ITO, Ward, Sangrur V. Shri Vaneet Mittal, Sangrur

ITA 844/CHANDI/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3046 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2015-2016
• Appeal Filed On: 29-05-2019

Judgement Text

ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 1 OF 12 , , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH B, CHANDIGARH BEFORE: SHRI N.K. SAINI, VICE PRESIDENT AND SHRI R.L. NEGI, JUDICIAL MEMBER ./ ITA NO.844/CHD/2019 / ASSESSMENT YEAR : 2015-16 THE ITO, SANGRUR WARD, SANGRUR. SHRI VANEET MITTAL, C/O MITTAL TRADER, NABHA GATE,SANGRUR. ./PAN NO: BBWPM2379A /APPELLANT /RESPONDENT / REVENUE BY : SHRI ASHOK KHANNA, ADDL.CIT(DR) /ASSESSEE BY : SHRI TEJ MOHAN SINGH, ADVOCATE $ /DATE OF HEARING : 27.07.2021 $ /DATE OF PRONOUNCEMENT: 22.10.2021 (HEARING THROUGH WEBEX) / ORDER PER R.L. NEGI, JUDICIAL MEMBER: THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST TH E ORDER DATED 05.03.2019 PASSED BY COMMISSIONER OF INCOME TAX (AP PEALS), PATIALA [FOR SHORT THE CIT(A)], WHEREBY THE LD. CIT(A) HA S ALLOWED THE APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED BY T HE AO 143(3) OF THE INCOME TAX ACT, 1961 [FOR SHORT THE ACT] FOR THE ASSESSMENT YEAR 2015-16. ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 2 OF 12 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE AN INDIVIDUAL FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING TOTAL INCOME OF RS. 5,04,990/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE AO PASSED ASSESSMENT ORDER U/S 143 (3) OF THE ACT AND DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT RS. 2,85,50,990/- AFTER MAKING ADDITION OF RS. 2,80,46,000/-U/S 69 OF THE ACT. THE ASSESSEE CHALLENGED THE ASSESSMENT ORDER BEFORE THE LD. CIT(A). THE LD. CIT(A) AFTER HEARING THE ASSESSEE ALLOWED THE A PPEAL AND DELETED THE ADDITION MADE BY THE AO. THE REVENUE IS IN APPE AL AGAINST THE SAID FINDINGS OF THE LD. CIT(A). 3. THE REVENUE HAS CHALLENGED THE IMPUGNED ORDER PA SSED BY THE LD. CIT(A) ON THE FOLLOWING EFFECTIVE GROUND: - WHETHER ON THE FACTS & IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.2,80,46,00 0/- ON ACCOUNT OF INVESTMENT MADE FROM UNDISCLOSED SOURCES. THE OBSER VATIONS MADE, WHILE DISBELIEVING THE EVIDENCE PRODUCED DURING THE ASSESSMENT PROCEEDINGS, SPECIFICALLY RELATING TO THE CREDITWOR THINESS AND GENUINENESS OF PARTIES FROM WHOM LOANS HAVE RAISED ARE NOT BASED ON PROBABILITIES, BUT THE EVIDENCE PRODUCED BY THE ASS ESSEE ARE BASELESS. THESE SAID PARTIES HAVE NO FINANCIAL CAPACITY TO GI VE HUGE INTEREST FREE LOANS. 4. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIV E SUPPORTING THE ORDER PASSED BY THE AO SUBMITTED THAT THE LD. CIT(A) HAS DELETED THE ADDITION MADE BY THE AO IGNORING THE FACT THAT THE ASSESSEE HAS FAILED TO E STABLISH THE GENUINENESS OF TRANSACTION BY ESTABLISHING CREDITWORTHINESS OF PER SONS FROM WHOM UNSECURED ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 3 OF 12 LOANS HAD BEEN RAISED. THE LD. DR SUBMITTED THAT DU RING THE YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION