COMMISSIONER OF INCOME TAX-I, LUDHIANA vs. SANJIV TALWAR

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ITA/13/2012HC Punjab & HaryanaPHHC01099194201219 April 2012Bench: MR. JUSTICE ALOK SINGH,MR. JUSTICE M.M. KUMAR2 pages
AI SummaryDismissed

What did the High Court hold?

The Tribunal upheld the concurrent findings of fact by the CIT(A) and itself. The assessee had discharged the initial onus by demonstrating the creditworthiness of Shri Jagmohan Talwar and the genuineness of the advance of Rs. 30,00,000/-. This was supported by the fact that the creditor was an existing assessee, the transaction was routed through bank accounts, and a copy of the creditor's balance sheet reflecting the amount was filed. The Tribunal found that once the assessee discharged the initial onus, the Revenue failed to produce any material to shake the creditworthiness of the creditor. Therefore, the genuineness and creditworthiness of Shri Jagmohan Talwar were beyond doubt. The appeal was considered to be without merit and did not involve any substantial question of law.

What were the facts?

The Revenue (Commissioner of Income Tax I, Ludhiana) filed an appeal before the High Court of Punjab and Haryana at Chandigarh against an order dated 30.8.2011 passed by the Income Tax Appellate Tribunal, Chandigarh Bench. The Tribunal had upheld the order of the CIT(A) dated 20.8.2010, which related to assessment year 2007-08. The assessment was finalized under Section 143(3) of the Income Tax Act, 1961. The dispute concerned the creditworthiness and genuineness of transactions involving Shri Jagmohan Talwar, the father of the assessee, who had advanced over Rs. 30,00,000/- to the assessee. The CIT(A) had found that the assessee discharged his onus, noting the creditor was an existing assessee and the transaction was routed through bank accounts. A balance sheet of Shri Jagmohan Talwar reflecting the amount was also filed.

What were the issues?

1. Whether the assessee-respondent had discharged the onus of establishing the creditworthiness of Shri Jagmohan Talwar, the creditor, and the genuineness of the advance of Rs. 30,00,000/-. (Question of law and fact, concerning Section 68 of the Income Tax Act, 1961). Assessee's Contention: The assessee had discharged his onus by providing evidence of the creditor's creditworthiness and the genuineness of the transaction, including bank statements and the creditor's balance sheet. The CIT(A) had accepted this evidence. Revenue's Contention: The Revenue argued that the assessee failed to establish the creditworthiness of Shri Jagmohan Talwar and the genuineness of the transactions during the assessment proceedings.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 68

AI-generated summary — verify with the full judgment below

ITA No1.13 of 2012 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT

CHANDIGARH. ITA No. 13 of 2012 (O&M) Date of decision 19 .4.2012 Commissioner of Income Tax I, Ludhiana . Appellant Versus Sh. Sanjiv Talwar .. Respondents. CORAM: HON'BLE MR. JUSTICE M.M.KUMAR HON'BLE MR. JUSTICE ALOK SINGH Present: Mr. Rajesh Katoch Advocate for the appellant 1. To be referred to the Reporter or not ? 2. Whether the judgement should be reported in the Digest ? M.M.KUMAR,J. 1. The revenue has filed this appeal challenging order dated 30.8.2011 rendered by the Income Tax Appellate Tribunal, Chandigarh Bench, Chandigarh (for brevity 'the Tribunal') upholding the order of the CIT (A) dated 20.8.2010 relating to the assessment year 2007-08 finalizing the assessment under Section 143 (3) of the Income Tax Act, 1961 (for brevity 'the Act'). The substance of the question raised by Mr. Rajesh Katoch, learned counsel for the revenue, is that the assessee- respondent had failed to establish the creditworthiness of Shri Jagmohan Talwar, who happens to be father of the assessee. It is also submitted that genuineness of the transactions has also not been established during the assessment proceedings. It is appropriate to point out from para 3.2 of the order CIT(A) is that the assessee had discharged his onus in respect of credit for over Rs.30,00,000/-. From the persual of the documents filed, the CIT (A) had reached the conclusion that the creditor was the existing

ITA No1.13 of 2012 2 assessee and the entire transaction of advance of Rs. 30,00,000/- was routed through the bank account. A copy of the balance sheet of Shri Jagmohan Talwar had also been filed in which the amount of Rs. 30,00,000/- stand duly reflected. A copy of the assessment order in respect of the assessment year under consideration was also produced which shows that the assessment was completed under Section 143(3) of the Act by the Income Tax Officer Ward No. VII(1), Ludhiana. Once the initial onus has been discharged by the assessee- respondent it was then for the revenue to show any material to the contrary which may shaken the creditworthiness of the asseessee- respondent. No such material has been produced. Therefore, the genuineness and creditworthiness of Shri Jagmohan Talwar was beyond any doubt. The appeal does not involve any question of law much less a substantial question of law. Furthermore, these are concurrent findings of fact recorded by the CIT(A) and the Tribunal. The appeal is without merit. Dismissed. (M.M.Kumar)

Judge (Alok Singh ) 19.4.2012 Judge okg

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