TaxTMI 
TaxTMI 
2018 (6) TMI 1669
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....or and the money was received from her through three cheques from her NRO account at Canara Bank and Yes Bank at Nagpur. If the balance sheet for the year 201213 is examined along with the audit report in form 3CB, 3CD are looker into, there is absolutely no ambiguity and it is a million dollar question how the learned Assessing Officer and the Appellate Authority could ignore the disclosures in the balance sheet and Audit Report for the AY 2013-14. (C) It is pertinent to mention that Section 68 of Income Tax, 1961 reads "where any sum is found credited in the books of an assessee maintained for any previous year and the assessee offers no explanation about the nature and source there of or the explanation offered by him, is not in the opinion of the Assessing officer, satisfactory, the sum so credited may be charged to Income Tax as the income of the assessee of that previous year." In the touchstone of the aforesaid provision, if the assessment order is examined: the following facts would emerge. (i) Sum credited in the books - only Rs. 26 lakh - well explained. (ii) The assessee offered explanation with sources in the confirmation of accounts along wit....
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....y, substitute, delete and/or rescind all or any of the grounds of appeal, submit written submissions, adduce evidence, paper book and such other facts and figures before or at the time of final hearing of the case, if necessary so arises." 2. M/s Siddharth Exports, a partnership firm is engaged in manufacture and trading (export) of Engineering and Automobile spare parts. The assessee is filing Income Tax Returns (ITR) regularly. During the Assessment Year 2013-2014, the assessee received Unsecured Loan of Rs. 26,00,000/- through three cheques issued as detailed below : Sl No. Chq. No Date Amount (Rs.) Bank A/C 1 738671 23.10.2012 600,000 Canara Bank, Nagpur A/C No. 0265101012274 2 738674 23.10.2012 10,00,000 Canara Bank, Nagpur A/C No. 0265101012274 3 649338 23.10.2012 10,00,000 Yes Bank, Nagpur NRO A/c No. 002890400000072 The above cheques were drawn from by Ms. Jasmin Kochar Kapoor, a citizen of GBR (United Kingdom) and also an Overseas Citizen of India (OCI). Her Passport Number is A097004 dated 02.02.2007 issued at Birmingham. The assessee got their account audited u/s 44AB of the Income Tax Act, 1961. The asses....
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..... 5. The Ld. AR submitted that the Assessing Officer without considering the factual matrix of the case, adjudicated the matter and arbitrarily decided to disallow unsecured loan amounting to Rs. 180,65,314/- which includes previous year closing balance of Rs. 17,025,370/-. The Assessing Officer, despite being explained about the factual position of unsecured loan amount with relevant records, made an observation that the Assessee was deliberately avoiding to attend the office and defend the case. The Assessing Officer also observed that the Assessee could not furnish the ITR of persons from whom unsecured loan was received except in the case of Sh. Sanjay Srivastava. The Ld. AR submitted further that the Assessing Officer was not justified in adding back Rs. 1,80,65,314/- to the declared income without any basis and mere approval of assessment order by the CIT(A) is a failure of justice. The Ld. AR submitted that in response to the query raised by the Assessing Officer during assessment proceeding u/s 143(3), the assessee filed following documents: i) Copy of confirmation (dated 01.04.2014) from Ms. Jasmine Kochar Kapoor towards receipt of genuine "unsecured loan" of R....