THE ASSESSEE MA DE INVESTMENT OF RS. 2,88,74,750/- I.E., 50% OF THE TOTAL CONSIDERATION PAID FOR PURCHASING LAND JOINTLY WITH HIS WIFE. SINCE THE ASSESSEE COULD EXPLAIN THE SOURCE OF INVESTMENT AMOUNTING TO RS. 1,25,000/- (BALANCE SHOWN IN SAVIN G BANK ACCOUNT), RS. 6,54,000/- BALANCE IN CAPITAL ACCOUNT IN MITTAL TRA DERS AND RS. 50,000/- FROM SALARY, THE AO HAS RIGHTLY MADE ADDITION OF THE REM AINING AMOUNT OF INVESTMENT MADE BY THE ASSESSEE. THE LD. DR ACCORDINGLY SUBMIT TED THAT THE ORDER PASSED BY THE LD. CIT(A) MAY BE SET ASIDE. 5. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE SUPPORTING THE ORDER PASSED BY THE LD. CIT(A) SUBMITTED THAT THE DURING THE RELEVANT PERIOD, THE ASSESSEE BEING A PARTNER IN THE PARTNERSHIP FIRM M/ S MITTAL TRADERS, HAD BEEN RECEIVING REMUNERATION APART FROM RENTAL INCOME. DU RING THE YEAR RELEVANT TO THE ASSESSMENT YEAR UNDER CONSIDERATION THE ASSESSEE AN D HIS WIFE JOINTLY PURCHASED BASEMENT OF SHOP NO 13-14, SECTOR 27-D CHANDIGARH V IDE TWO SALE DEEDS DATED 12.08.2014 AND 05.11.2014. THE ASSESSEE PAID RS. 2 ,75,00,000/- AS HIS SHARE (EXCLUDING REGISTRATION EXPENSES). DURING THE ASSES SMENT PROCEEDINGS THE ASSESSEE EXPLAINED THE SOURCE OF INVESTMENT ON THE BASIS OF DOCUMENTARY EVIDENCE. THE DOCUMENTS FURNISHED BY THE ASSESSEE W ERE FURTHER EXAMINED BY THE LD. CIT(A) DURING THE APPELLATE PROCEEDINGS. SINCE THE AO HAD MADE ADDITION IN QUESTION IGNORING THE DOCUMENTARY EVIDENCE ADDUCED BY THE ASSESSEE, THE LD. CIT(A) HAS RIGHTLY DELETED THE SAME. THE LD. COUNSE L ACCORDINGLY SUBMITTED THAT ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 4 OF 12 SINCE THE DECISION OF THE LD. CIT(A) IS BASED ON TH E EVIDENCE ON RECORD AND AS PER THE SETTLED PRINCIPLES OF LAW, THERE IS NO MERIT IN THE APPEAL OF THE REVENUE. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE P ARTIES AND CAREFULLY PERUSED THE MATERIAL ON RECORD. THE ONLY GRIEVANCE OF THE REVEN UE IS THAT THE LD. CIT(A) HAS WRONGLY DELETED THE ADDITION MADE BY THE AO U/S 69 OF THE ACT. THE LD. CIT(A) HAS DELETED THE ADDITION IN QUESTION HOLDING AS UND ER: - THAT THE APPELLANT PURCHASED PROPERTY THROUGH REGI STERED DEEDS EXECUTED ON 12.08.2014&05.11.2014 FOR A TOTAL CONSIDERATION OF 2,75,00,000 (RS.2,53,00,000/- + RS. 19,25,000/-, TCS RS.2,75,00 0/-) AND PAID STAMP DUTY OF RS. 13,75,000/- THEREON IS A MATTER OF RECORD AN D NOT IN DISPUTE. THE APPELLANT HAS ATTEMPTED TO DEMONSTRATE IN HIS SUBMI SSION THAT ALL PAYMENTS ARE EITHER IN CHEQUE/ DEMAND DRAFT DRAWN FROM THE APPEL LANT'S BANK ACCOUNT AND THE ONES IN CASH ARE BACKED BY CASH WITHDRAWAL FROM THE SAME BANK ACCOUNT. THE LD. AO HAS IN THE ASSESSMENT ORDER NOT DOUBTED THE PAYMENTS THROUGH BANKING CHANNELS/ CASH WITHDRAWALS BUT HAS QUESTION ED THE SOURCES OF THE DEPOSIT/ LOANS SHOWN BY THE APPELLANT STATING THAT THESE ARE CONCOCTED, AND ENTRIES TAKEN TO JUSTIFY INVESTMENT FOR WHICH THE A PPELLANT HAS HIMSELF NOT CONTRIBUTED ANYTHING. THAT THE LD. AO HAS MADE THE ADDITION U/S 69 OF THE ACT FOR UNACCOUNTED INVESTMENT IS MATTER OF RECORD; THA T THE LD. AO HAS ALSO