TMI Blog2015 (11) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... us to prove identity and creditworthiness of the payer and the genuineness of the transaction as required u/s 68 of the Act. We are also of the opinion that the addition cannot be made u/s 68 of the Act where the assessee has established this fact that he made advance/loan to payer on 14.2.2000 which was returned during previous year under consideration and thus amount cannot be held as deemed income of the assessee u/s 68 of the Act. - Decided in favour of assessee. - I.T.A. No. 5642/Del/2012 - - - Dated:- 30-10-2015 - Shri Chandra Mohan Garg, Judicial Member And Shri L. P. Sahu, Accountant Member For the Appellant : Shri Sanjay Sood, CA For the Respondent : Shri K.K. Jaiswal, DR ORDER Per Chandramohan Garg, J. M. This appeal by the assessee has been directed against the order of the CIT(A)- XVII, New Delhi dated 27.08.2012 passed in assessee s first appeal no. 107/CIT(A)-XVII/11-12 for assessment year 2003-04. 2. The grounds raised by the assessee read as under:- 1) THAT in the facts and circumstance of the case, the Learned CIT(A) erred in confirming the addition to the appellant s income made by the Learned A.O. of the amount of ₹ 26, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account of the assessee wherein it was noticed by Assessing Officer that the appellant had credited his capital account by ₹ 2631257 as remittances from overseas. The assessee preferred an appeal against the order of CIT (Appeal) - X dated 27-12 2007 to ITAT. The honorable ITAT in its order dated 27 11-2009 in IT A No. 846/Del/2008 deleted the addition of ₹ 2746531 made by the AO. However on the issue of enhancement of ₹ 26,31,257 made by CIT (Appeal) X, the honorable ITAT has restored the matter back to the file of the assessing officer with a direction to examine the contention of the assessee and after examining the same to consider the said credit in the capital account as per the provisions of the law. In pursuance to the above said order of Honorable ITAT, a notice under section 143(2) of IT Act was issued on 10-08-2010 fixing the case for 20-08-2010. On 2008-2010, Shri Sandeep Gupta attended and filed a letter and part information. The case was adjourned for 31-08-2010. Shri Sandeep Gupta attended and filed his submission as under:- We refer to your notice above. In this regard we would like to submit that during the proceedings in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duce the full evidence with documentary proof date wise when this claimed loan was shown and copy of bank account showing these transactions and copy of bank account of payer from where the foreign money was sent along with his IT return. The case was adjourned for 26.11.2010. On 26.11.2010, Shri Sandeep Gupta CA attends and seeks more time. A final opportunity for filing the details was given for 3.12.2010. However no one attended on the date. Hence I m fortified to hold the view that the assessee has nothing to say or explain or produce in support of his claim. The copy of Bank account in which money has been received is filed however the genuineness of the transaction is not complete unless the copy of account of the payer is produced. Though the AR of the assessee has been repeatedly asked to give the same. In the absence of the said account from where the money travelled the sources genuineness of the claim of the assessee remains unverifiable. The assessee though proved the identify yet failed to prove and establish the other two crucial aspects namely genuineness of the transaction since payer s bank account copy is not given and the creditworthiness of the payer. Under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 27,46.531/- was credited in the capital account as remittance from overseas and the additional evidence in this regard was filed subsequently before CIT(A) only. But the difference between the receipt and income shown in the P L a/Commissioner was confirmed by the CIT(A) as he written submissions not satisfied with the additional evidence submitted by the appellant. 4.5. As per section 68, the onus is on the appellant to satisfactorily explain the source of credit in the books of account maintained by him. I am of the opinion that the appellant has not satisfactorily explained the source of ₹ 26,31 ,257/-. Further, the appellant had not taken the plea during the appellate proceedings that the material and attending circumstances available on record do not justify the sum found credited in the book to be treated as a receipt of income nature. The burden in this regard is on the appellant and no such attempt is made by the appellant during the appellate proceedings. Therefore, respectfully following the Hon'ble Supreme Court's decision in the case of CIT vs. P. Mohanakala reported in 291 ITR 278, the addition made by the AO is here by upheld and the ground No. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o Mr. Giang Tran on 14.2.2000 transferring amount from his own bank account which was credited to the account of Mr. Giang Tran on 16.2.2000 and against this amount, the assessee, in turn, received USD 46000 (INR ₹ 26,31,257) in eight instalments from Mr. Giang Tran from 20.7.2002 to 2.1.2001 as confirmed by Mr. Giang Tran. Ld. DR also pointed out that as per profile of the payer Mr. Giang Tran, he is a well qualified author of several books, widely travelled entrepreneur and well associated active person who received amount from assessee in Feb. 2000 and returned the same in instalments during 2002-03 hence, not only identity of this payer has been established but also his creditworthiness and genuineness of the transaction has been established by the assessee, thus conclusion of the Assessing Officer was not correct and the CIT(A) upheld the addition without considering the explanation and documents of the assessee and by considering the wrong and irrelevant facts, hence, addition is not sustainable. 8. Lastly, the ld. AR submitted that the affidavit of the assessee dated 12.2.2012 and affidavit of the payer Mr. Giang Tran along with all documents clearly show that not o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts emerged from documentary evidence and affidavits of the assessee payee and Mr. Tran payer, this fact is amply clear that the amount of USD 46000 equivalent to INR 26,31,257 at that time was received by the assessee from Mr. Tran in eight instalments from 20.7.2002 to 2.1.2003 pertaining to FY 2002-03 relevant to assessment year 2003-04 which is under consideration in this appeal. In this situation, we are inclined to hold that the assessee discharged its onus to prove identity and creditworthiness of the payer and the genuineness of the transaction as required u/s 68 of the Act. We are also of the opinion that the addition cannot be made u/s 68 of the Act where the assessee has established this fact that he made advance/loan to payer on 14.2.2000 which was returned during previous year under consideration and thus amount cannot be held as deemed income of the assessee u/s 68 of the Act. 11. We are also in agreement with the contention of the ld. AR that the ratio laid down by Hon ble Apex Court in the case of CIT vs Mohanakala (supra) does not apply to the facts of the present case because in that case, assessee received foreign gifts from one common donor and the payments w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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