Appeal details
Counselvise Citation
[2011] 124 COUNSELVISE.COM (IT) 7954 (ITAT-INDORE)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
1 year(s) 6 month(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax (Search & Seizure) Appeal
Pronouncement Date
29-11-2011
Appeal Filed By
Department
Order Result
Dismissed
Bench Allotted
DB
Assessment Year
2004-2005
Appeal Filed On
14-05-2010
Judgement Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER IT(SS)A NO.58/IND/2010 A.Y. 2004-05 ACIT-1(1), BHOPAL ... APPELLANT VS SHRI LAXMI AGENCIES, BHOPAL PAN AAZFS 9084 M ... RESPONDENT APPELLANT BY : SHRI ARUN DEWAN, SR. DR RESPONDENT BY : SHRI S.S. DESHPANDE, CA DATE OF HEARING : 29.11.2011 DATE OF PRONOUNCEMENT : 29.11.2011 O R D E R PER JOGINDER SINGH THIS APPEAL IS BY THE REVENUE CHALLENGING THE ORDE R OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-I, BHO PAL, DATED 22.2.2010 ON THE GROUND THAT THE LEARNED CIT( A) ERRED IN DELETING THE ADDITION OF RS.19 LACS MADE BY THE ASS ESSING 2 OFFICER ON ACCOUNT OF UNEXPLAINED CASH CREDITS U/S 68 OF THE ACT. 2. DURING HEARING OF THIS APPEAL, THE LEARNED SR. D R MERELY SUPPORTED THE ASSESSMENT ORDER WHEREAS THE LEARNED COUNSEL FOR THE ASSESSEE DEFENDED THE IMPUGNED ORDER. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON FILE. THE FACTS, IN BRIEF , ARE THAT THE ASSESSEE DECLARED NIL INCOME IN ITS RETURN FILED ON 1.11.2004. HOWEVER, NOTICE U/S 153C/153A OF THE ACT WAS ISSUED ON 19.5.2008 TO WHICH THE ASSESSEE FURNISHED RETURN ON 30.5.2008 DECLARING NIL INCOME. IT WAS NOTICED BY THE LD. ASS ESSING OFFICER THAT THE ASSESSEE SHOWN TO HAVE OBTAINED FOLLOWING UNSECURED LOANS DURING ASSESSMENT YEAR 2004-05: S.NO. NAMES OF LENDERS AMOUNT (RS.) 1 SHRI ASHOK AGENCIES 6,00,000 2 GANGA MKTG. PROP. PRABHU KINGRANI 10,00,000 3 MANOHARLAL KINGRANI 1,00,000 4 RAJKUMAR NARAYANI 1,00,000 5 RAM KUMAR NARAYANI 1,00,000 TOTAL: 19,00,000 3 4. IN RESPONSE TO THE QUERY FOR JUSTIFICATION OF UN SECURED LOANS FROM AFORESAID PARTIES/PERSONS, THE ASSESSEE FURNISHED CONFIRMATIONS. THE ASSESSING OFFICER WAS UNSATISFIE D WITH SUCH JUSTIFICATION ON THE FOLLOWING REASONS: A) THE CASH CREDIT IS NOT REFLECTED IN THE BANK ACCOUNT OF THE ASSESSEE OR NO LOAN WAS RECEIVED THROUGH BANK ACCOUNT. B) THE ASSESSEE HAS FILED CASH FLOW STAT EMENT. THE AVAILABILITY OF THE FUND WAS NOT SUFFICIENT IN THE HAND OF THE ASSESSEE FOR THE INVESTMENT IN LAND AND TO EXPLAIN THE DOCUMENTS FOUND DURING THE COURSE OF SEARCH. C) NO RETURN OF INCOME WAS FILED U/S 139 