TaxTMI 
TaxTMI 
2023 (4) TMI 855
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....tances of the case and in law, the ld. CIT(A) has erred in holding that any addition during the assessment u/s 153A has to be confined to the incriminating material found during the course of search u/s 132(1) of the Act, even though there is no such stipulation in sec 153A of the Act. 2. On the facts and in the circumstances of the case and in law, the ld. CIT(A) has erred in not appreciating that sec. 153A requires a notice to be issued requiring the assessee to furnish his return of income in respect of each assessment year falling within six assessment years and to assess or to assess the total income of those six assessment years, and that the scheme of assessment or to assessment of the total income of a person searched will be brought to naught if no addition is allowed to be made for those six assessment years in the absence of any seized incriminating material. 3. On the facts and in the circumstances of the case and in low, the ld. CIT(A) has erred in not appreciating that while computation of undisclosed income of the block period u/s. 158BB was to be made on the basis of evidence found as a result of search or requisition of books of accounts, there is no such stipu....
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....search and seizure action under section 132 of the Act carried out at the 'Barter Group' dated 04-12-2014 and a search warrant was also issued in the name of the present assessee. Accordingly, proceedings under section 153A of the Act were initiated in the case of the assessee for the A.Y. 2009-10 to 2014-15. Finally, the AO, for the year under consideration i.e. A.Y. 2011-12 finalized the assessment under section 143(3) r.w.s. 153A of the Act, wherein the AO treated the credit entries in the bank account of the assessee aggregating to Rs. 1,78,35,069/- as unexplained investment under section 69 and added to his total income. 5. The aggrieved assessee preferred an appeal before of the learned CIT(A). 5.1 The assessee before the learned CIT(A) submitted that during the search at his premises, there was no material of incriminating nature found regarding credit entries in bank account. The AO made addition based on bank entries which has already been incorporated and shown in the return of income. Further, such a bank statement was also not found during the search proceedings. Therefore, the year under consideration being unabated/completed assessment, no addition can be made in th....
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.... the order passed u/s 153A of the Act which are not pertaining to any undisclosed income or seized material when proceedings are closed and attained finality. In support of its contention the appellant strongly relied on the decision of Hon'ble Gujarat High Court in case of CIT Vs. Saumya Construction Pvt Ltd (Tax appeal No. 24 of 2016) dated 14th March 2016, the facts and findings of which are restated as under." ******************************************************************* "7.7 It is an undisputed fact that on the date of initiation of the search no assessment proceedings were pending in this assessment year. Therefore, the proceedings were not abated in the case as mentioned in the second proviso to section 153A(1) of the Act. It seems that the AO lost sight of the fact that he was not making an assessment under section 153A(1) of the Act read with its second proviso. As discussed hereinabove, there is no indication in the contents of the assessment order that the addition was made on the basis of any incriminating material found and seized in search. 7.8 In view of the aforesaid finding and respectfully following the judgments/decisions of Jurisdictional High Court,....
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....essment can be made with respect to abated assessment years. The word 'assess' in Section 153A/153C of the Act is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to the completed assessment proceedings. The Hon'ble Gujarat High Court in the case of Saumya Construction Pvt. Ltd. reported in 81 taxmann.com 292, has held that there cannot be any addition of regular items shown in the books of accounts until and unless there were certain materials of incriminating nature found during search. The word incriminating has not been defined under the Act, but it refers to materials/ documents/ information which were collected during the search proceedings and not produced in the original assessment proceeding. Simultaneously, these documents had bearing on the total income of the assessee. Now coming to the case, we note that addition was made based on the amount credited in the bank account of the assessee without referring to incriminating document found in this regard which would have made basis for the addition in the assessment. The learned CIT(A) has also given clear finding that the entries in the bank statement which ....
