Shri Mahesh N. Vyas, Ahmedabad V. The Dy. CIT., Cent. Circle-1(3), Ahmedabad

ITSSA 416/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9029 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 25 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 08-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 13-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H V GUJJAR
• Keywords: Unexplained cash credit; Income from undisclosed sources; Non compliance; Set aside
• Section: 153A; 250; 68; 12; 144; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER (SS) ./ IT(SS)A NOS.415 & 416/AHD/2017 ( / ASSESSMENT YEARS : 2010-11 & 2011-12) MAHESH N. VYAS D-4, 302, KARNAVATI APARTMENT HIRABHAI TOWER, UTTAMNAGAR MANINAGAR, AHMEDABAD-380008 / VS. THE DY.CIT CENTRAL CIR-1(3) AHMEDABAD ./ ./ PAN/GIR NO. : ABUPV 2611 H ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI ASEEM L. THAKKAR, AR / RESPONDENT BY : SHRI H.V. GUJJAR, CIT-DR / DATE OF HEARING 13/06/2019 !'# / DATE OF PRONOUNCEMENT 08/07/2019 / O R D E R PER SHRI RAJPAL YADAV, JUDICIAL MEMBER : THE PRESENT TWO APPEALS ARE DIRECTED AT THE INSTANC E OF THE ASSESSEE AGAINST THE SEPARATE ORDERS OF EVEN DATE I.E. DATED 18/08/2017 PASSED BY THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-11, AHME DABAD [CIT(A) IN SHORT] IN ASSESSMENT YEARS (AYS) 2010 -11 & 2011-12. IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 2 - 2. THE ASSESSEE HAS RAISED SIX GROUNDS OF APPEAL IN EACH ASSESSMENT YEAR. HOWEVER, AT THE TIME OF HEARING, LD.COUNSE L FOR THE ASSESSEE HAS CONFINED HIS ARGUMENT TO A LIMITED ISSUE WHEREBY HE CONTENDED THAT ADDITIONS ON MERIT HAS BEEN MADE U/S.68 OF THE INCO ME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN BOTH THE YEARS WITHOUT THERE BEING ANY SUPPORT OF SEIZED MATERIAL. HE POINTED OUT THA T ADDITION OF RS.6,25,000/- AND RS.12,43,028/- HAS BEEN MADE BY THE ASSESSING OFFICER IN AYS 2010-11 & 2011-12 U/S.68 OF THE ACT WHICH HAS BEEN CONFIRMED BY THE CIT(A). 3. WITH THE ASSISTANCE OF LD.REPRESENTATIVES, WE HA VE GONE THROUGH THE RECORD CAREFULLY. IT EMERGES OUT FROM THE RECO RD THAT A SEARCH U/S.132 OF THE ACT WAS CONDUCTED IN THE CASE OF SHIP BREAKE RS GROUP OF BHAVNAGAR ON 17/02/2012. THE ASSESSEE WAS ALSO COV ERED UNDER SEARCH ACTION AND, THEREFORE, IN ORDER TO GIVE LOGICAL END TO THE PROCEEDING, A NOTICE U/S.153A OF THE ACT WAS ISSUED UPON THE ASSE SSEE ON 21/12/2012 WHICH WAS DULY SERVED UPON THE ASSESSEE. IT ALSO E MERGES OUT FROM THE RECORD THAT IN RESPONSE TO SUCH NOTICE ASSESSEE DID NOT FILE RETURNS OF INCOME IN BOTH THE YEARS. THE LD. ASSESSING OFFIC ER SET THE ASSESSMENT PROCEEDINGS IN MOTION BY ISSUANCE OF NOTICE U/S.142 (1) OF THE ACT WHICH WAS ISSUED ON 10/02/2014. THE ASSESSEE DID NOT RES POND TO ALL THESE NOTICES, HENCE AN EX-PARTE PROCEEDING WAS TAKEN UP U/S.144 OF THE ACT AND ASSESSMENT ORDERS WERE PASSED ON 24/03/2014. THE LD.AO MADE IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 3 - ADDITION OF RS.6,25,000 AND RS.12,43,028/- IN AYS 2 010-11 & 2011-12 RESPECTIVELY. 