TaxTMI 
TaxTMI 
2022 (1) TMI 1328
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....d for the assessment years mentioned in the cause-title. Since issues in these appeals arose out of search carried out in the Sigma Group of cases and consequent searches at the residential premises of assessee-directors, are inter-connected, we have heard all these appeals together and proceed to dispose of them by way of this consolidated order. 2. First we take ITA No.135/Ahd/2019 in the case of Neotech Education Foundation for the Asstt.Years 2012-13. In this appeal, the assessee has raised the following grounds: "1.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A), has erred in confirming the re-opening of the assessment u/s 147/148 of the Act and thereby not holding the order u/s 143(3) r.w.s. 147 of the Act as bad in law. (Para 35.2 on page 120 of the Ld. CIT(A)'s order). 2.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A) has erred in confirming the addition of Rs.1,98,00,000/- on substantive basis as unexplained investment u/s 69B of the Act and also erred in holding and directing the Id. AO that the said amount be taxed on protective basis the hands of Sh....
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.... confirming the re-opening of the assessment u/s 147/148 of the Act and thereby not holding the order u/s 143(3) r.w.s. 147 of the Act as bad in law. (Para 39.1 on Pg 127 referring to Para 35.2 on page 120 of the Ld. ClT(A)'s order). 2.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A) has erred in confirming the addition of Rs.1,00,00,000/- on substantive basis as unexplained investment u/s 69B of the Act and also erred in holding and directing the Id. AO that the said amount be taxed on protective basis the hands of Shri Pravinchandra Patel and also in the hands of all the directors of the appellant as their joint and several liabilities. (Para 39.2 and 39.3 on page 127/128 of the Ld. CIT(A)'s order)." 8. Revenue's ground of appeal in ITA No. 194/AHD/2019 for A.Y. 2014-15 Ground No.1 "On the facts and in the circumstances of the case and in law, the Id. CIT(A) has erred in deleting the addition of Rs.1,35,00,OOQ/-on account of unexplained investment u/s 69B of the I. T. Act, when the seized document itself proves that the assessee had made investment of Rs.1,35,00,000/- (altogether Rs.5,68,00,000/....
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.... land which was duly signed by the recipient as well as the director of the company namely Shri Praveen Patel. The breakup of the cheque payment stands as under: 205 50 + 40 40 40 35 12/1/12 15/5/12 18/7/13 18/7/14 18/7/15 106 22 + 21 21 21 21 12/1/12 15/5/12 15/7/13 18/7/14 18/7/15 120 24 + 24 24 24 24 12/1/12 18/5/12 15/7/13 18/7/14 18/7/15 51 11 + 12 10 11 7 (document pending) 12. From the above details it was revealed that the cheque payment was made by the assessee at the time registration of the land property i.e. 12-1-2012 and after the registration of the land. Likewise, the scheduled for the cheque payment was also falling prior to the date of survey as well as subsequent to the date of survey. In other words prior to the date of survey, the cheque payment of Rs. 3.51 crores was appearing in the payment schedule. All the details of cheque payment were matching with the registered documents, books of accounts and bank statement. 13. However, the AO during the assessment proceedings ....
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....e cash payment of Rs.2.98 crores, cannot be a ground to reach to the conclusion that there was no cash payment made by the assessee. Moreover, it is a prevalent practice with respect to the cash transactions to keep the records of such transaction without the signatures and in short form until and unless the transactions are settled. Once, the cash transactions are settled, these records are scrapped. The contention of the assessee that business activity was not started hence there was not any source of income is not accepted for the reason that land was purchased by the assessee and the incriminating document related to the purchase of land which also signed by the director and vendor. The on-money payment is be to be added in hand of assessee because the amount paid for the land belong to the assessee. Thus the AO treated the amount of cash payment of Rs. 5.68 crores paid in Nov/Dec 2011 to Nov/Dec 2014 as unexplained investment of the assessee under section 69B of the Act which was added to the total income in different assessment years as detailed below: "A.Y.2012-13 Rs.1,98,00,000/- A.Y.2013-14 Rs,.1,00,00,000/- A.Y.2014-15 Rs.1,35,00,000/- A.Y.2015-16 ....
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.... item as income in terms of the provisions of section 68 to 69D of the Act. As such, it is the onus of the revenue to bring out the necessary evidence to hold that the assessee has made investments in the impugned land which is unexplained under the provisions of section 69B of the Act. Likewise, the contents of the email having attachments of page 157 and 158 were found from the personal laptop of the director who has also admitted to disclose a sum of Rs.2.98 crores along with other directors on account of cash income. Thus, under the provisions of section 132 (4A) of the Act it is presumed that these seized documents belong to the director and therefore the same can be explained by the director and not by the assessee company. Furthermore, the presumption under section 132 (4A) of the Act is of rebuttable presumption and therefore it cannot partake the character of conclusive evidence. The assessee also contended that the seized document is not conclusive evidence that there was the cash payment made against the purchase of land until and unless the corroborative evidences are brought on record about such cash payment. Furthermore, the details of cheque and cash payment are reco....
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....page No. 158. Similarly the seized document bearing page No. 157 of annexure A1 was containing the schedule for the cash payment which was also signed by Shri Shashikant Patel, the vendor of the land and the director of the assessee company Shri Praveen Patel. Thus, the documents seized in the course of survey belongs to the company and not with the directors in his individual capacity. iii. The contention of the assessee that the cash entries appearing on page 157 of annexure A1 may relate to the land the bearing No. 245/B which was not materialized, is afterthought and misleading. The contents of the seized documents on page 158 with respect to the payment schedule is similar with the contents of on page 157 of annexure A1. Thus, it cannot be said that the cash entries relates to the plot bearing No. 245/B which was not materialized. Further the directors of the assessee have admitted to have made the payment of Rs. 2.98 crores as shown on page 157 of the seized documents for the purchase of plots and thus it is transpired that all the remaining entries of cash payment relate to the same plot of land which were purchased by the assessee. 19. The learned CIT (A) after ....
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....order of the learned CIT (A), both the assessee and Revenue are in appeal before us. 22. The learned ARbefore us filed a paper book running from pages 1 to 80 and reiterated the contentions made before the Authorities below. 23. The learned DR before us vehemently supported the stand of the authorities below by reiterating the findings contained in the respective orders which we have already adverted to in the preceding paragraph. Therefore we are not repeating the same for the sake of brevity. 24. We have heard the rival contentions of both the parties and perused the materials available on record. In the present case, the AO found that the assessee has made cash payment against the purchase of land amounting to Rs. 5.68 crores in different assessment years. The view of the AO was based on the seized document found during the survey proceedings. Thus, the addition was made by the AO in different assessment years as discussed above. On appeal, the learned CIT (A) was pleased to confirm the addition of Rs. 1.98 crores and 1 crores for the AYs 2012-13 and 2013-14 and deleted the addition made by the AO for the AYs 2014-15 and 2015-16 for Rs. 1.35 crores for both the AYs on t....