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....n loose papers/pocket diary were also made in AY 2014-15 and 2015-16 on which both the Revenue and the assessee were before us in separate appeals. As such, the facts of the issue of unaccounted receipts/ payment for the year under consideration viz a viz the succeeding years i.e. AY 2013-14 and AY 2014-15, 2015-16 are interconnected. Hence, for the sake of brevity, we combined the issue raised by the assessee and revenue regarding unaccounted receipt and payment in all these three assessment years. 15.1 The necessary facts are that the during the search and seizure action at the residence of the assessee, certain loose papers, pocket diaries etc. marked as Annexure A-1 to A-10 were discovered which were containing various noting relating to the land dealings situated at Memnagar, Hasdad, and Hasol besides other noting and jottings. The AO during the assessment proceeding required the assessee to explain the noting/ jotting on the loose papers/pocket diary in specified format which is as under: Annexure Page No. Contents Period Explanation Where re ected 16. The assessee vide letter dated 8-12-2016 explained the same in the specified format wherein he has shown receipt....
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....3 37,68,640 2 2014-15 1,33,22,253 47,95,000 3 2015-16 17,34,13,108 7,66,97,954 Total 18,83,71,854 8,52,61,594 17.1 The AO accordingly made the addition of unaccounted receipt under section 69A of the Act. Likewise, the AO also made the addition of unaccounted payment after adjusting the unaccounted receipts under section 69C of the Act. Hence, the AO made addition of the net amount in all these three AYs detailed as under: 1. A.Y. 2013-14 Rs. 37,68,640/- 2. A.Y. 2014-15 Rs. 1,33,22,253/- 3. A.Y. 2015-16 Rs. 17,34,13,108/- 18. Aggrieved assessee carried the matter before the Ld. CIT-A. 18.1 The assessee before the learned CIT(A) made contentions applicable to all the years in dispute i.e. A.Y. 2013-14 to 2015-16 which are detailed as under: (i) During the search operation, no assets, being money, bullion, jewelry etc. were found whereas the AO, based on loose paper containing unaccounted receipt/ payments worked out addition under section 69A of the Act. However, there is no correlation between the income determined and assets found. Hence, the provision of section 69A of the Act is not applicable. (ii) During the assessment proceedings, ....
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....ch proceeding worked out the amounts of receipts and payments coming out from seized documents. The basis adopted by the learned CIT(A) can be summarized as under: 1. In cases where there was no dispute between the AO and the assessee regarding the amounts of receipts or payments recorded on loose pages, the learned CIT-A has taken the same as it is. 2. In cases where the assessee worked the different amount than what has been worked out by the AO, the learned CIT(A) analyzed the specific page in the light of content on such pages and oral statement of the assessee if any recorded during the search proceeding, thereafter, he worked out the amount of receipt or payments as per his analysis. 3. In cases where the assessee was not agreed with the amounts worked out by the AO from specific pages at all, the learned CIT(A) analyzed the specific page in the light of content on such pages and oral statement of the assessee if any recorded during the search proceeding. Thereafter, the ld. CIT-A either accepted the version of assessee or AO or re-worked out other amount as per his understanding. 21. Thus, the learned CIT-A based on the above discussion worked out the amounts of recei....
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.... amount as income of the assessee and thereby the learned CIT(A) provided the substantial relief to the assessee. Now both the assessee and Revenue are before us in separate appeal for separate assessment years. The issue before us can be summarized as under: (i) Whether income can be assessed based on noting or jotting on the loose sheets /diary etc. found during search? (ii) The materials found in the premises of the present assessee are dumb documents or not? (iii) The quantum of transaction of receipt and payment on the impugned sheets? 25.1 With regard to the first question, we note that the provisions of section 132(4A) and section 292C of the Act provide that in the search proceedings any books of account, other document found from the possession and control of any person then it may be presumed that such books of account or document belong to such person and contents of such books of accounts and documents are true. However, we find that such a presumption under section 132(4A) or 292C of the Act is rebuttable. It is upon the assessee to rebut such presumption based on cogent material. In holding so, we find support and guidance from the judgment of Hon'ble Supreme c....
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....some transaction subjected to tax and consequently bears the tax liability. (ii) If yes, taxability in whose hands? (iii) The year of taxability of such income. (iv) The rate and amount of tax 25.3 A non-speaking document without any corroborative material, evidence on record and finding that such document has materialized into transactions giving rise to income of the assessee which had not been disclosed in regular books of account by such assessee, must disregarded for the purposes of assessments to be framed pursuant to search and seizure action. From the search and seizure perspective, such non-speaking seized documents are to be referred to as "Dumb Documents". Therefore, in our considered opinion any loose sheets/diary/note pad containing certain noting or jotting found but on perusal of the same it not discernible that whether any transaction taxable in nature materialized which has not been recorded in the regular books of account or not corroborating with some other cogent material shall not be used for making assessment despite being presumption provide under section 132(4A) and under section 292C of the Act. In holding so, we draw support and guidance from the ju....
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.... SCC 410 held as under: 20. It is apparent from the aforesaid discussion that loosesheets of papers are wholly irrelevant as evidence being not admissible under Section 34 so as to constitute evidence with respect to the transactions mentioned therein being of no evidentiaryvalue. The entire prosecution based upon such entries which led to the investigation was quashed by this Court. 25.6 Thus, in view of the above discussion the answer to the question is that no assessment can be made in the hand of the assessee on basis of certain noting/jotting/rough estimates on the loose sheets/note pad/diary etc. unless and until same is corroborated with independent cogent material giving rise to undisclosed income. 25.7 Now coming to the facts of the present case, we note that there were several documents in the form of loose papers/diary etc. found and impounded containing various financial transactions. Some of the pages contain dates whereas some are undated and unsigned, some pages contain clear names and narration such as receipts or payments whereas some pages contain only noting of some amount without being specific narration. The assessee contended that these are dumb document a....
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.... of seized material in the light of finding of the AO, submission of the assessee and the oral statement of the assessee recorded under section 132(4) of the Act and the contents of pages. Accordingly, the learned CIT(A) held that pages of seized document are either dumb document or non-speaking one and worked out the amount of the receipts or payment from such pages. The finding and analysis of the learned CIT(A) nowhere been controverted either by the learned AR or the learned DR. Therefore, the finding of the learned CITA(A) cannot be brushed aside in absence of cogent contrary materials. 25.11 We find that the learned CIT(A) worked out the amount of unaccounted receipt or payment based on admission by the assessee either in the statement recorded during the search or in the submission made during assessment or appellate proceeding and based on analysis of seized document which has not been controverted. Therefore, we do not find any infirmity in the order of the learned CIT(A). Nevertheless, we find that the sum of Rs. 12,58,333 has been added twice i.e. in the AY 2014-15 and 2016-17 which is not desirable under the provisions of the Act. Thus, we delete the above addition fro....
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....we have decided the issue against the Revenue. For detailed discussion, please refer to the paragraph of this order. Hence, the grounds of appeals filed by the Revenue are hereby dismissed. 29. The next issue raised by the revenue is that the Ld. CIT-A erred in deleting the addition of Rs. 91,80,000/- on account of unexplained credit entries in bank. 30. The necessary facts are that the AO during the assessment proceeding found that the assessee's bank account maintained with Ahmedabad District Cooperative Bank Ltd was credited by Rs. 1,69,25,848/- throughout the year. The AO, in absence of satisfactory explanation regarding to the identity, genuineness and creditworthiness of the depositor treated the same as unexplained investment under section 69 of the Act and added the same to total income of the assessee. 31. The aggrieved assessee preferred an appeal before the learned CIT(A). 31.1 The assessee before the learned CIT(A) submitted that he does not maintain any books of account therefore details were not readily available as required by the AO regarding credit entries in the bank. Furthermore, the AO also the issued the notice in the fag-end of the assessment proceeding. T....