OF THE I.T.ACT. D) NEITHER ASSESSEE HAS FILED ANY PERSON AL BALANCE SHEET NOR ANY FAMILY MEMBERS OF THE ASSESSEE. E) NO DOCUMENTARY EVIDENCE WAS PRODUCED BY THE ASSESSEE EXCEPT FUND FLOW STATEMENT OF FAMILY MEMBERS. AS ALREADY DISCUSSED IN THE ASSESSMENT 4 ORDER OF THE FAMILY MEMBER OF THE ASSESSEE THAT VER Y PURPOSELY PREPARED CASH FLOW STATEMENT. F) THE CORRESPONDING ENTRIES WERE NOT FOUND IN THE BOOKS OF ACCOUNT OF KHAIYALDAS CONSTRUCTION THEREFORE THE AMOUNT OF RS.2000/- IS BEING ADDED AS UNDISCLOSED INCOME OF THE ASSESSEE. 5. WE FIND THAT THE SUBMISSIONS OF THE ASSESSEE WER E FORWARDED TO THE LD. ASSESSING OFFICER BY THE LD. C IT(A) AND SOUGHT THE REMAND REPORT WHICH WAS ALSO DULY CONSID ERED AND ULTIMATELY HELD AS UNDER: 3.6 I HAVE CAREFULLY CONSIDERED THE REASONS RECORDED IN THE ASSESSMENT ORDER, SUBMISSION OF THE APPELLANT, REMAND REPORT OF THE AO AND REJOINDER OF THE APPELLANT. I FIND FORCE IN THE SUBMISSION OF THE APPELLANT. FIRST, IT IS NOTIC ED THAT THE AO HAS MADE ADDITION OF RS. 19,00,000/- ON THE GROUNDS MENTIONED IN PARA (A) TO (F) IN THE ASSESSMENT ORDER, BUT IT WAS FOUND THAT THE FACTS MENTIONED IF THESE GROUNDS ARE FACTUALLY INCORRECT. IN THE REMAND REPORT, THE AO ADMITTED THAT THESE FACTS WERE MENTIONED DUE TO TYPING ERROR. SINCE THE GROUNDS ON WHICH THE ADDITION WAS MADE BY THE AO ARE FACTUALLY INCORRECT , ON THIS ACCOUNT ALONE, THE ADDITION MADE IN A CASUAL AND CA LLOUS MANNER DOES NOT DESERVE TO BE SUSTAINED. SECOND, FROM THE SUBMISSION AND DOCUMENTS FURNI SHED BY THE APPELLANT IT IS NOTICED THAT THE APPELLANT HAD PROVED THE IDENTITY OF THE CREDITORS, CREDITWORTHINESS OF THE CREDITORS AND GENUINENESS OF THE TRANSACTIONS BY FURNISHING THE C ONFIRMATIONS FROM THE CREDITORS, COPY OF CHEQUES/ DD ISSUED BY T HE CREDITORS, COPIES OF THE BANK STATEMENT OF THE CREDITORS AND T HAT ALL THE CREDITORS ARE INCOME TAX PAYEE HAVING PAN. THERE IS NO MATERIAL ON RECORD TO SUGGEST THAT THE CASH CREDITO RS WERE NOT GENUINE. IT IS ALSO NOTICED THAT THESE LOANS WERE S UBSEQUENTLY 5 PAID EITHER WITH INTEREST OR ADJUSTED AGAINST THE S ALES MADE. THE POSITION WHICH EMERGES CAN BE SUMMARISED AS UNDER: NAME PAN DATE OF LOAN RECEIVED AMOUNT OF LOAN DATE OF REPAYMENT REPAYMENT AMOUNT INTEREST PAID RAJ KUMAR NARYANI AAHPN3019K 18.03.04 1,00,000 20.05.04 1,00,000 2000 RAJ KUMAR NARYANI ACBPN3795R 18.03.04 1,00,000 01.06.04 1,00,000 2300 ASHOK AGENCIES AANPC1899A 29.03.04 6,00,000 27.09.0 7 11.10.07 2,00,000 4,00,000 18000 GANGA MARKETING PROP.PRABHU KINGRANI