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TMI Blog2022 (12) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... vate limited company engaged in the business of construction activity. The assessee maintained regular books of accounts which are duly audited and original return of income were filed. A search action u/s. 132 of the Act was conducted in the case of Venus Group of Ahmedabad on 10.03.2015, various premises were covered u/s. 132/133A of the Act, during the search and various incriminating documents were seized. On the terrace of Crystal Arcade, C.G. Road, Ahmedabad documents related to unaccounted cash transactions of Venus Group were seized. On analysis of documents seized and their co-relation, it was found that unaccounted cash transactions were first recorded on cash vouchers. On the basis of recording made on these cash vouchers, the entries were recorded on the day cash book. 2.1. During the course of search on Vaswani Group, several documents reflecting transaction of Venus Group members with the assessee company has been found. It was noticed from the seized documents that certain documents pertained to the assessee and information contained therein related to the assessee. Therefore satisfaction is recorded by the Assessing Officer on 17.11.2017 as follows: "In view of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee could not prove with documentary evidence that the transaction shown in the seized documents were considered in the hands of the persons of Venus Group. Even if unaccounted transactions are considered in the hands of one party. These can also be considered in the hands of the party and opposite to these transactions. Keeping in view of these facts, the additional grounds raised by the assessee was dismissed. 3.1. On merits of the case, the assessee contended that it received unsecured loan from M/s. Sunderdeep Builders a Proprietorship concern wherein Mr. Rajesh Vaswani is the sole Proprietor. In regular course of business during the financial year, total loans obtained from M/s. Sunderdeep Builders is amounting to Rs. 35 Crores, upon which interest of Rs. 1,83,79,553/- was paid/credited and appropriate TDS @ 10% was deducted on the same. During this financial year itself, a sum of Rs. 5,34,24,521/- was repaid by the assessee to M/s. Sunderdeep Builders. All these transactions were through normal banking channel. The assessee filed copy of the acknowledgement of Income Tax Return, Tax Audit Report, Copy of the account confirmation and Bank Statement of Sunderdeep Builde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dependently assessed to income tax. He should be held answerable for these transactions and not the appellant company. Further, during the year, the appellant company had taken loan of Rs. 35 crore from M/s. Sunderdeep Builders. The AO has considered Rs. 30 crore as explained from same creditor, whereas only Rs. 5 crore has been considered as unexplained which is unjustified. The appellant repaid Rs. 5.34 crore during the year itself and interest of Rs. 1.83 crore was paid credited. The appellant deducted TDS @ 10% of the interest amount. These facts further prove the genuineness of the transactions. As per the chart placed in para 17.3 of the assessment order, transaction of Rs. 3 crore on 6.3.2013 and Rs. 2 crore on 4.3.2013 have been mentioned, whereas, as per ledger account of M/s. Sunderdeep Builders, Rs. 2 crore were credited on 4.3.2013 and Rs. 1 crore on 6.3.2013. This show that entry of Rs. 3 crore on 6.3.2013 does not match with the regular books of accounts, hence, the entries made in these documents are not factually correct and do not match exactly, so as to warrant additions. It is important to mention that at the year end, M/s. Sunderdeep Builders had closing balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v/s Ridhi Sidhi Corporation by Hon'ble Gujarat High Court in T.A. No. 69 of 2018. iv) CIT v/s. Apex Therm Packaging P Ltd. (2014) 42 Taxamn.com 473(Guj). B) Non providing opportunity of cross examination i) Andaman Timber v/s, CC Exim CA No. 428 of 2006(SC) ii) PCIT v/s, Kanubhai M. Patel (2017) 79 Taxman.com 257 (Guj) iii) C/T v/s. Jndrajit Singh (2013) 215 Taxman 58 (Guj) iv) H.R. Mehta v/s. AC/T 387 ITR 561 (Bom) As the facts of the appellant's case are identical to the facts of the above mentioned binding judgments, the additions made by the AO are not found factually & legally justified, hence, these are deleted. This ground of appeal is allowed. 4. Aggrieved against the same, the Revenue is in appeal before us raising the following Grounds of Appeal in IT(SS)A No. 248/Ahd/2018 for A.Y. 2013-14. 