AI Drafter 
TaxTMI 
TaxTMI 
2018 (6) TMI 1282
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....Shri Ajay Maheshwari at the earliest and there was no material placed on record by the Revenue justifying the addition. It was explained that interest has been paid by the assessee on the loans, which was also disallowed by the Assessing Officer. It was also pleaded that the Ld. Commissioner of Income Tax (Appeal) granted relief after considering the factual matrix and on the interest portion, no appeal has been filed by the Revenue. The ld. counsel further explained that the assessee was doing only one project i.e. Shreedam Splendor and the statement of Shri Arun Jately is having no relevant as it talks about the case of sister concern. It was further pleaded that the loans taken by the assessee were repaid along with interest and no cash was found during the survey. It was empathetically argued that the loans were even repaid before the survey and all the parties appeared before the Assessing Officer during remand proceedings, when the Ld. Assessing Officer recorded the statement and nothing was found against the assessee, therefore, the Ld. Commissioner of Income Tax (Appeal) rightly deleted the addition. It was explained that even Shri Pravin Jain himself appeared before the As....
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....nsecured loans from the entities controlled by Shri Pravin Kumar Jain, who was alleged to be engaged in providing accommodation bills. The statement of Shri Ajay Maheshwari, one of the partners of M/s Shreedham Builders (sister concern) was recorded on oath under section 131 of the Act on 17/10/2014, wherein, he made a disclosure of Rs. 15.40 crores (Rs.4.70 crores for Assessment Year 2012-13 and Rs. 10.70 crores for Assessment Year 2013-14). On account of bogus unsecured loans by further claiming that all these transactions were carried out through one broker namely Shri Jitu Bhai. The statement of Shri Anil Jately, broker was also recorded. Considering the statement, the Ld. Assessing Officer made addition under section 68 of the Act. Further, the Ld. Assessing Officer also made addition on account of interest payment and disallowed under section 37 of the Act. 2.3. On appeal before the Ld. Commissioner of Income Tax (Appeal), the factual matrix was considered and the additions so made were deleted. The Revenue is in appeal before this Tribunal with respect to the additions made under section 68 of the Act. 2.4. If the observation made in the assessment order, leading to ad....
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....here may not be an entry in such books of account. The law is well settled, the onus of proving the source of a sum, found to be received/transacted by the assessee, is on him and where it is not satisfactorily explained, it is open to the Revenue to hold that it is income of the assessee and no further burden lies on the Revenue to show that income is from any other particular source. Where the assessee failed to prove satisfactorily the source and nature of such credit, the Revenue is free to make the addition. The principle laid down in Ganpati Mudaliar (1964) 53 ITR 623/A. Govinda Rajulu Mudaliar (34 ITR 807)(SC) and also CIT vs Durga Prasad More (72 ITR 807)(SC) are the landmark decisions. The ratio laid down therein are that if the explanation of the assessee is unsatisfactory, the amount can be treated as income of the assessee. The ratio laid down in Daulat Ram Rawatmal 87 ITR 349 (SC) further supports the case of the assessee. In the case of a cash entry, it is necessary for the assessee to prove not only the identity of the creditor but also the capacity of the creditor and genuineness of the transactions. The onus lies on the assessee, under the facts available on record....
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....sment Year2008-09 was reopened based on the search proceedings carried out in the case of Pravin Kumar Jain Group wherein Shri Pravin Kumar Jain is said to have deposed before the authorities that he is indulged in providing accommodation entries in the nature of the bogus bills/sales bills and unsecured loans. As per the information the assessee is one of the beneficiaries of such accommodation entries. In the course of Assessment Proceedings assessee was required to explain unsecured loans and prove genuineness of transactions, identity and creditworthiness of the unsecured loans, records and supporting documentary evidences. In response to the same, assessee furnished loan confirmations, bank statements, I.T. Return acknowledgements of the lender companies and also submitted that money has been borrowed through regular banking channels and it was repaid in subsequent years with interest. TDS was made on such interest. It was also further submitted that Shri Pravin Kumar Jain was retracted the statement which he has said to have been given and therefore it was contended that transactions are genuine and they cannot be treated as unexplained unsecured loans. However, Assessing Off....
