TaxTMI 
TaxTMI 
2015 (11) TMI 854
X X X X Extracts X X X X
X X X X Extracts X X X X
....ear 2008-09. 2. The assessee in its appeal has raised two grounds : (i) Confirmation of the addition of Rs. 40,00,702 as unsecured loan received from one of its directors. (ii) Ad hoc disallowance of Rs. 2,00,000 from total expenses of Rs. 21,18,054. 3. The Revenue in its appeal has raised three grounds. However, the crux of grounds raised is, admission of additional evidence in violation of rule 46A of the Income-tax Rules, 1962. 4. The brief facts of the case as emanating from records are : The assessee is a private limited company and is engaged in the business of software development. The assessee filed its return of income for the impugned assessment year on January 29, 2009 declaring total income of Rs. 9,58,520. During....
X X X X Extracts X X X X
X X X X Extracts X X X X
....enue are in appeal before the Tribunal. 7. Shri Pramod Shingte appearing on behalf of the assessee submitted that Shri Xerces Mullan is the promoter director of the assessee-company. Since, the operations of the assessee-company had just commenced the bank account of Shri Xerces Mullan was operated like a current account on behalf of the assessee. From the said bank account cheques were issued on behalf of the assessee-company. The learned authorised representative further submitted that balance outstanding represents accumulated balance on account of series of transactions. The learned authorised representative in support of his submissions placed on record ledger loan account of director Shri Xerces Mullan in the books of the assessee.....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e for the assessment year 2008-09 as Rs. 1,50,820 only. Whereas, the alleged loan extended by him to the assessee is more than Rs. 40,00,000. The source for funding loan amount was not established. 9. In respect of appeal by the Revenue the learned Departmental representative submitted that the assessee had furnished certain documents for the first time before the Commissioner of Income-tax (Appeals). The Assessing Officer had given sufficient opportunity to the assessee to submit the documents in support of its contentions. However, the assessee deliberately withheld the information and relevant documents for the reason best known to it. The Commissioner of Income-tax (Appeals) admitted the documents and granted relief to the assessee i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....40,00,702 in respect of unsecured loan from the director of the company. The Commissioner of Income-tax (Appeals) rejected the contentions of the assessee with the following observations : "It is settled position of law that to accept a credit as genuine, the assessee has to necessarily establish the identity of the person, genuineness of the transaction and creditworthiness of the person. In the present case, the documentary evidence adduced establishes the identity of the person. However, merely because a creditor has been identified, it is not enough to show that the onus placed on the appel lant is discharged. What is further required is sufficient evidence to show the creditworthiness of the creditors and genuineness of loans. The c....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tor in the books of the assessee-company. However, the question raised by the Commissioner of Income-tax (Appeals) regarding the source of funding the assessee-company remained unanswered. The Commissioner of Income-tax (Appeals) had raised a very valid doubt, that is, if the director has returned his income of Rs. 1,50,820 in the assessment year 2008-09, how he can extend loan of Rs. 40,00,702 to the assessee-company. The learned authorised representative has not been able to place on record for any cogent evidence in the form of bank statement, statement of asset and liability of the assessee, etc., to dispel the shadow of doubts. It is a well accepted principle that to accept a credit as genuine all the three conditions, i.e., identity o....