4. BEFORE LD.CIT(A), ASSESSEE TOOK VARIOUS LEGAL PL EAS WHEREBY HE HAS CHALLENGED THE JURISDICTION OF THE ASSESSING OF FICER U/S.153A OF THE ACT. THE LD.CIT(A) DID NOT ACCEPT THE CONTENTIONS OF THE ASSESSEE. ACCORDING TO THE CIT(A), THE ASSESSEE DID NOT FILE RETURN OF INCOME U/S.139(1) IN AY 2010-11. THE RETURN WAS FILED ON 30/03/2012 WHICH IS SUBSEQUENT TO THE SEARCH. HENCE, THE ASSESSMENT PR OCEEDINGS WOULD ABATE AND ASSESSMENT IS TO BE PASSED U/S.153A OF TH E ACT. THE FINDING ON MERIT IN BOTH THE ASSESSMENT YEARS IS VERBATIM SAME . WE TAKE NOTE OF THE FINDING RECORDED BY THE CIT(A) IN AY 2010-11 WHICH READS AS UNDER: 5.1. THE AR OF THE APPELLANT SUBMITTED THAT THE AO HAD TAKEN INTO CONSIDERATION THE UNEXPLAINED CASH CREDITS FROM THE BALANCE-SHEET FILED ALONGWITH THE RETURN U/S.139 OF THE ACT. HE MADE A DDITION OF THE CASH CREDITORS ON THE ALLEGED GROUND OF NON COMPLIANCE B Y THE APPELLANT. THE AO DID NOT HAVE ANY MATERIAL ON RECORD FOR MAK ING THE ABOVE ADDITION. 5.2. FACTS OF THE CASE AND FINDINGS OF THE AO ARE S ELF EVIDENT ON THE ISSUE THAT THE ASSESSEE DID NOT FURNISH CONFIRMATIO NS OF THE CASH CREDITORS NOR DID HE FURNISH ANY OTHER INFORMATION AS CALLED FOR BY THE AO IN THE SHOW CAUSE NOTICE DATED 18.3.2014. SO F AR AS THE MATTER OF ADDITION MADE WITHOUT REFERRING TO ANY SEIZED MATER IAL IS CONCERNED, THE POSITION OF LAW ON THIS ISSUE IS WELL SETTLED. THE ASSESSEE FURNISHED RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION U /S.139(1) ON 13.3.2012 AND THE SEARCH WAS CONDUCTED ON 17.2.2012 . THUS, THE RETURN WAS FILED AFTER INITIATION OF THE SEARCH. THEREFOR E, THE ASSESSMENT IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 4 - PROCEEDINGS FOR THE YEAR UNDER CONSIDERATION WERE A BATED. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, THE GROUND OF AP PEAL IS DISMISSED. 5. THE LD.COUNSEL FOR THE ASSESSEE WHILE IMPUGNING THE ORDERS OF LD.CIT(A) IN BOTH THE YEARS CONTENDED THAT THE LD. FIRST APPELLATE AUTHORITY HAS NOT TAKEN INTO CONSIDERATION THE SUBM ISSIONS FILED BY THE ASSESSEE. HE TOOK US TO THE COPIES OF THE WRITTEN SUBMISSIONS FILED BEFORE THE FIRST APPELLATE AUTHORITY ON THE ISSUE ON MERIT . AT THIS STAGE, IT IS PERTINENT TO TAKE NOTE OF THE RELEVANT SUBMISSIONS MADE BY THE ASSESSEE WHICH READ AS UNDER: 5.5. A.Y. 2010-11 :- 5.5.2 SUNDRY CREDITORS :- ON ANALYZING THE BALANCE SHEET FOR A.Y. 2010-11, IT IS SEEN THAT YOU HAVE SHOWN SUNDRY CREDITORS OF RS.6,25,000/-. IN ABSENCE OF THE DETAILS OF CONCERNED PARTIES, THE IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF THE CONCERNED PARTIES COULD NOT BE V ERIFIED, YOU ARE, THEREFORE, REQUIRED TO SHOW CAUSE AS TO WHY THE SAI D AMOUNT OF RS.6,25,000/- SHOULD NOT BE DISALLOWED AND ADDED TO THE TOTAL INC OME FOR A. Y.2010-11. 