TaxTMI 
TaxTMI 
2025 (4) TMI 2039
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..... 2, 2.1, 2.2 & 2.3 raised by the Appellant-Revenue in challenging the action of the ld. CIT(A) in directing the Assessing Officer to treat Rs..1,01,04,800/-, Rs..37,74,839/- and Rs..99,43,032/- as business income as against the additions as unexplained investment under section 69 r.w.s. 115BBE of the Income Tax Act, 1961 ["Act" in short] for the AYs 2019-20, 2020-21 and 2022-23 respectively. 6. At the outset, we note that the assessee company filed its return of income admitting total income of 80,04,120/-. After recording reasons for reopening, the Assessing Officer issued notice under section 148 of the Act on 17.03.2023. In response to the said notice, the assessee filed return of income admitting total income of Rs..1,81,08,920/-. Subsequently, notice under section 143(2) of the Act was issued on 14.06.2023, further notice under section 142(1) of the Act was also issued on 11.08.2023 calling for various details. According to the Assessing Officer, during the course of search proceedings, some note books were found and seized and on an examination of such seized materials, the Assessing Officer found that the finance syndicate in which the assessee, i.e., Shri N.C. Jain, Shr....
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....e assessee and by following the decision of the Tribunal in assessee's own case in ITA No. 1218/Chny/2024 dated 08.08.2024 for AY 2021-22, the ld. CIT(A) held that the income is the business income of the assessee and to be taxed under normal provisions and deleted the addition made by the Assessing Officer by observing as under: 6.3.12 The Appellant has worked out his undisclosed business income based upon the Peak Credit and admitted the same in the return of income filed, the search team was also not able to find any other incriminating material indicating that the Appellant is in receipt of any other income. The AO also has not made any findings upon this issue. 6.3.13 At this juncture, it is appropriate to bring on record that the undersigned while disposing the appeal in the case of the appellant vide Appellate order u/s 250(6) of the Act dated 08.09.2023 for the AY 2021-22 has categorically held that the income is the business income of the appellant and to be taxed under normal provisions and allowed the grounds of appeal. Further, the jurisdictional tribunal while disposing the appeal of the revenue against the above appellate order in its order in ITA No....
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....tments may be deemed to be the income of the assessee of such financial year". * As noted above, it is assessee's own submission that the loan investments as found in the seized documents are not recorded in the books of accounts maintained. * It is also assessee's own admission that for the amount arrived as peak credit. assessee could not explain the source from which the said amount has been received acknowledging the said facts by declaring the said income to have been received from unknown loan debtors. * Admitting the said amount arrived at by peak credit as the income / interest arising out of finance business would not absolve the responsibility of assessee for explaining the sources for the loans advanced. 11. The ld. AR Shri R. Venkata Raman, C.A. strongly supported the order passed by the ld. CIT(A). By placing reliance on the decision of the Tribunal in assessee's own case for the AY 2021-22 in ITA No. 1218/Chny/2023 dated 08.08.2023, the ld. DR submits that the ld. CiT(A) followed the above decision of the Tribunal and the same may be sustained. 12. We have heard both the parties and perused the materials available on record. On....
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....ng of Ld. CIT(A) that the amount of Rs. 200.90 Lacs would be considered as business income only. The impugned order, to that extent, stands confirmed. 13. The ld. DR could not controvert the above findings of the Tribunal. Thus, we find that the ld. CIT(A) rightly applied the above decision of the Tribunal in assessee's own case for AY 2021-22 and held that the income is business income and the same is justified. Accordingly, the grounds No. 2, 2.1 & 2.2) raised by the Appellant - Revenue are dismissed. 14. Ground No. 3 (3.1 to 3.2) raised by the Appellant-Revenue in challenging the action of the ld. CIT(A) in deleting the addition made towards unaccounted interest income and miscellaneous receipts as quantified from the seized note books. 15. On perusal of the seized materials, the Assessing Officer found that the assessee has received interest and commission from the borrowers at Rs..2,07,84,200/-, besides miscellaneous receipts to the tune of Rs..26,03,900/- during the FY 2018-19 relevant to the AY 2019-20. After considering the submissions of the assessee, the Assessing Officer treated the interest receipts of Rs..2,07,84,200/- as additional interest income from the to....
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....made as unaccounted interest and unaccounted miscellaneous receipts and dismissed the revenue appeal. As the facts and circumstances relating to the addition(s) made remain the same, the various grounds raised by the Appellant upon these issues are hereby treated as allowed and the AO is hereby directed to delete the additions of Rs. 2,07,84,200/- Rs. 1,41,10,814/- & Rs. 1,44,36,982/- as interest income and the amount(s) of Rs. 26,03,900/- Rs. 23,36,475/- & Rs. 9,69,000/- as miscellaneous receipts for the AY(s) 2019-20, 2020-21 & 2022-23 respectively. 16. Before us, the ld. DR filed written submissions and the contents are reproduced hereinbelow: Item 2: interest Income of Rs. 2,07,54,200/- the Miscellaneous receipts of Rs. 26,03,900/- brought to tax separately by the AO. 4 The assessee while arriving at the peak credit of Rs. 1,01,04,800/- and offering the same as undisclosed interest income earned for the year submitted as follows: "The entire investor transactions as recorded wiz investor receipts, interest receipts miscellaneous receipts, repayments made by the borrower, bans advanced, repayments made to investors and miscellaneous withdrawals have....
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....s expenses Commission & interest income Interest expenses Miscellaneous expenses 2019-20 2,41,52,964 1,41,46,235 27,24,923 3,42,57,764 1,89,23,934 25,24,922 1,01,04,800 47,77,699 -(2,00,001) In addition, the assessee counsel also submitted a working where-in the interest Income was excluded from the peak credit working and the figures arrived at are follows: FY Peak credit without interest income 2018-19 Rs. 80,82,400/- While assessee arrived at a lesser peak credit of Rs. 80,82,400/- for the year under consideration for which sources could not be explained by the assessee, the appellant counsel submitted that a higher peak credit has been offered to tax already it is the submission of the revenue that the above said workings defies logic and hence the addition made by the AO is to be upheld. 17. The ld. AR strongly supported the order passed by the ld. CIT(A). 18. Having heard both the parties, we note that the issue involved in this appeal is squarely covered by the decision of the Tribunal in assessee's own case for the assessment year 2021-22, wherein, the Tribunal has observed as under: 6. It is anot....
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.... income and miscellaneous receipts are not maintainable and deleted accordingly. Thus, we find that the ld. CIT(A) rightly applied the above decision of the Tribunal in assessee's own case for AY 2021-22 and directed the Assessing Officer to delete the additions made towards interest income earned and miscellaneous receipts and the same is justified. Accordingly, the grounds No. 3, 3.1 & 3.2 raised by the Appellant - Revenue are dismissed. I.T.A. No. 2663/Chny/2024 - AY 2020-21 20. Ground No. 1 raised by the Appellant-Revenue is general in nature and requires no adjudication. 21. Ground No. 2, 2.1, 2.2 & 2.3 raised by the Appellant-Revenue in challenging the action of the ld. CIT(A) in directing the Assessing Officer to assessee Rs..1,01,04,800/-, Rs..37,74,839/- and Rs..99,43,032/- as business income as against the additions made by the Assessing Officer as unexplained investment under section 69 r.w.s. 115BBE of the Income Tax Act, 1961 ["Act" in short] for the AYs 2019-20, 2020-21 and 2022-23 respectively. 22. We find the issues in AY 2020-21 are similar to the facts and circumstances relevant to AY 2019-20 in ITA No. 2662/Chny/2024, wherein, we have sustained the or....