REJECTED GENUINENESS OF THE LOAN TRANSACTIONS SHOWN BY THE A PPELLANT IS ALSO A MATTER OF RECORD. THUS, BEFORE ADJUDICATING ON WHETHER SECTIO N 69 OR SECTION 68 WOULD APPLY IN THE INSTANT CASE; A DISCUSSION OF THE LD. AO'S FINDINGS WITH REGARDS TO THE EXPLANATION OF THE SOURCES OFFERED BY THE APPEL LANT AND THE LD. AR'S SUBMISSIONS WITH REGARDS TO THE SAME WILL BE IN ORD ER. A. WITHDRAWALS OF RS. 1,57,00,000/- MADE FROM C APITAL ACCOUNT WITH M/S. MITTAL TRADERS, NABHA GATE, SANGRUR, WHEREIN THE AP PELLANT IS A PARTNER. THAT M/S. MITTAL TRADER, SANGRUR A PARTNERSHIP WITH PAN AAGFM8686E IS REGULARLY GETTING THEIR ACCOUNTS AUDITED U/S 44 AB OF THE ACT, FILING RETURNS OF INCOME AND IS ASSESSED TO TAX FIRM WITH THE ITO, WA RD-SANGRUR, IS A MATTER OF RECORD AND NOT DISPUTED BY THE LD. AO. THAT THE APP ELLANT IS A PARTNER IN THE ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 5 OF 12 SAID PARTNERSHIP FIRM AND HAD WITHDRAWN RS. 1,57,00 ,000/-, IN THREE TRANCHES OF RS. 1,00,00,000, RS. 50,00,000 & RS. 7,00,000/- FROM THE BANK ACCOUNT 029305000047OF THE FIRM WITH THE ICICI BANK, SANGRU R ON 02.04.2014, 02.08.2014 AND 11.08.2014 RESPECTIVELY IS ALSO MATT ER OF RECORD AND NOT IN DISPUTE. THAT THE FIRM ENCHASED AN FDR DATED 02.04. 2014 OF RS. L,10,00,000- AND THAT THE FIRM HAD ADEQUATE BALANCE IN ITS ACCOU NTS ON THE DATE OF THE TRANSFER IS ALSO MATTER OF RECORD AND NOT IN DISPUT E. THAT THE APPELLANT PAID INTEREST IN EXCESS OF RS. 13 LAKHS TO THE FIRM IS A LSO MATTER OF RECORD AND NOT IN DISPUTE. THE LD. AO HAS CITED THE LOW CAPITAL BASE, THE NEGATIVE CAPITAL OF THE APPELLANT IN THE FIRM (A CONSEQUENCE OF THE LOAN IN EXCESS OF HIS CAPITAL CONTRIBUTION), THE LOW INCOME OF THE FIRM (ACTUALLY A LOSS EXCLUDING THE INTEREST PAID BY THE APPELLANT); AND THE HIGH CREDITORS/ LOA NS OF THE FIRM TO DEBUNK THE CAPACITY OF THE FIRM TO GIVE THE LOAN. THE LD.AO HA S ALSO QUESTIONED THE BUSINESS EXIGENCY QUA THE FIRM MITTAL TRADERS, GIVE N THAT THEY HAVE LARGE OUTSTANDING AND HELD THAT THE SAME HAS BEEN DONE DU E TO THE CLOSE RELATIONSHIP OF THE REST OF THE PARTNERS WITH THE APPELLANT. THE LD. AO HAS NOT TAKEN INTO ACCOUNT THE AVAILABILITY OF FUNDS WITH THE FIRM IN THE FORM OF 'BANK DEPOSITS AND CASH IN HAND' I HAVE CAREFULLY CONSIDERED THE APPELLANT'S SUBMISS IONS AND THE LD. AO'S FINDINGS WITH REGARDS TO THIS LOAN SHOWN FROM MITTA L TRADERS. IT IS MY CONSIDERED VIEW THAT THE APPELLANT HAS DULY DISCHARGED THE BUR DEN OF PROOF WITH REGARDS TO THE IDENTITY AND CREDITWORTHINESS OF THE FIRM AS AL SO THE TRANSACTION QUA THE APPELLANT. THAT THE APPELLANT MAY BE SUBJECT TO DIS ALLOWANCE U/S 36(I)(III) OR THAT THE APPELLANT FIRM HAS DIVERTED BUSINESS FUNDS TO A PARTNER IS A SUBJECT TO BE EXAMINED IN THE ASSESSMENT OF THE FIRM AND THE LD. AO WAS FREE TO REFER THE MATTER TO THE CONCERNED ASSESSING OFFICER. B. WITHDRAWALS OF RS. 10,00,000/- MADE FROM JOINT B ANK ACCOUNT OF THE APPELLANT WITH SMT. KUSUM LATA. THAT THE APPELLANT WAS CO-OWNER OF IMMOVEABLE PROPE RTY AT PARK, SANGRUR, WITH SMT. KUSUM LATA AND HAD BEEN RECEIVIN G RENT FROM