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Income Tax Appellate Tribunal, MUMBAI BENCH “G” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI SANDEEP SINGH KARHAIL
Ld. CIT(A)’] for assessment year 2008 for assessment year 2008-09 and 2009- -10 respectively. As common grounds have been raised in these appeals, therefore grounds have been raised in these appeals, therefore grounds have been raised in these appeals, therefore same were heard together and disposed off by way of this same were heard together and disposed off by way of this same were heard together and disposed off by way of this consolidated order for convenience. consolidated order for convenience.
ITA No. 6121/MUM/2018 2008-09 Assessment Year: 2008 2. Firstly, we take up the appeal for assessmen we take up the appeal for assessment year 2008 t year 2008-09. The grounds of the appeal are reproduced as under: The grounds of the appeal are reproduced as under:
On facts and circumstances of the case, the Ld. CIT(A) On facts and circumstances of the case, the Ld. CIT(A)-50, On facts and circumstances of the case, the Ld. CIT(A) Mumbai erred in not holding that the order passed u/s. Mumbai erred in not holding that the order passed u/s. Mumbai erred in not holding that the order passed u/s. 143(3) r.w.s. 153A by the DCIT, CC 143(3) r.w.s. 153A by the DCIT, CC-8(3), Mumbai ("Assessing 8(3), Mumbai ("Assessing Officer) is without jurisdictio Officer) is without jurisdiction, invalid and bad in law. n, invalid and bad in law.
2. The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the addition of loan amounting to Rs. 60,00,000/ addition of loan amounting to Rs. 60,00,000/- by treating it by treating it as accommodation entry. as accommodation entry. 3. 3. The Ld. CIT(A) erred in facts and law in upholding the 3. The Ld. CIT(A) erred in facts and law in upholding the 3. The Ld. CIT(A) erred in facts and law in upholding the addition of interest amounting addition of interest amounting to Rs. 4,25.343/ to Rs. 4,25.343/- on the above accommodation loan. above accommodation loan. 4. Without prejudice to 3 above, the Ld. CIT(A) erred in facts Without prejudice to 3 above, the Ld. CIT(A) erred in facts Without prejudice to 3 above, the Ld. CIT(A) erred in facts and law in not allowing interest expense of Rs. 1.24.600/- as and law in not allowing interest expense of Rs. 1.24.600/ and law in not allowing interest expense of Rs. 1.24.600/ per the loose papers. per the loose papers.
Shri Sanjay Shantilal Jain 3 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018
5. The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the addition of interest income of Rs. 1,21,423/ ion of interest income of Rs. 1,21,423/- based on ITS based on ITS details.
6. The Ld. CIT(A) erred in facts and law in upholding details. 6. The Ld. CIT(A) erred in facts and law in upholding details. 6. The Ld. CIT(A) erred in facts and law in upholding the addition of labour charges of Rs. 3,00,660/ the addition of labour charges of Rs. 3,00,660/- based on ITS based on ITS details. details. 6. The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the The Ld. CIT(A) erred in facts and law in upholding the addition of l addition of loan aggregating to Rs. 32,50,000/ oan aggregating to Rs. 32,50,000/- as unexplained cash credit u/s. 68 of the Act. unexplained cash credit u/s. 68 of the Act. 7. All the above grounds are independent and without All the above grounds are independent and without All the above grounds are independent and without prejudice to each other. prejudice to each other. 3. Briefly stated facts of the case are that assessee filed regular stated facts of the case are that assessee filed regular stated facts of the case are that assessee filed regular return of income on 30/09/2008 return of income on 30/09/2008 declaring total income of declaring total income of ₹12,37,430/- which was processed under section 143(1) of the which was processed under section 143(1) of the which was processed under section 143(1) of the Income-tax Act, 1961 (in short , 1961 (in short ‘the Act’). Subsequently, the search . Subsequently, the search and seizure action under section 132 of the and seizure action under section 132 of the Act was carried out on was carried out on 11/06/2013 on the premises of the assessee along with cases of 11/06/2013 on the premises of the assessee along with cases of 11/06/2013 on the premises of the assessee along with cases of “RSBL” group. Consequent to search action, notice under section “RSBL” group. Consequent to search action, notice under section “RSBL” group. Consequent to search action, notice under section 153A of the Act was issued asking the assessee to file return of was issued asking the assessee to file return of was issued asking the assessee to file return of income. In response income. In response, the assessee filed return of income on n of income on 07/10/2014 declaring income of 07/10/2014 declaring income of ₹12,37,430/- which was declared which was declared
Shri Sanjay Shantilal Jain 4 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 in the regular return of income. The in the regular return of income. The Assessing Officer Assessing Officer in the assessment completed under section 153A on 31/03/2016 made assessment completed under section 153A on 31/03/2016 made assessment completed under section 153A on 31/03/2016 made various additions and assessed total income at various additions and assessed total income at ₹1,13,34, 1,13,34,860/-. On further appeal, the Ld. CIT(A) rejected the grounds of the assessee further appeal, the Ld. CIT(A) rejected the grounds of the assessee further appeal, the Ld. CIT(A) rejected the grounds of the assessee and dismissed the appeal. Aggrieved the assessee is before the and dismissed the appeal. Aggrieved the assessee is before the and dismissed the appeal. Aggrieved the assessee is before the Tribunal by way of raising grounds as reproduced above. by way of raising grounds as reproduced above. by way of raising grounds as reproduced above.
