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TMI Blog2023 (5) TMI 1441X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee without proper enquiry by challenging genuinity of the transaction, when sufficient and appropriate evidence is submitted by assessee to prove genuinity. Therefore, addition of Rs. 26,72,250/- in total income by CIT (A) is illusionary and based on suspicion and surmises without scrutinizing/enquiring about the documents submitted by assessee is incorrect, unjustified & deserves to be deleted; 3. That, there is no enabling provision now which permits to challenge the genuinity of transaction without scrutinizing to the utmost extent the documents submitted by the assessee, If the assessee has submitted sufficient & appropriate evidence to prove; 4. That during the assessment proceeding assessee books of accounts was not rejected under the provision of section 145(3) of The Income Tax Act, 1961. Hence, the addition is illusionary and based merely on suspicion and so should be deleted. 5. That the addition sustained by the Ld. CIT (A) is arbitrary under the facts and circumstances of the case and also, there is no justification for the Ld. CIT(A) to sustain the disallowance of loan as explained above; and 6. The appellant craves leave to add, alter, amend or delete any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) comprised of two parts, viz. (i) old unsecured loans of Rs. 36,17,060/-; and (ii) unsecured loans that were raised by the assessee during the year from three parties of Rs. 26,72,250/-. Bifurcated details of the impugned unsecured loans raised by the assessee during the year is culled out as under: Sr. No. Particulars Amount 1. Loans raised from Shri. Raj Kumar Jain on 18.05.2011 & 18.01.2012). RS. 16,20,000/- 2. Loan raised from M/s Surana Khandsari Products Pvt. Ltd. on 04.10.2011 Rs. 10,00,000/- 3. Loan raised from Shri. Akash Jain on 22.09.2011 Rs. 52,250/- Total Rs. 26,72,750/- The A.O holding a conviction that as the assessee despite specific directions had failed to produce the bank accounts of the lender parties, therefore, held the impugned unsecured loans of Rs. 26,72,250/- that were received during the year under consideration as unexplained cash credits and made additions of the said amount to the assessee's returned income. 8. On a perusal of the order of the CIT(Appeals), I find that the assessee even in the course of proceedings before him had failed to substantiate the authenticity of the loan transactions in question. It is a matter of fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss and genuineness of the loan transactions, even though specific requisitions had been given by the AO vide Notice u/s. 142(1) dated 13/01/2015 fixing the case on 15/01/2015. Even the accountant of the appellant and the appellant himself had appeared in the next fixed date of hearing on 19/01/2015 before the AO but failed to furnish the said details and evidences. 5. All the loan confirmations have been signed in short form (illegible signature) without giving full names of the signatories so that the signatories could be identified, questioned to verify the genuineness of issue of such loan confirmations by them and in one case i.e. for Surana Cold Storage, the same has been signed by Manager and it is not clear as to whether he was the Authorized Signatory. 6. The copies of bank statements of the appellant filed in respect of Oriental Bank of Commerce (Punjab National Bank w.e.f. 01/04/2020) though revealed such credits of loans received by the appellant, no details relating to the sender of the amount of loans so credited are available from the bank account statement." 9. On the basis of the aforesaid observations, the CIT(Appeals) was of the view that the assessee had fai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed to have been received, least to say the copies of accounts or the returns of income of the loan creditors filed thereby explaining the source of such credits in appellant's books. As already stated above, for such credits in appellant's books of Rs. 26,72,250/-, neither the identity of the creditors could be proved nor the creditworthiness of the creditors had been established and least to say about the genuineness of transactions by and between the creditors and the appellant. When factual details and supporting documents had not been furnished by the appellant relating to such credits of the loan creditors in appellant books of accounts and further the accountability or burden of the appellant had not been discharged by any iota of documents/ particulars, mere furnishing of a number of judicial decisions in support of appellant's claim that such credits should be treated as explained as far as their source were concerned and could not be treated as appellant's unexplained credits and further that the action of the AO was based on suspicion and surmises, in my considered opinion is merely a hollow shouting having no solid materials or foundation to substan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... para 4 of the submission quoted above further a number of decisions such as Radhakrishna Bihari Lal Vs. CIT (1954) CIT 26 ITR 344 (Pat), Jainarayan Balaba Kas of Khamgaon Vs. CIT [1957] 31 ITR 271 (Nag) and also certain other decisions contending that in the said cases it was held that the AO does not have any material proof of making addition and therefore cash credit in the names of third parties in the assessee's books cannot be treated as the income of the assessee from an undisclosed source unless that Department has adequate material to prove that the cash credits belonged to the assessee. I have already made a detailed factual analysis of the appellant's case as above thereby pointing out specifically that the appellant had not furnished any materials whatsoever in nature barring 3 confirmations which are totally incomplete and in the nature of false/ bogus confirmations thereby giving my reasoning above and, therefore, the facts of the case of the appellant under consideration, in no case, can be equated with the facts of the cases cited by the appellant as above. 6.3.9 The appellant has also cited the Hon'ble Supreme Court's decision in the case of CIT Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s forming part of the paper book are in the nature of additional evidence. I am unable to comprehend this novel method of filing of application by the assessee for admission of "additional evidence". Be that as it may, as the assessee had not come up with any cogent reason to explain as to why the aforesaid documents could not be filed before the lower authorities, therefore, I find no reason to admit the same. Accordingly, the application filed by the assessee for admission of additional documentary evidence is rejected. 12. Adverting to the merits of the case, I find that it is a matter of fact borne from record, that the A.O in the course of assessment proceedings had, inter alia, directed the assessee to produce the bank accounts of the three lender parties from whom unsecured loans aggregating to Rs. 26,72,250/- were stated to have been raised during the year under consideration. On a perusal of the records, I find that the assessee had merely filed before the A.O confirmations of the aforementioned parties. At this stage, it would be relevant to point out that neither of the aforementioned parties had appeared before the A.O. Coming back to the confirmations of the aforement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld. AR, that now when the assessee in the course of the assessment proceedings had filed before the A.O confirmations of the respective parties, wherein their addresses, PAN and mobile numbers were clearly stated, then, the A.O in case of any doubt should have carried out necessary enquiries on his own. I am unable to concur with the aforesaid contention of the Ld. AR. As the primary onus to substantiate the authenticity of the loan transactions was cast upon the assessee, therefore, the contention of the Ld. AR that in case if the A.O had any doubts as regards the said transactions, then, he should have carried out necessary enquiry on his own, cannot not be accepted. On the basis of my aforesaid deliberations, I am of a strong conviction that the assessee in the case before me had clearly failed to discharge the primary onus that was cast upon him as regards proving the identity and creditworthiness of the lenders and also, genuineness of the transactions in question. Apropos the judicial pronouncements that have been pressed into service by the ld. A.R, as under: (i) CIT Vs. Orissa Corporation (1986) 25 Taxman 80F (SC) (ii) CIT Vs. Ranchhod Jivabhai Nakhava (2012) 21 tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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