6. IS FURTHER REITERATED THAT DESPITE OF GIVING YOU AMPLE OPPORTUNITIES, YOU HAVE NOT FILED RETURNS OF INCOME U/S 153A OF TH E ACT. SINCE THIS IS FINAL SHOW CAUSE NOTICE U/S 144 OF THE ACT YOU ARE REQUESTED TO SHOW CAUSE AS TO WHY THE ABOVE DISALLOWANCES/ADDITIONS S HOULD NOT BE MADE IN YOUR CASE ON THE ABOVE ISSUES. 7. YOUR REPLY IN THIS REGARD SHOULD REACH THE UNDER SIGNED WITHIN 07 DAYS OF RECEIPT OF THIS LETTER AND IF NO REPLY IS R ECEIVED, THE UNDERSIGNED WILL PROCEED WITH THE FINALISATION OF ASSESSMENT PR OCEEDINGS U/S 144 OF IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 5 - THE I.T.ACT, 1961, ON THE BASIS OF THE MATERIAL AVA ILABLE WITH THIS OFFICE, FOR A. Y.2006 07 TO 2012-13. THEREFORE, FROM THE PERUSAL OF THE ABOVE SHOW CAUSE NOTICE IT WOULD BE CLEAR THAT THE AO HAS NOT RELIED UPON ANY SEIZED MA TERIAL FOUND DURING THE COURSE OF SEARCH PROCEEDINGS FOR THE PURPOSE OF MAKING ANY ADDITION WITH RESPECT TO UNEXPLAINED CASH CREDITS. THE AO HAS IN FACT REFERRED TO THE BALANCE SHEET OF THE APPELLANT WHIC H HAS BEEN FILED ALONG WITH THE RETURN FILED U/S 139 OF THE ACT. THI S ONLY GOES TO DEMONSTRATE THAT THE AO HAS MERELY RELIED UPON THE FINANCIAL STATEMENTS FURNISHED BY THE APPELLANT DURING THE COURSE OF ORI GINAL ASSESSMENT WHILE PROPOSING AND MAKING THE ADDITIONS. 8. FROM THE ABOVE DISCUSSION IT WOULD BE WOULD BE APPARENT THAT THE AO ACCEPTED AND ADMITTED THE FACT THAT THERE WAS NO IN CRIMINATING MATERIAL FOUND DURING THE COURSE OF SUCH PROCEEDINGS ON THE BASIS OF WHICH IT COULD BE INFERRED THAT THE APPELLANT HA4 EARNED INC OME WHICH WAS NOT REFLECTED IN THE REGULAR BOOKS OF ACCOUNT MAINTAINE D. THE AO HAS MERELY REFERRED TO THE BALANCE SHEET AND ON THE BAS IS OF ALLEGED NON- COMPLIANCE HAS MADE DISALLOWANCE U/S 68 OF THE ACT BEING UNEXPLAINED CASH CREDIT. THE ENTIRE ACTION OF THE AO CLEARLY SH OWS THAT THERE IS NO MATERIAL ON THE BASIS OF WHICH THE ADDITIONS CAME T O BE MADE. 9. COMING TO THE MERITS OF THE ADDITION THE AO H AD STATED FOLLOWING CREDITORS AS UNEXPLAINED: A. VARUN METRO CRAFT PVT. LTD. RS. 5,00,0 00/- B. ARVIND FOUNDRY RS. 1,25,000 10. AS REGARDS VARUN METRO CRAFT PVT. LTD. HE IS OUR REGULAR CUSTOMER AND COPY OF ACCOUNT FROM THE PREVIOUS YEAR RELEVANT TO A.Y.2008-09 IS ENCLOSED FOR YOUR KIND REFERENCE. THE PERUSAL OF TH E ACCOUNT WOULD REVEAL THAT AGAINST THE SALES MADE HE HAD ISSUED CH EQUE OF RS.721854 ON 29.01.2009. THEREFORE, ADVANCE AMOUNT OF RS.4996 57 WAS OUTSTANDING FOR THE YEAR UNDER APPEAL. DURING THE Y EAR UNDER APPEAL IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 6 - FURTHER RS.5.00 LACS ADVANCE HAD BEEN RECEIVED WHIC H HAVE BEEN TREATED AS ALLEGED