AHGPK2162C 22.03.04 10,00,000 ADJUSTED WITH THEIR CREDIT PURCHASES 10,00,000 NIL MANOHAR LAL KINGRANI AEBPK8399K 22.03.04 1,00,000 27.05.06 1,00,000 NIL FROM THE BANK ACCOUNTS, IT IS ALSO NOTICED THAT IN THE CASE OF RAJ KUMAR NARYANI, RAM KUMAR NARYANI AND GANGA MARKETIN G, CHEQUES WERE ISSUED BY THE PARTIES TO THE APPELLANT FROM THEIR OVERDRAFT/CASH CREDIT ACCOUNTS. IN OTHER CASES OF A SHOK AGENCIES AND MANOHARLAL KINGRANI, THE CHEQUES WERE ISSUED FROM CREDIT BALANCES IN THEIR BANK ACCOUNTS. CONSID ERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE , I AM OF THE OPINION THAT THE APPELLANT HAS DISCHARGED ITS ONUS TO PROVE THE GENUINENESS OF THE CASH CREDITS OF RS.19,00,000/-. THEREFORE, THE ADDITION OF RS.19,00,000/- MADE U/S 68 IS DELETED. 6. IF THE STAND TAKEN BY THE LD. CIT(A) IS ANALYSED , WE FIND THAT THE BASIS, MENTIONED IN PARA (A) TO (F) IN THE ASSESSMENT ORDER, FOR MAKING THE ADDITION IS FACTUALLY INCORRE CT AS THE LD. ASSESSING OFFICER HIMSELF ADMITTED THE MISTAKE BEIN G TYPING ERROR. EVEN OTHERWISE, THE IDENTITY OF THE CREDITOR S, THEIR CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTIONS BY F URNISHING THE CONFIRMATIONS WERE ALSO PROVED. THE COPIES OF T HE BANK 6 STATEMENTS OF THE CREDITORS, PAYMENTS MADE THROUGH CHEQUES AND THE CREDITORS WERE INCOME-TAX PAYEES HAVING PAN WERE ALSO ANALYSED BY THE LD. CIT(A). EVEN OTHERWISE, NO EVIDENCE HAS BEEN PRODUCED BEFORE US SUGGESTING THAT THE CAS H CREDITS ARE BOGUS. IT IS PERTINENT TO MENTION HERE THAT THE IMPUGNED LOANS WERE SUBSEQUENTLY PAID EITHER WITH INTEREST O R ADJUSTED AGAINST SALES AS IS EVIDENT FROM THE AFORESAID TABL E CONTAINED IN PARA 5 (SUPRA). THERE IS AN UNCONTROVERTED FINDING THAT IN THE CASES OF RAJKUMAR NARAYANI, GANGA MARKETING & RAM K UMAR NARAYANI, THE CHEQUES WERE ISSUED FROM THEIR OVERDR AFT/CASH CREDIT ACCOUNT AND IN THE REMAINING CASES FROM CRED IT BALANCES IN THEIR RESPECTIVE BANK ACCOUNTS. IN VIEW OF THESE FACTS, WE FIND THAT THERE WAS NO JUSTIFICATION TO MAKE THE ADDITIO N U/S 68 OF THE ACT BY THE ASSESSING OFFICER, THEREFORE, WE FIND NO INFIRMITY IN THE STAND OF THE LD. CIT(A) ON THE IMPUGNED ISSUE. THE SAME IS AFFIRMED. 7 FINALLY, THE APPEAL OF THE REVENUE IS HAVING NO ME RIT, THEREFORE, DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN IN THE PRE SENCE OF LEARNED REPRESENTATIVES FROM BOTH THE SIDES AT THE CONCLUSION OF THE HEARING. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 29.11.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE !VYS!