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....essee was not having any source of income until July 2013. Further the assessee time and again contended that the cash was paid out of cash received from the directors and directors have offered the cash income in their individual returns. Therefore considering the fact in totality we are of the view that amount of Rs. 1.98 crore and 1 crore paid in the A.Y. 2012-13 and 2013-14 are made out of the cash received from directors. Hence the source of investment in the hand of the assesse to the tune of Rs. 2.98 crore gets explained and no addition can be made in hand of the assessee as it is not the income of the assesse. If at all any addition of cash income is required to be made, that can be made in the individual capacity of the director. Indeed the addition of cash investment for Rs 3,97,37,485/- has been made in hand of Shri Pravinchandra Patel and therefore, no addition in the present case is warranted. Thus the ground of appeal of the assessee for A.Y. 2012-13 and 2013-14 allowed. 27. Now we proceed to adjudicate the issue of addition of Rs. 1.35 crores made in AY 2014-15 which was delete by the learned CIT(A). On perusal of the seized document, we note that there was no sig....
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.... erred in confirming the addition of Rs.53,06,500/- as unexplained receipts and unaccounted expenses. (Para 24.2 on page 110 of the Ld. CIT(A)'s order). 5.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A) has erred in confirming the addition of Rs. 2,05,11,300/- as undisclosed and unexplained income. (Para 25.6 on page 113 of the Ld. CIT(A)'s order). 31. There was found a piece of paper bearing page no. 33 of annexure A-3 from the premises of the cabin of the Director namely Shri Manish B Shah. This paper was containing various types of recording in six different compartment. Out of them some were recorded in the books of account and some were not recorded in the books of accounts of the assessee which were treated by the AO detailed as under: C. No Heading Total amount (Rs.) Addition (Rs.) Treated as 1 Never show in books of account 3,81,12,000 83,12,000 unaccounted expenses 2 Account not closed till date 93,52,385 59,45,153/- unaccounted expenses 3 As per new Diary 50,14,800 50,14,800 unaccounted receipt 4 (Blank) 3,41,32,693 98,80,193 &nbs....
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....during the survey until and unless some corroborative evidence are brought on record. May be this paper was maintained for budgeting purposes. Therefore whatever the transaction actually took place were accounted in the books and remaining transactions which did not take place were not accounted. 34.1 However the AO rejected the submission of the assessee by observing as under: 34.1.1 1st compartment, there were appearing certain transactions of cash payment including the cash payment of Rs. 2.98 crores towards the purchase of land which has already been accepted by the assessee that such amount represents the payment to the vendor of the land and treated separately. 34.1.2 Besides the above, there were certain entries of cash payment aggregating to Rs.83,12,000/- which were not recorded in the books of accounts. Mostly, such payment was representing the expenses in connection with the development of the land which was purchased by the assessee vide agreement dated 12th January 2012. The assessee in connection with the purchase of the land has made cash payment of Rs.2.98 crores which was admitted by the directors. Therefore, the contention of the assessee that it had no s....
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....tment was shown under the heading "AS PER NEW DIARY". There were certain entries showing the different amount against different page Nos. of the alleged diary which were treated as unaccounted receipt of the assessee. Accordingly the same i.e. Rs. 50,14,800/- was added to the total income of the assessee in absence of necessary submission and explanation. 4^th Compartment 34.1.6 There were certain entries against the serial numbers 49 to 52 of seized document bearing page No. 33 of annexure A3. Under this compartment, certain amount was recorded against different nomenclatural such as petty cash, share capital /application, unsecured loan in the name of the directors aggregating to Rs. 3,41,32,693/- only. On verification it was found that certain entries such as Rs. 1,79,51,000/- as share capital of Pravinbhai, Rs. 7,95,000 as share capital of Ansuyaben, Rs. 4 Lacs as unsecure Pravinbhai were recorded in the books of accounts maintained by the assessee. However the remaining entries aggregating to Rs. 1,49,86,693/-, were not matching with the records maintained by the assessee. Therefore the AO treated the same as unaccounted receipt of the assessee. Out of such unaccounted r....
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....e transactions has been carried out by the assessee in cash and that too without recording in the books of accounts. ii. The seized document bearing No. 33 was found from the possession of Shri Manish B Shah. The purpose of preparing such document was only known to him i.e. Shri Manish be Shah. It is very much possible that Shri Manish B Shah might have prepared such document for budgetary purposes. As such, Shri Manish B Shah can only explain the purpose for which such transactions were recorded in the seized documents. Since the document was found from the possession of Shri Manish B Shah, then the presumption provided under section 132(4A) of the Act postulates that such document belongs to Shri Manish B Shah. Accordingly, no inference can be drawn against the assessee based on such document. If any addition is required to be made based on such document, the same can be made in the hands of Shri Manish B Shah. The assessee also contended that based on the impugned seized document, an addition of Rs. 72 Lacs and 7.9 Lacs has already been made in the hands of Manish B Shah for the assessment year 2014-15 in the assessment framed under section 153A of the Act. iii....
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.....50 Lacs which were duly recorded in the books of accounts. Therefore, no addition is warranted. II. Compartment No. 2, unexplained expenditure of Rs. 59,45,153in the assessment year 2014-15. The cash entries reflected in such compartment which were not recorded in the regular books of accounts, does not suggest that these entries reflect the unexplained expenditure from the unrecorded source. III. Compartment No. 3, unaccounted receipts of Rs. 50,14,800 in the assessment year 2014-15. Under this compartment, the addition was made for the cash entries shown under the head "new diary" which contains different page numbers against the amounts. None of the amount is ascertainable whether it represents the receipt or the expenditures. Furthermore, there is not appearing any date therein. Therefore, no addition is warranted with respect to such entries found in the seized document. IV. Compartment No. 4, unaccounted share application and cash receipt from the directors for Rs. 96,80,193in the assessment year 2014-15. The assessee with respect to the addition of Rs. 1,58,300.00 and 4 Lacs submitted that addition has already been made ....
