TMI Blog2014 (8) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... xamination that they had advanced money to the assessee from their own respective bank accounts - when there is categorical finding even by the AO that the money came from the respective bank accounts of the creditors, which did not flow in the shape of the money, such an addition cannot be sustained – the order of the Tribunal is upheld – Decided against Revenue. - D.B. ITA No.269/2011 - - - Dated:- 6-2-2014 - MR. AJAY RASTOGI AND MR. J.K. RANKA, JJ. Smt. Parinitoo Jain, for the appellant BY THE COURT (Per Hon'ble Ranka, J.) 1. This appeal under section 260A of the Income-tax Act, 1961 (for short, the IT Act ) has been preferred by the appellant-Revenue against the order of the Income-tax Appellate Tribunal (for short, the ITAT ) dated August 6, 2010, passed in I. T. A. No. 349/JP-2009 by which the Income-tax Appellate Tribunal has dismissed the appeal filed by the appellant-Revenue against the order of the Commissioner of Income-tax (Appeals), Ajmer (for short, the the CIT(A)) . The relevant assessment year is the assessment year 2006-07. 2. The brief facts, as emerging on the fact of record, are that the respondent-assessee is carrying on the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed money by account payee cheque and permanent account number had also been provided. It was further submitted that the identity, capacity and genuineness of the transaction stands proved by the respondent-assessee and he is not required to prove source of the amount which had been deposited by the creditors in their respective bank accounts. However, they stood to the testimony in the cross-examination and primary facts were proved and, therefore, no adverse interference be drawn, however, the Assessing Officer was not satisfied and made addition of ₹ 17,27,250 under section 68 as income from undisclosed sources. 5. An appeal was preferred by the respondent-assessee before the Commissioner of Income-tax (Appeals). Detailed submissions appears to have been filed and the Commissioner of Income-tax (Appeals) agreed with the submission of the respondent-assessee and, accordingly, held that source of cash creditors is not required to be proved by the assessee once the identity, capacity and genuineness stands proved and, therefore, he deleted the addition. 6. The appellant-Revenue challenged the matter in further appeal before the Income-tax Appellate Tribunal. The Income-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt number. They have their own respective bank accounts which they have been operating and it is not the claim of the Assessing Officer that the respondentassessee was operating their bank accounts rather they have categorically stated that they issued cheque to the respondent-assessee. It is also an admitted fact that most of the cash creditors appeared before the Assessing Officer and their statements under section 131 were also recorded on oath. The cash creditors appeared to be from small place and it is quite possible that they may not be in a position to pin pointedly or specifically say about everything but by and large stood to the testimony and were able to explain various issues as per the question and answer reproduced by the Assessing Officer himself in the assessment order. It may be that most of the cash creditors are relatives of the respondent-assessee and heavy burden lay on the respondent-assessee to prove about the cash credit but once all the cash creditors appeared before the Assessing Officer, their statements having been recorded under section 131, then in so far as the respondent-assessee is concerned, the onus, which lay upon him (assessee), in our view, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wledge of the Revenue that the said creditors were income-tax assessees. Their index numbers were in the file of the Revenue. The Revenue, apart from issuing notices under section 131 at the instance of the assessee, did not pursue the matter further. The Revenue did not examine the source of income of the said alleged creditors to find out whether they were creditworthy or were such who could advance the alleged loans. There was no effort made to pursue the so-called alleged creditors. In those circumstances, the assessee could not do anything further. In the premises, if the Tribunal came to the conclusion that the assessee has discharged the burden that lay on him, then it could not be said that such a conclusion was unreasonable or perverse or based on no evidence. If the conclusion is based on some evidence on which a conclusion could be arrived at, no question of law as such arises. 12. The hon'ble apex court in the case of CIT v. Daulat Ram Rawatmull [1973] 87 ITR 349 (SC) held as under : The onus to prove that the apparent is not the real is on the party who claims it to be so. As it was the department which claimed that the amount of fixed deposit r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eyond to put the assessee under an obligation to further prove that where from the creditor has got or procured the money to be deposited or advanced to the assessee. The fact that the explanation furnished by the creditor about the source from where he procured the money to be deposited or advanced to the assessee is not relevant for the purposes of rejecting the explanation furnished by the assessee and make additions of such deposits as income of the assessee from undisclosed sources by invoking section 68 unless it can be shown by the Department that source of such money comes from the assessee himself or such source could be traced to the assessee itself. 16. This court, in the case of Aravali Trading Co. v. ITO [2008] 220 CTR 622 (Raj) has gone to the extent of observing the fact that the explanation furnished by the four creditors about the sources where from they acquired the money was not acceptable by the Revenue could not provide necessary nexus for drawing inference that the amount admitted to be deposited by these four persons belonged to the assessee. The assessee having discharged his burden by proving the existence of the depositors and the depositors owing their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e money came from the respective bank accounts of the creditors, which did not flow in the shape of the money, then, in our view, such an addition cannot be sustained and has been rightly deleted by both the two appellate authorities. There is no clinching evidence in the present case nor the Assessing Officer has been able to prove that the money actually belonged to none but the assessee himself. The action of the Assessing Officer appears to be based on mere suspicion. 21. Accordingly, in our view, the Income-tax Appellate Tribunal, after appreciation of evidence has rightly come to the aforesaid conclusion and when there is appreciation of evidence, then it is purely a finding of fact and no question much less substantial question of law can be said to emerge out of the said order of the Tribunal and we do not find any infirmity or perversity in the order of the Income-tax Appellate Tribunal so as to call for any interference of this court. In our view, no substantial question of law arises out of the order passed by the Income-tax Appellate Tribunal. 22. Consequently, the appeal, being devoid of merit, is hereby dismissed in limine. No order as to costs. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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