UNEXPLAINED CASH CREDIT. IT IS SUBMITTED THAT IN THE EARLIER YEARS THE TRANSACTION WITH THE SAME PARTY HAS BEEN ACCEPTED AS GENUINE AND PART OF THE TRANSACTION WITH THE SAME PARTY IN THE SUBSEQUENT YEAR HAS BEEN TREATED AS UNEXPLAINED CASH CREDIT. FURTHE RMORE, IN THE SUBSEQUENT YEAR THE AMOUNT RECEIVABLE FROM SATYAM M ETAL HAS BEEN ADJUSTED AGAINST THE OUTSTANDING BALANCE AND FINAL REPAYMENT HAS BEEN MADE ON 24.01.2013. THE ABOVE DISCUSSION WOULD REVE AL THAT THE ASSESSEE HAD RECEIVED ADVANCE FROM ITS CUSTOMER VAR UN METROCRAFT PVT. LTD. AGAINST PROPOSED SALES AND SINCE THE SALE ORDE R DID NOT FRUCTIFY THE SAME HAD BEEN RETURNED IN THE SUBSEQUENT YEARS. THE ADVANCES FROM CUSTOMERS HAVE BEEN ERRONEOUSLY CONSIDERED AS UNEXP LAINED CASH CREDITS. INFACT, THESE ARE TRADE DEPOSITS FROM SUCH PARTIES WHERE SALES MADE TO THEM HAVE BEEN TREATED AS INCOME. THE PERUS AL OF THE ACCOUNTS WOULD ALSO REVEAL THAT THE AMOUNTS IN QUESTION HAVE BEEN RETURNED BY ACCOUNT PAYEE CHEQUES. THE ENTIRE TRANSACTIONS HAVE BEEN CONDUCTED THROUGH NORMALLY BANKING CHANNELS AND BY ACCOUNT PA YEE CHEQUES ONLY. SINCE THE AMOUNTS HAVE BEEN RETURNED AND THERE IS N O FURTHER TRANSACTIONS WITH THESE PARTIES WE ARE NOT IN A POS ITION TO OBTAIN THEIR CONFIRMATIONS. IN ANY CASE THE ALLEGATION THAT THE UNEXPLAINED CASH CREDITORS REPRESENT THE UNACCOUNTED INCOME OF THE A PPELLANT WOULD NOT SURVIVE ON THE GROUND THAT THE AMOUNTS HAVE BEEN RE TURNED AND THERE WOULD BE NO REASON ON THE PART OF THE APPELLANTS TO RETURN THE MONEY IF THE SAME HAD BEEN INTRODUCED IN THE BOOKS OF ACCOUN TS UNDER THE GUISE OF LOANS/ADVANCES. 11. IN THE CASE OF ARVIND FOUNDRY THE APPELLANT H AD CONDUCTED SALES IN THE PREVIOUS YEAR RELEVANT TO A.Y.2008-09. APART FROM T HE RECEIPT OF THE SALE PROCEEDS ADVANCE OF RS.1,25,000/- HAD BEEN REC EIVED IN THE PREVIOUS YEAR RELEVANT TO A.Y.2012-13. THE AMOUNT I N QUESTION HAS BEEN RETURNED ON 26.12.2012 BY ACCOUNT PAYEE CHEQUE. THE ABOVE DISCUSSION WOULD REVEAL THAT THESE ARE TRADE ADVANCES WHICH HA VE BEEN RETURNED IN THE SUBSEQUENT YEARS. 12. IT IS WORTHWHILE TO NOTE THAT THE AO HAS D RAWING THE CONCLUSION THAT DURING THE YEAR UNDER CONSIDERATION THERE IS ACCRET ION OF UNEXPLAINED IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 7 - CASH CREDIT TO THE EXTENT OF RS.6,25.000/- WHICH IS UNEXPLAINED IN NATURE HAS NOT EVEN FURNISHED THE NAME OF THE INDIVIDUAL P ARTIES WHO HAVE BEEN TREATED AS UNEXPLAINED CASH CREDITS. FROM THE PERUS AL OF THE BALANCE SHEET IT CAN BE OBSERVED THAT THE CURRENT LIABILITI ES COMPRISE OF SUNDRY CREDITORS AS APPEARING IN THE BALANCE SHEET FOR A.Y .2010-11 WAS RS.25,27,439/-. IN THE EARLIER YEAR THE SUNDRY CRED ITORS WAS APPEARING AT RS.19,02,439/-. THEREFORE, THERE BEING AN INCREA SE OF RS.6,25,000/- WITH RESPECT TO SUNDRY CREDITORS FOR GOODS (25,27,4 39 - 17,02,439/-) THE AO HAS PROCEEDED TO TREAT THE SUNDRY CREDITORS AS U NEXPLAINED CASH CREDITORS WHICH IS NOT JUSTIFIABLE. THE AMOUNTS IN QUESTION HAVE BEEN RECEIVED IN RESPECT OF THE TRADE ADVANCES. THE AO H AS ACCEPTED THE PURCHASES AND THEREFORE THERE IS NO REASON TO TREAT THE CREDITORS FOR GOODS AS UNEXPLAINED CASH CREDITORS. RELIANCE IS PL ACED ON THE FOLLOWING DECISION IN SUPPORT OF OUR CONTENTION. 