TaxTMI 
TaxTMI 
TaxTMI 
2024 (3) TMI 146
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....f the case of the assessee, the Ld. CIT(A)-3 was not justified in confirming the addition against unsecured loan amounting to Rs. 20,00,000/- as unexplained cash credit u/s 68 of the Act. 4. That on the facts and in the circumstances of the case of the assessee, the Ld. CIT(A)-3 was not justified in confirming the addition towards disallowance of Rs. 29,867/- on account of donation and charity expenses." 2. The registry has informed that the present appeal is delayed by 66 days and therefore time-barred. Ld. AR for assessee carried us to an affidavit of one Shri Brijesh Kumar Pandey, owner of Shop No. 12, Ground Floor, Block-A, Kamdhenu Tower, E-2/21, Arera Colony, Bhopal who is neighbour of assessee. In the said affidavit, Shri Brijesh Kumar has averred the factual position according to which the post containing the impugned order was served upon him on 05.06.2023 but on that day, the assessee's shop was closed. Therefore, he received the post but thereafter he had to go out of Bhopal for attending some urgent work and missed to deliver to assessee. Subsequently, he delivered post to assessee on 10.08.2023. This way, the impugned order dated 19.05.2023 was effectively served ....
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....Ground No. 2: 5. In this ground, the assessee challenges the addition of Rs. 6,00,000/- made by AO and upheld by CIT(A) on account of unexplained cash credit u/s 68. 6. The AO has dealt this issue in Para 4 of assessment-order. Basically, the AO noted that the assessee had taken a loan of Rs. 6,00,000/- from Reshma Qureshi (Rajesh Malviya) but, however, the assessee filed only copies of cheques and did not file any evidence like A/c confirmation, ITR details, Bank details of the lender. Accordingly, the AO was not satisfied with creditworthiness of the lender and made addition. 7. During first-appeal, the assessee filed additional evidences in the shape of A/c Confirmation of lender, Bank Statement of lender and Assessee's own bank statement to CIT(A) in terms of Rule 46A of Income-tax Rules, 1962. The CIT(A) admitted those evidences after obtaining remandreport from AO. However, the CIT(A) upheld addition making these observations : (i) The assessee has given address and filed A/c Confirmation and Bank Statement of the lender which proves identity but does not prove creditworthiness of lender; (ii) The assessee claimed to have repaid loan on 29.10.2012 but the bank statement w....
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....evenue supported the orders of lowerauthorities. He iterated that the assessee did not file requisite documents to AO. He submitted that although the assessee filed documents before CIT(A) but the AO, in remand-report, pointed out that the repayment was made to the lenders through cross-cheques and not a/c payee cheques. 11. We have considered rival submissions of both sides and perused the orders of lower-authorities as also the documents filed in Paper-Book to which our attention has been drawn. After a careful consideration, we find that the assessee has taken a total loan of Rs. 6,00,000/- through 2 cheques each of Rs. 3,00,000/-. In support of transactions, the assessee has filed documentary evidences in the form of (i) A/c Confirmation of lender, (ii) Lender's Bank Statement and (iii) Assessee's own bank statement. The lender's bank statement shows that there was a credit entry of Rs. 6,20,000/- in the a/c of lender which made up a sufficient balance for about 2 months from which the lender gave loan to assessee. It is not a case where there is any cash deposit in lender's bank a/c before giving loan to assessee. Thus, the source or creditworthiness of lender qua the giving ....
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....servations, the CIT(A) upheld addition. 15. Before us, Ld. AR for assessee made following arguments to show that the creditworthiness of lender as well as genuineness are proved: (i) The lender was non-resident and his taxable income in India was just Rs. 79,180/- as declared in the return. Therefore, his taxable income cannot be taken as indicator of real creditworthiness. (ii) Regarding source of Rs. 20,00,000/- advanced by Shri Ajay Gupta to assessee, Ld. AR submitted that the assessee took loan in two tranches, Rs. 5,00,000/- and Rs. 15,00,000/-. For the source of first tranche of Rs. 5,00,000/-, Ld. AR submitted that M/s Unitrade & Services issued a Cheque No. 245084 from their Bank A/c in favour of Shri Ajay Gupta and the same was credited in Shri Ajay Gupta's NRO A/c with Axis Bank on 24.11.2009 and from Axis Bank A/c, it was transferred to assessee's bank a/c on 25.11.2009, which is very much clear from Ledger A/c of Shri Ajay Gupta extracted from books of account of M/s Unitrade & Services (Paper-Book Page 23), Debit entry in Bank Statement of M/s Unitrade & Services (Paper-Book Page 25) and Credit/Debit entries in Bank Statement of lender with Axis Bank (Paper-Book ....
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....s in bank statement filed at Page No. 27-27A of Paper-Book. (iv) That the partners of assessee-firm had a friendly relationship with Shri Ajay Gupta and therefore the loan was interest-free. 16. With these submissions, Ld. AR contended that Shri Ajay Gupta has made loans to assessee from the funds sourced from recoveries made from M/s Unitrade & Service. Therefore, the source of giving loans to assessee is proved. Accordingly, Ld. AR prayed to delete the addition. 17. Per contra, Ld. DR for revenue supported the orders of lowerauthorities. He re-iterated the observations made by CIT(A). 18. We have considered rival submissions of both sides and perused the orders of lower-authorities as also the documents filed in Paper-Book. On a careful consideration of various debit/credit entries in the bank statements of assessee, Shri Ajay Gupta (lender) and M/s Unitrade & Service and also the Ledger A/c of Shri Ajay Gupta as extracted from books of M/s Unitrade & Services which are filed in the Paper-Book and also analysed before us during hearing, we find that Shri Ajay Gupta was having a pre-existing deposit with M/s Unitrade & Service and by making recoveries therefrom, made loans ....