TaxTMI 
TaxTMI 
2016 (12) TMI 749
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....e ld. CIT(A) to rebut the submission and contentions in the letter dated 12/1/2015. 3) On the facts and in law the ld. CIT(A)-I, Nashik has erred in reproducing the appellant's letter dated 4/9/2014 as the tabular chart mentioned by CIT(A) has been filed with the letter dated 12/1/2015 and no such chart as mentioned by CIT(A) is there in the letter dated 4/9/2014, the CIT(A) has purposely ignored the submission and contentions in letter dated 12/1/2015." 3. The assessee has also raised an additional ground of appeal, which reads as under:- "1] The learned CIT(A) erred in confirming the additions u/s. 68 of Rs. 15,00,000/- in respect of loans taken from three persons without appreciating that the identity, genuineness and creditworthiness of the lenders was proved by the appellant and hence, there was no reason to make any addition u/s. 68 in respect of the said loans." 4. The additional ground of appeal raised by the assessee is legal and hence, the same is admitted for adjudication. 5. Briefly, in the facts of the case, the assessee had furnished the original return of income on 15.12.2006 declaring total income of Rs. 2,36,570/- and agricultural income of Rs. 1,73,80....
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....itors. The assessee was asked to produce four persons from whom he had taken loan of Rs. 5 lakhs each in order to establish their identity and the capacity to lend the money and to prove the genuineness of transactions. The assessee produced only one person i.e. Shri Limba Sudam Patil and his statement was recorded on oath under section 131 of the Act. In respect of other persons, the assessee furnished the relevant 7/12 extract but could not produce the persons. The Assessing Officer in such circumstances, accepted the loan to the extent of Rs. 5 lakhs but the balance sum of Rs. 15 lakhs were treated as income of the assessee under section 68 of the Act. 6. Another addition which was made in the hands of assessee was on account of unpaid compensation. The assessee claimed that it had received Rs. 20 lakhs from M/s. Nirmal Seeds, Pachora, Dist. Jalgaon on account of compensation payable to the farmers. During the course of assessment proceedings, statement of one Shri Ishwar Manik Mali was recorded who stated that he had not received any amount on account of compensation. On further verification of information called for under section 133(6) of the Act, sum of Rs. 50,000/- was to ....
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.... have carefully gone through the facts of the case. In respect of the claim of the appellant about the payment of compensation of Rs. 49,20,000/-, the A.O. in the assessment order has pointed out that the appellant could produce only 3 persons for verification. The AO. however, issued summons u/s. 131 of the Act to some farmers on test check basis for verification of the facts. AO recorded statement of 7 farmers namely Ishwar Manik Mali, Dahindule, Dist. Nandurbar Rs. 50,000/-); Komalsing Fatesing Rajput, Nandurbar (Rs. 25,000/-); Sudam Vitthal Wagh, Nandurbar (Rs. 80,000/-); Madhav Namdeo Marathe, Nandurbar (Rs. 90,000/-), Bhagwan Tajani Marathe (Rs. 40,000/-); Rohidas Sajan Mogal Dahindule (Rs. 40,000/-) and Shri Shivdas Shamrao Marathe, Nandurbar (Rs. 40,000/-) who have denied having received compensation from the appellant. The A.O., therefore, mentioned in the assessment order that the appellant has not made payment to the above farmers, whose statements were recorded and has also failed to produce the remaining farmers. Appellant has failed to explain the payment of the said compensation to farmers satisfactorily and could not discharge his burden properly. The AO has also me....
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....y could not explain the source of money. They failed to furnish their bank statements to prove the source of credit with them. With regard to repayment of loan, all the three persons furnished similarly worded affidavits that the assessee had allowed them to cultivate the agricultural land at Village Wagodha and Dudhale free of cost for the years 2005-06 to 2008-09 to recover Rs. 5 lakhs. The CIT(A) was of the view that where the assessee has failed to prove the genuineness of cash credits and also where the assessee has not been able to substantiate the creditworthiness and source of credits, then the addition of Rs. 15 lakhs was upheld. The CIT(A) also noted that the affidavits filed by three persons regarding the method of repayment of loan was self serving documents and were concocted to prove the transaction as genuine. With regard to the alternate plea of the assessee, the CIT(A) vide para 11 observed that the assessee had claimed payments to the farmers to the extent of 49,20,000/- appearing in his bank statement through bearer cheques. However, the Assessing Officer had accepted the said payments only to the extent of Rs. 19,50,000/-. The plea of assessee in this regard was....
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....lation to the proceedings of assessment year 2005-06. Attention was drawn to the submissions filed before the CIT(A) which are placed at pages 1 to 6, second one at pages 10 to 16 and third one at pages 20 to 23 of the Paper Book. The main contention as per the learned Authorized Representative for the assessee was allowing the telescoping benefit, wherein the assessee claimed that it had to pay compensation to the extent of Rs. 49,20,000/-, against which M/s. Nirmal Seeds paid only Rs. 20 lakhs. The Assessing Officer disallowed Rs. 50,000/- of compensation and hence, the balance claim was only Rs. 48,70,000/-. The assessee had filed the return of income declaring profit under section 44AF of the Act. He further pointed out that the ground of appeal No. 2 before the CIT(A) was for allowing the compensation of Rs. 29,20,000/- which was disallowed by CIT(A) under para 6.1. In case the disallowance was made of Rs. 29,20,000/-, then the plea of telescoping is to be allowed in the hands of assessee and no addition is warranted. 11. The learned Departmental Representative for the Revenue on the other hand, placed reliance on the order of CIT(A). 12. The issue arising in the present app....