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....l amount of loan from Shri GVG stands at Rs. 10 Lacs which was duly recorded in the books of accounts and same was squared up in the year under consideration. Thus, it was contended by the assessee that there cannot be any addition to the total income of the assessee. 41. Without prejudice to the above i.e. general and compartment wise contention, the assessee submitted that seized document contain various noting which has been described as unaccounted expenses and unaccounted receipt by the AO. Therefore expenses and income cannot be added to income of the assessee separately. As such only profit element as per telescoping should be taxed. The assesse accordingly submitted the working of the telescoping and prayed only an amount of Rs. 8,40,140/- can be added as per sheet bearing page no. 33 of A-3. 41.1 The ld. CIT-A after considering the submission of the assessee rejected the alternate plea for telescoping without assigning specific reason and adjudicate the compartment wise addition individually which are summarized in following paragraph. 42. The learned CIT(A) with respect to the addition made by the AO under the 1st compartment found that the assessee has incurred ....
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....application of Rs. 4 Lacs has been added in hand of Shri Parvin R Patel. Hence no further addition is required. The Assessee claimed that the amount of petty cash of Rs. 7,51,893/- also owned by Shri Pravin R Patel. Hence,the same should be deleted subject to verification. With regard to the amount of Rs. 83.70 Lacs being shares issued to Shri Preet Patel, the learned CIT(A) found that during the year new shares for Rs. 66,86,500 were allotted to Shri Preet Patel which were duly recorded in the books. Therefore, addition for the balance amount to the extent of Rs. 16,83,500/- (83,70,000 - 66,86,500) was confirmed. 47. With respect to the addition made by the AO under 5th compartment for Rs. 2,85,22,600/ being loan taken and repaid along with interest to GVG. The learned CIT(A) found that this compartment contain unaccounted loan for Rs. 1.89 crorewhich has been accepted and repaid along with interest of Rs. 16,11,300/- from unaccounted source. Thus the learned CIT(A) held that only the principal amount of loan and interest thereon can be added. Accordingly, the ld. CIT-A confirmed the addition to the tune of Rs. 2,05,11,300/- only. 48. With respect to the addition made by the....
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....document found during the search proceedings belongs to the assessee or Manish B Shah, the director of the company. iv. Whether the benefit of telescoping can be extended to the assessee in the given facts and circumstances. 53. We proceed to adjudicate the question No. 4 as discussed above so as to see whether the concept of telescoping can be applied in the given facts and circumstances. Admittedly, the seized document bearing page No. 33 contains various financial transactions. This document has been divided in 6 compartments by the Revenue. Three of the compartments out of 6 were treated as the receipts and the remaining 3 compartments were treated as the payments. The authorities below have added each compartment separately as being unaccounted receipt and unexplained expenses after providing adjustment of amount already recorded in the books of accounts and added separately in hands of directors. To our mind the approach adopted by the authorities below is not justifiable for the reason that it is settled position of law that the material seized or found in a proceeding cannot be read in isolation rather the same should be read as whole. The authority below at one....
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....e argument of the assessee that the impugned papers not only showed the receipts but also the expenditure and, therefore, the document should be read as a whole and deduction for the expenditure incurred should be given to the assessee while computing undisclosed income was concerned, the seizeddocument should be read as a whole if it has to be relied upon. It cannot be read only to the extent it is advantageous to the revenue and not read when it becomes disadvantageous to the revenue. It is an accepted principle of interpretation of documents that they should be read as a whole, as persons of common prudence will read them. They cannot be read in bits and parts to suit the convenience of one party or the other. Therefore, the expenditure would also have to be read on proper appreciation of the document. 56. In view of the above, we find that the net results of the receipts and expenses should only be considered for the purpose of the additions. As such the individual receipts and the expenses cannot be subject matter of the addition independently. There is also no ambiguity to the fact that whatever amount of the unaccounted expenses have been incurred have been sourced out of....
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....the AO which was reduced by the learned CIT(A) to the tune of Rs. 39,12,000/- in the assessment year 2012-13 on account of unexplained expenditure. There is no dispute to the fact that the land was acquired by the assessee dated 12th January 2012 and its commercial activities were commenced from July 2013. In other words, there was no activity carried out by the assessee in the year under consideration. Thus the question arises can there be any addition for the unexplained expenditure incurred by the assessee on account of undisclosed income. In the present case, there cannot be any possibility for the assessee for having any unaccounted income in its hands for the year under consideration. It is for the reason that the assessee has not done any commercial activity suggesting that the assessee has earned income which was not disclosed in the books of accounts. If any addition was at all liable to be made, the same could have been done in the hands of the directors of the company. It is for the reason that there were directors who were found to have invested money on behalf of the assessee out of their undisclosed income. Thus, it can be inferred that the directors of the company ha....
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....d of appeal raised by the assessee is dismissed as being not pressed. 63. The next issue raised by the assessee in ground Nos. 2 & 3 of its appeal is that learned CIT(A) erred in confirming the addition made by the AO for Rs. 1 crores on account of unexplained investment made in the land. 64. At the outset we note that the issue raised by the assessee has been decided along with the appeal bearing No. ITA No. 135/Ahd/2019 for AY 2012-13. The appeal was allowed in favourof the assessee. For, the detailed discussion, please refer the paragraph Nos. 24 to 28 of this order. Hence the ground of appeal of the assessee is allowed. 65. In the result appeal of the assessee partly allowed. 66. Coming to next assessee's appeal in ITA No. 137/Ahd/2019 for the Asstt.Year 2014-15, the following grounds are raised. "1.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A) has erred in confirming the addition of Rs.59,45,153/-as unexplained expenditure u/s 69C of the Act. (Para 21.4 on page 105 of the Ld. CIT(A)'s order). 2.0 On the facts and in the circumstances of your appellant's case and in law, the Ld. CIT (A) has....
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....he learned CIT (A) erred in confirming the disallowance of the depreciation for Rs.7 Lacs on account of excess value of the building. 71. There was the addition in the block of assets under the head building which was held in the year under consideration for less than 6 months. The value of such addition stands at Rs.13,53,95,335/- only. However, the AO based on the seized document bearing No. 55 of Annexure A-1 found that the assessee has received cash of Rs. 1.40 crores from the contractors. The impugned seized document was handwritten by Ms. Dhruvi Pandya, the chief accountant of the company. On confrontation, she admitted in the statement furnished on oath under section 131 of the Act that the contractor has raised the bills at the higher value and the payment was accordingly made to the contractor at the higher value which was received back in cash by the assessee. Based on the statement, the AO held that the assessee is not eligible for depreciation on the higher value of the construction expenses added in the value of the building which was of worked out at Rs. 7 Lacs. Thus the AO treated the same as excessive depreciation claimed by the assessee and disallowed the same. ....
