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2017 (5) TMI 205 - ITAT RAIPUR

2017 (5) TMI 205 - ITAT RAIPUR - TMI - Addition u/s 68 - loans creditors admitted to the fact of having advanced the loan to the assessee - Held that:- It is not the case of the assessee that the loan creditors had advanced the money out of the income of the year alone and no positive material has been brought on record to show that loan creditors could not have any other source like his capital i.e. saving of earlier years or receipt from any other person from which the loan creditors could not .....

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the assessee has discharged its onus to prove the creditworthiness and genuineness of the lender, there was no requirement in law for the assessee to prove the genuineness and creditworthiness of the sub-creditor. Thus we delete the addition made by the Assessing Officer u/s.68 of the Act as unexplained cash credit. - Decided in favour of assessee - Denying deduction u/s.54F claimed out of long term capital gain on sale of land - Held that:- We are of the considered view that if during the c .....

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54F before the CIT(A), who held against the assessee on the ground that the assessee had not claimed deduction in the return of income. We find that Hon’ble Supreme Court in the case of Goetz (India) Ltd (2006 (3) TMI 75 - SUPREME Court ) has categorically held that the decision does not impinge upon the power of the appellate authority. Thus we feel it would be just and fair to remand back the issue of allowability of deduction u/s.54F to the file of the Assessing Officer for adjudication afres .....

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010. 2. The first issue involved in this appeal is that the ld CIT(A) erred in confirming the addition of ₹ 12,00,000/- made by the Assessing Officer u/s.68 of the Act on account of loan taken by the assessee from three lenders. 3. The brief facts of the case are that the Assessing Officer observed that the assessee had taken unsecured loan of ₹ 12,00,000/- from the following three persons: Name of the person Amount (Rs.) Lata Devi Agarwal, Shakti 5,02,301 Sharvan Kumar Mittal,Lailun .....

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x returns of the lenders together with the profit and loss account and balance sheet of the loan creditors were filed voluntarily at the fag end of the assessment year without any capital account/balance sheet. 6. Before us, ld Authorised Representative of the assessee argued that the Assessing Officer has examined the loan creditors by recording their statement on 27.12.2011 in case of Shravan Kumar Mittal and on 28.12.2011 in case of Smt. Usha Devi Agrawal and Smt. Lata Devi Agrawal, wherein, .....

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edits in its books of account but not the source of the source. Ld A.R. also relied on the decision of Hon ble Gauhati High Court in the case of Nemchand Kothari vs CIT & another, 264 ITR 254 (Gau), wherein, it was held that the burden of the assessee to prove the genuineness of the transactions as well as creditworthiness of the creditor is confined to transactions which have taken place between the assessee and creditors, and it is not the burden of the assessee to show the source(s) of hi .....

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ble Delhi High Court in the case of CIT vs. Shiv Dhooti Pearls & Investment in ITA No.429/2003 order dated 21.12.2015, wherein, it has been held that where the assessee has discharged its onus to prove the creditworthiness and genuineness of the lender, there was no requirement in law for the assessee to prove the genuineness and creditworthiness of the sub-creditor. Ld A.R. submitted that since the assessee has proved the identity of the loan creditors, genuineness of transaction and credi .....

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t. Usha Devi Agrawal of ₹ 4,01,578/-. It is not in dispute that the above loans were received by cheque. Further, it is also not in dispute that in their statement, the loans creditors admitted to the fact of having advanced the loan to the assessee. 10. We find that the argument of ld A.R. of the assessee is that the loan from all the loan creditors has been received by cheque through banking channel. All the three loan creditors are income tax assessee. They have filed their income tax r .....

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see is required to prove the source of the credit in his books of account and not the source of source i.e. the source of the credit in the account of the sub-creditor. All the moneys were received by cheque. Therefore, we find that the assessee has discharged his initial burden which established the identity of the loan creditors beyond any shadow of doubt. Thereafter, the department could not bring any positive material on record to show that the either the loan creditors have not actually adv .....

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s or receipt from any other person from which the loan creditors could not have advanced the loan. The Assessing Officer observed that the loan creditors have deposited the amount in cash before issuing cheque to the assessee. In our view where a borrowing or a credit is shown to have come from the person other than the assessee, there is no further responsibility for the assessee to show that it has come from the accounted source of the lender. Our view finds support from the decision of Hon bl .....