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....ition made towards unsecured loans. 5. The Ld. DR strongly supported the orders of the Assessing Officer. Further taking us through the Assessment Order, Ld. DR submits that Shri Pravin Kumar Jain has categorically said in his statement that he is providing only accommodation entries and no genuine business was carried on and as per the information assessee is one of the beneficiary to such transactions and therefore the Assessing Officer rightly concluded that assessee has obtained only accommodation entries in the name of unsecured loans and the entities were not carrying out any business. 6. On the other hand, Learned Counsel for the assessee strongly supported the orders of the Ld.CIT(A). He further submitted that the Assessing Officer has relied on the information received from DGIT(Inv), Mumbai regarding the details of accommodation entries provided in the nature of bogus purchases/ sale bills and unsecured loans by Shri Pravin Kumar Jain Group. Further the Assessing Officer has stated in the order that DGIT(Inv) has carried out search and seizure action on Pravin Kumar Jain group. The report mentions Shri Pravin Kumar Jain is one of the entry providers, ope....
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....en by said Shri Pravin Kumar Jain is retracted by himself subsequently. It is submitted that the alleged statement given by Shri Pravin Kumar Jain is not yet confirmed in his assessments and thus it cannot be considered as evidence. Therefore, it is submitted that the Assessing Officer has made additions merely relying on the report and no evidence was placed on record to make the additions. 8. Learned Counsel for the assessee further referring to Page Nos.24 to 28 of the Paper Book submits that an identical issue came up before this Coordinate Bench in the case of DCIT vs. Bairagra Builders P. Ltd reported in [2017] 51 CCHand submits that the Hon'ble Bench held that the plain reading of the Assessment Order demonstrates that the Assessing Officer merely went by the investigation done by the office of DGIT(Inv), Mumbai.No enquiries or investigation was carried out in the case of parties who lent the money, no evidence to controvert the claims of the assessee was brought on record by the Assessing Officer, even the submissions of Shri Pravin Kumar Jain was not supplied, nothing is on record about the result for investigations done by DGIT (Investigation), Mumbai, papers....
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....oncerned party CIT v. K. Bhuvanendran & Ors. [303 ITR 0235 (Mad) Revenue having brought no material on record to establish that consideration shown in the sale deed was understated and no material having been found during search to show that assessee paid a sum over and above the stated consideration, no addition could have been made on the basis of retracted statement of assessee recorded during speech. CIT v. Sahibganj Electric Cables (P) Ltd. [115 ITR 0408 (Cal)] Where the amounts of loan were received by cheque and repayment was also made by cheque through assessee's bankers; and confirmation of creditors along with their income-tax file numbers were furnished the assessee discharged its initial burden and ITO was not justified, in the absence of any further investigation, to reject the evidence and Case reference citation Proposition make addition. 9. We have heard the rival submissions, perused the orders of the authorities below, the case laws relied on and the material furnished before us. The only issue involved inthis appeal relates to the deletion of addition of Rs..20 lakhs made by the Assessing Officer towards unexplained unsecur....
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....ntiated his presumption, his doubt with any verifiable documents. He has merely described the statement of Shri. Pravin Kumar Jain and as communicated by the investigation wing. Thus, it is very evident that the Ld. Assessing officer has not made any independent enquiry in order to establish the in-genuineness of loans if any, with contrary evidence. The statements referred to and relied upon by the assessing officer have never been disclosed to the appellant opportunity for cross examination was also not given, hence such statement could not be utilized against the appellant without giving full and proper opportunity of cross examination as has been held vide Mahesh Gulabral Joshi Vs. CIT(A) (2005) 95 lTD 300 Mumbai ITAT and Hon'ble Supreme Court decision in the case of KishanchandChellaram Vs. CIT (125 ITR 713 (SC)). 6.3. Further during the course of assessment proceedings, the appellant has produced copy of a comprehensive Affidavit of Shri. Pravin Kumar Jain dated 25.04.2014 retracting, the statements made before the Investigation Wing. Assessing officer has not given opportunity to the appellant for cross examination of Shri Pravin Kumar Jain. Going by the discussion ....