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....to indicate the particular year to which it pertains. Accordingly, the learned AR contended that there cannot be any disallowance of the depreciation. On the other hand, the learned DR vehemently supported the order of the authorities below. 75. We have heard the rival contentions of the parties and perused the materials available on record. The seized document bearing page No. 55 is placed on page 138 of the paper book. On perusal of the seized document, we note that no name either of the assessee or the contractor is appearing therein. Likewise, there is no date mentioned on such seized paper. In simple words, such seized document contains certain figures with the remark cash back only. Thus, to our understanding, no adverse inference can be drawn against the assessee solely on the basis of such seized document. However, if such seized document is seen in aggregation of the statement of the chief accountant, as alleged by the revenue, it appears that the assessee has claimed higher amount of expenses. In other words, it seems that the conclusion has been drawn by the revenue solely based on the statement furnished during the assessment proceedings. We find that the CBDT in ins....
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....aw, the !d. CIT(A) has erred in deleting the addition of Rs.1,35,00,000/-on account of unexplained investment u/s 69B of the I. T. Act, when the seized document itself proves that the assessee had made investment of Rs.1,35,00,000/- (altogether Rs.5,68,00,000/- for different years) in the purchase of land for A.Y.2014-15. 2. On the facts and in the circumstances of the case and in law, the Id CIT(A) has erred in deleting the entire addition of Rs.1,62,44,073/- on account of unsecured loan, which also includes unsecured loan of Rs.58,00,000/- [claimed to be received from Shri Shashikant R. Patel (Rs.50,00,000/-) and ShnDeshraj Singh (Rs.8,00,000/-)] for which the assessee as well as the lenders miserably failed to prove their creditworthiness. 3. It is, therefore, prayed that the order the Ld. CIT(A)-12, Ahmedabad may be set aside and that of the AO may be restored to the above extent." 81. The first issue raised by the Revenue is that the learned CIT(A) erred in deleting the addition of Rs. 1.35 crore made on account of unexplained investment in land. 82. At the outset we note that the issue raised by the Revenue in ground number 1 of its appeal has already ....
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....and the remand report of the AO deleted the addition made by the AO by observing as under: "26.2 From the perusal of the Remand Report dtd.09/03/2018 read with the Remand Report dtd.11/07/2018 it is seen that AO has examined the details submitted by the appellant vide the letters dated 16/02/2018 and 09/03/2018 the AO has accepted the identity of 13 depositors/lenders but has doubted the nature of transactions and worthiness (on account of low income as per the respective returns of income) in respect of some, the remand reports are already reproduced in this order earlier. In this regard it is submitted by the appellant vide dated 01/08/2018 that since these monies were received (and-subsequently repaid) through account payee cheques/bank transfers and were duly recorded in the books of account and the lenders confirmed the transactions, it is clear that the appellant-Company has discharged its onus regarding the said deposits. 26.3 I have examined the submission of the appellant vide dated 01/08/2018 and gone through the supporting evidences furnished earlier and I am of the considered view that the appellant has discharged its onus of proving identities, the so....
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....dentity of the creditors and their creditworthiness. Mere payment by account payee cheque was not sacrosanct nor could it make a non-genuine transaction genuine." 91. The assessee has discharged its onus by furnishing the necessary details such as a copy of PAN, bank details, and ITR etc. in support of identity of the parties, genuineness of transaction and creditworthiness of the parties. Admittedly the AO has accepted the identity and genuineness of transaction but doubted the credit worthiness of the parties. However the learned CIT(A) held that the assessee has discharged the primary onus cast under section 68 of the Act and onus shifted on the AO to prove otherwise based on contrary materials on record. 92. Now coming to the third condition, i.e. creditworthiness of the parties, regarding this we note that the assessee has refunded the amount through banking channel to all the parties.The repayment of the loan amount by the assessee was duly accepted by the Revenue. In this regard, we find support and guidance from the judgment of Hon'ble Gujarat High Court in the case of the CIT Vs. Rohini builders reported in 256 ITR 360 wherein it was held as under: "The genu....
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....issue to the Bench to decide the same in accordance with law. 101. Admittedly,the tax effect in appeal of the Revenue is below Rs.50 Lacs, and therefore, keeping in view the above CBDT circular and provisions of section 268A of the Income Tax Act, we are of the view that the present appeal of the Revenue deserve to be dismissed at the threshold. It is accordingly dismissed. 102. However, it is observed that in case on re-verification at the end of the AO it can be demonstrated that the tax effect on the disputed addition is more, or Revenue's case falls within the ambit of exceptions provided in the Circular, then the Department will be at liberty to approach the Tribunal for recall of this order. Such application should be filed within the time period prescribed under the Act. 103. In the result, appeal of the Revenue is dismissed due to low tax effect. 104. Now we take following appeals in the case of Shri Parvinchandra Patel: IT(SS)A Nos. 69/AHD/2019, 71/AHD/2019, 72/AHD/2019 and 73/AHD/2019 for the assessment years 2009-10, 2011-12, 2012-13 and 2013-14. 105. The issues raised by the Revenue in IT(SS)A Nos. 69/AHD/2019, 71/AHD/2019, 72/AHD/2019 and 73/AHD/2019 ....
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....when the Remand report has been called for from the A.O. and the case has not been decided on the facts submitted by the A.0. 6. It is, therefore, prayed that the order of the Ld. CIT(A)-12, Ahmedabad may be set aside and that of the AO may be restored to the above extent. 7. The appellant craves leave to add, alter, amend and/or withdraw any ground(s) of appeal either before or during the course of hearing of the appeal." 107. The preliminary issue that has to be decided in all these appeals whether there can be any addition with respect to the unabated assessment years without having found any incriminating materials in the course of search proceedings under section 132 of the Act. 108. The facts of the case are that there was the search and seizure operation under the provisions of section 132 of the Act at the premises of the assessee dated 13th November 2014. Accordingly, the proceedings for the assessment under the provisions of section 153A of the Act were initiated for the assessment years as discussed above. The assessment was framed by the AO after making certain additions in different assessment years as detailed below: For the AY 2009-10....