6. SIMILAR PLEADINGS WERE RAISED FOR AY 2011-12. I T IS IMPERATIVE UPON TO TAKE NOTE OF SUCH SUBMISSIONS: 5.6 A.Y. 2011-12 :- 5.6.2. UNSECURED LOANS :- ON ANALYZING THE BALANCE SHEET FOR A.Y. 2011-12, I T IS SEEN THAT YOU HAVE SHOWN NEW UNSECURED LOANS AMOUNTING TO RS.12,4 3,028/-. IN ABSENCE OF THE CONFIRMATIONS IN RESPECT OF UNSECURED LOANS, TH E IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE CONCERNED PARTIES COULD NOT BE VERIFIED AND YOU ARE THEREFORE, REQUIRED TO SHOW CAUSE AS TO THE SAID AM OUNT OF RS. 12,43,028/- SHOULD NOT BE DISALLOWED AND ADDED TO THE TOTAL INC OME FOR A.Y.2011-12. 6. IT IS FURTHER REITERATED THAT DESPITE OF GIVING YOU AMPLE OPPORTUNITIES, YOU HAVE NOT FILED RETURNS OF INCOME U/S 153A OF T HE ACT. SINCE THIS IS FINAL SHOW CAUSE NOTICE U/S 144 OF THE ACT YOU ARE REQUE STED TO SHOW CAUSE AS TO WHY THE ABOVE DISALLOWANCES/ADDITIONS SHOULD NOT BE MADE IN YOUR CASE ON THE ABOVE ISSUES. 7. YOUR REPLY IN THIS REGARD SHOULD REACH THE UNDER SIGNED WITHIN 07 DAYS OF RECEIPT OF THIS LETTER AND IF NO REPLY IS RECEIVED, THE UNDERSIGNED WILL PROCEED IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 8 - WITH THE FINALIZATION OF THE ASSESSMENT PROCEEDINGS U/S 144 OF THE I.T.ACT, 1961, ON THE BASIS OF THE MATERIAL AVAILABLE WITH THIS OF FICE, FOR A. Y.2006-07 TO 2012- 13'. THEREFORE, FROM THE PERUSAL OF THE ABOVE SHOW CAUSE NOTICE IT WOULD BE CLEAR THAT THE AO HAS NOT RELIED UPON ANY SEIZED MATERIAL FOUND DURING THE COURSE OF SEARCH PROCEEDINGS FOR THE PURPOSE OF MAKING ANY AD DITION WITH RESPECT TO UNEXPLAINED CASH CREDITS. THE AO HAS IN FACT REFERR ED TO THE BALANCE SHEET OF THE APPELLANT WHICH HAS BEEN FILED ALONG WITH THE R ETURN FILED U/S 139 OF THE ACT. THIS ONLY GOES TO DEMONSTRATE THAT THE AO HAS MERELY RELIED UPON THE FINANCIAL STATEMENTS FURNISHED BY THE APPELLANT DUR ING THE COURSE OF ORIGINAL ASSESSMENT WHILE PROPOSING AND MAKING THE ADDITIONS . 8. IT IS HEREBY POINTED OUT THAT THE AO HAS NOT MENTIONED HOW THE AMOUNT OF RS.12,43,028/- HAS BEEN DERIVED FOR TREATING TH E SAME AS UNEXPLAINED CASH CREDITS. PRESUMABLY, ON THE BASIS OF THE TOTAL OUTS TANDING LOANS(LIABILITIES) AS APPEARING IN THE BALANCE SHEET ON 31.03.2011 BEING RS.64,31,194/- AND THE LOANS (LIABILITIES) OUTSTANDING AS ON 31.03.2010 IS RS.51,88,166/- THE AO HAS PROCEEDED TO TREAT THE DIFFERENCE AMOUNT OF RS.L2,4 3,028/- (64,31,194/- - 51,88,166/-) AS UNEXPLAINED