THIS PROPERTY ALONG WITH HIS AUNT KUSUM LATA IS MATTER OF RECORD. THAT THE APPELLANT AND KUSUM LATA HAD BEEN MAINTAINING JOINT BANK IN ICICI BANK, SANGRUR, FOR ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 6 OF 12 RECEIVING RENTAL INCOME IS ALSO MATTER OF RECORD. T HE LD. AO HAS NOT COMMENTED ON THIS, BUT THE DOCUMENTS WERE PRODUCED BEFORE HIM DURING THE ASSESSMENT PROCEEDINGS. THAT THE APPELLANT AND KUSUM LATA WERE DISCLOSING THE RENT AS INCOME FORM HOUSE PROPERTY IN THEIR RETURNS OF INCO ME IS ALSO A MATTER OF RECORD AND NOT IN DISPUTE. THAT, KUSUM LATA IS REGULARLY A SSESSED TO TAX IS ALSO MATTER OF RECORD AND NOT IN DISPUTE. THAT RS. 10,00,000/- HAD BEEN TRANSFERRED ON 02/08/2014, FROM THIS BANK ACCOUNT TO THAT OF THE A PPELLANT IS ALSO ESTABLISHED FROM RECORD. IT IS MY CONSIDERED VIEW THAT WITH REG ARDS TO THIS CREDIT ENTRY THE APPELLANT HAS BOTH DURING ASSESSMENT AND APPELLATE PROCEEDINGS ESTABLISHED THE SOURCE OF THE FUNDS AND THE IDENTITY OF THE CRE DITOR (FOR 50%), THE CREDITWORTHINESS AND THE GENUINENESS OF THE TRANSAC TION. C. WITHDRAWALS OF RS.60,00,000/-, FROM JOINT KIS SAN GOLD CARD BANK ACCOUNT OF THEAPPELLANT WITH S/SHRI RAJINDER PAL MITTAL AND PUNEET MITTAL, THAT THE APPELLANT ALONG WITH S/SHRI RAJINDER PAL M ITTAL, SURINDER PAL MITTAL, PUNEET MITTAL, JIT PAL MITTAL, PREM CHAND, SMT. PARVEEN LATA, SMT. KIRAN BALA AND SMT. KUSUM LATA HAS A KISSAN GOLD CARD LIM IT IN JOINT BANK ACCOUNT NO. 50200005592962 WITH HDFC BANK LTD IS A MATTER O F RECORD AND NOT IN DISPUTE. THAT RS. 60,00,000/- WAS TRANSFERRED IN TH REE TRANCHES OF RS. 10,00,000/-, RS. 10,00,000/- AND RS.40,00,000/- ON 01/08/2014, 01/08/2014 AND 09/02/2014 RESPECTIVELY FROM THE ABO VE TO THE BANK ACCOUNT OF APPELLANT IS A MATTER OF RECORD AND NOT IN DISPU TE. THE LD. AO HAS CITED THE POOR FINANCIAL POSITION ALL THE ABOVE TO DOUBT THE CLEAR BANK TRANSFER. IT IS MY CONSIDERED VIEW THAT THE SOURCE OF THE RS. 60,00,00 0/- LOAN STANDS DULY ESTABLISHED. D. LOAN OF RS.3,00,000/- FROM SHRI RAJINDER PAL MIT TAL, FOR THE PURCHASE PROPERTY. THAT SHRI RAJINDER PAL MITTAL UNCLE OF THE APPELLAN T DERIVES RENTAL INCOME, SHARE IN PARTNERSHIP FIRM AND INTEREST INCOMES AND IS REGULARLY ASSESSED TO TAX WITH ITO, WARD-SANGRUR IS A MATTER OF RECORD AND NO T IN DISPUTE. THAT THE LOAN AMOUNT OF RS. 3,00,000/- WAS TRANSFERRED THROUGH BA NKING CHANNELS IS ALSO MATTER OF RECORD. THE LD. AO HAS DOUBTED THE PAYMEN T CAPACITY OF THE UNCLE ON THE BASIS OF HIS LOW RETURNED INCOME. RETURNED INCO ME FOR A PARTICULAR ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 7 OF 12 ASSESSMENT YEAR IS NO CRITERIA FOR JUDGING THE ACCO UNTED FUNDS AT HAND OF A PERSON AND HIS/ HER CAPACITY TO PAY. I HAVE NOT CON SIDERED THE BANK ACCOUNT OF RAJINDER PAL MITTAL SUBMITTED AS ADDITIONAL EVIDENC E; REGARDLESS THEREFORE IT IS MY CONSIDERED VIEW THAT THE APPELLANT HAS DISCHARGE D THE BURDEN OF EXPLAINING THE IDENTITY, CREDITWORTHINESS OF RAJINDER PAL MITT AL AND ALSO THE GENUINENESS OF THE TRANSACTION QUA THE APPELLANT. E. AMOUNTS TOTALING RS.25,00,000/- RECEIVED FROM SH