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TMI Blog2019 (12) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... holding it as unexplained credits u/s. 69 of the Act, whereas the addition made by the AO was u/s.68 which is contrary to the facts and circumstances of the case. 3. Ground No. 3 & 4 are without prejudice to above ground which states that the assessee is explained with documentary evidence that the ingredients of section 69 of the Act, hence the addition made of Rs. 4,96,500/- by the AO u/s.68 as confirming by the CIT(A) u/s.69 requires to be deleted holding that it is genuine bonafide and supported by documentary evidence. 4. Since, the above 3 to 5 grounds are inter-connected, hence same are being considered together. 5. Brief facts are that the assessee is an individual deriving income from House Property, Capital Gain and income f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Harshad D. Patel, is sustained as they have admitted in their statements before the AO that cash for deposit in the bank account was given by the husband of the assessee Shri Mayankbhai Parikh. Further, deposit of Rs. 49,000/- was taken from Smt. Jyoti B. Gandhi was also confirmed as she could not explain the source of cash deposit in her bank account. So far remaining four lenders i.e. Shri Ashiwin Patel (Rs. 1,00,000), Shri Indrajit P. Gohel (Rs. 1,00,000), Shri Kamlesh R. Baxi (Rs. 49,500) and Mitesh B. Patel (Rs. 1,00,000), also there was cash deposit of equal amount immediately before the issue of deposit cheque to the assessee. Therefore, the CIT(A) was the opinion that creditworthiness of these persons has not been established. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee about the nature and source of investment and if he find that no such explanation is furnished by the assessee or the explanation is not satisfactory, he can treat the value of investment as the income of the assessee. However, in the present case the ld. CIT(A) has not established that the assessee has made investment which are not recorded in the books of account. Since, the assessee has taken loan from the parties which cannot be treated as investment made by the assessee, therefore invocation of the Section 69 of the Act is not in accordance with the law. The ld. counsel supported this view by placing reliance in the case of Aurobindo Sanitary Stores v. CIT [ITA No. 13 of 2002] dated 31-01-2005 of Orissa High Court. The ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mum-Trib.). The ld. counsel further place reliance on the decision of Hon'ble Supreme Court in the case of Andaman Timber Industries [2015] 281 CTR 241 (SC) to contend that the assessee was not allowed to cross-examination of the lenders, hence the addition made by the AO is not sustainable. The ld. counsel further filed a chart giving details which was also filed before the lower authorities in which the aforesaid loans have been repaid to the concern debitors by cheque from the bank account of the assessee. Therefore, when the assessee has repaid the loans to the debitors the addition sustained u/s.69 of the Act is not tenable, as held by the Co-ordinate Bench of Tribunal in the case of ABT Limited v. ACIT in Para 16 as under:- "The se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eir complete addressees, GIR Numbers/Permanent Account Numbers which can be made to the assessment order, whereas rightly follow the order of AO is not sustainable. 10. Per contra, the ld. Sr. Departmental Representative (DR) relying on the order of lower authorities and submitted that the assessee was not able to produce the four parties and the two persons admitted in their statements that cash was given by the husband of the assessee to them for depositing of cash cheques. However, the ld. Sr. DR could not controvert the argument that how the section 69 is applicable in the case of the assessee. 11. We have heard the rival submissions and perused the relevant material available on record. We find that the AO has made addition u/s.68 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amounts to a serious flaw which makes impugned order nullity in as much as it amounted to violation of principles of natural justice. Though the CIT(A) by not allowing opportunity to the assessee cross-examination as violated the principles of natural justice. We further observe that the addition is not sustainable u/s.69 of the Act. We further observed that the assessee has repaid all the loans to the lenders in the subsequent year through cheque which has been appeared in their bank account also therefore when the assessee has repaid the loans by cheques which has in cash to the respective parties, and the assessee has furnished complete details and address, and thus the assessee has discharged the onus u/s.68 of the Act, hence addition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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