CASH CREDITS. HOWEVER, THE AO HAS COMPLETELY LOST SIGHT OF THE FACT THAT THESE ARE NOT NEW CASH CREDI TS RECEIVED BY THE APPELLANT DURING THE YEAR UNDER CONSIDERATION. THE COPY OF AC COUNT OF THE VARIOUS PARTIES APPEARING IN THE LOANS (LIABILITIES) ACCOUN T IS ENCLOSED. DETAILS WITH RESPECT TO THE VARIOUS PARTIES ARE AS UNDER: SR.NO. NAME AMOUNT REMARKS 1. JASUMATIBEN VYAS 6,00,000/- THE ASSESSEE HAS RECEIVED RS.6,00,000/- FROM HER. COPY OF THE CONFIRMATION INDICATING HER DETAILED POSTAL ADDRESS AND HER BANK STATEMENT IS ENCLOSED. IT IS HEREBY SUBMITTED THAT SHE IS THE MOTHER OF THE ASSESSEE AND IT IS OUT OF HER PERSONAL SAVINGS THAT IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 9 - THE AFORESAID AMOUNT HAS BEEN GIVEN BY WAY OF LOAN. SHE IS A RETIRED SCHOOL TEACHER AND THE LAST SALARY DRAWN WAS RS.6900/- PER MONTH. SHE RETIRED ON 31.12.1998 AFTER NEARLY 28 YEARS OF SERVICE. SUBSEQUENT TO RETIREMENT SHE WAS IN RECEIPT OF PENSION/GRATUITY WHICH WAS INVESTED. ON ACCOUNT OF HER SON REQUIRING FUNDS THE AMOUNTS WERE RECALLED AND GIVEN TO HIM. 2. MANISHBHAI M. MEGHPARA 8,00,000/- AN AMOUNT OF RS.8,00,000/- HAS BEEN RECEIVED FROM HIM DURING THE YEAR UNDER CONSIDERATION. COPY OF ACCOUNT, CONFIRMATION, ACKNOWLEDGEMENT OF THE RETURN OF INCOME, COMPUTATION OF INCOME AND BANK STATEMENT IS ENCLOSED FOR YOUR KIND REFERENCE. ALL THESE EVIDENCES ESTABLISH THE CREDITWORTHINESS, IDENTITY AND GENUINENESS OF THE TRANSACTION. 3. NIRANJANBHAI VYAS 6,00,000/- HE IS FATHER OF THE APPELLANT AND HE IS EXPIRED ON 14.10.2014. COPY OF THE DEATH CERTIFICATE IS ALSO ENCLOSED FOR YOUR KIND REFERENCE. WE ARE ALSO ENCLOSING THE COPY OF HIS BANK STATEMENT. HE WAS SERVING WITH AMRELI JILLA MADHYASTH SAHKARI BANK LTD. AND RETIRED ON 30.11.1998 AFTER NEARLY 30 YEARS OF SALARY. WHEN HE RETIRED HIS LAST SALARY DRAWN IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 10 - WAS RS.L 1.186 PER MONTH. IT WAS OUT OF HIS PERSONAL SAVINGS THAT HE HAD GIVEN THE LOAN TO HIS SON. 4. SHREE NANDSAI STEEL PVT.LTD. 19,25,000/- THE ASSESSEE HAS GRANTED A LOAN OF RS.L0,40,000/- IN THE EARLIER YEARS. DURING THE AFORESAID YEAR AN AMOUNT OF RS.29,65,000/- HAS BEEN RECEIVED. THE ASSESSEE IS A DIRECTOR OF THE COMPANY. COPY OF ACCOUNT,CONFIRMATION, ACKNOWLEDGEMENT OF THE RETURN OF INCOME AND THE BANK STATEMENT OF THE COMPANY IS ENCLOSED FOR YOUR KIND REFERENCE. THEREFORE, COMPLETE DETAILS ESTABLISHING THE GENUIN ENESS, IDENTITY ARID CREDITWORTHINESS OF THE CASH CREDITORS STANDS ESTAB LISH. IN VIEW OF THE SAME THE ADDITIONS MADE BY THE AO ARE NOT JUSTIFIED AND ARE REQUIRED TO BE DELETED. 7. ON THE STRENGTH OF THE ABOVE, LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT NOTHING HAS BEEN CONSIDERED BY THE LD.FIRST AP PELLATE AUTHORITY. 