IMPORTANT TO MENTION HERE THAT THE A.O. ISSUED THE NOTICE TO THE ASSESSEE FOR CLARIFICATION OF WRITTEN SUBMISSION GIVEN BY THE AS SESSEE VIDE LETTER NO.ITO/WARD(2)/LDH/L718/485 DATED 13.10.2017 AND LE TTER NO. ITO/WARD(2)/LDH/1718/540 DATED 13.11.2017 AND THE UN DERSIGNED ATTENDED AND CLARIFIED EACH AND EVERY ISSUE ON THE ISSUE OF INTR ODUCTION OF CASH CREDIT BY SH. ANKUSH GUPTA. THE PHOTOCOPIES OF THE ENQUIRIES LETT ER ISSUED BY THE A.O. ARE ALSO ATTACHED FOR YOUR KIND REFERENCE. THE A.O. HAS NOT UTTERED A SINGLE WORD ABOUT THE AMOUNTS RECEIVED BY SH. ANKUSH GUPTA FROM HIS B ROTHER WHO IS LIVING AND WORKING IN U.K. AND HAS TRANSFERRED THE FUNDS THROU GH RTGS FROM HIS NRE ACCOUNT. FURTHER HE HAS RECEIVED THE AMOUNTS FROM SH. AKASHB ANSAL AND AGAINST THE SALE OF PROPERTY. THE COMPLETE CLARIFICATION WAS GIVEN T O THE A. O. AT THE TIME OF ATTENDING HIS OFFICE DURING ENQUIRIES AGAINST REMAN D REPORT AND THIS WAS ACCEPTED BY HIM DURING DISCUSSIONS BUT HE HAS NOT M ENTIONED THE SAME IN HIS REMAND REPORT. THIS PROVES THE SOURCE OF SOURCE OF SH. ANKUSH GUPTA. IN VIEW OF THE ABOVE FACTS IT IS REQUESTED AND PRAYED TO DELET ED THE ADDITION OF RS. 41,50,000/- IN THE HANDS OF THE FIRM UNDER THE WRON G NOTION OF LAW. 15. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION S OF THE ASSESSEE AND THE REMAND REPORT OF THE A.O. DELETED THE ADDITION BY O BSERVING IN PARA 7.5 OF THE IMPUGNED ORDER AS UNDER: 7.5 I HAVE CONSIDERED THE OBSERVATIONS OF THE ASSE SSING OFFICER AS MADE BY HIM/HER IN THE ASSESSMENT ORDER WHILE MAKING THE IM PUGNED ADDITION AS WELL AS IN THE REMAND REPORT. I HAVE ALSO CONSIDERED WRITTEN S UBMISSIONS FILED BY THE ASSESSEE FIRM THROUGH ITS LEARNED AR VIDE LETTERS D ATED 26.09.2017, 12.02.2018 AND 22.02.2018 ON THE ISSUE UNDER REFERENCE AS WELL AS THE COUNTER COMMENTS OF THE ASSESSEE FIRM IN CONNECTION WITH THE REMAND REPORT OF THE ASSESSING OFFICER. I HAVE FURTHER CONSIDERED OTHER MATERIAL PLACED BY TH E LEARNED AR OF THE ASSESSEE ON RECORD. ON CAREFUL CONSIDERATION OF THE ASSESSMEN T ORDER, IT HAS BEEN NOTICED THAT THE ASSESSING OFFICER HAS MADE THE IMPUGNED ADD ITION AS THE ASSESSEE FIRM IN THE OPINION OF THE ASSESSING OFFICER COULD NOT EX PLAIN THE CREDIT BALANCE IN THE ACCOUNT OF SH. ANKUSH GUPTA. ON THE OTHER HAND, THE LEARNED AR OF THE ASSESSEE FIRM HAD SUBMITTED THAT SH. ANKUSH GUPTA RECEIVED A N AMOUNT OF RS. 32,00,000/- FROM HIS BROTHER SH. PUNEET GUPTA WHO IS NRI AND IS PRESENTLY SETTLED IN UK WHICH WAS GIVEN BY HIM TO THE ASSESSEE FIRM ON DIFFERENT DATES. IT HAS ALSO BEEN 17 SUBMITTED THAT