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al that it is not necessary that there should be an explanation as to the source of the money on the part of the creditors in every case. The Hon ble Delhi High Court in the case of CIT vs. Shiv Dhooti Pearls & Investment in ITA No.429/2003 order dated 21.12.2015, has held that where the assessee has discharged its onus to prove the creditworthiness and genuineness of the lender, there was no requirement in law for the assessee to prove the genuineness and creditworthiness of the sub-credito .....

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year, the assessee claimed to have sold a piece of land measuring 0.64 acres of Khasra No.98/7 of Jagatpur, Raigarh to Shri Naveen Bansal for ₹ 13,15,000/- on 17.9.2008. The assessee had neither shown the capital gain in the return of income nor claimed exemption of capital gain in the return of income. On being show caused by the Assessing Officer, it was explained by the assessee that the said land was purchased for ₹ 40,000/- on 9.6.1994 and was sold for ₹ 13,15,000/- and pr .....

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the other hand had no tax liability. 14. The Assessing Officer observed that it has been gathered that there was dispute between the assessee and Shri Leela Ram Soni regarding sale of land. Summons u/s.131 of the Act was issued to Shri Leela Ram Soni, who issued power of attorney in favour of his son Shri Sanjay Soni to appear on his behalf before the Assessing Officer, who in his statement recorded stated that the land was purchased by his father Shri Leela Ram Soni from Smt. Krishna Devi, W/o .....

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iece of land was purchased in the name of her minor son Shri Amit Kumar Agrawal , Smt. Krishna Devi had shown it in her books of account, which showed that the fund used to purchase the said piece of land was of Smt Krishna Devi and not that of Amit Agrawal. The Assessing Officer further observed that as per the provisions of Income tax Act, even if any asset was purchased in the name of any family members, the same will be held to be the property of the person, with whose fund, the property was .....

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g gifts had been furnished before the Assessing Officer. The Assessing Officer observed that the assessee was merely 10 years old in 1994 when the said property was purchased in his name by Smt. Krishna Devi. Therefore, the above submission of the assessee that he had received small gifts of ₹ 40,000/- till that age was not acceptable by the Assessing Officer. The Assessing Officer further observed that had the property in question been purchased with the help of gifts of the assessee, it .....

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r held that the fund used to purchase the property in the name of the assessee did not belong to the assessee. Consequently, when the property was not considered to be the property of the assessee for the purpose of Income Tax Act, 1961, the amount received from Shri Naveen Bansal, who is the father of the assessee on the pretext of sale of this property cannot be considered as sale consideration but deemed to be the income from other sources. Further, the assessee has not shown either capital g .....

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; 87,782/-. The return of income was filed in ITR-4 and the capital gain and deduction U/S.54F had been shown as Nil. There was no declaration of long term capital gain or investment of the gain for purchase of house property and claim of exemption of long term capital gain u/s.54F of the Act either in the return of income or in the computation of income filed along with return. The fact regarding the sale of the impugned piece of land at ₹ 13,15,000/-, the long term capital thereon at  .....

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ring the relevant assessment year and contains separate column for showing income from long term capital gain and claim of deduction u/s.54F. Thus, the assessee had not disclosed the facts in the specified column simply by contending that the assessee assumed that the capital gain was exempt u/s.54F and thus, inadvertently, missed the disclosure of computation of sale of land which on the other hand has no tax liability. It is difficult to appreciate the submission since it would render the clea .....

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, the Assessing Officer denied the benefit u/s.54F for want of material evidence on record and there was no evidence annexed with the return on exemption claimed u/s.54F. He further observed that the Hon ble Rajsthan High Court observed that if the view is taken without any evidence or documents annexed with the return, the claim of any deduction was to be allowed, there was no purpose of even filing the return or sending the intimation u/s.143(1) of the Act. Hence, he confirmed the action of th .....

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fit of the same to the assessee if all the evidence and details are made available to the Assessing officer. He submitted that Hon ble Supreme Court in the case of Goetze (India) Ltd vs CIT (2006) 284 ITR 323 (SC) has held that the deduction not claimed in the return of income cannot be allowed by the Assessing Officer but does not impinge upon the power of the appellate authority. Ld A.R. relied on the CBDT Circular No.014(XL)-35) dated 11.4.1955, wherein, it has been stated that Officers of th .....

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he may be sure of getting a square deal from the department. Although, therefore, the responsibility for claiming refunds and reliefs rests with assessee on whom it is imposed by law officers should allow the mandatory relief about exemption from tax whether claimed or not. He, therefore, prayed that when the deduction was claimed before the CIT(A) and the relevant details was filed before him, the CIT(A) ought to have examined the case of the assessee and if he found eligible for deduction u/s .....

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