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....o is giving the statement and what exactly did he admit. Instead of stating that the party did not exist, he should have summoned the party and recorded the statement. As the AO, has not brought anything in record to show that the evidences filed by the appellant are false, the loan received and repaid by the appellant cannot be treated as bogus. The addition cannot be made merely on the basis of suspicion, surmises and conjectures. There has to be some concrete evidence whether direct or circumstantial. In this case, no such evidence is present. On the contrary, the appellant is showing from the record that he has received loan through account payee cheques from above TWO PARTIES. He has shown that the loans have been repaid through account payee cheque and as long as he was holding the loan, he has paid the interest after deducting TDS. With regard to the disallowance of interest on loans taken from afore-mentioned parties, the appellant submitted that the AO has also ignored the fact that the said interest expenses were incurred wholly, exclusively & necessarily for business of the Appellant. The interest paid on loans was subject to TDS. During the present proceedings, the appe....
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....harged its primary onus on providing complete details in respect of the loan transactions and the Assessing Officer failed to carry out any fruitful investigation. Therefore, no addition can be made towards unexplained unsecured loans, this finding in our view is completely justified in view of the facts and circumstances of the assessee's case. 11. An identical issue came up in the case of DCIT vs. Bairagra Builders P. Ltd reported in [2017] 51 CCH 0107 in ITA.No. 4691 and 4692/Mum/2015 dated 14.09.2017 wherein the Coordinate Bench held as under: "6. We have heard the rival submissions along with the orders of the tax authorities below. We noted that during the impugned assessment year, the assessee had taken unsecured loans from the following two parties: Sr. No Name of the Party and Address PAN Loan taken(Rs.) Rate of Interest 1. Javda India Impex Limited CS-1, Silver Anklet, Yari Road, Versova, Mumbal 400 061 AAACA7065L 20,00,000 9% 2. Lexus Infotech Ltd. 626, Panchratna, OperaHouse, Mumbai 400 002 AAACL4646G 20,00,000 9% When the Assessing Officer asked the assessee to prove the genuineness of these loans,....
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.... 9. We have gone through the orders relied upon by the learned DR. We noted that the decision of the Delhi High Court in the case of Bikram Singh, the assessee could not discharge the onus as laid down by section 68 of the Act. Similarly, in the case of CIT vs. Jansampark Advertising & Marketing Pvt. Ltd. (supra), the additions have been made u/s. 68 in respect of the share capital received by the assessee from various companies and during the course of investigation, it was found that the share capital has been received from three entry operators, who are allegedly in the business of providing accommodation entries. Notices issued u/s. 131 to these parties were returned undelivered by the postal authorities with the remark "left"/ "no such person". Under these circumstances, the Hon'ble High Court took a view that the assessee failed to discharge the burden to prove the credit worthiness as well as the genuineness of the transactions. 10. But in the impugned case, we noted that the assessee has submitted all the evidences including the confirmation of the creditors. This is not a case where the creditors have not given confirmations rather they have duly conf....
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....en by us in the appeal for the Assessment Year 2008-09 shall apply mutatis-mutandis to the appeals for the Assessment Years 2009-10 to 2013-14. 14. In the result all the appeals of the Revenue are dismissed." 2.8. In the aforesaid case, search proceedings were carried out in the case of Pravin Kumar Jain Group, wherein, Shri Pravin Kumar Jain said to have deposed before the authorities that he was indulged in providing accommodation entries in the form of bogus bills/sale bills and unsecured loans. As per the information, the assessee involved in the case was beneficiary of such accommodation entries. The assessee was required to explain the genuineness of unsecured loans and identity and creditworthiness. The assessee furnished loan confirmation, bank statement, IT returns acknowledgment of lender companies and the proof of borrowable through regular banking channel. The Bench considered the factual matrix and held that no addition can be made towards alleged unsecured loans. Identical are the facts in the present appeal before us. Thus, this case clearly supports the case of the assessee. Identical ratio was laid down in the case of DCIT vs Bairagra Builders Pvt. Ltd.....