SH. ANKUSH GUPTA HAS ALSO RECEIVED A NOTHER AMOUNT OF RS.9,50,000/- ON DIFFERENT DATED FROM HIS COUSIN SH . AKASHBANSAL WHICH WAS ALSO GIVEN TO THE ASSESSEE FIRM ON DIFFERENT DATES. IN S UPPORT OF HIS CONTENTION, THE LEARNED AR OF THE ASSESSEE FIRM HAS ALSO ENCLOSED C OPY OF NRE SAVING BANK ACCOUNT OF SH. PUNEET GUPTA AS WELL AS BANK ACCOUNT S OF SH. AKASHBANSAL. IT WAS FURTHER SUBMITTED THAT AN AMOUNT OF RS. 1,00,000/- WAS GIVEN TO THE ASSESSEE FIRM OUT OF OUTSTANDING BALANCE IN THE BANK ACCOUNT OF S H. ANKUSH GUPTA. IT HAS AGAIN BEEN SUBMITTED THAT THE ASSESSEE FIRM HAS GIV EN COMPLETE EXPLANATION TO THE ASSESSING OFFICER ALONG WITH DOCUMENTARY EVIDENC E BUT THE ASSESSING OFFICER HAS MADE IMPUGNED ADDITION IN THE HANDS OF THE ASSE SSEE FIRM WITHOUT CONSIDERING THE FACT THAT THE AMOUNT HAS BEEN TRANS FERRED BY SH. ANKUSH GUPTA OUT OF HIS EXPLAINED SOURCES AND IF AT ALL ANY ADDI TION WAS TO BE MADE IT SHOULD HAVE BEEN MADE IN THE HANDS OF SHRIANKUSH GUPTA. IT HAS AGAIN BEEN SUBMITTED THAT THE ASSESSING OFFICER HAS NOT GIVEN ANY SHOW CA USE NOTICE BEFORE MAKING THE ADDITION UNDER REFERENCE WHICH VIOLATES THE NAT URAL JUSTICE. ON CAREFUL CONSIDERATION OF THE RIVAL CONTENTIONS, I AM OF THE OPINION THAT THE ASSESSEE FIRM HAS EXPLAINED EVEN THE SOURCE OF SOURCE IN RESPECT OF THE AMOUNT RECEIVED FROM SH. ANKUSH GUPTA BY PRODUCING COPY OF NRE ACCOUNT O F SH. PUNEET GUPTA AND COPIES OF BANK ACCOUNT OF SH. AKASHBANSAL. ON PERUSA L OF THE BANK ACCOUNTS OF SH. PUNEET GUPTA, SH. AKASH BANSAL AND SH. ANKUSH G UPTA, I AM CONVINCED THAT THE AMOUNT WHICH SH. ANKUSH GUPTA HAS GIVEN TO THE ASSESSEE FIRM IS OUT OF EXPLAINED SOURCES. WHEN ASKED TO PROVE THE SOURCE O F SH. PUNEET GUPTS, THE LEARNED AR OF THE ASSESSEE ALSO PLACED ON RECORD TH E DOCUMENTS WHICH PROVE BEYOND DOUBT THAT THE AMOUNT IN HIS NRI ACCOUNT HAS BEEN TRANSFERRED BY SH. PUNEET GUPTA FROM HIS OWN EXPLAINED SOURCES AND THA T TOO IN POUNDS. UNDER SUCH CIRCUMSTANCES, THE ACTION OF THE ASSESSING OFFICER I N MAKING AN ADDITION OF RS.40,50,000/- IN THIS CASE ON ACCOUNT OF UNEXPLAIN ED CREDIT BALANCE IN THE ACCOUNT OF SH. ANKUSH GUPTA CANNOT BE SAID TO BE JU STIFIED AND AS SUCH THE ADDITION OF RS.40,50,000/- MADE BY THE ASSESSING OFF ICER IN THIS CASE ON ACCOUNT OF UNEXPLAINED CREDIT BALANCE IN THE CASE OF SH. AN KUSH GUPTA IS, THEREFORE, DIRECTED TO BE DELETED. IN THE RESULT, THE GROUND N O. 4 OF APPEAL TAKEN BY THE ASSESSEE IS ALLOWED. 16. NOW THE DEPARTMENT IS IN APPEAL. 17. LD. CIT DR STRONGLY SUPPORTED THE ASSESSMENT OR DER PASSED BY THE A.O. AND REITERATED THE OBSERVATIONS MADE THEREIN. 