TaxTMI 
TaxTMI 
2017 (11) TMI 2029
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....was justified in upholding the order of the CIT(A) and deleting the addition of Rs.1,01,55,994/- made on account of interest income estimated on cash credits by relying on the additional evidences and admitting them specifically when the assessee failed to discharge the prima facie burden casted on him u/s68?" 3. Counsel for the appellant has taken us to the order of AO and contended that the AO while considering the matter, it has observed as under:- "2. Addition on account of unexplained cash credits u/s 68 IT Act, 1961 A survey proceedings u/s 133A was concluded on the business premises of the Assessee on 06.10.2010. Alongwith other impounded documents a diary Annexure A-3 was seized from the premises of the Assessee. During the survey proceedings the Assessee admitted in his statement recorded on 06.10.2010 at Page No.5 question No.11 that a diary Annexure 3 was shown to him and he described the transactions entered in that diary. The relevant part of the statement is reproduced as under: Thereafter learned counsel for the appellant has also taken us to the observation made by AO which reads as under: "The above reply of the Assessee is untenabl....
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....earned interest income on the above amount in absence of any evidence on the contrary. Considering all the facts & circumstances of the case the interest rate is taken at 12% per annum which is fair & reasonable. The interest has been calculated on the period of the loan advance by the Assessee for A.Y. 2011-12 as per the calculation in the table above at para 2. The Assessee has earned an amount of Rs. 10155994/- as interest income on the undisclosed investment of the Assessee for A.Y. 2011-12. Therefore, the total interest on these items comes out to be Rs. 1055994/- (10102715+8962+44317). This interest income is the undisclosed income of the Assessee from other sources. Hence, undisclosed interest income of Rs. 10155994/- is added back to the returned income of the Assessee. Penalty proceedings u/s 271(1)(c) of IT Act, 1961 are being intiated for concealment of income and thereby filing inaccurate particulars of his income. (Addition of Rs. 1,01,55,994/-)" 6. Counsel for the respondent has also taken us to the finding arrived at by the CIT(A) which reads as under: " In this case, additional evidence in the form of confirmations etc. were filed by as....
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....ation of the Tribunal which reads as under: "Thus it is evident on the face of the Remand Report itself that ADMITTEDLY the entries on the Diary reflects Lenders and the Borrowers against each other and therefore, it is amply clear that the assessee has nothing to do in these transactions except that he has acted Broker between them and that it was not his money. I have gone through the AO's finding, assessee's submission, AO's remand report and assessee's rejoinder. In most of the cases, the lender as well as the borrower has confirmed the transaction in some of the cases, no reply was furnished u/s 136 (6), however, most of their confirmations were submitted by the assessee. Regarding the difference in dates, the same has no bearing on the assessment of income of assessee (as the assessee was apparently acting as a broker). Only in one case i.e. in the case of Sh. Om Prakash, the lender denied the transaction." 8. Counsel for the respondent has placed reliance upon the following judgments :- 1. Commissioner of Income Tax vs. Jai Kumar Bakliwal, [2014] 45 taxmann.com 203 (Rajasthan), wherein it has been observed as under:- 17. As obs....
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....n has to be based on proper foundation and cannot be made merely on the basis of such an estimated project report, which one may prepare for diverse purposes and really do not indicate as to actual investment having made by the assessee. Burden under s. 69 is on the Revenue and it failed. 16. The AO has blindly made addition merely on the basis of project report without bringing further evidence in the shape of say a valuation report which may have been obtained by the AO from its Valuation Officer to indicate prima facie that investment to such an extent was made, then in our view the AO could have been well justified to support its addition based on the project report vis-a-vis the valuation report or any other material evidence. However, nothing is apparent on the face of record as to whether any exercise in this direction was made or not. Therefore, in our view, both the appellate authorities have come to a concurrent finding of fact based on appreciation of evidence on record and no substantial question of law can be said to arise out of the impugned order as it is entirely based on finding of fact. The first question shall be only of academic interest and would be ex....
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....revenue's appeal is rejected." 10. In view of this, we are of the considered opinion that the assessee is a broker and after payment report received, the CIT(A) has rightly observed in favour of the assessee. We are in complete agreement with the view taken by the CIT(A) and the Tribunal. Therefore, both the issues are answered in favour of assessee against the department. 11. The appeal is dismissed. ============= Document 1 पà¥à¤°à¤¶à¥à¤¨ : 11 सरà¥à¤µà¥‡ की कारà¥à¤¯à¤µà¤¾à¤¹à¥€ के दौरान आपके वà¥à¤¯à¤¾à¤µà¤¸à¤¾à¤¯à¤¿à¤• परिसर पर दिनांक 06.10.2010 को à¤à¤• हरे रंग की डायरी मिली जिस पर motivation diary लिखा हà¥à¤† है ( Annexure A-3) जो मैं आपको दिखा रहà¤....
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.... संखà¥à¤¯à¤¾ 9 पर बाईं ओर लिखा गया नाम इंगित करता है कि इन वà¥à¤¯à¤•à¥à¤¤à¤¿à¤¯à¥‹à¤‚ से रूपया उधार लिया है तथा दाईं ओर लिखा गया वà¥à¤¯à¤•à¥à¤¤à¤¿ इंगित करता है कि इन वà¥à¤¯à¤•à¥à¤¤à¤¿à¤¯à¥‹à¤‚ दà¥à¤µà¤¾à¤°à¤¾ रूपया उधार दिया गया है। इसका तातà¥à¤ªà¤°à¥à¤¯ बाईं ओर लिखा गठवà¥à¤¯à¤•à¥à¤¤à¤¿ दà¥à¤µà¤¾à¤°à¤¾ रूपया à¤....