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2019 (5) TMI 1693
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....o 232/Mum/2018 for AY 2012-13 for an amount of Rs. 64 lacs. The facts and circumstances are identical in both the years. Hence, we mainly take the facts mainly from AY 2010-11 in ITA No. 193/Mum/2018, which is lead year. The grounds raised by Revenue read as under: - "1. Whether on the facts and in the circumstances of the case and in law, the Ld CIT(A) is justified in deleting the addition of Rs. 9133644/- made by the AO u/s. 68 by treating them as bogus loans." 2. Whether on the facts and in the circumstances of the case and in law, the Ld .CIT(A) is justified in holding that the initial burden of establishing the identity & creditworthiness of the creditors, as well as the genuineness of the transaction. had been discharged by the assessee and that, therefore, the onus had shifted on the Assessing Officer to controvert and disapprove the claims of the assessee. 3. Whether on the facts and circumstances of the case and in law, the Ld ClT(A) is justified in holding that the transactions are genuine just because there were no cash deposits in the lender's account." 4. Whether on the facts and circumstances of the case and in law, the Ld. CIT(....
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.... return of income, copy of bank statement and ledger account of the parties. The AO noted that Shri Praveen Kumar Jain during the search under section 132 of the Act and consequent statement recorded under section 132(4) of the Act, it was admitted that he runs web of concerns, which are engaged in providing accommodation entries of various nature like bogus unsecured loans, bogus share application money and bogus sales(purchases for the beneficiaries) etc. but on the basis of this statement recorded under section 132(4) of the Act, the AO noted that Praveen Kumar Jain although retracted the statement given under section 132(4) of the Act by filing affidavit and statements. The AO had noted the details of the filing of retraction by various persons as under: - Sl No. Name of the assessee PAN Date of filing the affidavit Relation with Praveen Kumar Jain 1. Praveen Kumar Jain AADPJ5102D 15/05.2014 Self 2. Nilesh Parmar AIXPP8680Q 15/05/2014 Accountant 3. Manish Jai AGTPJ806F 15/05/2014 Cousin and accountant 4. Dinesh Chaudhary KFPC3048P 15/05/2014 Associate Broker 5. Ramesh Soni AAKPS3473K 15/05....
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....e case of ITO v. Anant Shelters Pvt. Ltd 51 SOT 234 (Mum) has enumerated certain legal principles regarding cash credits u/s 68 as under: 1. Section 68 can be invoked when there is a credit of sum of money in the books maintained by the assessee during the previous year and either the assesse offers no explanation about the nature and source of such credits or the explanation furnished by the assesse in the opinion of the AO is not satisfactory. The opinion of the AO for no accepting the explanation offered by the assessee as not satisfactory is required to be formed objectively with reference to the material on record. III. Courts are of the firm view that that the evidence produced by assessee cannot be brushed aside in a casual manner IV. The onus of proof is not static. The initial burden lies on the assesse to establish the identity and the creditworthiness of the creditor as well as the genuineness of transaction. V. The identity of creditors can be established by either furnishing their PANs or assessment orders. The genuineness of the transaction can be proved if it was shown that the money was received by a/c payee cheque. Credi....
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....am, facts are similar to shri Praveen kumar jam's case) decision of Reliance Corporation v. ACIT (ITAT, Mumbai) ITA No.1069 to 1071/Mum12017 it support the case of appellant wherein it is held that: 8. We have heard the rival contentions perused the material placed before us including the orders of authorities below and orders retied upon by the parties. We find that undisputedly the assessee has borrowed money by way of loan from three aforesaid three parties i.e. MIs Laxmi Trading Company, MIs Rose Impex and Megha Gems from whom the assessee borrowed the money and total outstanding including the interest as on 31.3.2010 were amounting to Rs. 1,29.04,2311-. The case of the assessee was re-opened upon receiving the information from DGIT(lnv), Mumbai that the assessee was one of the beneficiary of the said accommodation entries provided by Mr. Bhanwarlal Jain and group. We find from the record that the assessee filed during the course of assessment proceedings all the details like loan confirmation letters from the creditors, PAN of the creditors, bank statements of the creditors and the assessee, form no. 16 qua TDS on interest profit and loss account and balance sheet....
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....nfirmation. Nothing contrary has been brought on record by the Assessing Officer. Hence, the grounds No. 4 challenging the addition u/s 68 of the act found to be with merits hence, the same is allowed." Aggrieved, now Revenue came in appeal before us in both the years. 7. We have heard rival contentions and gone through the facts and circumstances of the case. Before us, the learned Counsel for the assessee filed paper book consisting of pages 1 to 242 and particularly the details filed in respect of four parties from whom accommodation entries of 90 lacs was taken in respect to AY 2010-11 are as under: - Loan confirmation of Tanika commodities Pvt. Ltd, along with their financials & Proof of return filed ITR (V) & their bank statement showing receipt and re-payment of loan Loan confirmation of Ansh Merchandise Pvt. Ltd, along with their financials & Proof of return filed ITR (V) & their bank statement showing receipt and re-payment of loan Loan confirmation of Duke Business Pvt. Ltd, along with their financials & proof of return filed ITR (V) & their bank statement showing receipt and re-payment of loan Loan confirmation of Olive Overseas Pvt. Ltd, along with the....
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....was made to the total income of the assessee. Before us, the learned Counsel for the assessee argued that in order to make addition under section 68 of the Act when the following three things are not established. (i) identity of the creditors (ii) genuineness of the transactions and (iii) creditworthiness of the creditors. He explained that the onus is cast upon the assessee to explain the sources from which he has received the cash credit and the creditworthiness of the creditors is to be gauged vis-a-vis the transactions which occurred between the assessee and the creditors. He stated that it was not the burden or responsibility of the assessee to find out the source of creditors or the capacity of the creditors in order to prove the genuineness of transactions as has been held by the Hon'ble Gauhati High Court in the case of CIT Vs. Smt. Sangmitra Bharali reported in 361 ITR 481. He further, argued that the addition was made out of unsecured loans raised by the assessee from the group concern of Praveen Kumar Jain Group engaged in providing accommodation entries. On the contrary, there was no indication or proof that loans taken by the assessee were merely accommodation entries ....
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....sessee has borrowed money by way of loan from three aforesaid four parties i.e. Tanika Commodities P. Ltd, Ansh Merchandise P. Ltd., Duke Business P. Ltd and Olive overseas Pvt. Ltd. from whom the assessee borrowed the money and total outstanding including the interest as on 31.3.2010 were amounting to Rs. 91,33,644/-. The case of the assessee was re-opened upon receiving the information from DGIT(Inv), Mumbai that the assessee was one of the beneficiary of the said accommodation entries provided by Praveen Kumar Jain and group. We find from the record that the assessee filed during the course of assessment proceedings all the details like loan confirmation letters from the creditors, PAN of the creditors, bank statements of the creditors and the assessee, form no.16 qua TDS on interest, profit and loss account and balance sheet including the ledger account of the creditors, and ITR etc. Moreover, the loan creditors also appeared before the AO in compliance to the notice issued under section 133(6) of the Act and filed confirmations before the AO that loans were actually given to the assessee. From all these details and facts on record, we find that the assessee has discharged its ....