18. IN HIS RIVAL SUBMISSIONS THE LD. COUNSEL FOR TH E ASSESSSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND S TRONGLY SUPPORTED THE IMPUGNED ORDER PASSED BY THE LD.CIT(A). IT WAS FURT HER SUBMITTED THAT SHRI ANKUSH GUPTA RECEIVED THE AMOUNT OF RS. 32,00,000/- FROM HIS BROTHER SHRI PUNEET GUPTA WHO IS THE NRI AND SETTLED IN UK. THE EVIDENCE FOR THE SAID AMOUNT WAS FURNISHED AND THE REMAINING AMOUNT OF RS . 9,50,000/- WAS RECEIVED 18 BY SHRI ANKUSH GUPTA FROM HIS COUSIN SHRI AKASH BAN SAL AND COPY OF BANK ACCOUNT OF SHRI AKASH BANSAL WAS ALSO FURNISHED TO PROVE THE CREDIT WORTHINESS OF SHRI ANKUSH GUPTA FOR MAKING THE DEPOSIT WITH THE A SSESSEE. IT WAS FURTHER SUBMITTED THAT ALL THE DOCUMENTARY EVIDENCES WERE F URNISHED, THEREFORE THE IMPUGNED ADDITION MADE BY THE A.O. WAS NOT JUSTIFIE D AND THE LD. CIT(A) RIGHTLY DELETED THE SAME. 19. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CASE IT IS NOT IN DISPUTE THAT THE ASSESSEE RECEIVED A SUM OF RS. 41,50,000/- FROM SHRI ANKUSH GUPTA THROUGH BANKING CHANNEL AND THE SOURCE OF SOU RCE WAS EXPLAINED BY THE ASSESSEE BY FURNISHING THE DOCUMENTARY EVIDENCES TO PROVE THE CREDIT WORTHINESS OF SHRI PUNIT GUPTA AND SHRI AKASH BANSA L FROM WHOM SHRI ANKUSH GUPTA RECEIVED THE AMOUNT. THE SAID DOCUMENTS REVEA LED THAT THE AMOUNT OF RS. 32,00,000/- WAS RECEIVED BY SHRI ANKUSH GUPTA F ROM HIS BROTHER SHRI PUNEET GUPTA WHO IS THE NRI AND SETTLED IN UK. THE SAID AM OUNT WAS TRANSFERRED FROM THE NRE ACCOUNT. THE ASSESSEE ALSO EXPLAINED THE SO URCE OF ANOTHER AMOUNT OF RS. 9,50,000/- RECEIVED BY SHRI ANKUSH GUPTA FROM H IS COUSIN SHRI AKASH BANSAL BY FURNISHING THE COPY OF BANK ACCOUNT OF SHRI AKASH B ANSAL, THEREFORE THE ADDITION MADE BY THE A.O. WAS NOT JUSTIFIED AND THE LD. CIT( A) RIGHTLY DELETED THE SAME PARTICULARLY WHEN THE ASSESSEE PROVED THE IDENTITY AND CREDITWORTHINESS OF DEPOSITOR AS WELL AS GENUINENESS OF TRANSACTION. 20. THE NEXT ISSUE VIDE GROUND NO. (III) RELATES TO THE DELETION OF ADDITION OF RS. 3,88,82,000/- MADE BY THE A.O. ON ACCOUNT OF THE TR ANSACTION WITH M/S SHREE RADHA COMMODITY SERVICES. 21. AS REGARDS TO THIS ISSUE THE LD. COUNSEL FOR TH E ASSESSEE AT THE VERY OUTSET STATED THAT AN IDENTICAL ISSUE HAVING SIMILAR FACTS WAS INVOLVED FOR THE A.Y. 2008- 09 IN ITA NO. 728/CHD/2018 IN THE DEPARTMENTAL APPE AL, IN ASSESSEES OWN CASE WHICH HAS BEEN ADJUDICATED BY THIS BENCH OF ITAT VI DE ORDER DT. 03/10/2019 AND 19 THE ADDITION OF RS. 2,26,30,000/- RECEIVED FROM THE SAME CREDITOR M/S SHREE RADHA COMMODITY SERVICES WAS HELD TO BE GENUINE AND THE DELETION OF THE SAID ADDITION BY THE LD. CIT(A) WAS CONFIRMED VIDE AFORE SAID ORDER DATED 03/10/2019 (COPY OF THE SAID ORDER WAS FURNISHED WHICH IS PLAC ED ON THE RECORD). 22. IN HIS RIVAL SUBMISSIONS THE LD. CIT DR STRONGL Y SUPPORTED THE ORDER OF THE A.O. AND SUBMITTED THAT THE ASSESSEE PREPLANNED THE ACTIVITY OF INTRODUCING THE CASH IN THE NAME OF M/S RADHA COMMODITY SERVICES AN D THE SAID AMOUNT WAS SHOWN AS OUTSTANDING UNDER THE HEAD SUNDRY CREDITOR S IN THE BALANCE SHEET WHILE THE AMOUNT RECEIVED BY THE ASSESSEE WAS A LOA N. 23. IN HIS REJOINDER THE LD. COUNSEL FOR THE ASSESS EE SUBMITTED THAT IN THE SIMILAR CIRCUMSTANCES THE CASE OF M/S RADHA COMMODI TY SERVICES WAS REOPENED FOR THE A.Y. 2008-09, 2009-10 , 2011-12 AN D 2013-14 WHEREIN THIS AMOUNT WAS CONSIDERED AS GENUINE AND NO ADDITION WA S MADE IN THE HANDS OF THE SAID CREDITOR M/S RADHA COMMODITY SERVICES. THE REFERENCE WAS MADE TO PAGE NO. 105 TO 111 OF THE ASSESEES COMPILATION WHI CH ARE THE COPIES OF THE ASSESSMENT ORDER OF SHRI KUSHAL GUPTA, PROPRIETOR M /S RADHA COMMODITY SERVICES FOR THE A.Y. 2013-14, 2011-12 AND 2012-13 WHEREIN THE ASSESSMENT HAS BEEN FRAMED UNDER SECTION 143(3) OF THE ACT AND NO ADDITION HAS BEEN MADE IN THE HANDS OF THE SAID FIRM M/S RADHA COMMODITY SERV ICES A PROPRIETARY CONCERN OF SHRI KUSHAL GUPTA. REFERENCE WAS ALSO MADE TO PA GE NOS. 139-142 & 143-145 OF THE ASSESSEES PAPER BOOK WHICH ARE THE COPIES O F THE ASSESSMENT ORDERS OF SHRI KAUSHAL GUPTA COMPLETED U/S 143(3) OF THE ACT FOR THE A.Y. 2008-09 & 2009- 10 RESPECTIVELY. 24. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT IS NOTICED THAT AN IDENTICAL ISSUE HAVING SIMILAR FACTS HAS ALREADY BE EN ADJUDICATED BY THIS BENCH OF THE ITAT IN ITA NO. 728/CHD/2018 FOR THE A.Y. 20 08-09 IN ASSESSEES OWN CASE WHEREIN THE DEPARTMENTAL APPEAL ON SIMILAR ISSUE WA S DISMISSED AND THE 20 RELEVANT FINDINGS ARE GIVEN IN PARA 11 OF THE ORDER DT. 03/10/2019 WHICH READ AS UNDER: 11. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT APPEARS THAT THE A.O. MADE THE IMPUGNED ADDITION ON THE BASIS THAT THE AS SESSEE COULD NOT EXPLAIN THE SOURCE OF CASH DEPOSITED IN THE BANK ACCOUNT OF M/S SHREE RADHA COMMODITIES SERVICES FROM WHOM THE ASSESSEE HAD REC EIVED THE IMPUGNED AMOUNT DURING THE YEAR UNDER CONSIDERATION. THE EXP LANATION OF THE ASSESSEE BEFORE THE LD. CIT(A) WAS THAT THE CONFIRMED COPY O F THE ACCOUNT OF M/S SHREE RADHA COMMODITIES SERVICES WHOSE PROPRIETOR IS SHRI KAUSHAL GUPTA A FAMILY MEMBER OF THE PARTNERS OF THE ASSESSEE FIRM WAS FUR NISHED