RI SURINDER PAL MITTAL APPELLANT'S FATHER: THAT SHRI SURINDER PAL MITTAL, THE APPELLANT'S FATH ER IS REGULAR ASSESSEE ASSESSED WITH ITO, WARD-SANGRUR WITH ANNUAL RENTAL INCOME OF RS.25,88,628/- AND ALSO DERIVING INCOME FROM SHARE IN PARTNERSHIP FIRM AND INTEREST INCOMES IS A MATTER OF RECORD AND NOT IN DISPUTE. THAT THE APP ELLANT HAS RECEIVED THE LOAN AMOUNT THROUGH BANK TRANSFER IN TWO TRANCHES OF RS. 13,00,000/- AND RS. 12,00,000/- IS ALSO MATTER OF RECORD AND NOT IN DIS PUTE. THE LD. AO HAS DOUBTED THE LOAN ON THE BASIS THAT THE APPELLANT HAS PAID N O INTEREST ON THE LOAN FROM HIS FATHER AND THAT THE FATHER'S RETURNED INCOME IS ON THE LOWER SIDE. IT IS MY CONSIDERED VIEW THAT THE APPELLANT HAS DULY DISCHAR GED THE BURDEN OF PROOF REGARDING THE IDENTITY CREDITWORTHINESS OF SHRI. SU RINDER PAL MITTAL AND ALSO THE GENUINENESS OF THE TRANSACTION. F. LOAN OF RS.21,00,000/- FROM SMT. PARVEEN MI TTAL AND SMT. KIRAN BALA THAT PARVEEN MITTAL AND KIRAN BALA ARE INCOME TAX A SSESSEE AND RELATIVES OF THE APPELLANT IS A MATTER OF RECORD AN D NOT IN DISPUTE. THAT THE TWO REGULARLY FILE RETURNS OF INCOME SHOWING INCOME FRO M RENT, INTEREST INCOME, SHARE FROM PARTNERSHIP FIRM OTHER THAN AGRICULTURAL INCOM E IS A MATTER OF RECORD. THAT THE TWO REGULARLY FILE RETURNS OF INCOME IS ALSO A MATTER OF RECORD. THE APPELLANT CLAIMS THAT THE LOAN TO THE APPELLANT WAS FROM A JO INT ACCOUNT HELD BY PARVEEN MITTAL AND KIRAN BALA WHICH INTER-ALIA REGULARLY HA D THEIR AGRICULTURAL INCOME DEPOSITED. THAT THE LOAN OF RS. 21,00,00 WAS TRANSF ERRED IN TWO TRANCHES OF RS. 12,00,000/- AND RS.9,00,000/- ON 02/07/2014, AND 03 /07/2014 TO THE BANK ACCOUNT OF THE APPELLANT FROM THE SAME JOINT ACCOUN T OF PARVEEN MITTAL AND KIRAN BALA IS A MATTER OF RECORD AND NOT IN DISPUTE. THAT THE APPELLANT FILED DULY SWORN AFFIDAVITS OF SMT. PARVEEN MITTAL AND SMT. KI RAN BALA BEFORE THE LD. A.O., ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 8 OF 12 ALONG WITH COPIES OF INCOME TAX RETURNS, INCOME COM PUTATION CHARTS, BANK ACCOUNT STATEMENT, 'J' AND PHOTOCOPIES OF CHEQUES I SSUED BY THE KACHAARHATIYAS' TO SUPPORT THE CLAIM OF AGRICULTUR AL PROCEEDS TO THEM IS ALSO A MATTER OF RECORD AND NOT IN DISPUTE. THE LD. AO HAS BROUGHT NOTHING ON RECORD TO SUGGEST THAT THE SOURCES OF INCOME OR THE BANK TRAN SFER ARE NOT GENUINE. THE LD. AO CASE AGAINST THESE LOANS IS BASED ON THE FINDINGS THAT THE APPELLANT DID NOT REMEMBER THE NAMES OF THESE CREDITORS DURIN G THE STATEMENT RECORDED DURING ASSESSMENT PROCEEDINGS AND THAT NO INTEREST IS PAID THEREON AND FURTHER THAT THE RETURNED INCOME OF THE CREDITORS IS ON THE LOWER SIDE. THE APPELLANT NOT REMEMBERING THAT PART OF THE LOANS WAS FORM HIS REL ATIVES {CHACHI) WHILE RAISING SOME DOUBT ABOUT THE ENTIRE ARRANGEMENT OF LOANS TO PURCHASE THE PROPERTY, DOES NOT CONTROVERT THE SUBSTANTIVE EVIDENCE. IT IS MY CONSIDERED VIEW THAT THE APPELLANT HAS DISCHARGED QUA THE APPELLANT THE IDEN TITY, CREDITWORTHINESS OF THE CREDITOR AND THE GENUINENESS OF THE TRANSACTION. IF THE LD. AO HAD ANY DOUBTS ABOUT THE SOURCES OF THE