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....i Atul Hiralal Shah in whose case the transaction of loans or advances were not found to be genuine. 31.6 With regard to the credit entry of Rs. 10 lakhs from Shri Dharmesh Chandulal Patel, the AO submitted only confirmation and bank statement. There is no detail of ITR, hence the creditworthiness was not verified. 32. The learned CIT(A) after considering facts in totality deleted the addition made by the AO on account of credit entry in the bank except for the amount of Rs. 77.45 Lacs credited form Jalaram Finvest Ltd. The relevant finding of the learned CIT(A) reads as under: "8.3 At the outset, It has been noticed that insufficient opportunity had been granted to the appellant before completing the assessment proceedings. As mentioned, except in the case of Jalaram Finvest Ltd., the appellant has provided PAN numbers in all cases, Confirmations of these parties & ITR acknowledgements besides bank statement copies. The appellant had also filed his bank statements wherein all these credits are reflected. It can be seen that all these sums have been received through proper banking channel which proved the genuineness of these credits. The appellant had also filed bank statement....
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...., in respect of the other depositors the addition is legally found not sustainable and the same are deleted respectfully following the decisions/judgments of the Hon'ble Courts including the followings: a) CIT v/s Apex Therm Packaging Pvt Ltd (2014) (42 taxman.com 473 (Guj)) b) Pratapbhai Virjibhai Patel v/s ITO (2014) (45 Taxman.com 151 (Guj)) c) DCIT vs Rohini Builders 256 ITR 360 (Guj) d) ITO vs Riddhi Siddhi Corporation ITA No 2248/Ahd/2012 e) CIT vs Ranchhod JivabhaiNakhava [2012] 21 taxmann.com 159 (Guj) f) BanwariLalvs ITO ITA No 1542/Del /2012 dated 15-01-2016 8.7 Hence, in view of the above discussion except unsecured loans from Jalaram Finvest amounting to Rs 77.45,000 & saving bank interest of Rs 848/ other additions aggregating to Rs 91 80,000 is deleted. However, the addition of Rs 77,45,848 is confirmed." 33. Being aggrieved by the order of the learned CIT(A), both the assessee and the Revenue are in appeal before us. The Revenue is against the relief/ deletion of addition made by the AO whereas the assessee is in appeal against the addition sustained by the learned CIT(A). The relevant ground of appeal of the assessee in IT(SS)A No. 47/Ahd/2021 rea....
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....derstand the identity of the party. The identity of the party refers to the existence of such a party which can be proven based on the evidence. As such the identity of a party can be established by furnishing the name, address and PAN detail, bank details, passport, and other details of the Government agencies. 35.2 The next stage comes to verify the genuineness of the transaction. Genuineness of transaction refers what has been asserted is true and authentic. A genuine transaction must be proved to be genuine from all prospective and not merely on paper. The documentary evidences should not provide a mask to cover the actual transaction or designed in way to present the transaction as true but the same is not. The genuineness of transaction can be proved by submitting confirmation of the party along details of mode transaction but merely showing transaction carried out through banking channel is not sufficient. As such, the same (genuineness) should also be proved by circumstantial/ surrounding evidences as held by the Hon'ble supreme court in case of Durga Prasad More reported in 82 ITR 540 and in case of Smt. Sumati Dayal reported in 214 ITR 801. 35.3 The last stage comes to ....
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....d PAN, copy of confirmation letter, copy of bank statement of party, and copy of ITR acknowledgment. The AO in the remand only objected that the sources of fund and advance made by the party namely Labdhi Finance held as bogus. In this respect, we are of the considered opinion that the assessee is only liable to explain the sources of credit in his books which he duly discharged. If any adverse action is taken in the case of creditor party, then the same will ipso facto prove that the credit in the books of the assessee is not genuine unless cogent material suggesting otherwise brought on record. Hence, we do not find any infirmity in the finding of learned CIT(A) as he rightly deleted the addition made by the AO to this extent. 35.10 Likewise, an amount of Rs. 10 Lacs credited from one Shri Dharmesh Chandulal Patel and the assessee in support furnished PAN, copy of confirmation letter, bank statement of party. The AO in remand only objected that assessee has not furnished copy of ITR. In our considered opinion, the AO was having PAN detail of the party, he should have obtained copy of ITR from ITD portal. But AO has not carried out any independent inquiry. Thus, in our considered....