8. ON THE OTHER HAND, LD.DR RELIED UPON THE ORDERS OF THE REVENUE AUTHORITIES. HOWEVER, HE WAS UNABLE TO CONTROVERT THE SUBMISSIONS MADE BY THE LD.COUNSEL FOR THE ASSESSEE. IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 11 - 9. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS AN D GONE THROUGH THE RECORD CAREFULLY. SUB-SECTION (6) OF SECTION 250 CONTEMPLATES THAT LD.FIRST APPELLATE AUTHORITY WOULD STATE THE POINTS IN DISPUTE AND THEREAFTER RECORD REASONS IN SUPPORT OF HIS FINDING ON THOSE POINTS IN DISPUTE. WE HAVE EXTRACTED THE ORDER OF LD.CIT(A) VIDE WHICH HE HAS ADJUDICATED THE ISSUES ON MERIT. IT IS PERTINENT T O NOTE THAT IN THE ORDERS, NOWHERE THE LD. FIRST APPELLATE AUTHORITY HAS MADE A MENTION OF THE SUBMISSIONS GIVEN BY THE ASSESSEE ON MERIT. NO DO UBT, ASSESSEE DID NOT RESPOND TO THE NOTICE OF THE ASSESSING OFFICER AND MIGHT HAVE FAILED TO FILE THESE SUBMISSIONS. BUT HE HAS POINTED OUT THA T ADDITIONS HAVE BEEN MADE BY THE ASSESSING OFFICER FROM THE DETAILS AVAI LABLE IN THE BALANCE- SHEETS, IF THAT BE SO, THEN BOOKS OF ACCOUNTS PROD UCED DURING THE HEARING BEFORE THE FIRST APPELLATE AUTHORITY THOSE HAVE TO BE LOOKED INTO. 10. NORMALLY, WHENEVER ANY IRREGULARITY CREPT IN TH E PROCEEDING, THEN AFTER REMOVING THE IRREGULARITY, PROCEEDING IS TO B E INSTITUTED FROM THAT STAGE BUT BY REMITTING THE ISSUE TO THE LD. FIRST APPELLATE AUTHORITY, WE WOULD BE MULTIPLYING THE LITIGATION, BECAUSE LD. CI T(A) WOULD CALL FOR A REMAND REPORT FROM THE ASSESSING OFFICER AND PROCEE DING WOULD COMMENCE ON TWO STAGES. IN ORDER TO AVOID THAT SITU ATION, WE DEEM IT PROPER TO SET ASIDE THE ORDERS OF THE BOTH THE REVE NUE AUTHORITIES AND TO REMIT ALL THE ISSUES TO THE FILE OF ASSESSING OFFIC ER. THE LD.AO WHILE ADJUDICATING THESE ISSUES SHALL KEEP IN MIND THE SC OPE OF ASSESSMENT IT(SS)A NOS.415 & 416 /AHD/2017 MAHESH N. VYAS VS. DCIT ASST.YEAR 2010-11 - 12 - U/S.153A R.W.S.143(3) AS PROPOUNDED BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PRINCIPAL COMMISSIONER OF INC OME-TAX-4 VS. SAUMYA CONSTRUCTION (P.)LTD. REPORTED IN (2016) 3 87 ITR 529(GUJ.). IT IS NEEDLESS TO SAY THAT OBSERVATIONS MADE BY US WIL L NOT INJURE OR IMPAIR THE CASE OF THE ASSESSING OFFICER AND WILL NOT CAUS E ANY PREJUDICE TO THE DEFENCE/EXPLANATION OF THE ASSESSEE. THE LD.AO SHA LL READJUDICATE ALL THESE ISSUES IN ACCORDANCE WITH LAW. 11. IN THE RESULT, BOTH THE APPEALS FILED BY THE AS SESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 8 TH JULY-2019 AT AHMEDABAD. SD/- SD/- ( AMARJIT SINGH ) ( RAJPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 08/ 07 /2019 &.., .(../ T.C. NAIR, SR. PS !'#$%$' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. )*+ , / CONCERNED CIT 4. , ( ) / THE CIT(A)-11, AHMEDABAD 5. /01 ((*+ , *+# , ) / DR, ITAT, AHMEDABAD 6. 145 6 / GUARD FILE. / BY ORDER, / ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD