TMI Blog2017 (9) TMI 1811X X X X Extracts X X X X X X X X Extracts X X X X ..... was issued and assessee society was asked to show cause as to why the exemption claimed u/s 10 23C)(iiiad) should not be withdrawn and excess of income over expenditure should not taxed as per the provisions of Income Tax Act as the gross receipts of the society are exceeding Rs. One crore and the society has not taken prior approval from the Ld. CCIT, Panchkula u/s 10(23C) (vi) which is mandatory for claiming exemption. In response, the society filed its written reply stating therein that receipt of our school should be kept at ₹ 72,28,383/- which is prescribed limit explained in section 10(23c)(iiiad). This contention of the assessee is not genuine because, the gross annual receipts of the society exceeding Rs. One crore and society has not taken prior approval from the CCIT, Panchkula, Therefore, the society is not eligible for exemption u/s. 10(23C)(iiiad) - Decided against assessee. - ITA No. 777/DEL/2016 - - - Dated:- 29-9-2017 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER For the Appellant : Sh. V.M. Chaurasia, CA For the Respondent : Sh. Koushlendra Tiwari, Sr. DR ORDER PER H.S. SI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A.R. of the assessee attended the assessment proceedings and furnished the requisite details / information as called for from time to time as per order sheet entries. The books of accounts were produced and examined on test check basis. In the present case, the assesseesociety is engaged in imparting education. During the year under consideration, the society was running a school namely Satluj Senior Secondary School situated at Village, Berli Kalan, PO Musepur, Distt. Rewari. During the year under consideration, the assessee has shown to have received unsecured loan of ₹ 76,25,000/-. The assessee was asked to furnish the complete details of unsecured loan. The assessee submitted that an amount of ₹ 45,50,000/- have been received through account payee cheques and remaining amount of ₹ 29,75,000/- has been received from 177 various persons in cash. The list provided by the assessee of the so called 12 persons from whom loan received through banking channel has been mentioned at page no. 2 3 of the assessment order. Since the assessee-society has failed to discharge its onus in respect of unsecured loan amounting to ₹ 67,75,000/-, the same was treated as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... At the time of hearing, Ld. A.R. of the assessee has reiterated the contentions raised in the grounds of appeal and also reiterated the contents of the Synopsis filed by him during the hearing and relied upon the case laws cited therein. For the sake of clarity, the contents of the Synopsis filed by the assessee s A.R. are reproduced hereunder:- The Society M/s. Satluj Shiksha Samiti was formed in the year 1989 and is engaged in imparting education in rural village Berli Kalan, PO - Musepur, District Rewari, Haryana by the name of Satluj Senior Secondary School . During the year under consideration the Society has applied for the purchase of land from Haryana Urban Development Authority (HUDA), Government of Haryana under the auction to setup new school at Rewari. The society has accepted sum of ₹ 76,75,000/- as un-secured loans from various persons known to the management of the society on the goodwill (as no banking institution provide loan to purchase of land) and the same was utilized for purchase of land from auction conducted by HUDA, these loans were accounted in books of accounts of the society. Ultimately the society returned the land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant details. In the instant case no evidence has been brought on record by the AO to prove that the money emanated from the coffers of the applicant. The AO has not carried out any investigation after the assessee has submitted details about the cash creditors. It is now well settled that, there are two sets of judgments and cases, but these judgments and cases proceed on their own facts. In one set of cases, the assessee produced necessary documents/evidence to show and establish identity of the shareholders, bank account from which payment was made, the fact that payments were received thorough banking channels, filed necessary affidavits of the shareholders or confirmations of the directors of the shareholder companies, but thereafter no further inquiries were conducted. The Assessing Officer does nothing with the evidences provided by the Assessee, and he does not carry out independent investigation or enquiry by summoning from the list of persons from whom un-secured loan taken by the assessee. He just made addition of ₹ 76,25,000/- under section 68 of the Income Tax Act, 1961. The issue is covered by the various orders of the Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee does not arise. This explanation of the assessee' has been duly considered and found not acceptable. This entry remains unexplained in the hands of the assessee as has been arrived by the Investigation wing of the Department. As such entries of ₹ 55,50,000/- received by the assessee are treated as an unexplained cash credit in the hands of the assessee and added to its income. Since I am satisfied that the assessee has furnished inaccurate particulars of its income, penalty proceedings under section 271 (1 )(c) are being initiated separately. The facts of Nova Promoters and Finlease (P) Ltd. (supra) fall in the former category and that is why this Court decided in favour of the revenue in that case. However, the facts of the present case are clearly distinguishable and fall in the second category and are more in line with facts of Lovely Exports (P) Ltd. (supra). There was a clear lack of inquiry on the part of the assessing officer once the assessee had furnished all the material which we have already referred to above. In such an eventuality no addition+ can be made under section 68 of the Act. Consequently, the question is answered in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. The Appeal is accordingly dismissed. 4) CIT vs Goel Sons Golden Estate Pvt Ltd ITA 212/2012 (Delhi) Para 3. We have examined the said contention and find that the assessee during the course of assessment proceedings has filed confirmation letters from the companies, their PAN number, copy of bank statements, affidavits and balance sheet. Thereafter the Assessing Officer had asked the assessee to produce the said Directors/ parties. Assessee expressed its inability to produce them. The Assessing Officer did not consequent thereto conduct any inquiry and closed the proceedings. This is a case where the Assessing Officer has failed to conduct necessary inquiry, verification and deal with the matter in depth specially after the affidavit/confirmation along with the bank statements etc. were filed. In case the Assessing Officer had conducted the said enquiries and investigation probably the challenge made by the Revenue would be justified. In the absence of these inquiries and non-verification of the details at the time of assessment proceedings, the factual findings recorded by the Assessing Officer were incomplete and sparse. The impugned order passed can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... antial question of law arises. 9. Following the various judicial pronouncements including above, we are of the opinion that the case of the assessee is squarely covered by the above judgment and therefore the Ld CIT(A) had rightly deleted the addition. In view of the above, we do not find any reason to interfere in the order of Ld CIT(A). 10. In the result, the appeal filed by the revenue is dismissed. 5. On the contrary, Ld. DR relied upon the orders of the authorities below and he also filed the written submissions in support of his contention and relied upon the decisions mentioned therein. For the sake of clarity, the contents of the Written Submissions filed by the Ld. DR are reproduced hereunder:- In the above case, it is humbly submitted that the following decisions may kindly be considered with regard to addition made u/s 68 of I.T. Act: 1. Suman Gupta Vs CIT (2013-LL-0122-69) (Supreme Court) where Hon'ble Supreme Court dismissed appeal of the assessee. Suman Gupta Vs ITO (ITA NO.680/12 vide judgement dated 07.08.2012) (Allahabad High Court) where Hon'ble Allahabad High Court held that where identical amounts were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case laws cited therein. We find that a sum of ₹ 67,65,000/- has been added on account of unsecured loan received. We further find that after perusing the assessment records, appellate order and the Remand Report, it is apparent that the lenders of funds have not, at any stage, discharged their onus in furnishing documentary evidence in respect of cash deposits made in their accounts and against which loans were advanced to the assessee. We further note that in this case the creditworthiness of the lenders and the genuineness of the transaction is not clear. Moreover, the lenders who were summoned by the AO have not submitted their Income Tax Returns. In view of the above facts and circumstances, in our considered opinion, Ld. CIT(A) has rightly confirmed the addition in dispute made by the AO u/s. 68 of the Act, which does not need any interference on our part, hence, we uphold the order of the Ld. CIT(A) on the issue in dispute and reject the ground no. 2 raised by the assessee. 6.1 With regard to ground no. 3 relating to upholding the action of the AO in denying exemption u/s. 10(23C)(iiiad) to the assessee amounting to ₹ 7,89,745/- claimed by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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