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....ining the addition for Rs. 36,87,106/- made by the AO on account of unaccounted payment based on loose paper. 38. At the outset, we note that the issue raised by the assessee in his grounds of appeal for the year under consideration i.e. AY 2014-15 has been dealt with assessee's appeal in IT(SS)A No. 46/AHD/2021 for the assessment year 2013-14. The issue has been dealt with in detail vide paragraph no. 25 of this order where we have decided the issue partly in favour of the assessee. For the detailed discussion, please refer to the above-mentioned paragraph of this order. Hence, the ground of appeal filed by the assessee is hereby partly allowed. 39. The next issue raised by the assessee is that the Ld. CIT-A erred in sustaining the addition for Rs. 77,45,000/- made by the AO by treating the credit in bank as unexplained. 40. At the outset, we note that the issues raised by the assessee in his grounds of appeal has been dealt along with Revenue appeal in IT(SS)A No. 53/AHD/2021. The issue has been dealt with in detail vide paragraph no. 35 of this order where we have remitted the issue to the file of the AO for fresh adjudication. For detailed discussion, please refer to the abo....
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.... erred in deleting the addition made by the AO for Rs. 70,00,000/- representing unexplained cash based on the seized material found on the premises of the assessee without considering provisions of section 132(4A) of the Act. 43. The necessary facts as emerging from the order of the authorities below are that the assessee in the present case is an individual and deriving his income under the head business and profession as share of profit from the partnership firm, income from other sources in the form of interest. The assessee was also engaged in the activity of state broker/property consultant. The assessee was also engaged in political and social activities. Accordingly, the assessee used to act as mediator to resolve the issues of various parties relating to social and business activities. 44. There was a search and seizure operation under section 132 of the Act dated 4th December 2014 at the group known as Barter Group which was engaged in providing the accommodation entries. The assessee was also made subject to the search operation under section 132 of the Act along with the search at Barter Group. 45. As a result of search at the premises of the assessee, there were foun....
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.... Vora does not arise. 50. It was also submitted by the assessee that he, being a social worker, was involved in resolving the disputes of various parties between the barter group and the 3rd parties being the buyers of the land. Therefore, based on the document found on his premises, bearing page No. 70 of annexure-A1 no adverse inference can be drawn against him. 51. However, the AO rejected the contention of the assessee by observing as under: "Above explanation of the assessee is not acceptable as section 132(4A) clearly provides that: 132(4A): Where any books of account, other documents, money, bullion, jewellery or other valuable article or thing are or is found in possession or control of any person in the course of search, in the course of a search, it may be presumed- (i) That such books of account, other documents, money bullion, jewellery or other valuable article or thing belong or belongs to such person; (ii) That the contents of such books of account and other documents are true; and (iii) that the signature and every other part of such books of account and other documents which purport to be in the handwriting of any particular person or which may reasonab....
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....ioned in the second and the third column of the pages found from the residence of Shri Ashit H. Vora. The Jottings showin total of Rs.2446.86 pertains to the third party whose plots were being proposed to be sold through appellant. Secondly, to the best of your appellant's knowledge, the figure of 2446.86 has been admitted and disclosed by Shri Ashit Vora or Raju Barter Group (R.B. Group) and therefore, the paper found from appellant's residence containing the same total of 2446.86 is fully covered by the disclosure as transaction of and belonging to R.B Group. As regards the third party evidence, it is important to place on record that it does not belong to appellant or pertain to appellant. There are no jottings made by appellant. The total of the first column has been carried forward to third column and amount has been enhanced to 2517.86. Enhancing entries does not match with the entries below appellant's name and therefore, as a natural corollary arc not. carried forward in column No.3. In nutshell, it is appellant's respectful submission that, there is apparent contradiction between jottings found from his residence and jottings found from possession of the third part....
