TaxTMI 
TaxTMI 
2023 (1) TMI 1083
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....ecured loans of Rs.26,32,52,300/-. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(Appeals) has allowed the relief of Rs.84,45,85,996/- towards the sundry creditors by observing that during the remand proceedings the assessee has submitted the confirmation, bank statements, ledger accounts etc. ignoring the fact that the creditor neither responded to the notices issued u/s 133(6) nor furnished the confirmation, bank statements, ledger accounts etc., the Ld. CIT(A) relied on the confirmation submitted by the assessee, whose genuineness and authenticity cannot be said to have been established in absence of production of the confirmation documents and evidence by the creditors. 2.1 The assessee has submitted the details of Mr. Inayat Munshi who is claimed to have paid an amount of Rs.41,40,04,000/- to IIFL on behalf of the assessee, M/s Salya India Pvt.Ltd., The assessee has not submitted any evidence to prove that the payment made by Mr. Inayat Munshi is on behalf of the assessee company. The assessee has also not submitted the required documents to prove the genuineness or transaction between Mr. Inayat Munshi and IIFL. In absence of any evidence, th....
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....res from Ridham Jewels Private Limited. The Assessing Officer also noted that assessee has debited expenses of Rs.59.132 crores. However, no evidence is provided to prove the genuineness of such expenses. The Assessing Officer instead of disallowing either sundry creditors or treating the said loan nongenuine and income of assessee or disallowing the expenses, rejected the books of assessee and disallowed the entire loss. The assessing officer simply recorded that outstanding liability of loan and sundry creditor and expenses is not proved, the books of accounts of assessee was rejected under section 145(3) and passed assessment order under section 143(3) of the Act on 26.03.2013. Aggrieved by the disallowance of loss and other passing remarks in the assessment order, the assessee filed appeal before Ld. CIT(A). Before Ld. CIT(A) the filed its detailed written submission. The assessee submitted that Assessing Officer treated the sundry creditors of Rs.84.45 crores has not genuine in absence of documentary evidence to prove the genuineness of increase of sundry creditors and entire amount of Rs.84.45 crores was in respect of M/s Ridham Jewels Private Limited. The assessee furnished ....
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...., which was received on 23.03.2013, the assessee was having only one working day for filing confirmation before Assessing Officer. The assessee confirmed the loan of Rs.84.45 crores was paid in full in assessment year 2011-12. The assessment was completed in A.Y 2011-12 and Assessing Officer accepted repayment in assessment year 2011-12. Before Ld. CIT(A) the assessee filed confirmation letter dated 25.03.2013, ledger of M/s India Infoline Limited, contract note and bills, invoices of Rs. 20,000/-of accurate financial services and ledger account of Nirmal Bang Securities. The assessee contended that there was sufficient cause which prevented the assessee in producing such evidence, which was called upon by Assessing Officer as only one-day time period was allowed. Thus, it is a sufficient cause within the scope of Rule-46 of Income Tax Rules, 1962 for admission of additional evidence. The assessee reiterates that they were unable to file loan confirmation letter during the assessment proceedings as the assessee suffered huge loss and assessee was not able to pay interest. The loan was received from banking channel and complete record was maintained. The assessee furnished copy of c....
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.... and 31.03.2012 it is "Rs.0 & Rs.0" respectively. The Assessing Officer accepted that on perusal of ledger account of opening balance is shown at Rs.84.45 crores on 31.03.2010 as outstanding and as on 31.03.2011, it was reduced to "Nil". On the transaction of loan, the Assessing Officer reported that Ridham Jewels Private Limited informed that a total bridge loan of assessee was at Rs.29.22 crores during the financial year 2009-10 and the assessee was able to pay Rs.2.90 crores during the same financial year and remaining balance of Rs.26.23 crores was outstanding as on 31.03.2011. The bank statement of assessee was also furnished and on perusal of such bank statement, the Assessing Officer reported that an amount of Rs.2.90 crores was paid back on 20.11.2009. Thus, the amount of Rs.26.32 crores was pending in financial year 2009-10 relevant to assessment year 2010-11. The Assessing Officer further reported that return of Yogesh R Sancheti (proprietor M/s Ridham Jewels Private Limited) was enclosed and as per their return of income, sundry debtors are at Rs.11.12 crores and advance recoverable of Rs.32.12 crores. 5. The copy of remand report was forwarded to assessee for its / rep....
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....r rejoinder dated 16.03.2018 repeating the earlier stand taken by assessee. 7. The Ld. CIT(A) after considering the assessment order, various submission of assessee, remand reports dated 22.03.2016 and 07/08/2017 furnished by Assessing Officer and the rejoinder thereto, noted that Assessing Officer passed the assessment order by taking view that genuineness of sundry creditors and unsecured loan are not proved. During the appellate proceedings, the assessee furnished additional evidence to support its sundry creditors and unsecured loan along with profit and loss account. The Ld. CIT(A) held that considering the circumstances of the case, he was satisfied that assessee has sufficient cause for not furnishing such evidence during the assessment proceedings, therefore, keeping in view in the principle of natural justice, the additional evidences was admitted. The Assessing Officer was asked to furnish her comments by way of remand report on the additional evidence filed by the assessee during the appellate proceedings. The Ld. CIT(A) further recorded that Assessing Officer furnished two separate detailed remand reports commenting on various additional evidence that Assessing Officer....
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....ed to prove the genuineness of sundry creditors and transaction of unsecured loan. The Assessing Officer made addition of Rs.84.45 crores on account of sundry creditor and addition of Rs.26.32 crores on account of unsecured loan. The assessee was offered opportunity to explain both the additions, but assessee failed to file confirmation of sundry creditors as well as conformation of lender about unsecured loan and genuineness of such transaction. The Ld. CIT-DR submits that Ld. CIT(A) deleted both the additions and erred in accepting the additional evidence produced by assessee, during the appellate stage. The Ld. CIT-DR for the revenue submits that matter may be remitted back to the file of Assessing Officer for adjudication of issue afresh in accordance with law. 9. On the other hand, Ld. AR for the assessee strongly objected against the submission raised by Ld. CIT-DR for the Revenue. The Ld. AR for the assessee invited our attention by referring the assessment order and would submit that no addition either on account of sundry creditors of Rs.84.45 crores or unsecured loan of Rs.26.32 crores were made by Assessing Officer in the assessment order. The Assessing Officer merely r....
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....ssing Officer accepted that India Infoline Limited vide their reply dated 08.05.2017, submitted copy of ledger account, copy of return of income, confirmation and also confirmed that they are registered broker for the assessee who had booked various shares for assessee. They have also confirmed the fact in the next assessment year 2011-12, the entire amount was repaid. On the reference of unsecured loan, the Ld. AR for the assessee submits that during the remand proceedings, the creditor furnished confirmation letter of balance of outstanding, their return of income, ledger account and bank statement. The Ld. CIT(A) after considering the remand report of Assessing Officer held that rejection of books of account was not justified and directed the Assessing Officer to delete the addition of disallowance of loss suffered by assessee. The Ld. AR for the assessee further submits that there was no addition under section 68 of the Act or otherwise about sundry creditors or unsecured loan. Therefore, the deletion of such amount is unwarranted, uncalled for and was devoid of merit and such reference was made by Assessing Officer for rejecting the books of account on flimsy ground by taking ....
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....ng Officer as well as senior officer of Revenue has not taken any remedial action either section 147 or section 263 for examining such issue. Therefore, the Revenue cannot use the Tribunal as tool and technique for second innings even otherwise when no such addition either on account of sundry creditors or unsecured loan was made by Assessing Officer. Therefore, the Ld. CIT-DR for revenue has no right to improve case of Assessing Officer. The tribunal cannot consider new material or information which came to the notice of assessing officer after passing the assessment order. The appellate procedure is designed to adjudicate matter that were originally framed in the assessment order and new material cannot be considered. The issues were otherwise examined by ld CIT(A) after granting opportunity to the assessing officer and the assessee otherwise has fully discharged its onus on both the issues, on which the assessing officer made passing remarks, without making such additions. The support his various contentions, the ld AR for the assessee relied on the following decisions; * H. K. Pujara Vs ACIT (ITA No. 2034/Mum/2014 dated 09.05.2016, with corrigendum of even date), * Shapoorj....
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....evidences of the assessee was accepted by the ld CIT(A) by passing order on admissibility of such evidences. The ld CIT(A) referred all such evidences to the assessing officer for his remand report. The assessing officer initiated remand proceedings and issued notice under section 133(6) to India Infoline Limited as well as to Ridham Jewels. We find that both parties responded to the notices of the assessing officer and furnished requires details. On receipt of such requires details, the assessing officer filed his remand report dated 22.03.2016 and second report dated 07/08/2017. 15. We find that in the remand report dated 2.03.2016, on the issue of sundry creditors, the assessing officer reported that during the remand proceedings notices under section133(6) were issued to India Infoline Limited and Ridham Jewels Private Limited for seeking details and nature of transactions with assessee along with confirmation letters, bank statement, copy of return, balance-sheet and profit & loss account. India Infoline Limited vide their letter dated 07.08.2015 replied that they are registered broker of assessee and transacted on various exchange platform on behalf of assessee and furnished....
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....filed by lender whether remaining unsecured loan of Rs.26.12 crores was repaid by assessee and whether loan amount is shown to the "asset side" of their balance-sheet. We find that the ld CIT(A) after considering confirmations, audited financial statement, ledger account, return of income of lender and held that the claim of unsecured loan of outstanding cannot be denied and the genuineness of same cannot be doubted. The Ld. CIT(A) categorically held that books of assessee was rejected only on the ground of genuineness of sundry creditors and unsecured loan and that expenses were not proved. However, in the remand report, the Assessing Officer has not doubted the genuineness of such sundry creditors and unsecured loan. The ld CIT(A) held that the assessee has proved with supporting documents and there is no doubt about the genuineness of such transaction. We find that ld. CIT(A) on such observation held that rejection of books of account was not warranted. It was also held that when genuineness of sundry creditors and unsecured loan were proved by beyond doubt the Assessing Officer has no occasion to make such addition. 17. Before us, the ld AR for the assessee while making his su....
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....scussions, we do not find any merit in the ground No.1 to 3 of appeal raised by the revenue. 20. Now adverting to the ground No.4 of the appeal, which relates to enhancement of the assessment by Rs. 77.78 Crore. We find that during the hearing, though, no specific submissions were made by ld CIT-DR for the revenue, except for making prayer that the issue of the sundry creditors and loan may be restore to the file of assessing officer. 21. On the other hand, the ld AR for the assessee strongly objected to such submissions of ld CIT-DR for the revenue. The ld AR for the assessee again retreated and submitted that the assessing officer or ld DR for the revenue cannot use the Tribunal as tool and technique for second innings and Ld. DR for revenue has no right to improve case of Assessing Officer. The Tribunal cannot consider new material or information which came to the notice of assessing officer after passing the assessment order. The appellate procedure is designed to adjudicate matter that were originally framed in the assessment order and new material cannot be considered. Such issue was never raised by assessing officer during first appellate stage. The ld AR for the assessee ....