TMI Blog2019 (7) TMI 1586X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, just because the assessee has business relations with a persons (not even the person from whom the documents were recovered) nor it is proved that unsubstantiated entry found recorded in the similar name is true and belongs to the assessee. We are therefore inclined to agree with the findings recorded by the ld.CIT(A) in penalty proceedings that no corroborative or substantive evidence has been brought on record to suggest that the assessee has taken any loan in cash or repaid any loan in cash and done the transactions reflected in the seized material recovered from third party - no reason to deviate from findings recorded by the ld.CIT(A). Accordingly the appeal of the Revenue in respect of penalty u/s.271D and 271E is dismissed. - Decided in favour of assessee. - I.T.A. No’s. 208 to 216/SRT/2017 - - - Dated:- 12-7-2019 - Shri V.Durga Rao, Judicial Member And Shri O.P.Meena, Accountant Member Assessee by: Shri Rasesh Shah, CA Revenue by: Shri Prasenjit Singh, Ld CIT DR Shri J.K. Chandrani, Sr. DR ORDER PER BENCH: 1. These nine appeals filed by the Revenue are directed against the common order passed by the Ld. Commissioner of Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee were found and seized, hence the proceedings u/s.153C r.w.s 153A of the Act were initiated in the case of assessee. On the basis of material seized from the residence of Shri Piyush Ghanshyam Modi it was ascertained that the assessee had taken cash loan amounting to ₹ 3,72,80,000/- during the year from Shri Dilip C Sojitra on various dates. Seized page no.18 of Annexure A-30 reflected with an amount of ₹ 2,97,000/- as interest was charged towards amount of ₹ 75,00,000/- borrowed by Shri Gaurangbhai P. Upadhyay of which was to be repaid on 31.08.2009, accordingly the Assessing Officer has calculated the interest amount by considering the rate of interest of ₹ 47.52 % per annum which was aggregate at ₹ 40,20,554/-, hence same was added as unexplained expenditure u/s.69C of the Act. Since the assessee has taken cash loans, therefore provisions of section 269SS r.w.s. 271D were attracted. Accordingly reference was made to JCIT, Range4 for passing the penalty order u/s.271D on the aforesaid amount of cash loan of ₹ 3,72,80,000/-. The JCIT, Range after allowing opportunity to the assessee has levied penalty of ₹ 3,72,82,000/- being equ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecovered from a third party is moreover acquired and hence to be substantiated by corroborative evidence. Therefore, presumption u/s.132(4A) and section 292C is not available in the case of third party as held by the Hon'ble Delhi High Court in the case of CIT vs Anil Khandelwal [2015] 93 CCH 0042 (Del SC) and Hon'ble Bombay High Court in the case of Addl. CIT vs. Miss Lata Mangeshkar (1974) 97 ITR 0696. The ld.CIT(A) further observed that the Assessing Officer has added alleged interest payment of two different accounts, namely Shri Gaurangbhai P Upadhyay account and Shah and Singhvi account, however he has convincingly ignored that according to the ledgers made by him, two accounts were running simultaneously for substantial period in 2009 and 2010 which are clearly without any other evidence or statement. Therefore, this should be taken to represent two different entities. In view of these aforesaid circumstances, it was concluded by the ld.CIT(A) that the Department s case is based on documents that too acquired from a third party who is changing his stand on whose instructions these were written. Another third party, namely Shri Dilip C Sojitra, without admitting that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of interest charge in respect of cash loan taken repaid has been deleted by ld.CIT(A) in quantum appeal on the ground that the departments case was based on documents which were acquired from the third party who is changing its stand that on whose instructions these were written. Another third party, namely Shri Dilip C Sojitra asserting that the transaction should be true but he has not deciphered the transactions. Shri Dilip C Sojitra s stands that these transactions were entered into by joint venture or partnership has been rejected by the department itself and therefore the meaning given the Assessing Officer to these documents suffers from test of basic common sense and logic, therefore the very basis of that cash loans were repaid taken stands deleted in the appeal, hence no penalty u/s.271D and 271E is survived. The ld.Counsel further submitted a copy of order of ITAT in ITA No.132 to 136/Ahd/2017/SRT dated 06.09.2018 wherein these five appeals of the Revenue filed against the common order of ld.CIT(A)-4, Surat dated 20.12.2016 were dismissed on account of Low Tax Effect involved therein. Hence, ld.ICT(A) order has become final. Since the order of ld.CIT(A) has be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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