4. Before us the Ld. counsel Ld. counsel of the assessee filed of the assessee filed a paperbook containing pages 1 to 51. containing pages 1 to 51.
The Ld. counsel Ld. counsel of the assessee did not press ground of the assessee did not press ground No. 1 of the appeal being general in nature. He also did not press the ground the appeal being general in nature. He also did not press the ground the appeal being general in nature. He also did not press the ground No. 2 to 4 of the appeal. Accordingly, ground No. 1 to 4 of the appeal No. 2 to 4 of the appeal. Accordingly, ground No. 1 to 4 of the appeal No. 2 to 4 of the appeal. Accordingly, ground No. 1 to 4 of the appeal are dismissed as infructuous. as infructuous.
5.1 Regarding ground No. 5 to 7 the Regarding ground No. 5 to 7 the Ld. counsel submitted that additions made are not based on any incriminating material found additions made are not based on any incriminating material found additions made are not based on any incriminating material found or seized during the course of the search. He submitted that in view or seized during the course of the search. He submitted that in view or seized during the course of the search. He submitted that in view
Shri Sanjay Shantilal Jain 5 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 of the decision of the Hon’ble Delhi High C of the decision of the Hon’ble Delhi High Court in the case of ourt in the case of CIT v. Kabul Chawala (2016) 380 ITR 573 (Delhi), (2016) 380 ITR 573 (Delhi), if no assessment f no assessment proceedings are pending as on the date of the search than no proceedings are pending as on the date of the search than no proceedings are pending as on the date of the search than no addition can be made without basis of incriminating material. addition can be made without basis of incriminating material. addition can be made without basis of incriminating material. The Ld. counsel submitted that time limit for i itted that time limit for issuing ssuing notice under section 143(2) of the section 143(2) of the Act had already expired prior to the date of the had already expired prior to the date of the search and even no notice under section 148 of the search and even no notice under section 148 of the search and even no notice under section 148 of the Act was issued before initiation of the search before initiation of the search, therefore, it can be concluded that it can be concluded that return of income of the assess return of income of the assessee have been accepted and attained ee have been accepted and attained finality. Hence, no assessment o no assessment or reassessment was pending as on reassessment was pending as on the date of the initiation of the date of the initiation of search. According to him both the . According to him both the conditions of the decision of the Hon’ble conditions of the decision of the Hon’ble Delhi High Court in the case Delhi High Court in the case of Kabul Chawala (sup (supra) stands fulfilled and thus no addition can stands fulfilled and thus no addition can be made without link be made without link of any incriminating material found during the incriminating material found during the course of the search. He also relied on the decision of the Hon’ble course of the search. He also relied on the decision of the Hon’ble course of the search. He also relied on the decision of the Hon’ble Delhi High Court in the case of Delhi High Court in the case of PCIT Vs Kurele paper Mills Private PCIT Vs Kurele paper Mills Private
Shri Sanjay Shantilal Jain 6 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 Limited 380 ITR 571 (Delhi) 380 ITR 571 (Delhi) and submitted that SLP filed and submitted that SLP filed by the Revenue against the said decision has been dismissed by the Hon’ble against the said decision has been dismissed by the Hon’ble against the said decision has been dismissed by the Hon’ble Supreme Court on 07/12/2015 Supreme Court on 07/12/2015.
The Ld. DR on the other DR on the other hand relied on the order of the relied on the order of the lower authorities.