CREDITORS THE MATTER COULD HAVE BEEN REFERRED TO THE AOS OF THE CREDITORS. G. LOAN FROM M/S. GARG CHEMICALS, SUNAMI GATE, SANGRUR FOR 10 DAYS THE APPELLANT HAS SHOWN A LOAN FORM M/S. GARG CHEMI CALS, SUNAMI GATE FOR A PERIOD OF 10 DAYS RECEIVED ON 12.08.2014 THRO UGH RTGS FROM THE BANK ACCOUNT OF GARG CHEMICALS AND REPAID 10 DAYS LATER ON 22.08.2014 AFTER RECEIVING ADDITIONAL LOANS FROM J.R CHEMICALS AS DI SCUSSES SUPRA. THAT GARG CHEMICALS IS AN EXISTING INCOME TAX ASSESSEE, REGUL ARLY FILING ITS RETURN OF INCOME IS A MATTER OF RECORD AND NOT IN DISPUTE. TH AT THE LOAN PAYMENT AND REPAYMENT IS THROUGH BANKING CHANNELS IS A MATTER O F RECORD AND NOT IN DISPUTE. THAT THE APPELLANT HAS FILED COPY OF THE LEDGER ACC OUNT OF THE APPELLANT IN THE BOOKS OF GARG CHEMICALS IS A MATTER OF RECORD AND N OT IN DISPUTE. THE LD. AO HAS NOT ACCEPTED THE GENUINENESS OF THE LOAN ON THE GROUNDS THAT DURING THE ASSESSMENT PROCEEDINGS THE APPELLANT DID NOT REMEMB ER THE NAME OF THE CREDITOR WHILE A STATEMENT WAS RECORDED. IN ADDITIO N, THE LD. AO HAS COMMENTED ON THE FACT THAT THE APPELLANT HAS NOT PA ID ANY INTEREST ON THE LOAN AND NOT GIVEN THE DETAILS OF RETURNED INCOME OF GAR G CHEMICALS. THE LD. AO HAS BROUGHT NOTHING ON RECORD TO ESTABLISH THAT THE BAN K TRANSFER OF LOAN AND ITS REPAYMENT WERE NOT GENUINE OR THAT GARG CHEMICAL DI D NOT HAVE THE CAPACITY TO ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 9 OF 12 PAY. HOWEVER, THAT THE APPELLANT DID NOT REMEMBER T HE NAME OF A FIRM THAT GAVE IT A SHORT-TERM ACCOMMODATION LOAN OF RS. 10,00,000 /- AND THAT THESE TWO TRANSACTIONS WERE THE ONLY TRANSACTIONS BETWEEN THE APPELLANT AND GARG CHEMICALS DOES RAISE A DOUBT ABOUT THE ARRANGEMENTS , HOWEVER THERE IS NOTHING ON RECORD TO CONTROVERT THE TRANSACTIONS OR THAT AN Y CASH PASSED ON BETWEEN THE APPELLANT AND GARG CHEMICALS. WITH REGARDS TO THE P ROVISIONS OF SECTION 68 OF THE ACT, IT IS MY CONSIDERED VIEW THAT WITH REGARDS TO SECTION 68 OF THE ACT, THE APPELLANT HAS DISCHARGED THE BURDEN OF PROOF TO EST ABLISH THE IDENTITY AND CREDITWORTHINESS OF THE CREDITOR AND THE GENUINENES S OF THE TRANSACTION QUA THE APPELLANT. THE LD. AO HAS NOT RAISED ANY DOUBTS ABO UT THE SOURCE OF THE SOURCE. H. LOAN FROM M/S. J.R. PRINTING PRESS, NABHA G ATE, SANGRUR WITH REGARDS TO JR PRINTING PRESS THE LD. AO HAS DO UBTED THE CREDIT ON THE GROUNDS THAT THERE IS A DISPARITY BETWEEN THE BOOKS OF THE APPELLANT WHICH SHOWS A LOAN OF RS. 2,00,000 FROM M/S J.R PRINTING PRESS WHILE THE FIRM HAS SHOWN A LOAN OF RS. 55 LAKHS TO THE APPELLANT. THAT THE LOAN OF RS. 2,00,000/- HAS BEEN CITED BY THE APPELLANT TO EXPLAIN THE SOUR CE OF FUNDS FOR THE PURCHASE OF THE IMPUGNED PROPERTY AND THAT RS. 55,00,000/- I S THE LOAN SHOWN BY THE APPELLANT FROM M/S JR PRINTING PRESS AT THE END OF THE PREVIOUS YEAR RELEVANT TO THE AY OF THE IMPUGNED ASSESSMENT YEAR IS A MATTER OF RECORD. HOWEVER, IF THE ACCOUNT OF THE APPELLANT IS EXAMINED IN THE BOOKS O F JR PRINTING PRESS, THE ENTRIES ARE AS UNDER: DATE PARTICULARS VCH DEBIT CREDIT BALANCE 1.04.14 OPENING BALANCE 