TMI Blog2019 (1) TMI 593X X X X Extracts X X X X X X X X Extracts X X X X ..... following the rule of consistency cannot be found fault with. On this aspect, the approach of the learned CIT(A) is perfect and needs to be confirmed. We accordingly decline to interfere with the same. Hence, ground No.1 of the appeal is dismissed. Addition u/s 68 - identity, creditworthiness and genuineness of transactions of all the partners -- Held that:- When the learned CIT(A) transmitted the documents submitted by the assessee to the learned AO calling for the report, record speaks that there was no response from the learned AO in spite of three reminders. No explanation is forthcoming from the revenue even before us as to what prevented the learned AO to verify the documents to submit report if there is a serious objection on the identity and creditworthiness of such partners. We are convinced that the reasoning of the learned CIT(A) that he addressed a letter to DIT (Systems) for the purpose of identity and creditworthiness of these partners and to proceed with the matter having analyzed the report and the documents submitted by the assessee. No other course was left open to the learned CIT(A) in view of the non response of the learned AO to the letter dated 22.5.201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 5,01,90,000/-u/s 68 of the Act in respect of the cash found credited in Axis bank and the cash flow statement filed by the assessee was a self serving document without any proof in support of various cash receipts. Learned AO further observed that the assessee had also filed the cash flow statement in earlier years from which opening balance was coming on but no explanation was given in earlier years too. 4. Challenging the action of the learned AO, assessee preferred an appeal before the learned CIT(A) and by way of the impugned order, learned CIT(A) deleted both the additions. Hence, the revenue is before us in this appeal stating that the learned CIT(A) should not have relied upon the cash flow statement which is merely a self serving document and the source of cash deposit was not explained before the learned AO; that the learned CIT(A) erred in placing reliance on the report received by the Officer of the Directorate of Income-tax (Systems) and which has checked the returns have been filed by the partners of contributing firm when merely filing of the income tax return is neither a conclusive proof of identity nor of creditworthiness nor of genuineness of the tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellate proceedings, learned CIT(A) looked into the contentions of the assessee and also found that besides the opening cash in hand, the assessee received ₹ 2.05 crores from M/s Vivek Commodities, ₹ 2.65 crores from M/s Mittal Tin Container Industry, ₹ 1,30,500/- from Triveni Infrastructure Development Company Ltd. (TIDCO) and ₹ 75 lacs from M/s Triveni Motors. Out of the four entities, the assessee is the promoter director of TIDCO and Triveni Motors, which entities are assessed by the very same AO having PAN AACCT3870A and AACFT0256B. Further, learned CIT(A) on a perusal of the financial accounts of TIDCO and Triveni Motors noticed that the TIDCO had shareholders fund of ₹ 46.57 crore and loan funds to the tune of ₹ 47.04 crore and Triveni Motors had a capital orf ₹ 2.89 crores and loan funds of ₹ 5.35 crores. He, therefore, held that the identity, creditworthiness and genuineness of M/s TIDCO and M/s Triveni Motors is above any suspicion. 11. In respect of the other two entities, namely, M/s Vivek Commodities and M/s Mittal Infrastructure Tin Containers Ltd., learned CIT(A) perused the copies of the income-tax return, balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed CIT(A) confirmed his contribution to an extent of ₹ 2,62,500/-. 13. Similarly, out of 20 partners of M/s Mittal Infrastructure Tin Containers Ltd., learned CIT(A) found the creditworthiness of three partnersdoubtful , namely, Gopal Dass Mangal, Sunder Gupta and one Rajni Mangal, who contributed a sum of ₹ 41 lacs, as such, this amount was confirmed by the learned CIT(A) while deleting the rest of the amount. 14. Though the revenue assails this exercise conducted by the CIT(A) stating that thecash flow statement is a self serving documents and the report receipt from DIT (Systems) is conclusive proof of identity or creditworthiness or genuineness of the transaction, the revenue failed to establish before us as to what should be the proper course that should have been adopted by the learned CIT(A) in the given circumstances. Cash flow statement while always looksalike and it is for the learned AO to call for the documents, if any, he desires to verify to ascertain the correctness of the cash flow statement. As a matter of fact, learned CIT(A) not only stooped at the entity level of the contributors of the amounts but he went a little further and to call for the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und fault with and the learned CIT(A) did the possible exercise that should have been done in the given circumstances. Learned CIT(A) reached the right conclusions and we do not find any reason to interfere with the same. Hence, we dismiss the revenue appeal and the CO of the assessee. ITA 6127/Del/2014 (Puja Mittal): 17. This case relates to the addition of ₹ 75 lacs and ₹ 50 lacs received by the assessee from one Smt. Seema Rajesh Sharma and M/s Vivek Commodities.In respect of the amounts received from Smt. Seema Rajesh, the assessee explained before the learned CIT(A) that they have sold 10 lacs shares of TIDCO @ ₹ 7.5 per share and received ₹ 75 lacs but since the face value of the shares of TIDCO was ₹ 10 and the shares were sold at ₹ 75 lacs, the assessee incurred a loss of ₹ 25 lacs towards short term capital loss. The learned CIT(A) perused the bank statement of Smt. Seema Rajesh and found that there was substantial deposits in her bank account and income-tax return of ₹ 18,54,579/- and ₹ 15,92,134/- were filed for the Asstt. Years 2006-07 and 2007-08 and such returns of income were got verified from the Direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn of 20 partners and those partners had brought in a capital of ₹ 1,72,50,000/-in the year under consideration, out of which they Mittal Traders paid a sum of ₹ 1,21,50,000/-to the assessee for purchase of shares of TIDCO held by the assessee. 21. Ld. CIT(A), therefore, felt the need to verify the identity and creditworthiness of 20 partners as to the source of source. Ld. CIT(A) further recorded that Mittal traders during the assessment year 2007-08 had also given a sum of ₹ 39 Lacs to the assessee s husband by name MrSumit Mittal for the purchase of shares of TIDCO out of the said capital of ₹ 1,72,50,000/- raised in that year under consideration and for that transaction learned AO had not considered the amount received from Mittal traders to be the source of cash deposit in MrSumit Mittal s bank account and accordingly learned AO made the identical addition in the assessment year 2007-08 in Sumit Mittal s hands also. Then the Ld. CIT(A) referred to the proceedings in the case of MrSumit Mittal, and by relying upon his findings in that case returned a finding that identity and creditworthiness of all the 19 partners out of 20 partners of Mittal traders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 10, by suffering a loss of ₹ 25 Lacs and thisshort-term capital loss was claimed by them in their return of income filed on 31/3/2009, but since the said return was late the short-term capital loss was not pursued. 26. Impugned order for this year 2008-09 speaks that the Ld. CIT(A) had perused the bank statement of Smt. Seema Rajesh Sharma and found that she had substantial deposits in account and the return declaring an income of ₹ 18,54,579/-and ₹ 15, 92, 134/-were filed for the assessment year 2006-07 and 2007-08. Ld. CIT(A) also got these returns of income verified from the Directorate of Income Tax (Systems) and satisfied himself that the identity, creditworthiness and genuineness of the transaction of the assessee with the Seema Rajesh Sharma was proved. 27. The reasoning adopted and the conclusions reached by the Ld. CIT(A) could not be controverted by the revenue with reference to any substantial material. Having regard to the facts and circumstances of the case we do not find anything reason to interfere with the orders of the Ld. CIT(A). Impugned order does not suffer any illegality or irregularity. We, therefore, decline to interfere with th ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
