SHRI V.M. DAWARA V. THE DCIT

ITA/8/2019

AI Insights

The case involves an appeal by Shri V.M. Dawara against the order of the ITAT which upheld the additions of loans amounting to rupees fifty lacs and rupees sixteen lacs ten thousand for the assessment year 1994-95. The appellant contested that the Tribunal did not adequately address the grounds raised regarding the addition of Rs.16,10,000, despite the documentary evidence provided to prove the genuineness and creditworthiness of the loan transactions. The respondent defended the Tribunal's decision, emphasizing the appellant's failure to produce the creditors to confirm the loans. The High Court found that the Tribunal had not considered all the issues raised by the appellant and thus set aside the Tribunal's order, remitting the matter back for a fresh decision.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 670489 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 30-07-2024
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: SANDEEP PATHAK
• Assessee Lawyers: PRAKUL KHURANA; AKSHAY SHARMA
• Keywords: Creditworthiness; Documentary evidence; Income tax appeal; Quasi-judicial authority; Loan Additions
• Section: 147; 148; 68; 260A

Judgement Text

"[2024:RJ-JP:32312-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 8/2019 Shri V.M. Dawara, C/o Jaipur Textile Industries, Behind Arun Oil Mill, Near Jaipur Glass Factory, Tonk Road, Jaipur ----Appellant Versus The DCIT, Circle-5, Jaipur ----Respondent For Appellant(s) : Mr. Prakul Khurana, Adv. with Mr. Akshay Sharma, Adv. For Respondent(s) : Mr. Sandeep Pathak, Adv. HON'BLE MR. JUSTICE AVNEESH JHINGAN HON'BLE MR. JUSTICE ASHUTOSH KUMAR Order 30/07/2024 1. This appeal under Section 260A of the Income Tax Act, 1961 (for short ‘the Act’) is filed against the order of Income Tax Appellate Tribunal (for short ‘the Tribunal’) dated 04.09.2018. 2. Proceedings under Section 147 & 148 of the Act were initiated for AY 1994-95 and additions were made in pursuance to remands in appeal. Ultimately two additions of rupees fifty lacs and rupees sixteen lacs ten thousand of the loans borrowed by the appellant remained and are issue in the present appeal. The Tribunal vide order dated 04.09.2018 upheld the additions and hence, this appeal. 3. While admitting the appeal on 27.08.2002, following substantial questions of law were framed:- [2024:RJ-JP:32312-DB] (2 of 3) [ITA-8/2019] “1. Whether under the facts and the circumstances of the case and in law the impugned order passed by Ld. ITAT is not perverse and bad in law? 2. Whether the Ld. ITAT is not bound to deal and disposed of all the grounds raised by the Assessee by assigning proper reasons and therefore, the addition of Rs.16,10,000/- is bad in law?” 4. Learned counsel for the appellant submits that the contentions of the appellant with regard to addition of Rs.16,10,000/- were noted by the Tribunal in Paragraph 3.2, however, were not dealt with. It is argued that the appellant had filed documentary evidences to discharge the onus under Section 68 of the Act of the loan transactions of rupees twenty five lacs each borrowed from M/s Johari Jewellers and M/s Trimurti Enterprises. The contention is that the appellant though even now is not able to produce the creditors physically as there were criminal proceedings pending between the appellant and M/s Johari Jewellers but the documentary evidence produced was sufficient to prove the genuineness of the transaction, creditworthiness and the identity of creditors. 5. Learned counsel for the respondent defends the impugned order. Submission is that inspite of providing ample opportunities, appellant failed to produce the creditors to confirm the loans. 6. From the perusal of the order of the Tribunal, it is evident that the grounds raised by the appellant for challenging the additions made of loans of rupees sixteen lacs ten thousand from four creditors were noted by the Tribunal but not considered. It is [2024:RJ-JP:32312-DB] (3 of 3) [ITA-8/2019] a trite law that a quasi judicial authority has to deal with the issues raised and pass a speaking order. 7. The addition of rupees fifty lacs of the loan taken from M/s Johari Jewellers and M/s Trimurti Enterprises was upheld by the Tribunal for the reason that the confirmation of the loan could not be done by ensuring presence of the creditors. 8. It is an undisputed fact that the receipt and returning of the loan was through banking channels. The creditors were income tax assessees. 9. The Tribunal as well as the Appellate Authority noted that the confirmation of the loan was filed with the Income tax returns. No findings were recorded viz-a-viz evidentiary value of documents produced. 11. The Tribunal failed to decide the ground challenging the addition of rupees sixteen lacs ten thousand. The evidence led to prove the loan transaction was not deliberated over, consequently, the order of the Tribunal for assessment year 1994-95 is set aside and the matter is remitted back to the Tribunal to decide the appeal afresh in accordance with law by passing a speaking order. 12. The appeal is allowed. (ASHUTOSH KUMAR),J (AVNEESH JHINGAN),J Chandan/Mohita/55 Whether Reportable: Yes "