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....BS-2, page 1-65 of annexure BS-3 and page 1 of annexure BS-4, the assessee submitted that same is payment towards purposed purchase of agricultural land which was made out of cash available in hand from bank withdrawal on different dates. 113. The learned CIT (A) after considering the submission of the assessee observed that there are plethora of judgments of various tribunals, Hon'ble High courts including the Hon'ble Gujarat High court in case of Pr. CIT vs. Saumya Construction Pvt. Ltd. reported in 81 taxmann.com 292 and Hon'ble Apex court in case of CIT vs. Singhad Technical Education Society reported in 84 taxmann.com 290 wherein it has been laid down that in case of elapsed/unabated AYs there cannot any addition in the absence incriminating material found and available on record. In the present case all the assessment years i.e. 2009-10 to 2013-14 have been elapsed/unabated. Therefore no addition can be made in the absence of incriminating material in all these assessment years. Accordingly,the learned CIT (A) held that the AO has made the addition in the present search proceedings of regular items of agricultural income, credit entry in bank statements and deduction claim....
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....nd relevant assessment year in which such search was conducted. The 2nd proviso to section 153A of the Act speaks/deals for the unabated and abated assessment years. As per the 2nd proviso to section 153A of the Act, the assessment/reassessment, if any, relating to the period of 6 assessment years as on the date of search is pending, then the same shall abate which implies that there will be regular assessment meaning thereby all the items of income and expense disclosed by the assessee in that assessment year shall be subject to scrutiny. 119. On the contrary, the assessment years which have been completed as on the date of search, there cannot be any addition/disallowance to the total income of the assessee until and unless found some document of incriminating nature during the course of search proceedings. 120. The word incriminating document has nowhere been defined under the income tax Act but the same has been evolved by the Hon'ble courts while rendering judgments. In this connection we draw support and guidance from the judgment of Hon'ble Gujarat High Court in the case of Pr. CIT vs. Saumaya Construction (P.) Ltd. (supra), the relevant observation is extracted here u....
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....search proceedings which is being incriminating in nature. To our understanding, as there were not mentioned any document discovered in connection with transaction in the bank accounts during the search proceedings, the same cannot be said as incriminating document. Furthermore, there was no allegation of the AO that these bank accounts were not disclosed in the income tax return. Moreover, the learned CIT-A in his order has also observed as under: "13.4 On the technical ground of applicability of Sec. 153A, it is seen that the A.Y, 2009-10 is an unabated assessment year and thus the appellant is protected by the case laws relied upon by him and that the AO cannot make addition without any basis of incriminating material. If the bank accounts with various banks including the City Bank and the Royal Bank of Scotland were disclosed for the purpose of Income tax, the bank accounts cannot be held to be incriminating and no addition on account of credit entries therein can be made by the AO without there being any material found during the course of search which could incriminate a particular or set of or whole of credit entries in these bank accounts. In the assessment order i....
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..../- being difference in sale consideration and stamp value under section 50C of the Act. In this regard we are of the view that had this addition been made under normal assessment/ reassessment proceedings, then the addition may have sustained subject to other conditions laid down under the provision of section 50C of the Act. However, the proceedings before us are special proceeding under section 153A and assessment is also unabated/completed. Therefore, addition can only be restricted to the extent of incriminating material found during search as discussed above. As there was no material found in search suggesting that the assessee has received any amount over and above what have been already disclosed by the assessee in the income tax return, we are also of the view that the AIR information cannot be held as incriminating material as there is no evidence that assessee has received excess sale consideration. Therefore, the addition under section 50C in A.Y. 2012-13 being unabated/completed assessment also cannot be sustained. Thus the grounds of appeal of the Revenue are dismissed. 127. In the result, all the four appeals of the Revenue are dismissed. 128. Coming to ITA No. ....
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....etails / evidences have been furnished by appellant and therefore onus u/s 68 has not been discharged. (Para 18.4 on page 148/149 of the appellate order). (b) On the facts and in the circumstances of your appellant's case and in law, the Id.CIT (A) has erred in confirming addition u/s 68 of the Act as unexplained credits to the extent of Rs.26,63,386/- in various banks, since appellant submits that bank statements/pass books are not books of accounts as envisaged under the provisions of section 68 of the Act. {Para 18,4 on page 148/149 of the appellate order). 3.0 On the facts and in the circumstances of your appellant's case and in law, the Id. CIT (A) has erred in confirming addition as unexplained loan / investments in cash in Neotech Education Foundation to the extent of Rs.3,97,37,485/-. (Para 21.2 and 21.7 on page 152/153 and 156 of the appellate order). 134. The first issue raised by the assessee is that the learned CIT(A) erred in treating the agriculture income of Rs. 4Lacs as income from other sources out of the total agricultural income declared by the assessee at Rs. 4,48,600/-. 135. The assessee in the year under consideration has declar....
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....nt of Rs. 4 Lacs as income from other sources. 140. Being aggrieved by the order of the learned CIT(A), the assessee is in appeal before us. 141. The learned AR before us submitted that the assessee in possession of the agricultural land which is capable of generating the agricultural produce. Likewise, an agricultural land was purchased in the year under consideration for the value of Rs.1 crores. Even if 0.5% of the value of such investment is taken as the return on such investment, an income of Rs.50,000 is worked out and if it is multiplied with 16 vigha it comes out to Rs. 8 Lacs per annum. However the assessee has declared an income of negligible value at Rs. 4,48,600 which is very much viable. 142. On the contrary the learned DR before us contended that in the absence of necessary evidences about the details of the production, sales and expenditures, it cannot be presumed that the assessee has earned agriculture income merely on the basis of possession of land in his hand. 143. Both the learned AR and the DR before us vehemently supported the order of the authorities below to the extent favourable to them. 144. We have heard the rival contentions of both the p....
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....harge the onus cast under section 68 of the Act for an amount of Rs. 26,63,386/- credited in different bank accounts from different party detailed as under: 1. Rs. 8,386/- in RBS Bank bearing account number 1555195 2. Loan amount of Rs. 24,75,000/- received from one Shri Arunishbhai P. Patel in HDFC Bank account. 3. Loan amount of Rs. 90,000/- each from Shri Razak Mohammad bhai and Shri Kalubhai Mohammad bhai credited in HDF bank account. 149. Thus the learned CIT (A) was pleased to confirm the addition of Rs. 26,63,386/- only. The ground of appeal of the assessee was partly allowed. 150. Being aggrieved by the order of the learned CIT (A), the assessee is in appeal before us. 151. The learned AR before us submitted that an amount of Rs. 8386.00 was representing the transfer from RBS Bank. The learned AR for the receipt of Rs. 24.75 Lacs from Shri Arunishbhai P. Patel in HDFC Bank account submitted that he has made best effort to collect necessary document from the party but failed. Thus the Revenue should exercise power conferred under the Act to verify the genuineness impugned transaction by collecting necessary details from the bank directly. ....
