TaxTMI 
TaxTMI 
2013 (1) TMI 1041
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....onfirming the order of learned A.O. holding the loans of Rs.5,50,000/- (from M/s.Subhodh Enterprises and Rs.2,00,000/- from M/s.Naresh Trading Co. as bogus and adding the same to the income of the appellant and also erred in disallowing the consequential interest paid on such loans amounting to Rs.36,309/- in spite of the appellant discharging the primary onus that rested on him by submitting the copies of confirmation giving names, addresses, Permanent Account Numbers [PAN], Income tax return copies, TDS certificates and copy of accounts. It is submitted that it be so held now and the additions made be deleted. 2. The learned CIT(A)erred in law and on facts in concluding that the loans obtained by the appellant are bogus relying s....
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....ile. It was noted that the assessee had taken unsecured loans from the following two parties:- "Sr.No. Name of the party Amount (Rs.) 1. Subodh Enterprise (Prop. Smt.Nandini Manoj Agarwal) 5,50,000/- 2. Naresh Trading Co. (Prop.Amar G.Agarwal) 2,00,000/- Total 7,50,000/-" 2.1. The assessee was required to furnish the confirmation and the facts relating to the unsecured loans. In compliance, the assessee has furnished the bank statement, etc. Further, it was observed by the AO that a survey was conducted in a case, namely Shri Lalith S.Sharma, etc. During the course of the said survey, it was noticed that there was one Shri Ramdinesh Ranjit Sharma who was alleged to be managing the business affai....
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....sessee was that the said statement of Shri Ramdinesh Sharma had no link with the case of the assessee. Further, it was informed that the assessee has furnished the requisite information, such as, Bank statement, details of cheque issued, interest account with TDS certificate, addresses with confirmation, PAN with income-tax returns, etc. It was argued before ld.CIT(A) that the assessee had discharged the primary onus and the AO was at liberty to call those parties for examination, if he wanted to further verify the genuineness of the loan. However, ld.CIT(A) was not convinced and decided the issue in favour of the Revenue primarily on the basis of the said statement of Mr.Sharma. Ld.CIT(A) has concluded that by simply filing the confirmatio....
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....009, the AO had not issued any summons to those parties. Ld.AR has further drawn our attention on the photocopies of the incometax returns filed by those parties and argued that both of them are duly assessed to tax, therefore their respective income-tax records should have been examined by the AO. Ld.AR has also drawn our attention on the bank statement of those parties to demonstrate that the amounts in question were advanced as a loan through account payee cheques. The assessee had paid interest to those parties and also deducted TDS, therefore it was wrong to assume that the loans in question were bogus or not genuine. Copies of Form 16A in respect of the deduction of tax at source as also placed on record. The Ld.AR has also explained ....
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....el vs. ITO in ITA Nos.32 & 33/Ahd/2004 for AY 200-01 order dated 16/07/2010. 5. From the side of the Revenue, ld.DR Mr.BKS Pandya has placed reliance on the factual findings of the AO and CIT(A). His foremost argument was that the assessee had not discharged the primary onus. The assessee was granted opportunity to cross-examine Mr.Sharma but he had deliberately avoided the opportunity of cross-examination. Merely filing of confirmation and the bank statement have not conclusively proved the genuineness of the loan specially when a statement was recorded that the loans were nothing but accommodation entries. Reliance was placed on the decision(s) of Hon'ble Gujarat High Court in the case of Murlidhar Lahorimal vs. CIT [2006] 280 ITR 512 ....
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.... primary onus as prescribed under law had been discharged. Upto this extent, we are also with the argument of the assessee, hence we hereby hold that the reliance placed by ld.AR aptly apply on the issue in hand. 6.1. The main reason for the impugned addition was a statement recorded under survey of one Mr.Sharma. The survey was not conducted on the assessee but the said survey was conducted in some other cases. In that proceeding, the allegation of the Revenue Department was that a statement of one Mr.Sharma was recorded who had stated that the accommodation entries were given to the assessee in the form of unsecured loans. Now the question is that whether that statement was sufficient to invoke the provisions of section 68 of IT Act. F....