2,85,527 9.08.14 CHEQUE PAYMENT FROM CURRENT ACCOUNT 10 LAKHS 9.10.14 CHEQUE PAYMENT FROM CURRENT ACCOUNT 43 LAKHS 27.10.14 CHEQUE PAYMENT FROM CURRENT ACCOUNT 2 LAKH ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 10 OF 12 THE PAYMENT FOR THE PROPERTY IN QUESTION WAS MADE B ETWEEN 02.06.2014 TO 05.11.2014 AND THE TWO INITIAL LOANS THE APPELLA NT CLAIMS HAVE PURPORTEDLY BEEN TAKEN IN TWO TRANCHES OF LOANS OF RS. 10,00,00 0 AND RS. 43,00,000/-S FROM JR PRINTING PRESS OSTENSIBLY TO PAY BACK GARG CHEMI CALS AND TO PAY BACK PART OF THE LOAN TAKEN FORM THE AGRICULTURAL LIMIT ACCOU NT OF THE APPELLANT AND HIS RELATIVES DISCUSSED SUPRA. THE LD. AO HAS NOT DISCUSSED THE LATER LOANS AND TH EIR GENUINENESS OR OTHERWISE IN THE ASSESSMENT ORDER. THAT THE CREDITO R JR PRINTING PRESS IS A PARTNERSHIP FIRM REGULARLY FILING A RETURN OF INCOM E IS A MATTER OF RECORD AND NOT IN DISPUTE. THAT THE APPELLANT FILED THE COPY OF AC COUNT OF THE ACCOUNT OF THE APPELLANT IN THE BOOKS OF JR PRINTING PRESS, COPY O F THE BANK ACCOUNT, RETURNS OF INCOME P&L ACCOUNT BALANCE SHEET AND COMPUTATION OF INCOME OF OF THE JR PRINTING PRESS BEFORE THE LD. AO IS A MATTER OF REC ORD AND NOT IN DISPUTE. THAT THE APPELLANT WAS A CREDITOR OF THE FIRM JR PRINTIN G PRESS AT THE BEGINNING OF THE PREVIOUS YEAR RELEVANT TO THE AY OF THE IMPUGNED OR DER. THAT THE TRANSFERS TOOK PLACE THROUGH REGULAR BANKING CHANNELS IS ALSO A MA TTER OF RECORD AND NOT IN DISPUTE. THAT THERE IS NO CASH DEPOSIT IN THE BANK ACCOUNT LINKED TO THE TRANSFERS TO THE APPELLANT FROM THE FIRM DURING THE RELEVANT PERIOD IS ALSO A MATTER OF RECORD AND NOT IN DISPUTE. THE LD. AO HAS DOUBTED THE LOANS ON THE GROUND OF THE RECONCILIATION DIFFERENCES AS WELL AS BECAUSE NO INTEREST IS PAID THEREON. IT IS MY CONSIDERED VIEW THE APPELLANT HAS DURING ASSESSMENT PROCEEDINGS AND LATER DURING APPELLATE PROCEEDINGS, DISCHARGED THE BURDEN PROOF TO ESTABLISH THE IDENTITY AND CREDIT WORTHINE SS OF THE CREDITOR AND ALSO THE GENUINENESS OF THE CREDITOR JR PRINTING PRESS QUA T HE APPELLANT. THE LD. AO WAS FREE TO REFER THE MATTER REGARDING THE DOUBTS ABOUT THE TRANSACTIONS OF THE CREDITOR TO THE CONCERNED AO. 5.1 THE LD. AO HAS, STARTING ON A WELL-FOUNDED PREM ISE THAT A PURCHASE OF IMMOVEABLE PROPERTY IS UNLIKELY TO BE FUNDED ALMOST ENTIRELY FROM LOANS NOT BEEN ABLE TO CONTROVERT THE APPELLANT'S SUBMISSIONS REGA RDING THE GENUINENESS OF THE PARTIES, THEIR CREDIT-WORTHINESS AS WELL AS THE PUR PORTED GENUINENESS OF THE TRANSACTIONS WITHIN THE RUBRIC OF SECTION 68 OF THE ACT. THE LD. AO'S FINDING OF JUDGING THE CREDITWORTHINESS OF THE RELATIVES OF TH E RELATIVES OF THE APPELLANT ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 11 OF 12 BASED ON THEIR RETURNED INCOMES FOR THE AY OF THE I MPUGNED ORDER ALONE, IS IN MY CONSIDERED VIEW PREDICATED ON A FLAWED INTERPRETATI ON OF NET WORTH OF THE CREDITORS. AFTER THE APPELLANT GAVE THE UNDERLYING EVIDENCES TO SUPPORT THE GENUINENESS OF THE TRANSACTIONS AND THE SOURCE/ IDE NTITY OF THE CREDITORS, THE BURDEN OF PROOF SHIFTED ON THE DEPARTMENT TO DEMONS