TaxTMI 
TaxTMI 
2023 (9) TMI 1172
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....ration assessee company filed return declaring loss of Rs. 5,15,45,351/-. Ld. AO observed that during the year assessee company has shown loan against property from other parties under the head 'short term borrowings' amounting to Rs. 3,76,33,541 which was Rs. 1,89,54,980/- during the previous financial year. The assessee was asked by notice u/s 142(1) to justify the same however, failing to provide evidence addition of Rs. 1,86,78,560/- was made by Ld. AO which has been deleted by the ld. CIT(A) with following relevant findings ; "7.3 Vide letter dated 12.02.2020, the appellant further submitted that in respect of increase in the short-term borrowings from Rs. 1,89,54,980.48 to Rs. 3,76,33,541.18., that there was no increase in the liability on account of loan, against property, however the increase shown in the liability was on account of change in classification of long-term borrowings into short term borrowings. A comparative chart showing the same in comparison, to previous year is as under: Note of Balance Sheet Particulars 31.03.2016 31.05.2015 Difference Note 4 Short Term Borrowings 3,76,33,541.18 1,89,54,980.48 1,86,78,560.70 Note ....
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....rence Note 4 Short Term Borrowings 3,76,33,541.18 1,89,54,980.48 1,86,78,560.70 Note 3 Long Term Borrowings 4,53,57,847.71 8,11,85,323.41 -3,58,27,475.70 Repayment of loan during the year 1,71,48,915.00 8,29,91,388.89 10,01,40,303.89 Nil Since no fresh loan has been taken during the year under appeal the question of making any addition by treating it as unexplained would not arise. It is also noted that no show case notice was issued on this issue during the course of assessment, proceedings. Looking to the facts and circumstances of the case and in the interest of justice the application for admission of additional evidence was allowed and the assessing officer was provided an opportunity to furnish the remand report. In the remand report dated 01.02.2019, the A.O has not been able to controvert, the above material. Certain observations made in the remand report on this Ground of appeal are not relevant. The same are as under :- (i) Short term borrowings under the head current liabilities Loan from Reliance Capital was taken against property plot No-5, Block-12....
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....lant that die increase of Rs. 1,56,61,954/- is on account of increase in ''Other Current Liabilities" due to increase in VAT payable, TDS payable, Advance from Individual and Bank Overdraft. The aforesaid increase in ''Other Current Liabilities" is also reflected in the audited Balance Sheet as on 31.03.2016, Details of increase in "Other Current Liabilities" is tabulated below :- S. No. As at March 31, 2016 (Amount in Rs. ) As at March 31, 2015 (Amount in Rs. ) 1. TDS Payable 13,90,427.00 19,59,248.00 2. D-VAT Payable 28,79,937.00 17,57.971.00 3. Bank Overdraft Balance 31,08,809.50 4. Advance from individual 1,20,00,000.00 Total 1,93,79,173.50 37,17,219.00 From the above it can be seen that there is an increase in statutory liabilities such as VAT payable and TDS payable and also increase in Bank overdraft and Advance has been received from an Individual against sale of immovable property. In support of the increase in "Other Current Liabilities", the appellant has brought on record substantiating documents in the form of (i) Ledger account of VAT payable 2014-15 a....
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....3,2016 , is not being disputed. The point to be considered is that on. the basis of the statutory records and documents it has been established that the D-VAT liability outstanding is genuine and hence cannot be taxed u/s 68 of the Act. Same would be the position with regard to the TDS payable liability and the Bank overdraft for which substantiating documents have been furnished. As regards the Advance of Rs. 1,20,00,000/- received from individuals it has been conceded in the remand report that the genuineness of the- advance stands established. In view of the above taking into account totality of facts and circumstances of the case, the addition of Rs. 1,56,61,954/- is hereby deleted. The appellant gets relief on this ground. 4. Revenue is in appeal raising following grounds ; "1. That on the facts and in the circumstances of the case, the Ld. CIT (A) has erred and on facts in deleting the addition of Rs. 1,86,78,560 /- made on account of unexplained liability as loan taken from Reliance Capital Ltd. ignoring the fact that assessee has failed to produce any concrete and also additional evidences in support of its contention. 2. That on the facts and in the ci....
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....ppeal proceedings." 5. Heard and perused the record. 6. At the outset, it is pertinent to mention that Ld. AR had stated at Bar not pressing ground no. 3 with sub grounds raised in the appeal of assessee. 7. Ld. DR has supported the findings of Ld. AO and submitted that Ld. CIT(A) has relied the additional evidences and submissions without calling remand report. Ld. AR however supported the findings of Ld. CIT(A) in regard to grounds raised by the Revenue however, in regard to ground no.2 in the appeal of assessee it was submitted that the Ld. CIT(A) has made addition from a completely new source of income which is not permissible u/s 250 r.w.s. 251 of the Act. 8. Now giving thoughtful consideration to the matter on record and submissions the ground wise findings are as follows :- Revenue's appeal ITA No. 1592/Del/2021 Ground no. 1 9. It can be observed that before Ld. CIT(A) additional evidences were filed on behalf of assessee in the form of repayment schedules of Reliance Capital Ltd. and the accounts statement. In para 4.3 Ld. CIT(A) mentions the after considering the remand report that if the source of loan being established, the question of disputing iden....
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....h regard to addition of Rs. 1,56,61,594/- made in the assessment order by treating the increase in other current liabilities as unexplained and unverified. 3. Vide letter dated 10.01.2018 an application has been made for admission of additional evidence. In the said application it has been submitted that out of the total increase and other liabilities one amount refers to the increase in TDS payable as on 31.03.2016 vis-a-vis the position as on 31.03.2015. The table submitted by the appellant in this regard is reproduced below: S. No. As at March 31, 2016 (Amount in Rs. ) As at March 31, 2015 (Amount in Rs. ) 1. TDS Payable 13,90,427.00 19,59,248.00 2. D-VAT Payable 28,79,937.00 17,57,971.00 3. Bank Overdraft Balance 31,08,809.50 -- 4. Advance from individual 1,20,00,000.00 -- Total 1,93,79,173.50 37,17,219.00 4. It has been submitted in the Written Submissions as well as application for additional evidence that no addition is required on this issue since the increase in other liabilities is on account of the increase in statutory liabilities. From the details submitted it is not....
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....e Commissioner may hear and decide any matter arising out of the proceedings in which the order appealed against was passed notwithstanding that such a matter was not raised before the Appellate Commissioner by the appellant. 9. The issue with regard to the scope of powers of the first Appellate Authority in disposing of an appeal has come up before the Courts umpteen times but we do not propose to burden the judgment by making reference to all the decisions on the point. We will notice a few decisions which we consider are relevant to answer the question referred. In CIT, Bombay Vs. Shapoor ji Pallonji Mistry (1962) 44 ITR 891, while construing the corresponding provisions of the Indian Income-Tax Act, 1922, relating to the jurisdiction of the Appellate Commissioner in such an appeal, the Supreme Court held that, in an appeal filed by the assessee, the Appellate Assistant Commissioner has no power to enhance the assessment by discovering a new source of income, not considered by the Income-tax Officer in the order appealed against. Similar views were expressed by the Apex Court in CIT (Central) Calcutta Vs. Rai Bahadur Hardutory Motilal Chamaria (1967) 66 ITR443. It was h....