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....le walking the tightrope of sections 68 and 69 of the IT Act. The burden of proof can seldom be discharged to the hilt by the assessee: if the Assessing Officer harbours doubts of the legitimacy of any subscription he is empowered, nay duty-bound, to carry out thorough investigations. But if the Assessing Officer fails to unearth any wrong or illegal dealings, he cannot obdurately adhere to his suspicions and treat the subscribed capital as the undisclosed income of the Company. 16. In this analysis, a distillation of the precedents yields the following propositions of law in the context of Section 68 of the Income Tax act. The assessee has to p r ima f a c i e p r o v e ( 1 ) t h e i d e n t i t y o f t h e credi tor/subscriber ; (2) the genuineness of the transaction, namely: whether it has been transmitted through banking or other indisputable channels: (3) the c r edi twor thines s or f inanc ial s t r ength of the creditor/subscriber: (4) If relevant details of the address or PAN identity of the creditor/subscriber are furnished to the Department along with copies of the Shareholders Register, Share Application Forms, Share Transfer Register etc. it would constitute a....
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....2009) 26 DTR (Del.) 358, and v) Bhav Shakti Steel Mines (P) Ltd. v. CIT (2009) 179 Taxmnan 25. wherein the Hon 'bie Delhi High Court has observed as under: - "In any event we also note that the Supreme Court in the case of CIT v. Lovely Exports (F) Ltd. [2008] 216 CTR 195 considered the question as to whether the share application money can be regarded as undisclosed income under Section 68 of the Income Tax Act, 1961. The Supreme Court dismissing the SLP observed that if the share money is received by the assessee company from alleged bogus shareholders whose names are given to the Assessing Officer, then the Department is free to proceed to assess them individually in accordance with law. The Supreme Court did not find any infirmity with the impugned judgment of the High Court which was a common order along with the decision in CIT v. Divine Leasing & Finance Ltd. [2008) 299 ITR 268 (Delhi). Since the Commissioner of Income-tax (A) has not only found that the identity of each of the shareholders stood established, but has also examined the fact that each of them were income-lax ass essees and had disclosed the share application money in their accounts which ....
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.... such information to the assess cc to rebut the adverse material if any and he did not afford any opportunity of cross examination of all the adverse material on the basis of which impugned addi t ion has been made in the assessment order. It is settled proposition of law that the information gathered behind the back of the assessee cannot bc used against him unless until an opportunity of rebutting the same is given to the assessee, It is against the principle of natural justice. Reliance is placed on the decision of Hon 'ble Supreme Court in case of Prakash Chand Nahta v. Union of India 12001J 247 ITR 274 in support of the proposition that cross-examination of the witness is must, before the AO relies on the on the statement of the witness for making addition. Reliance is also placed on the decision of Allahabad High Court in the case of nathu Rain Prcmchand v. CIT [1963] 49 ITR 561, wherein the Hon'ble Court explained that it was the duty of the Assessing Officer to enforce the attendance of a witness. if his witness is material in exercise of his powers under order 16. Rule 10 of CPC and where the Officer does not do so, no inference can be drawn against the assessee. R....
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....lacing reliance merely on a report of the Investigation Wing. This reveals spectacular disregard to an AO's duties in the remand proceedings which the Revenue seeks to inflict upon the assessee in this case. No substantial question of law arises. The appeal is dismissed." 2.10. Hon'ble Rajasthan High Court in Supertech Diamond Tools (P) Ltd. (44 taxman.com 460)(Rajasthan) observed/held as under:- "By way of this appeal under Section 260A of the Income-tax Act, 1961 ('the Act'), the Revenue seeks to question the order dated 19.01.2012 passed by the Income Tax Appellate Tribunal, Jodhpur Bench, Jodhpur ('ITAT') in ITA No.211/Jodh/2009 for the Assessment Year 2004-05 whereby, the ITAT has affirmed the order dated 09.02.2009 passed by the Commissioner of Income Tax (Appeals), Central, Jaipur ['CIT(A)'] partly allowing the appeal preferred by the assessee and deleting the additions made by the Assessing Officer ('AO') in the assessment order dated 28.12.2007 to the tune of Rs. 79,80,000/- on account of unexplained share capital contribution and Rs. 19,950/- on account of unexplained expenditure on commission for getting accommodation e....