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in law and/or on facts in deleting the addition of Rs. 5,00,00,000/- made by the AO u/s. 68 of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) ought to have upheld the order of the A.O. 3. It is, therefore, prayed that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cifically requested for the statements and other materials but the same were not provided by the Assessing Officer. The Ld. Senior Counsel also taken us through Page No. 41 & 42 of the Paper Book wherein the assessee's request for the copies of the statement recorded of Venus Group during search, complete co-relation of the vouchers paid to 'YT' against 'EC'. Thus the Ld. Counsel submitted that it is settled legal position of law that merely on the basis of oral statement of third party recorded during search, no adverse inference can be drawn against the assessee company especially when such statement has not confronted to the assessee for appropriate rebuttal. The Ld. Senior Counsel also drawn our attention that the assessee has produced before the Lower Authorities confirmation from the lender M/s. Sunderdeep Builders at Page No. 43 to 46, Bank statement of the assessee with relevant transactions at Page No. 47 to 60 of the Paper Book, Return of Income and Statement of Total Income of Rajesh Vaswani proprietor of M/s. Sunderdeep Builders. At Page No. 61 to 67 of the Paper Book and Tax Audit Report of Rajesh Vaswani at page no. 68 to 84. Thus the Ld. Senior Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l stated that the Ld. CIT(A) after considering the above facts of the case, deleted the additions which does not require any interference and thereby requested to dismiss the Revenue's appeal. 7. We have given our thoughtful consideration and perused the materials available on record. The addition made by the Assessing Officer invoking Section 68 does not hold it good since the assessee has filed the confirmation letter from the lender, Bank statement from the assessee, Income Tax Return and statement of total income of the lender namely Mr. Rajesh Vaswani proprietor of M/s. Sunderdeep Builders. Thus the assessee has discharged its initial onus namely identity of the creditor, genuineness of the transaction and creditworthiness of the creditor. Further the Assessing Officer has disbelieved Rs. 5 Crores received from creditor and not doubted about the Rs. 30 Crores received from the same lender. Further the Assessing Officer has not doubted the interest payment of Rs. 1,83,79,553/- as against the above loan, with appropriate TDS made by the Assessee. Therefore the addition made by the Assessing Officer u/s. 68 of the Act is not sustainable in law. Further the Hon'ble Jurisd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of jurisdiction u/s. 153C of the Act does not exist, therefore the issuance of notice u/s. 153C is bad in law. 10. Per contra, the ld. D.R. could not controvert the above dates and the issuance of 153C notice. 11. We have given our thoughtful consideration and perused the material available on record. Section 153C was amended by the Finance Act, 2015 w.e.f. 01.06.2015 as follows: 153C [(1)] [Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that,- (a) Any money, bullion, jewellery or other valuable article or thing, seized or requisitioned, belongs to; or (b) Any books of account or documents, seized or requisitioned, pertains or pertain to, or any information contained therein, related to, 11.1. The pre-amended provisions reads as follows: "Notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, where the Assessing Officer is satisfied that any money, bullion, jewellery or other valuable article or thing or books of account or documents seized or requisitioned belongs or belong to a person other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the course of search, within the fold of that section, this question assumes significance, In as much as in the facts of the present case, as on the date of search, it was only if such material belonged to a person other than the searched person, that the Assessing Officer of the searched person could record such satisfaction and forward the material to the Assessing Officer of such other person. However, subsequent to the date of search, the amendment has been brought into force and based on the amendment, the petitioners who were not included within the ambit of section 153C as on the date of the search, are now sought to be brought within its fold on the ground that the satisfaction note and notice under section 153C have been issued after the amendment came into force. Therefore, this case does not relate to the interpretation of the provisions of any of the sections, but relates to the stage at which the amended section 153C can be made applicable, as to whether it relates to the date of search; or the date of recording of satisfaction by the Assessing Officer of the searched person; or the date of recording of satisfaction by the Assessing Officer of the other person; or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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