TMI Blog2023 (8) TMI 920X X X X Extracts X X X X X X X X Extracts X X X X ..... effective grounds of assessee are allowed and AO is directed to delete the addition. Appeal of the assessee is allowed. - Shri Chandra Mohan Garg, Judicial Member And Shri Pradip Kumar Kedia, Accountant Member For the Assessee : Shri Gaurav Bansal, CA For the Revenue : Shri N.K. Bansal, Sr. DR ORDER PER CHANDRA MOHAN GARG, J.M. This appeal has been filed against the order of ld. CIT(A) Ghaziabad dated 31.01.2019 for AY 2015-16. 2. Although the assessee taken as many as 12 grounds in this appeal but except ground no. 5 6, other grounds are argumentative and supportive to the said two main grounds which read as follows:- 5. That on the facts and circumstances of the case as well as in law, the Ld. CIT(A) has erred in sustaining the action of learned assessing officer in making addition of Rs. 14850000/- as unexplained investment/unexplained cash credit under section 68 69 of the Income tax Act 1961 under the head Income from other sources 6. That on the facts and circumstances of the case as well as in law, the Ld. CIT(A) has erred in confirming the action of learned assessing officer in making addition of Rs. 14850000/- by rejecting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . counsel in respect of R. D Traders submitted that despite the Assessing Officer accepted the creditworthiness of the lender he made addition on account of loan from said lender which is not sustainable. The ld. counsel finally submitted that the assessee successfully demonstrated identity and creditworthiness of lenders and genuineness of transaction regarding all four lenders out of which Shri Anand Garg and Shri Ganesh Rolling Mill, which is proprietor ship firm of husband of assessee Shri Deepak Garg. Finally ld. counsel submitted that in view of various orders of co-ordinate benches of Tribunal as referred in para 3 of written submissions addition made by the Assessing Officer and upheld by the ld. CIT(A) may kindly be deleted. 5. Replying to the above, the ld. Senior DR supporting the orders of the authorities below submitted that the Assessing Officer has taken a very balanced approach and thereafter granted substantial relief of Rs. 1,25,75,000/- to the assessee. He further submitted that the ld. CIT(A) rightly confirmed the addition as the assessee failed to prove source of investment in the property purchased during the relevant financial period therefore appeal may k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r) (ii) Smt. Manasi Mahendra Pitkar Vs. Income tax Officer, Thane 73 taxmann.com 68 (Mumbai) (iii) Mehul V. Vyas Vs. Income tax Officer, Mumbai 80 taxmann.com 311 (Mumbai) (iv) Income tax Officer Vs. Kamal Kumar Mishra 33 taxmann.com 610 (Luck.) Thus, it should be appreciated that since, the assessee was not required to maintain the books of account as she was not earning any business income, section 68 of the Income tax is not applicable. As regards the applicability of section 69, the assessee furnished the details of source of funds by furnishing the copies of the bank statements of the persons from whom the amount was received and used for purpose of investment and their account confirmation, which clearly proves the source of investment. It is an undisputed fact that the amount has been received by the assessee through banking channel and no cash was received. Thus, there was no unaccounted or unexplained investment. Hence, section 69 is also not applicable. In view of the above details furnished it is requested to the Hon' ble Bench to kindly delete the addition made u/s 68 and u/s 69 of the Income tax Act. 4. Before the CIT (A), the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... party confirmed the transaction, the source of the same being cash deposit cannot be questioned from the assessee but may be from the said party. Reliance is placed on the judgment of Hon' ble Rajasthan High Court in the case of Aravali Trading Co. Vs. ITO 187 Taxmann 338 (Raj.)(Refer Page 10 of the Paper Book). 3. To prove the identity, creditworthiness and genuineness, the following documents were furnished: - (i) Copy of bank statement of assessee and the lender Ms R.D. Traders (ii) Account Confirmation (iii) PAN details of the proprietor of the lender (iv) Copy of audited balance sheet of the said concern. (v) ITR copy and computation of income The Ld. AO could not point out any error in such documents except stating that the cash was deposited by the said party of Rs. 9,00,000/- (out of total of Rs. 23,00,000/-) before giving loan to the assessee without establishing any link that the cash deposited was the unaccounted money of the assessee. Reliance placed on the judgment of CIT Vs. Deen Dayal Choudhary 88 taxmann.com 475 and CIT Vs. RanchhodJivabhaiNakhav 21 taxmann.com 159 (Refer Page 11 and 12 of Paper Book). 4. The balance am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in earlier year is required to prove. Since, the details of amount received from these parties was duly shown in the bank account of these parties, the assessee was of the view that the source was explained. This , it is requested to your goodself to kindly delete the addition made by the Ld. A.O. and confirmed by the Ld. CIT(A). 7. At the outset, we find it necessary and appropriate to evaluate the order of Ld. CIT(A) dismissing prayer of assessee seeking admission of additional evidence. In para 5.1 the Ld. CIT(A) noted that assessee by submitting confirmation of Shri Ganesh Rolling Mills, acknowledgment of ITR of Shri Deepak Garg claiming to be proprietor of M/s Ganesh Rolling Mills and copy of ITR of Shri Govindam Casting Pvt. Ltd. In para 5.1 the Ld. CIT(A) although evaluated and examined the veracity of said additional evidence but denied to take the same on record by observing that evidences were available with the assessee during assessment proceedings and AR before the AO stated that he has nothing further to submit. On careful and thoughtful consideration of above observations and findings of the Ld. CIT(A) we are of the view that the assessee in the applicati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xercise by the Assessing Officer to verify the amount of loan given by the assessee during earlier financial period. To sum up, we are of the considered view that the said entity is a proprietorship firm of husband of assessee who is filing return of income. The assessee has successfully by way of submitting documentary evidence demonstrated that the amount of Rs. 39 lakh received during present year was the repayment of loan of Rs. 34,48,701/- (leaving credit balance of Rs. 4,59,219/- at the end of the F.Y.)by the said entity to the assessee given immediately preceding year. Therefore no addition is required to be made in this regard. 9. Regarding Govindam Casting Pvt. Ltd. the assessee has submitted documentary evidences at pages 25 to 39 of assessee paper book consisting of bank statements of lender and assessee, confirmation of account, copy of ITR signed by husband of assessee Shri Deepak Garg who is a director in the said company, confirmations of account and bank statements reveals that as on 31.03.2014 there was a credit balance of Rs. 28,50,000/- in favour of the assessee in the books of said company which was brought forward opening credit balance on 01.04.2014. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd undisputedly he is brother of assessee. The assessee during assessment as well as appellate proceedings reiterated copies of bank statement, confirmation of loan, PAN card, ITR for AY 2015-16 showing income of Rs. 31,89,000/- but the Assessing Officer and ld. CIT(A) did not accept the creditworthiness of this lender. Said documentary evidence is available at pages 60 to 66 of assessee paper book and the ld. CIT(A) has not made any allegation against the said lender in the relevant para 6.1.1 except stating that the assessee failed to establish creditworthiness of Shri Anand Garg during assessment proceedings. It is pertinent to mention that the ld. CIT(A) cannot be allowed to blow hot cold simultaneously by dismissing prayer of consideration of relevant additional evidence by the assessee and on the other hand by dismissing claim of assessee regarding capacity and creditworthiness of creditors/lenders without considering and controverting the self speaking and sustainable documentary evidence filed by the assessee. This approach of ld. first appellate authority is not reasonable, valid and thus sustainable. When the returned income of brother of assessee Shri Anand Garg, is Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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