TaxTMI 
TaxTMI 
2015 (11) TMI 1056
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....apore and addition, if any, is to be restricted to such receipt into assessee's bank account." 3. Briefly stated the facts giving rise to this appeal emerging from the appeal records are as follows:- "Originally return declaring an income of Rs. 3254510 was filed on 27.11.2003 which was assessed at Rs. 6402471. The assesses preferred an appeal against the order of ACIT circle 24(1) who made additions to the returned income on account of telephone expenses, vehicle expenses, entertainment expenses, business promotion expenses and an addition of Rs. 2746531 was made on account of undisclosed income from foreign remittance. The CIT (Appeals) - X New Delhi vide his order dated 27-12-2007 in appeal number 90/05-06 gave relief to the assessee of Rs. 200715 on disallowances made by AO on account of vehicle running expenses, telephone expenses, entertainment and business expenses. However the addition made on account of undisclosed foreign remittance to the tune of Rs. 2746531 was confirmed by the CIT appeal. Further the CIT appeal observed that the assessee had credited an amount of Rs. 2531257 to his capital account as remittance from overseas. It was further stated by the le....
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....hen the loan was given and that there was no confirmation. With reference to above, we would like to submit that, the assessee was a non-resident working in Singapore during the period September 1989 to March 1996 as a director of M/s Hughes Network System. Out of the savings in the account the assessee vide letter to the bank dated 14thApril 2000 had provided a friendly loan to his friend Mr. Giang Tran through his company iyou.com. (Annexure 1). The amount was duly debited to the assessee HSBC account no.252 033 816 270 on 16th April 2000 (Annexure 2). Mr. Gaing Tran is an American Citizen and is a serial entrepreneur. His passport number is 203746221 (Annexure 3). He had promoted a company called iyou.com for which he had requested for a friendly loan from the assessee. Mr. Giang Tran had then subsequently returned the money over a period of 6 months and has also given a confirmation to the effect that he had in fact taken the loan and the same was returned - (Annexure 4)." 4. In pursuance to the order of the Tribunal dated 23.2.2010, the Assessing Officer, after affording due opportunity of hearing made addition of Rs. 26,31,257 u/s 68 of the Incom....
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....able to support his claim of genuineness of the transaction despite umpteen opportunities and sufficient time given to him for the same. Hence an addition of Rs. 26,31,257 is made to assessed income under section 68 of IT Act and penalty proceedings under section 271(1)(c) have been initiated separately for furnishing inaccurate particulars of income." 5. The aggrieved assessee preferred first appeal before CIT(A) which was also allowed by him observing and concluding as follows:- "4.4 Since the addition is made u/s 68 of the I.T. Act, the important aspect is whether the AO was satisfied with the explanation given by the appellant. In this case the Assessing Officer was not satisfied with the explanation and recorded the fact that the appellant had failed to prove genuineness of the transaction and the creditworthiness of the creditor. The above mentioned decision makes it clear that if the AO was not satisfied with the explanation offered by the appellant the burden was on the appellant to rebut the same. As appellate authority even I am not satisfied with the explanation offered by the appellant as the evidence submitted during the appellate proceedings do not prove t....
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....d appeal of the assessee on first ground and deleted the first addition of Rs. 27,46,431 sand ground no. 1 of the assessee was allowed by the CIT(A) and this conclusion of the CIT(A) has been accepted by the revenue as there is no appeal against that part of the Tribunal order. Ld. DR is fairly agreed to the above submissions of the ld. AR. 7. However, the controversy remained about second addition made u/s 68 of the Act which was restored to the file of the Assessing Officer for fresh adjudication and the Assessing Officer again made said addition which was again confirmed by the CIT(A). Ld. AR further pointed out that in the second round, the Assessing Officer rejected explanation of the assessee by wrongly observing that in absence of the said account from where the money travelled the source and genuineness of the claim of the assessee remains unverifiable. Ld. AR vehemently contended that the Assessing Officer noted that the assessee proved identity of the payer but failed to prove other two crucial aspects i.e. genuineness of the transaction and creditworthiness of the payer. Ld. AR also contended that the CIT(A) in the second round also denied relief to the assessee by wr....
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....y High Court in the case of CIT vs Bhaichand N. Gandhi 141 ITR 67 (Bom) and submitted that the passbook or bank statement supplied by the bank to the assessee cannot be regarded as a cash book or accounts maintained by the assessee or under his instruction and thus the same does not fall within the ambit of section 68. 9. Replying to the above, ld. DR supported the action of the Assessing Officer and submitted that as per dicta laid down by Hon'ble Supreme Court in the case of CIT vs P. Mohanakala reported as 291 ITR 278 (S.C.) the addition was well founded and sustainable. 10. On careful consideration of rival submissions, at the very outset, from the order of the Assessing Officer passed in second round of proceedings, we note that the Assessing Officer made addition u/s 68 of the Act on the basis of copy of the bank account statement of the assessee by holding that the genuineness of the transaction and creditworthiness of the payer have not been established. The CIT(A) upheld the same by considering amount of Rs. 27,46,531 in para 4.4 and in para 4.5, the first appellate authority has mentioned amount of Rs. 26,31,257 by holding that the onus was on the assessee to sa....