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....he bank reads as under: "To, The Manager, The Royal Bank of Scotland pic Brady House, 14, Veer Nariman Road, Fort, Mumbai - 400023 Date: 25/06/2018 Subject: Request for Identification of Remitter for the F.Y. 2013-14 Dtd. 08/01/2014 (Ref. CHQ DEP/544951/OWPADRA1/5) Rs.24,75,000=00 "Dear SirMadam, I. Pravinbhai R. Patel, had account in your bank. The Bank Details are as follow: Name of the A/c Holder Address : Pravinbhai R. Patel 52, Sarvoday Society Nizampura, Vadodara. 390002, Gujarat, India. Bank Account Number : 1555195 Bank Name and Address : GF, Chitrakut Complex, Nr. Pashabhai Park & Natubhai Circle, Race Course Vadodara. Customer Relation Number : 852207 Please note that in my personal case there is raid from Income Tax Department. My case is in Appeal with Income Tax Department. In this regards they are asking for the clarifications of all the receipts (Credit) entries in my Bank Statement. In this regards, one entry dated 08/01/2014 Rs. 24,75,000=00 ref. CHQ DEP/544951/owpadra1/SBIN/DAND/, I am not able to found the re....
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....t made to M/s Neotech Education Foundation. Based on the above, the AO sought an explanation from the assessee about the source of the fund recorded as cash and bank for Rs.3,97,37,485/- and 14 Lacs which has been utilized for making the payment to the M/s Neotech Education Foundation. However, the assessee failed to make any reply to the question raised by the AO. In the absence of any reply from the side of the assessee, the AO treated the cash and bank amount of Rs.3,97,37,485/- and 14 Lacs respectively as unexplained loans/investments in M/s Neotech Education Foundation. Accordingly, the entire amount of Rs. 4,11,37,485/- (Rs. 3,97,37,485/- plus 14 lacs) was added to the total income of the assessee. 162. Aggrieved assessee preferred an appeal to the learned CIT (A). 163. The assessee before the learned CIT (A) submitted that there was no corroborative evidence found during the course of search suggesting that the assessee has made cash payment to M/s Neotech Education Foundation. As such, the assessee has only made the payment through the banking channel which was duly recorded. Had there been any payment in cash, there would have been the entry in the books of accounts ....
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....and Rs.10,00,000/- (which is a typographical error and the amount in the return is Rs.19,00,000/-) in A.Y.2015-16. Hence penalty proceedings u/s 271(l)(c) are initiated in respect of unaccounted income for which disclosure is made". However, the AO has not allowed any set off of any unaccounted/undisclosed expenses on account of the additional income of Rs.30 Lacs and Rs.19 Lacs which becomes available with the appellant. 21.5 In this regard, it is reiterated that I have held in the case of M/s. Neotech Education Foundation that it is not possible to hold the "brokerage income" shown in the returns u/s 139(4) and u/s 153A by some of the Directors and their family members as "disclosure of (unaccounted) income". Reasons are at para 12.10.3 before of this order. However, in view of the submission of the appellant at para 21.3 above, it cannot be denied that the income of the appellant including the "brokerage income" of Rs.30 Lacs in A.Y.2014-15 and of Rs.19 Lacs in A.Y.2015-16 which is in cash are definitely available to the appellant and some of the unaccounted expenses/loans must be telescoped/set off as apparently the appellant has not shown any appropriation of the "bro....
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....ed that the document bearing page No. 35 is not an authentic piece of evidence. Hence, the same is not reliable. The addition made on such page is based on surmises and conjecture without having corroborative material. Likewise, such page No. 35 was not confronted during the search to the assessee while recording the statement. Thus the addition has been made hypothetically. 170. Without prejudice to the above, the benefit of telescoping of cash income by way of brokerage declared by the group of the assessee for Rs. 3,21,41,600/- crores and the amount of cash available in the hands of the assessee should be provided. The learned AR without prejudice to the above also contended that there was the surplus of cash in hand available with him amounting to Rs.81,00,065/- which should be adjusted against the impugned addition. The learned AR in support of his contention drew our attention on page 226 of the paper book where the cash flow statement was placed. 171. On the contrary the learned DR before us vehemently supported the order of the authorities below. 172. We have heard the rival contentions of both the parties and perused the materials available on record including the....
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....seized documents is a meaningful information and the same should be read in a scientific manner. At this juncture, it is also pertinent to note that there is a presumption provided under section 132(4A) /292C of the Act which provides that the contents of the seized documents are true. The relevant extract of the provisions of this section are extracted as below: Search and seizure. (4A) Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search, it may be presumed- (i) XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX (ii) that the contents of such books of account and other documents are true ; and XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX Presumption as to assets, books of account, etc. 292C. (1) Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in the possession or control of any person in the course of a search under section 132 or survey under section 133A, it may, in any proceeding under ....
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....hile giving effect to the appeal orders. I direct the AO to allow set off of at least Rs.30 Lacs (of brokerage income during the year) against the addition of Rs.3,97,37,485/- confirmed at para 21.2 of this order. 175. It is the settled law that the Revenue cannot mix the hot and cold for making the addition to the total income of the assessee which would certain lead to the double addition. As such the Revenue on the one hand cannot treat the cash investments as income of the assessee without adjusting the cash income declared by the assessee in the income tax return. It should be presumed that the cash income disclosed by the assessee is utilized for making investment in Neotech Education Foundation in the absence of any contrary evidence. It is also not in dispute that the assessee along with family members have earned cash income and declared the same as brokerage and there is no finding that such cash income has been utilized for any other purpose. In other words, the cash income disclosed by the assessee was available for the impugned investment in cash. Thus to our considered view, the adjustments to the extent of the cash income declared by the assessee along with the gr....
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....,37,485/. Thus if any addition is sustained in the hands of any other party, that would lead to the double addition which is not desirable under the provisions of law. 178. However, before we part with the matter, we are inclined to deal with one procedural issue as well. The payment of Rs. 2.98 crores for the acquisition of the land was made in the assessment years 2012-13 and 2013-14 whereas the income of Rs.3,97,37,485/ crores has been added in the hands of the assessee in the assessment year 2014-15. Thus a question arises how to establish the link between the income added in the hands of the assessee viz a viz the cash payment made by M/s Neotech Education Foundation as these transactions pertain to different assessment years. In this regard, we note that the seized document bearing page No. 35 contains the position of investment made by the assessee in cash as on 28 February 2014 and it does not establish the fact that this cash income was generated by the assessee in the year under consideration. Thus, in the absence of necessary information, we can safely presume that this income was earned by the assessee over the period of time which was invested inM/s Neotech Educatio....