TRATE FLAWS IN THE SUBMISSIONS OF THE APPELLANT. THE LD. AO HAS NOT DI SCHARGED THIS BURDEN OF PROOF REGARDING THE EXPLANATIONS OF THE APPELLANT BEING W RONG/ INCOMPLETE THE LD. AO'S FINDING THEREAFTER THAT THE ENTIRE INVESTMENT IN TH E PROPERTY IS UNEXPLAINED U/S SECTION 69 OF THE ACT, IS IN MY CONSIDERED VIEW NOT BASED ON ANY FIRM EVIDENCE AND THAT THE LD. AO HAS ACTED ON SURMISES AND CONJE CTURES. THE ADDITIONS HAVE NO LEGS TO STAND ON AND ARE DIRECTED TO BE DELETED. IT IS ORDERED ACCORDINGLY. 7. AS POINTED OUT BY THE LD. COUNSEL, THE LD. C IT(A) HAS PASSED THE IMPUGNED ORDER AFTER EXAMINING EACH AND EVERY DOCUMENT PLACE D ON RECORD BY THE ASSESSEE TO SUBSTANTIATE HIS CLAIM. THE ASSESSEE HAS PLACED ON RECORD THE DOCUMENTARY EVIDENCE TO ESTABLISH THAT HE RECEIVED RS. 1,57,00, 000/- FROM M/S MITTAL TRADERS WHEREIN THE ASSESSEE WAS A PARTNER. HE HAS PLACED O N RECORD THE DOCUMENTARY EVIDENCE TO PROVE WITHDRAWAL OF RS. 10,00,000/- FRO M HIS JOINT ACCOUNT WITH SMT. KUSUM LATA, WITHDRAWAL OF RS.60,00,000/- FROM JOINT KISSAN GOLD CARD BANK ACCOUNT WITH S/SHRI RAJINDER PAL MITTAL AND PUNEET MITTAL. HE HAS ALSO PLACED ON RECORD THE DOCUMENTARY EVIDENCE TO ESTABLISH THAT H E HAD OBTAINED LOAN AMOUNTING TO 3,00,000/- FROM SH. RAJINDER PAL MITTA L, LOAN AMOUNTING TO RS. 21,00,000/- FROM SMT. PRAVEEN MITTAL AND SMT. KIRAN BALA, LOAN AMOUNTING TO RS. 25,00,000/- FROM SH. SURINDER PAL MITTAL (FATHE R OF THE ASSESSEE), LOAN AMOUNTING TO RS. 10,00,000/- FROM M/S GARG CHEMICAL S AND LOAN AMOUNTING TO RS. 2,00,000/- FROM M/S JR PRINTING PRESS. DURING T HE APPELLATE PROCEEDINGS, NO INFIRMITY WAS NOTICED BY THE LD. CIT(A) IN THE SAID TRANSECTIONS. THE AO HAS ALSO NOT DOUBTED THE IDENTITY OF THE PERSONS OR ENTITIES FROM WHOM THE ASSESSEE RAISED ITA NO 844/CHD/2019 ITO VS. VANEET MITTAL, SANGRUR PAGE 12 OF 12 LOANS IN QUESTION. THE LD. CIT(A) FURTHER NOTICED T HAT ALL THE TRANSACTIONS HAD BEEN MADE THROUGH BANKING CHANNELS. UNDER THESE CIR CUMSTANCES, THE LD. CIT(A) RIGHTLY DELETE THE ADDITION MADE BY THE AO. MOREOVE R, AO HAS NOT POINTED OUT ANY EVIDENCE ON THE BASIS OF WHICH HE REACHED AT THE CO NCLUSION THAT THE ASSESSEE HAD OBTAINED ACCOMMODATION ENTRIES FROM THE PARTIES CONCERNED. IN OUR CONSIDERED OPINION, SINCE THE AO HAD MADE THE ADDIT ION IN QUESTION ON ASSUMPTION AND PRESUMPTION BASIS THE LD. CIT(A) HAS RIGHTLY DELETED THE ADDITION. WE ARE THEREFORE, OF THE CONSIDERED VIEW THAT THE ORDER PASSED BY THE LD. CIT(A) IS BASED ON EVIDENCE ON RECORD AND AS PER TH E SETTLED PRINCIPLES OF LAW, HENCE, DOES NOT REQUIRE ANY INTERFERENCE. THEREFORE , WE FIND NO MERIT IN THE APPEAL OF THE REVENUE. ACCORDINGLY, WE DISMISS THE APPEAL OF THE REVENUE. IN THE RESULT THE APPEAL FILED BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED ON 22 ND OCT. 2021. SD/- SD/- (N.K. SAINI) (R.L. NEGI) / VICE PRESIDENT / JUDICIAL MEMBER DATED: 22 ND OCTOBER, 2021 POONAM *+,+ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. - / CIT 4. - ( )/ THE CIT(A) 5. + 0 , $0 , 2 / DR, ITAT, CHANDIGARH 6. / GUARD FILE / BY ORDER, / ASSISTANT REGISTRAR