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....e by a third party at the back of assessee could not have been utilized against the assessee without providing an opportunity of cross-examination, which was not afforded by the AO. The CIT (A) also found that the AO could not bring any material to disapprove the genuineness of confirmations and affidavits; and following the decision of the Hon'ble Supreme Court in the case of CIT v. Lovely Exports (P.) Ltd. [2008] 216 CTR 195, found the additions unsustainable; and proceeded to delete the same. The CIT(A), inter alia, observed and held as under: - "However, the assessee filed confirmations along with the affidavit of the directors of the 5 purchasing companies who had confirmed that they have purchased the regular share and premium shares total at Rs. 79,80,000/- from the assessee-company and made the payment through account payee draft. It is also fact that the ld. A.O. made direct independent inquiry from the directors of the purchaser company by issuing a letter u/s 133(6) of the I.T. Act 1961. The ld. A.O. Sh. V.K. Chakarvarty was heard and the case was discussed with him. On perusal of letter u/s 133(6) I find that no confirmations or comment was asked from the d....
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....ation for the additions towards the share capital, share premium and alleged commission in the hands of the assessee company. The ITAT has, inter alia, held and observed as under:- 'We have gone through written submissions of ld. CIT D/R and also gone through various case laws relied upon and found that there is no evidence that assessee had paid any commission and has refunded the amount received under the garb of share application money. Various case laws relied upon by ld. D/R are in respect of cash credits added under section 68. After considering the submissions and various case laws, it is seen that the submission of ld. CIT D/R is not helpful to the case of revenue. The Hon'ble Supreme Court in case of Lovely Exports Pvt. Ltd. had clearly held that even if the shareholders are bogus in that case no addition can be made in the hands of the company but AO can reopen the cases of shareholders. The contention of ld. CIT D/R that in case of Lovely Exports Pvt. Ltd. only bogus share application was found but the investors were genuine. However, in the present case even there are no genuine investors as all the companies are fabricated just to provide accommodation....
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....n similar view and this decision of Hon'ble Delhi High Court has been affirmed by Hon'ble Supreme Court in CIT v. Steller Investment Ltd. [2001] 251 ITR 263wherein it is held that- "It is evident that even if it be assumed that the subscribers to the increase share capital were not genuine, nevertheless, under no circumstances can the amount of share capital be regarded as undisclosed income of the assessee. It may be that there are some bogus shareholders in whose names the shares had been issued and money may have been provided by some other persons. If the assessment of the persons who were alleged to have really advanced the money is sought to be reopened, that would have made some sense but we fail to understand as to how this amount of increased share capital could be assessed in the hands of the company itself." The findings in these cases are squarely applicable on the facts of the present case and we noted that ld. CIT (A) has already taken a recourse for taking action against the respective shareholders as the Assessing Officer was directed to take necessary action against the purchaser company for such investment in purchase of shares. ....
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....he ITAT has been from an altogether wrong angle where it has failed to consider that the companies in whose names investments were shown, had no explainable source of the funds for investment in the assessee company; and the source of the funds was the cash deposits. It is submitted that all the referred companies were being managed by Shri Pradeep Jindal, who was engaged in the business of providing accommodation entries to various companies in lieu of commission; and who had admitted the facts in his statements recorded under Section 131 of the Act. It is also submitted that in the given status of record and the statement of the persons related with the assessee-company, the additions made by the AO had been justified and there was no reason for the CIT(A) in deleting the same. 7. Having given thoughtful consideration to the submissions made and having perused the material on the record, we are unable to find any reason to consider interference; and are clearly of the opinion that no substantial question of law is involved in this appeal. 8. The reference to the statements made by some of the persons related with the said investing companies is of no effect beca....