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....rred to by the AO in the assessment order are for the period from 25/6/2014 to 28/6/2014 on which dates or even thereabout, no matching transactions are there in the paper seized from the residence of the appellant. The paper seized from the residence of the appellant is apparently rough jottings not even in the hand writing of the appellant and the total of which is mentioned at 2446/86 and has not correlation with the narration appearing in the diary seized from the residence of Shri Ashit Vora as wrongly observed by the AO. The Appellant does admit his role of a mediator to resolve dispute between the company and Sghri Nileshbhai Toliya. There is nothing either in the seized material or any oral evidence of any party much less that of Ashit Vora that I have any pecuniary interest in the said deal apart from being a mere mediator. Since the AO has grossly failed in his judicial duty to bring on record some corroborative material at least through obtaining some confirmation or examining Shri Ashit Vora that the said entries represented sale proceeds of some land sold to the appellant, the whole basis of making such addition is patently wrong. The Ld. AO could have at least verifie....
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.... of Rs. 70,00,000/- in relation to the land transaction deal was not received by Shri Ashit Haribhai Vora. It is because such income was the brokerage of the assessee. 55. The assessee in rejoinder to the remand report submitted as under: "2. Further, at Para 5.1 of the remand report, the AO has tried to correlate the document seized from the residence of Shri Asit Vora and the Appellant as per the table While doing so, the AO interpreted the seized papers and misrepresented as per his convenience and multiplied the figures / abstract jottings by 100 or 1000 or 100000 as per his own free will and without there being any corroborative material or any statement or admission of either the Appellant or a third party in support of such multiplication. The paper seized from the residence of the appellant is apparently rough jottings not even in the hand writing of the appellant and the total of which is mentioned at 2446/86 and has no correlation with the narration appearing in the diary seized from the residence of Shri Asit Vora as wrongly observed by the AO. 3. Assuming though not admitting the contents of the diary seized from the premises of Shri Asit Vora are true, the alleged....
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....he assessment order A search u/s 132 was carried out on Barter Group including one Shri Asit Vora and certain documents were found from his residence which inter alia showed receipts totalling to Rs 70,000=00 in the name of one Mihirbhai noted in seized diary. The AO multiplied the said figure by 100 and treated the same undisclosed investment of Rs 70,00,000/- of the appellant in Jamnagar land. The AO further contended that during the course of search at the residence of the appellant, certain jottings found in the seized paper No A-1/70 matches with the description contained in the papers / diary seized from the premises of Shri Ashit Vora. The AO then invoked the provisions of Section 132(4A) and held that the onus was on the appellant to prove that transaction relating to Jamanagar land was not related to him and the alleged transaction of Rs 70 lacs recorded in unaccounted Cash Book found and seized from the residence of Ashil Haribhai Vora was treated as unexplained investment of the appellant. 14.2 During the course of the appeal proceedings, the appellant submitted that the documents which have been relied upon for making additions were not found & seized from the appella....
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....e assessment order the same have been treated as appellant's undisclosed investment but subsequently in the remand proceedings the same have been held to be brokerage income of the appellant. So there was change in stand of the AO on similar facts but without any basis. 14.5 In so far as the admission of additional evidence is concerned & is an undisputed fact that the notice u/s 142(1) was issued on 16.12.2016, the appellant filed his reply on 23.12.2016 and the impugned order was passed on 20.12.2016. This clearly implies that only 7 days time was made available to the appellant to compile the voluminous details Furthermore the case is clearly covered by the provisions of Rule 46A and in order to impart justice, I admit the affidavit of Shri Ashit Vora as evidence. As per his affidavit the appellant only acted as mediator to solve business disputes and ho has not been sold any part of the land in question. Neither the maker of the affidavit namely in Asit Vora was examined by the AO in the assessment proceedings nor the averments made in the affidavit have been rebutted by the AO. Therefore, the affidavit stands in favour of the appellant as it has been legal sanctity. The ....
