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2024 (12) TMI 241
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....se substitute any of the foregoing grounds as and when required. 3. Succinctly, the fact as culled out from the records is that the assessee filed his ROI for the A.Y 2016-17 on 20.10.2016 declaring total income of Rs. 9,15,720/- after claiming deduction of Rs. 82,542/- under chapter VI A of the IT Act, 1961. The case of the assessee was selected for 'Complete Scrutiny' under CASS to primarily examine the claim of 'large exempt income." Notice u/s 143(2) of the IT Act, 1961 was issued to the assessee on 17.07.2017. Further notice u/s 142(1) of the IT Act, 1961 was issued to the assessee on 09.07.2018 & 8/10/2018 online through e-proceeding on ITBA calling for evidence in support of her returned income. Assessee furnished details vide letter dated 10.10.2018. 3.1 From perusal of the computation of income, ld. AO noted that assessee declared income of Rs. 1,62,060/- under the profit from business and profession and Rs. 8,36,201 as income from other sources. It is seen from the financial statements furnished by the assessee that the assessee credited gross receipts of Rs. 4,05,000/- from car plying business also. On further examination of the documents furnished by assessee, not....
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.... to produce any single evidence to establish her claim. In view of the above discussion the claim of the assessee regarding any receipt from the debtor was rejected and added to the income of the assessee. 4. Aggrieved from the order of Assessing Officer making addition, the assessee has along with other issues challenged the order of assessment before ld. CIT(A). Apropos to the various grounds so raised by the assessee, the relevant finding of the ld. CIT(A) is reiterated here in below: "3. Analysis and Decision: 3.1 In the assessment order passed u/s. 143(3) on 26.11.2018, the Assessing Officer made an addition of Rs. 12,88,800/- u/s. 68 and made such addition taxable u/s 115BBE 3.2 The facts of the case are that the assessee is engaged in money lending business where she claimed to have given loan to various individuals of low income group. During the year, she purchased a motor car from her Father-in- Law for a sum of Rs. 10.19,600/- She claimed that such car was used for hiring and she claimed that out of such letting of the vehicle, she earned Rs 4,05,000/- as car plying receipts. She disclosed of having a net income out of car plying receipt ....
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....-, a list of 21 debtors were presented during the appeal stage. It is seen that the lowest of such loan was for Rs 25,000/- and the highest was for Rs. 48.000/-. The provisions of section 269SS or 269T debars an assessee to take cash loan or repay such loan in cash. However, in assessee's case, the provisions do not apply as she has received back loans advanced by her earlier. In absence of detailed address etc. whether the assessee's submission can be accepted is a subjective issue. In the list of 21 individuals, certain prefixes like driver, sweeper, etc, are made. However, such claim is not established without any proper documentary evidence or in absence of any receipt issued by the assessee. Under the circumstance, I do not want to interfere with the conclusion drawn by the Assessing Officer where he has treated such receipt of Rs. 8.73,500/- as unexplained credit u/s 68. 3.8 With regard to the car running income and corresponding expenses, the assessee has submitted a ledger of day-wise receipts and payments for plying of such vehicle. The entire income and expenses were in cash. In absence of any other documentary evidence since the assessee has disclosed a ....
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....AO vide his Notice u/s 142(1) dated 27.010.2018 fixing date of hearing on 02.11.2018 raised following query in relation to pawning debtors of Rs. 873500/-. "Kindly refer to the return of income submitted by for the AY 2015-16 wherein you have shown interest receipts from sundry debtors amounting to Rs. 4,45,200/- and in the balance sheet pawning debtors of Rs. 8,73,500/- have been shown. However, in the ROI for AY 2016-17 interest receipts from sundry debtors came down to Rs. 10,300/- and Balance Sheet does not contain any receivable from pawning debtors. Kindly furnish the ledger accounts of all the pawning debtors dully confirmed and signed by the debtors and explain how the amount due from them was received. Also furnish the copy of your bank account statement evidencing amount received from pawning debtors." (it is reproduced on page 3 of Assessment Order also) 5. Before the date of hearing (02.11.2018) the appellant assessee submitted reply on 31.10.2018. The relevant part reads as under: - "Point No 1:- In case of pawn debtors interest is charged when loan is given. As in period related to Ass. Year 2015-16 loan was given or regiven interes....
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....an not be taxed in current year. As amount of Rs. 873500 credited in current years books relates to earlier years outstanding being well explained does not attract provisions of section 68 and can not be taxed as unexplained cash credit in view of Hon'ble Rajasthan High Court decision." 8. There was no next hearing before CIT(A) 2, Jaipur. Meanwhile files were transferred to NFAC, Delhi. In reply to hearing notice dated 02.05.2024 appellant submitted reply through mail dated 04.05.2024. In relation to addition of Rs. 883800/- (873500+10300) the same old facts were repeated and in view of decision of Hon'ble Rajasthan High Court in CIT vs Parmeshwar Bohra (Supra) request was made to delete addition of Rs. 873500/- and Rs. 10300/-. (PB 15 to 18) Details of Sundry Loans (Pawning Debtors) was also filed (PB 4). It was prayed to provide video conferencing hearing. 9. However, video conferencing hearing was not provided. Addition of Rs. 10300/- were deleted but addition of Rs. 873500/- was sustained. 10. (i) Being aggrieved we are before your honour GOA 1 reads as under: - "That under the facts and circumstances of the case and in law the learned CIT(A....
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.... being the receipt of money from pawning debtors. He has not appreciated the fact that the same was outstanding as on 31.03.2015. That money was received back in the year under consideration for an amount of Rs. 8,73,500/- as unexplained cash credit u/s 68 of the Act. In the year under consideration is not correct finding to drive home. To drive home to this contention, the ld. AR of the assessee relied upon the balance-sheet of the assessee filed before the revenue as on 31.03.2015. The same is extracted herein below. BALANCE SHEET AS AT 31.03.2015 Liabilities Amount Assets Amount Capital Account 1398885 Due from SK Wadhwa 505960 Pawaning Debtors 873500 Cash at Bank 2293 Cash in hand 17132 1398885 1398885 8. As is evidence that Pawning debtors appearing in the balance-sheet as advances and the re-payment of that advances received in the year under consideration i.e. F.Y 2015-16 relevant to A.Y 2016-17. The ld. AR of the assessee thus stated that the addition cannot be considered u/s 68 of the Act as cash credit receipt of this advances in the yea....
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....nces in the year when the advances were given. Even that aspect of the matter has not been disputed before us by either party. Thus, when the assessee has demonstrated that she has given advances against the security in the earlier year that source is not disputed even the interest earned on that is not disputed. Now when these money received back the same cannot be considered as unexplained money within the meaning of section 68 of the Act. As the money so received in the year under consideration is on account of opening balance of the advances of the earlier year and the same cannot be considered as income of the current year merely on the reasons that the assessee failed to give the complete details of the pawning debtors outstanding as on 31.03.2015. We get support of our view from our Hon'ble High Court Rajasthan in the case of CIT vs. Parmeshwar Bohra [2004] 267 ITR 698 (Raj.), wherein High Court held as under:- "7. It appears that the Tribunal has considered the issue regarding accessibility of the capital while considering the assessee's appeal ITA 71(Jdpr)/1999 for the asst. yr. 1993-94 by order dt. 6th Dec., 2001, whereby the Tribunal held that it is no....