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....ises." 11. In CIT v. Shree Barkha Synthetics Ltd. [2004] 270 ITR 477/[2003] 131 Taxman 114 (Raj.), in a similar nature of matter, this Court observed that the Tribunal having found that the companies from which the share application money had been received by the assessee-company were genuinely existing and the identity of the individual investors were also established and they had confirmed the fact of making investment, the finding that assessee had discharged initial burden and addition under Section 68 could not be sustained, was essentially a finding of fact. This Court said,- "19. A perusal of the aforesaid finding goes to show that deletion has been made on appreciation of evidence, which was on record Finding that there was existence of investors and their confirmation has been obtained, were found to be satisfactory. All these conclusions are conclusions of fact based on material on record and, therefore, cannot be said to be perverse so as to give rise to question of law, which may be required to be considered in this appeal under s.260A of the IT Act." 12. The ratio of the decisions aforesaid directly applies to the present case too. Herein, as....
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....ess and the genuineness of the transactions. The party from whom the Assessee had received the share amount never responded to the summons issued by the Assessing Officer. The Assessing Officer has considered the said aspect and thereafter has added the amount under Section 68 of the Income Tax Act. According to the learned counsel, the Tribunal only on the basis that documents are available has accepted the case of the Assessee. The Tribunal has failed to consider the circumstances and the facts which are relevant. 3. The learned counsel for the Assessee supports the order and submits that the Assessee had discharged its onus. The Assessee had produced the PAN of all the creditors along with the confirmation, Bank Statement showing payment of share application money and relevant record is produced with regard to the allotment of shares to those parties. The share application form, allotment letter, share certificate are also produced. Even the balance-sheet, profit and loss account, the books of account of these creditors were produced on record showing that they had sufficient funds for investing in the shares of the Assessee. The learned counsel relies on the judgment o....
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....he following re-framed questions of law for our consideration:- "(i) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in deleting the addition of Rs. 7,53,50,000/- under Section 68 of the Act being share capital/share premium received during the year when the Assessing Officer held the same as unexplained cash credit? (ii) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in restricting the disallowance under Section 14A of the Act only to the amount of expenditure claimed by the assessee in the absence of any such restriction under Section 14A and/or Rule 8D?" 3. Regarding question no.(i):- (a) During the previous relevant to the subject Assessment Year the respondent-assessee had increased its share capital from Rs. 2,50,000/- to Rs. 83.75 lakhs. During the assessment proceedings, the Assessing Officer noticed that the respondent had collected share premium to the extent of Rs. 6.69 crores. Consequently he called upon the respondent to justify the charging of share premium at Rs. 190/- per share. The respondent furnished the list of its shareholders, ....
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.... of CIT(A) also that the amount received on issue of share capital alongwith the premium received thereon, would be on capital receipt and not in the revenue field. Further reliance was also placed upon the decision of Apex Court in Lovely Exports (P.) Ltd. (supra) to uphold the finding of the CIT(A) and dismissing the Revenue's appeal. (d) Mr. Suresh Kumar, the learned counsel appearing for the Revenue contends that proviso to Section 68 of the Act which was introduced with effect from 1st April, 2013 would apply in the facts of the present case even for A.Y. 2008-09. The basis of the above submission is that the de hors the proviso also the requirements as set out therein would have to be satisfied. (e) We find that the proviso to section 68 of the Act has been introduced by the Finance Act 2012 with effect from 1st April, 2013. Thus it would be effective only from the Assessment Year 2013-14 onwards and not for the subject Assessment Year. In fact, before the Tribunal, it was not even the case of the Revenue that Section 68 of the Act as in force during the subject years has to be read/understood as though the proviso added subsequently effective only from ....