TO THE A.O. AND THAT THE TRANSACTIONS IN THE CASE OF M/S SHREE RADHA COM MODITIES SERVICES WERE MOSTLY IN CASH DUE TO ITS NATURE OF BUSINESS, WHENE VER THE CASH WAS RECEIVED BY THE SAID FIRM IT WAS DEPOSITED IN ITS BANK ACCOUNT AND OUT OF THE DEPOSITS IN THE BANK ACCOUNT, AMOUNT HAD BEEN TRANSFERRED TO THE AS SESSEE FIRM THROUGH BANKING CHANNEL. IN THE INSTANT CASE, THE LD. CIT(A ) CATEGORICALLY STATED THAT FOR THE A.Y. UNDER CONSIDERATION ASSESSMENT IN THE CASE OF M/S SHREE RADHA COMMODITIES SERVICES WAS REOPENED UNDER SECTION 147 OF THE ACT UNDER IDENTICAL FACTS AND THE REASSESSMENT WAS COMPLETED UNDER SECT ION 143(3) READ WITH SECTION 147 OF THE ACT VIDE ORDER DT. 23/03/2016, H OWEVER NO ADDITION ON ACCOUNT OF CASH DEPOSITS WERE MADE AND THE A.O. CAME TO THE CONCLUSION AFTER VERIFYING THE BOOKS OF ACCOUNTS THAT THE CASH DEPOS ITED WAS FOUND TO BE EXPLAINED. THE SAID OBSERVATION OF THE LD. CIT(A) W AS NOT REBUTTED. IN THE PRESENT CASE WHEN THE CASH DEPOSITED IN THE BANK ACCOUNT OF M/S SHREE RADHA COMMODITIES SERVICES WAS ACCEPTED AND CONSIDERED TO BE GENUINE WHILE FRAMING THE ASSESSMENT UNDER SECTION 143(3) R.W.S 1 47 OF THE ACT VIDE ORDER DT. 23/03/2016 THEN THE AMOUNT RECEIVED BY THE ASSESSEE THROUGH BANKING CHANNEL OUT OF THE SAID CASH DEPOSITED IN THE BANK ACCOUNT OF M/S SHREE RADHA COMMODITIES SERVICES CANNOT BE CONSIDERED AS UNEXPL AINED OR NON GENUINE IN THE HANDS OF THE ASSESSEE. WE THEREFORE DO NOT SEE ANY VALID GROUND TO INTERFERE WITH THE FINDINGS GIVEN BY THE LD. CIT(A). SO, RESPECTFULLY FOLLOWING THE AFORESAID REFERRED T O ORDER IN ASSESSEES OWN CASE, WE DO NOT SEE ANY MERIT IN THIS GROUND OF THE DEPARTMENTAL APPEAL PARTICULARLY WHEN THE CASH DEPOSITED IN THE BANK AC COUNT OF M/S RADHA COMMODITY SERVICES WAS ACCEPTED BY THE DEPARTMENT A S GENUINE WHILE FRAMING THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT VIDE ORDER DT. 23/03/2016, FOR THE SAME A.Y. 2013-14; IN THE CASE OF SHRI KUSHAL GUPTA PROPRIETOR OF M/S RADHA COMMODITY SERVICES FROM WHOM THE ASSES SEE RECEIVED THE LOAN THROUGH BANKING CHANNEL. WE THEREFORE DO NO SEE ANY VALID GROUND TO INTERFERE WITH THE FINDINGS GIVEN BY THE LD.CIT(A) ON THIS IS SUE. 21 25. IN THE RESULT, APPEAL OF THE DEPARTMENT IS DISM ISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 18/02/2021 ) SD/- SD/- .. .., (R.L. NEGI ) ( N.K. SAIN I) $ %&/ JUDICIAL MEMBER ! / VICE PRESIDENT AG DATE: 18/02/2021 (+! ,-.- COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. $ / CIT 4. $ / 01 THE CIT(A) 5. -2 45&456789 DR, ITAT, CHANDIGARH 6. 8:% GUARD FILE