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2015 (2) TMI 1335 - AT - Income TaxAddition u/s 68 - addition for loan unexplained - AY 1997-98 - HELD THAT:- What we notice is that AO had not doubted the VDIS declaration in respect of Shri D.I.Kamalakar. As for Shri K.I.Raghavendra, his only grievance is that bank details were not produced. He has not doubted the credit worthiness of Shri K.I.Raghavendra. In the case of Shri Vyjanath R Patil as well as Shri Naganna Swadi, these persons had appeared before the AO and confirmed the loans. They had also produced evidence for the agricultural land in their possession - such confirmations when read along with the affirmations made before the AO by these creditors on their personal appearance before him could not have been brushed aside. Assessee in our opinion had discharged his onus, vis-à-vis the loans claimed to have been taken from these 4 persons. These additions therefore, were not called for. We confirm the order of the learned CITA) to the extent he deleted the addition for the loans from Shri D.I.Kamalakr and Shri K.I.Raghavendra and set aside his orders in so far it relates to the confirmation of the addition for the loan from Shri Vyjanath R Patil and Shri Naganna Swadi. Addition on disbelieving the confirmation filed by one Shri Parakash Kattimani - AY 1999-2000 - HELD THAT:- It is an admitted position that Shri Prakash Kattimani in his confirmation dated 14-02-2012 had stated that he had no banks statement or books of accounts with him to show the source of the payment. A look at the affidavit of Shri Prakash Kattimani does not prove anything. It simply gives the cheque Nos. through which payment of ₹ 10,00,955/- was effected. This would not in any way show that the payments were made by Shri Prakash Kattimani himself. Nor does it show any light of the credit worthiness of Shri Prakash Kattimani. Further, the assessee had changed his version before the CIT(A). Before the AO it had given in the confirmation letter from one Dasharath and one M/s Amar Trading Co., against the above sum. Before the CIT(A) assessee roped in one Shri Prakash Kattimani as the creditor, to whom he claimed he had given sub-lease of Ron Taluk Range. We are of the opinion that the lower authorities were justified in disbelieving the version given by the assessee and making addition Demand drafts deposited with Excise department for the purpose of bidding for arrack ranges - Assessee had given the PAN of Shri Basant Kumar Patil and Smt.D.Pushpalatha before the CIT(A). In the remand report AO had made no comments whatsoever on the confirmations. Once the PAN of the creditor is given, the AO could have verified the veracity of the claim of the assessee. It is also a fact that the payments effected to excise department were through DD’s and details of all such DD’s were with the AO. Hence, we are of the opinion that in so far as the loans claimed by the assessee to have taken from Shri Basanth Kumar Patil and Smt D.Pushpalatha are concerned, it requires a fresh verification from the AO. However, in so far as the loan alleged to have been taken from Shri M.J.Torgal, assessee was unable to produce any substantiating evidence or document. We are of the opinion the addition by the AO to this extent was justified. Thus, we set aside the orders of the CIT(A) on this issue. Loan shown as outstanding to Standard Chartered Bank CIT(A) has mentioned that documents were produced before him. AO has not made any comments in the remand report. The amount shown as due to Shri D.I.Kamalakar, who is assessee’s father, is stated to be three instalments of ₹ 9,390/- each paid by Shri D.I.Kamalakar,to M/s ANZ Grindlays Bank, against the Car loan. On this also, AO has not made any comments in his remand report. However, in the Balance sheet a sum of ₹ 98,000/- was shown as due to Shri Chidambara Shetty whereas before the CIT(A) assessee had given confirmation from one Smt.D.Chitra, Proprietrix of M/s Chitra Enterprises. Nevertheless, confirmation which stated that the amount was paid by cheque to the assessee was not doubted by the AO in the remand report. We are therefore, of the opinion that CIT(A) was justified in considering the loans of ₹ 4,36,170/- appearing in the liability side of the balance sheet of the assessee to be genuine. Assessment year 2001-02 - Confirmation if any received from M/s Raghavendra Dall Industries, Sri Goverdhan Auto Finance, M/s Sangameshwara Enterprises, and Sri B Manik Rao are not before. However, learned CIT(A) does mention that the confirmation of all the 12 persons were available with him. Hence, with respect of the balance of ₹ 68,00,000/- we are of the opinion that the matter requires a fresh look by the AO. If the assessee is able to show that the confirmations had the details of the DD’s, and source for raising the amounts, and if the DD numbers tally, with the list given by the AO of his order reproduced by us in the annexure and provide details as to the account from which the money for which the DD’s were drawn, then, in our opinion the additions would not stand - we do make a note that it is the onus of the assessee to substantiate its contentions regarding the claim. Thus, against the deletion of ₹ 96,96,996/- the order of the CIT(A) is sustained to the extent whereas for the balance of sum of ₹ 68 lakhs pertaining to his order is set aside and issues remitted back to the file of the AO for consideration afresh in accordance with law. Addition by the CIT(A) admittedly, Sri D.I.Kamalakar, was an assessee and his financial statement reflected the loans given to assessee, who was his son, has not been disputed by the revenue. Hence, we are of the opinion that the CIT(A) justified in deleting this addition. Sustaining the addition against DD’s obtained from Thirupathaiah, we find that the assessee had indeed furnished a certificate from Allahabad Bank which clearly gave the DD numbers and the account from which the DD’s were taken. We find that the such DD nos. tallied with the list given by the AO and the Allahabad Bank had certified that the accounts belonged to M/s Kanakadurga Wines owned by Sri Thirupathaiah and Sri B.Venkatesah M. In such circumstances, we are of the opinion out of the total addition of ₹ 42,50,000/- sustained by the CIT(A) the addition was not justified. This addition stands deleted. Addition which the assessee claims to have obtained from Sri Govindaiah Goud,, it is an admitted position that confirmation of Sri Govindaiah Goud, itself was only for ₹ 20.00 lakhs and not for ₹ 34,50,000/-. Similarly, assessee was unable to produce any credible evidence for loan alleged to have been obtained from Sri U.A.Ballal and Sri M.J.Torgal, ₹ 2.00 lakhs and 5.00 lakhs respectively. We are therefore, of the opinion the CIT(A) justified in confirming these additions.
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