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....6 months of assessment proceeding period is contrary to law. The Ld. AR relied upon the decision of the Tribunal (Delhi) in the case of ITO Vs M/s. Necleus Steel Private Limited (ITAT Delhi) (judgment dated 23.03.2018 [ITA No. 369/DEI/2015]". 6) As regards appeal for A.Y. 2014-15, the ground, the factual matrix and the submission of the Ld. AR are as follows: ITA No. 7752/DEL/2017 ( A.Y 2014-15) (i) Because the Ld. Assessing officer failed to appreciate that for the Assessment Year 2014-15, the receipt of Rs. 87 lakh from Ms. Jasmine Kochar Kapoor was well documented in the ledger account and it does not suffer from any ambiguity. (ii) Because the only creditor's name reflected in the ledger account of current year transaction FY-2014-15 is that of Ms. Jasmine Kochar Kapoor and the money was received from her through six cheques from her NRO account at Yes Bank at Nagpur. If the balance sheet for the year 2014-15 is examined along with the audit report in form 3CB, 3CD are looked into, there is absolutely no ambiguity and it is a million dollar question how the Ld. Assessing Officer and the Appellate Authority could ignore the disclosures in the ba....
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....der passed by the Ld. Assessing Officer is liable to be set aside. (g) Because the addition made by Ld. Assessing Officer is ill founded and baseless for which it is liable to be vitiated. (h) Because the appellant never ever had any intention to suppress facts nor has it committed any fraud for which he is liable to be prosecuted. The appellant craves leave of the Hon'ble Tribunal to add, amend, modify, substitute, delete and/ or rescind all or any of the grounds of appeal, submit written submissions, adduce evidence, paper book and such other facts and figures before or at the time of final hearing of the case, if necessary so arises. 8. M/s Siddharth Exports, a partnership firm is engaged in manufacture and trading (export) of Engineering and Automobile spare parts. The assessee is filing Income Tax Returns (ITR) regularly. During the Assessment Year 2014-2015, the assessee received Unsecured Loan of Rs. 87,00,000/- through 6 (six) nos. cheques as detailed below : Sl. No. Chq. NO. Date Amount (Rs.) Bank A/C 1 649341 31.05.2013 10,00,000 Yes Bank, Nagpur NRO A/C No. 002890400000072 2 649342 05.06.2013 15,00,000....
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....ived. The Ld. AR further submitted that addition of 87,00,000/- made to the total income disregarding the documentary evidences and without any basis and mere approval of assessment order by the CIT (A) is a failure of justice. The Ld. AR submitted that the assessee actually received genuine "unsecured loan" of Rs. 87,00,000/- through three cheques from Ms. Jasmin Kochar Kapoor, a citizen of GBR (United Kingdom) who is an Overseas Citizen (OCI) having Passport No. A 097004 dated 02.02.2007 issued at Birmingham : Sl. No. Chq. NO. Date Amount (Rs.) Bank A/C 1 649341 31.05.2013 10,00,000 Yes Bank, Nagpur NRO A/C No. 002890400000072 2 649342 05.06.2013 15,00,000 3 649344 12.07.2013 15,00,000 4 649345 12.07.2013 25,00,000 5 649346 23.09.2013 15,00,000 6 649357 05.02.2014 700,000 TOTAL (RS.) 87,00,000 The Ld. AR further submitted that in response to the query raised by the Assessing Officer during assessment proceeding u/s 143(3), the assessee filed copy of confirmation (dated 01.04.2014) from Ms. Jasmine Kochar Kapoor towards receipt of genuine "unsecured loan" of Rs. 26,00,000/- thr....
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....tor and therefore, it cannot be said to be a confirmation of the loan from the creditor. The only other document produced in support of such cash credit is the passport of the creditor and her bank account in India. She has a permanent account number in India but has not filed any return of income in India on the ground that she is a non-resident during the year under consideration and therefore, do not have any income chargeable to tax in India. However, no evidence is filed with regard to her income in the country where she is living. What is her source of income has also not been explained. The bank account of the assessee in India is filed in support of explaining the source of income. However, from where the credit came in this bank account has also not been explained. In the above circumstances, we are of the opinion that the assessee has miserably failed to prove the creditworthiness of the creditor as well as genuineness of the transaction. We, therefore, hold that the assessee could not discharge the onus of proving the cash credit in the name of Ms. Jasmine Kochar Kapoor. 13. Now, the second question that arises is with regard to the quantum of addition. It is stated b....