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.... is liable to be dismissed at the threshold as not maintainable. However, the ld.DR did not dispute the same, but left the issue to the Bench to pass appropriate order in accordance with law. 183. We find that admittedly total tax effect in appeal of the Revenue is below Rs.50 Lacs, and therefore, keeping in view the above CBDT circular and provisions of section 268A of the Income Tax Act, we are of the view that the present appeal of the Revenue deserve to be dismissed at the threshold. It is accordingly dismissed. 184. However, it is observed that in case on re-verification at the end of the AO it can be demonstrated that the tax effect on the disputed addition is more, or Revenue's case falls within the ambit of exceptions provided in the Circular, then the Department will be at liberty to approach the Tribunal for recall of this order. Such application should be filed within the time period prescribed in the Act 185. In the result, the appeal of the Revenue is dismissed due to low tax effect. 186. Coming to ITA No. 299/Ahd/2019, an appeal by the assessee for A.Y. 2015-16. 187. The assessee has raised the following grounds of appeal: "1.0 On the facts and....
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....ssessment year 2014-15 shall also be applied for the year under consideration i.e. AY 2015-16. Hence, the grounds of appeal filed by the assessee is partly allowed. 190. The second issue raised by the assessee is that learned the CIT (A) erred in treating the sum of Rs.33.50 lacs as unexplained cash credit out of the total amount of Rs.13,92,28,464/ credited in different bank accounts. 190.1 There were appearing the credit entries for Rs. 13,92,28,464/- in the bank account of the assessee. But the assessee, failed to justify the source of such credit entries and therefore the AO treated the same as unexplained cash credit by adding the same to the total income of the assessee. 191. The assessee carried the matter to the learned CIT (A). 191.1. The assessee before the learned CIT (A) made detailed submission about the source of entries in the bank account. The learned CIT (A) also called for the remand report from the AO on the details filed by the assessee. The learned CIT (A) after considering the remand report held that the assessee failed to discharge the onus cast under section 68 of the Act for the amount aggregating to Rs. 33.50 Lacs credited in HDFC bank which is....
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.... representing the amount received from Shri SachinAshokbhai Patel. 198. With respect to the remaining parties, we note that the assessee has furnished the confirmation along with the PAN and in some of the cases bank statement. Thus we hold that the assessee has discharged the primary onus imposed under section 68 of the Act. Considering the profile of the assessee, the value of loan is not of significant amount which would create doubt on the genuineness of such loan. Had there been any doubt about the genuineness of the loan, the Revenue should have verified the same by issuing notice under section 133(6) of the Act. But we note that the authorities below have not exercised such powers. Accordingly, we are not impressed with the finding of the authorities below to the extent of the loan shown by the assessee for Rs. 27 Lacs. Accordingly, we set aside the order of the learned CIT-A and direct the AO to delete the addition made by him. Hence the ground of appeal of the assessee is partly allowed. 199. With respect to the issue raised by the revenue, we find that the AO in his remand report has not pointed out any defect with respect to the onus imposed upon the assessee under....
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.... amount of Rs. 62.25 Lacs is still payable. To this effect, assessee has furnished the confirmation from the vendor of the land in the form of the affidavit. However, the learned CIT (A) confirmed the addition of Rs.46 Lacs by observing as under: "22.6 As to this addition of Rs.50,00,000/- on account of investment in land, it is seen that verification of documents seized from the premises of Neotech Education Foundation revealed that Pages 11 and 12 of Annexure-A-1 contained noting regarding purchase (jointly by the appellant with his wife) of agriculture land for Rs.l,00,00,000/- from one Shri Aas Mohammed Pathan. It is case of the appellant that the land was purchased vide Deed dated 24/09/2014 (FY 2014 related to AY 2015-16) and that post dated cheques were issued to the Seller out of which, till date only Rs.37,50,OOO/- out of appellant's bank account has been encashed by the Seller. In the Remand Report dated 16/08/2018, the AO has noted that the dates of cheques except one dated 30/04/2012 (of Rs.8,00,000/-) are after the date of execution of purchase deed and has held that the claimed payment of Rs.37,50,OOO/- is not towards purchase of land and therefore, inves....
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.... AR for us submitted that the payment has been made to the vendor after withdrawing the cash the bank. There is no information available with the Revenue indicating that the withdrawal of cash has been utilized for any other purpose. Thus, there cannot be any doubt with respect to the payment of Rs.37.50 Lacs which was made after the withdrawal of cash from the bank. The assessee for the balance amount has contended that it is outstanding. To this effect, confirmation from the vendor was also filed which is available on record. 207. On the contrary, the learned DR before us vehemently supported the order of the authorities below. 208. We have heard the rival contentions of both the parties and perused the materials available on record. The issue in the present case relates whether assessee has made payment from the unaccounted sources for the purchase of the property along with his wife. As per the assessee, total value of the land stands at Rs.1 crores only. Part of the same has been paid for Rs.37.50 Lacs and the balance amount is still remaining outstanding. Payment for the amount of Rs.37.5 Lacs was made after withdrawing the money from the bank. However, the AO did not b....
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....e of payment i.e. from which bank such amount was transferred. 211. Being aggrieved by the order of the learned CIT-A, the assessee is in appeal before us. 212. The learned AR before us submitted that the payment of Rs.5.11 Lacs was paid to the banking channel and therefore no addition is warranted. On the contrary the learned DR before us vehemently supported the order of the authorities below. 213. We have heard the rival contentions of both the parties and perused the materials available on record. It is the trite law that the primary onus lies upon the assessee to justify his stand. Thus, it was the duty of the assessee to explain the source of amount which was utilised for making token money for purchase of land. We note that the assessee failed to provide the details of bank or cheque from where fund was transferred. Indeed, the primary onus lies upon the assessee to produce the necessary evidences in support of amount paid. The assessee was afforded enough opportunities to bring the necessary details on record during the assessment and remand proceedings.Thus, in view of the above we hold that the assessee failed to discharge the onus imposed upon him under the prov....
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....e addition of Rs. 3,97,37,485/- in AY. 2014-15 has allowed the setoff Rs. 3.21 core vide paragraph number 172 to 179 of this order. Thus the issue is covered against the revenue. Hence, the ground of appeal raised by the Revenue is dismissed. 220. The other issue raised by the revenue is general in nature. Hence the same is dismissed being infructuous. 221. In the result appeal of the Revenue is dismissed. Now coming issue related to Ansuyaben P Patel 222. Coming to ITA No. IT(SS) No. 27/AHD/2019 and 31/AHD/2019 appeals by the Assessee for A.Y. 2012-13 and 2013-14 223. The only issue raised by the assessee in both the AYs is that the learned CIT (A) erred in making the protective addition of Rs. 1 crore and 1.98 crores on account of unexplained investment. 224. At the outset we note that the addition of Rs.1 crores and 1.98 crores on account of unexplained investment was made on substantive basis in the hands of M/s Neotech Education Foundation and protective basis in the hands of directors. The assessee is one of the director in M/s Neotech Education Foundation. It was alleged by the Revenue that there was the cash payment against the purchase of land by M/s Neot....