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....2017 at 3.00 p.m., subject to overnight part-heard. 5. Registry is directed to communicate a copy of this order to the Tribunal. This would enable the Tribunal to keep the papers and proceedings relating to the present appeal available, to be produced when sought for by the Court. 6. Stand over to 17th April, 2017." 2.13. In the aforesaid cases, the Hon'ble High Courts including Hon'ble jurisdictional High Court considered the factual matrix including the decision from Hon'ble Apex Court in CIT vs Lovely Export Pvt. Ltd. (2008) 216 CTR 195 (Supreme Court) and held that the proviso to section 68 of the Act was introduced by the Finance Act, 2012 w.e.f. 01/04/2013, thus, it would be effective only from Assessment Year 2013-14 onwards and not to the earlier years. The legislature did not introduce the proviso to section 68 of the Act with retrospective effect nor does the proviso so introduce states that it was introduce 'for removal of doubts' or that it is 'declaratory', therefore, it is not open to give it to retrospective effect by proceeding on the bases that the addition of proviso to section 68 of the Act is immaterial. Thus, we find merit in th....
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.... assessee received on money of Rs. 44,00,000/- in cash from Mrs. Nitu Pugalia for purchase of flat at Shreedham Classic, developed by M/s Shreedham Construction Pvt. Ltd., a sister concern of the assessee. 2.17. Statement of Shri Atul Rupapara, salesman was also recorded. The statement of Shri Ajay Maheshwari, partner of the firm was also recorded, wherein, he tendered that they received accommodation entries in the form of unsecured loans in lieu of cash from Shri Pravin Kumar Jain. The statement of Shri Ajay Maheshwari has been reproduced in the assessment order which was heavily relied upon by the Assessing Officer for making the addition. It is noted that on 11/11/2014, Shri Ajay Maheshwari filed an affidavit retracting the statement recorded during survey after 23 days, wherein, he sworn (in the affidavit) that the loans were genuine and there were no corroborative evidence was found at the business premises during survey and the entire transactions were conducted through banking channel/account payee cheque. As per this retraction, the survey party put mental pressure and the statement was recorded under high BP/hyper diabetic conditions. It is noted that the loan confirma....
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....opy of statement recorded during survey, evidence of filing retraction on 11/11/2014, evidence of filing of loan confirmations, acknowledgment of ITRs and bank statement of parties vide letter dated 28/12/2014, copy of its submission on unsecured loans dated 16/02/2015, retraction affidavit of Shri Pravin Kumar Jain, dated 15/05/2014, repayment details of unsecured loans and its submissions dated 16/02/2015, wherein, present address, details of directors and shareholding patterns of lenders companies were filed by the assessee before the Ld. Assessing Officer. It is noted that before the First Appellate Authority, the assessee challenged the validity of assessment by raising an additional ground as the assessee was not allowed opportunity to cross examine Shri Pravin Kumar Jain and other material used against the assessee, which was not confronted to it. The Ld. Commissioner of Income Tax (Appeal) vide letter dated 05/07/2016 asked the Ld. Assessing Officer to handover the statements pertaining to Shri Pravin Kumar Jain or its staff members or dummy directors to allow the assessee an opportunity to cross examine Shri Pravin Kumar Jain. The Ld. Assessing Officer was also asked to pr....
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.... the case of Athrav Business Pvt. Ltd. (page 58 to 72 of the paper book). Identically similar documents as a proof of evidence were filed from Casper Enterprises Ltd. (pages 71 to 83 of the paper book), Duke Business Pvt. Ltd. (J.P. K. Trading I. Pvt. Ltd.) (pages 84 to 96 of the paper book), Olive Overseas Pvt. Ltd. (pages 97 to 110 of the paper book), Viraj Mercantile Pvt. Ltd. (pages 111 to 119 of the paper book) and Nakshatra Business Pvt. Ltd. (Pages 120 to 131 of the paper book). All these documents neither disproved by the Ld. Assessing Officer nor any evidence was brought on record to falsify the claim of the assessee or the authenticity of these documents. Thus, it can be said that the assessee discharged its onus as provided under section 68 of the Act. The interest was paid through banking channel by the assessee on such loans. It is also noted that so far as the disallowance of interest portion is concerned, the same was deleted by the ld. FAA and has not been challenged before this Tribunal by the Revenue further fortifies the case of the assessee. The loans were repaid along with interest before the date of survey i.e. 17/10/2014 and no cash was found during survey fu....