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.... of Rs. 70,00,000/- in the hands of the assessee on the reasoning that the assessee failed to explain the source of money paid to the Shri Ashit Haribhai Vora. As per the AO, there was a diary recovered during search operation from the premises of Shri Ashit Haribhai Vora showing the receipt of money from the assessee for Rs. 70,00,000/-. As such in the diary bearing number annexure-A4 was containing the financial transactions in the form of receipt and payment which were duly matching with the seized document recovered from the premises of the assessee except the receipt recorded in the diary against the name of the assessee amounting to Rs. 70,00,000/-. In other words, the other transactions recorded in the seized document recovered from the premises of the assessee were matching with the diary recovered from the premises of the Shri Ashit Haribhai Vora except the payment by the assessee of Rs. 70,00,000/- to Shri Ashit Haribhai Vora. Thus, the addition was made by the AO in the assessment framed under section 143(3) read with section 153A of the Act dated 30-12-2016. However, the AO in the remand proceedings before the Ld. CIT-A has changed his stand and submitted in the remand ....
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....aggregation of other documents/information. But, in the case on hand we find that the AO has not brought any iota of corroborative material before making any addition in the hands of the assessee for Rs. 70,00,000/-. Thus, in the absence of any corroborative material, the information contained in the seized document cannot be treated as incriminating material suggesting any income in the hands of the assessee. As such these documents are dumped documents and based on the same no addition can be sustained. Nevertheless, the director namely Shri Ashit Haribhai Vora has categorically denied by furnishing the affidavit to have made any payment of commission to the assessee. The contents of the affidavit were not controverted by the AO during the remand proceedings. On this count as well, the addition made by the AO is not sustainable. 61.3 Moving further, the Ld. CIT-A in his order has also observed that the due process of the provisions of section 153C was not adopted by the AO in the given set of facts and therefore for that reason as well the Ld. CIT-A was pleased to delete the addition made by the AO. The finding of the Ld. CIT-A was based on the order of this tribunal in the case....
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....ng the year under consideration. The appellant has provided PAN numbers, Confirmations of these parties & ITR acknowledgements. The appellant has provided his bank statement in this regard to prove that all the loans have been received through proper banking channel only. Since the assessment order has been passed within 3-4 days of issuing notice it is unreasonable to expect assessee to supply the documents not belonging to him. I held that once the basic documents are being supplied by the assessee the primary onus had shifted upon the AO to gather further evidences. The AO has not pointed out any defect in the papers filed before him. Further, there were no incriminating seized papers regarding these parties or these unsecured loans. Hence, it can be held that except insufficiency of documents, there is no evidence available on record based upon which addition can be made. Since primary onus has been discharged by the assessee, the AO ought to have made independent inquiries & brought on record evidences before proceeding further with the addition. No such inquires have been made by the AO. Moreover, the appellant has supplied bank statements of Paresh N Patel &b Paresh N Patel ....
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....delete the addition made by the AO. From the perusal of remand report and ground of appeal we note that the only issue of the revenue is that the transaction of credit of unsecured loan as discussed above was not genuine because the assessee has not paid interest on the loan. As such the assessee during the remand proceeding to establish the identity & creditworthiness of creditor and genuineness of transaction, furnished copy of pan, ITR and confirmation letter of the creditor. The AO in the remand did not find any infirmity in the primary evidence furnished by the assessee. The law is fairly settled in case of credit in the books of account the assessee is required to furnished primary document to establish identity & creditworthiness of creditor and genuineness of transaction, once the primary documentary evidence furnished, the onus shifts on the revenue to point infirmity in the document furnished by the assessee after conducting necessary inquiry. In the case on hand, the AO has not carried out any independent inquiry and not found any infirmity in the primary documents filed by the assessee but merely doubted the genuineness of transaction since interest was not paid on impu....