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....leged by the Revenue that there was the cash payment against the purchase of land by M/s Neotech Education Foundation which was not recorded in the books of accounts. In this regard, we find that once the addition on substantive basis to the tune of Rs.3,97,37,485/ representing the investment in cash by the another director namely Shri PravinCPatel has been made by us in the AY 2014-15, there cannot be any other addition either in the hands of M/s Neotech Education Foundation or other directors on substantive/protective basis. In other words, the payment of Rs. 1 crores represents the application of the income added in the hands of Shri Pravin Patel. As such, the investment of Rs.1 crores has been made out of the addition made in the hands of Shri Pravin Patel for Rs.3,97,37,485/. Thus if any addition is sustained in the hands of any other party, that would lead to the double addition which is not desirable under the provisions of law. 230. In the result appeal of the assessee is allowed. 231. Coming to IT(SS) No 28/Ahd/2019 an appeal by the assessee for A.Y. 2014-15 232. The assessee has raised following grounds of appeal: "1.0 On the facts and in the circumstanc....
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....ounds of appeal filed by the assessee is partly allowed. 235. The 2nd issue raised by the assessee is that the learned CIT (A) erred in confirming the addition of Rs. 2,68,063/- and Rs. 25,000/- as unexplained cash credit under section 68 of the Act out of the total amount of Rs. 28,29,777/-. 235.1 There were certain credit entries appearing in the bank accounts of the assessee namely ICICI bank and HDFC Bank amounting to Rs.4,04,739/- and 24,25,038/- respectively but the assessee failed to explain the source of the same during the assessment proceedings. Therefore, the AO treated the entire amount as unexplained cash credit under section 68 of the Act and added the same to the total income of the assessee. 236. Aggrieved assessee preferred an appeal to the learned CIT (A) who partly confirmed the addition made by the AO during the assessment proceedings. As per the learned CIT (A) there was the credit entry of Rs. 2,68,063/- in the ICICI bank account of the assessee dated 23rd July 2013 which was claimed by the assessee as redemption of the mutual fund. But the assessee failed to produce any documentary evidence justifying that the impugned amount of credit entry of Rs. 2....
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....ssessee to produce the necessary evidences in support of her claim. The assessee was afforded enough opportunities to bring the necessary details on record during the assessment and remand proceedings.Thus, in view of the above we hold that the assessee failed to discharge the onus imposed upon him under the provisions of section 68 of the Act. Hence, we are not inclined to interfere in the order of learned CIT-A to the extent addition confirmed for Rs. 2,68,063/-. Thus the grounds of appeal of the assessee is partly allowed. 243. The third issue raised by the assessee is that the learned CIT(A) erred in confirming the addition made by the AO for Rs.1 crore on protective basis ignoring the fact that there was no addition made on substantive basis in the hands of M/s Neotech Education Foundation in the year under consideration. 244. At the outset the learned AR contended that there was no substantive addition with respect to Rs. 1 crore in the hands of M/s Neotech Education Foundation for the year under consideration.Therefore, the question of making the addition on protective basis in the hands of the assessee does not arise. On the other hand, the learned DR vehemently suppo....
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....essee that the learned CIT-A erred in holding that the agricultural income shown by the assessee as income from undisclosed sources to the extent of Rs. 4 Lacs out of the total agricultural income of Rs. 4,48,600/- only. 250. At the outset we note that the issues raised by the Assessee in its ground of appeal for the A.Y. 2015-16is identical to the issues raised by the assessee in IT(SS) No. 28/AHD/2019 for the assessment year 2014-15. Therefore, the findings given in IT(SS) No. 28/AHD/2019 shall also be applicable A.Y. 2015-16. The appeal of the assessee for the assessment 2014-15 has been decided by us vide paragraph No. 234 of this order partly in favour of the assessee. The learned AR and the DR also agreed that whatever will be the findings for the assessment year 2014-15 shall also be applied for the year under consideration i.e. AY 2015-16. Hence, the grounds of appeal filed by the assessee is partly allowed. 251. The second issue raised by the assessee is that the learned CIT(A) erred in confirming the order of the AO by sustaining the addition of Rs. 46 Lacs out of the total addition of Rs.50 Lacs made by the AO. 252. At the outset, we note that the issues raised ....
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....n made by the AO by observing as under: "18.5 As to the credit entries in the bank statement of ICICI bank, it is seen that a deposit of Rs.1,24,00,000/- in ICICI bank account has been claimed by the appellant to be loan from one Shri PankajIshwarbhai Patel who has been claimed to be an NRI. It is the case of the AO that no loan confirmation was filed by the appellant. It is the case of the appellant that the said loan was received in cheque and has been repaid by the appellant through banking channel. Though it is a settled principle of law that mere transaction in cheque and the claim of return are not sufficient to hold that the assessee has discharged the onus cast u/s.68 of the Act, however, the appellant has submitted the copy of bank statement of Shri PankajIshwarbhai Patel (ICICI Bank S/B A/c 0830175126) which evidences the identity and capacity of the lender. The lender is claimed to be an NRI and therefore not a filer of ITR in India. During the appeal proceedings, the appellant has verbally narrated the reasons of hostile attitude of the lender which is coming in way of obtaining the loan confirmation of the lender and that because of the same bad relationship t....
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.... us. 260. The learned DR before us contended that the assessee failed to discharge the onus imposed under section 68 of the Act. The ld. DR vehemently supported the order of the AO. 261. On the other hand, the learned AR before us vehemently supported the order of the ld. CIT-A. 262. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, the issues involved in the appeal before us can be categorized in two compartment. i. Deletion of the deposits of Rs.1.24 crores in the ICICI bank account of the assessee. ii. Deletion of the deposits of Rs.59 Lacs in the HDFC Bank account of the assessee. 263. With respect to the deletion made by the learned CIT (A) for the amount credited in the ICICI bank for Rs.1.24 crores, we note that this amount was received by the assessee from his relative based in abroad which was repaid in the subsequent assessment year. The acceptance of loan and the repayment of loan has not been doubted by the authorities below. The addition was made on the reasoning that the assessee failed to furnish the confirmation and the copy of the ITR of the party who i....