We have heard rival We have heard rival submission of the parties on the issue in submission of the parties on the issue in dispute and perused the relevant material on record. In respect of dispute and perused the relevant material on record. In respect of dispute and perused the relevant material on record. In respect of the ground No. 5 to 7 of the appeal, the objection of the assessee are the ground No. 5 to 7 of the appeal, the objection of the assessee are the ground No. 5 to 7 of the appeal, the objection of the assessee are that no assessment proceedings were pending in respect of the that no assessment proceedings were pending in respect of the that no assessment proceedings were pending in respect of the assessment year under consideration as on the date of the search r under consideration as on the date of the search r under consideration as on the date of the search and also addition has been made without any reference to and also addition has been made without any reference to and also addition has been made without any reference to incriminating material. We find that incriminating material. We find that Revenue has not challenged has not challenged the fact of non-pendency of any assessment pendency of any assessment on the date of search on the date of search. From the assessment order t order, we find that addition in dispute we find that addition in dispute in ground No.
Shri Sanjay Shantilal Jain 7 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 5 and 6 have been made on the basis of ITS details. The relevant have been made on the basis of ITS details. The relevant have been made on the basis of ITS details. The relevant finding of the Ld. Assessing Officer Assessing Officer are reproduced as under: are reproduced as under:
“5. As per ITS, the assessee had received interest of Rs. 1,21,423/- As per ITS, the assessee had received interest of Rs. 1,21,423/ As per ITS, the assessee had received interest of Rs. 1,21,423/ on FDs which is not offered in the return of income. The assessee FDs which is not offered in the return of income. The assessee FDs which is not offered in the return of income. The assessee submitted that he is unable to trace the documents. Hence, an submitted that he is unable to trace the documents. Hence, an submitted that he is unable to trace the documents. Hence, an amount of Rs. 1,21,423/ amount of Rs. 1,21,423/- is added to the total of the assessee. Penalty is added to the total of the assessee. Penalty proceeding is initiated u/s. 271(1)(c) of the Income Tax Ac proceeding is initiated u/s. 271(1)(c) of the Income Tax Ac proceeding is initiated u/s. 271(1)(c) of the Income Tax Act, 1961 for furnishing inaccurate particulars of income. furnishing inaccurate particulars of income.
6. As per ITS, the assessee received labour charges of Rs. 3,00,660/ 6. As per ITS, the assessee received labour charges of Rs. 3,00,660/ 6. As per ITS, the assessee received labour charges of Rs. 3,00,660/- which is not offered in the return of income. When confronted, the which is not offered in the return of income. When confronted, the which is not offered in the return of income. When confronted, the assessee submitted that he did not receive the payment. The as assessee submitted that he did not receive the payment. The as assessee submitted that he did not receive the payment. The assessee is following mercantile system of accounting and hence the amount is following mercantile system of accounting and hence the amount is following mercantile system of accounting and hence the amount should have been offered on accrual basis. Hence, amount of Rs. should have been offered on accrual basis. Hence, amount of Rs. should have been offered on accrual basis. Hence, amount of Rs. 3,00,660/- is added to the total income of the assessee. Penalty is added to the total income of the assessee. Penalty is added to the total income of the assessee. Penalty proceeding is initiated u/s. 271(1)(c) of the Income T proceeding is initiated u/s. 271(1)(c) of the Income Tax Act, 1961 for ax Act, 1961 for furnishing inaccurate particulars of income. furnishing inaccurate particulars of income.” 7.1 Regarding the ground No. the ground No. 7 also though the Assessing Officer Assessing Officer has not referred to any incriminating material but the Ld. CIT(A) has to any incriminating material but the Ld. CIT(A) has to any incriminating material but the Ld. CIT(A) has made general observation made general observation that the assessee was was engaged in obtaining accommodation entries. The relevant para of the Ld. obtaining accommodation entries. The relevant para of the Ld. obtaining accommodation entries. The relevant para of the Ld. CIT(A) is reproduced as under: CIT(A) is reproduced as under:
Shri Sanjay Shantilal Jain 8 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018
“18.4 I have taken note of the fact that there is substantial adverse & 18.4 I have taken note of the fact that there is substantial adverse & 18.4 I have taken note of the fact that there is substantial adverse & incriminating material on record to prove that the appellant has incriminating material on record to prove that the appellant has incriminating material on record to prove that the appellant has indulged in taking & givin indulged in taking & giving cash unaccounted loans / advances. g cash unaccounted loans / advances. Further, even accommodation entries of loans have been taken by the Further, even accommodation entries of loans have been taken by the Further, even accommodation entries of loans have been taken by the Appellant from the bogus concerns of Gautam Bhanwarlal Jain Appellant from the bogus concerns of Gautam Bhanwarlal Jain Appellant from the bogus concerns of Gautam Bhanwarlal Jain Group. During the course of the search and survey operation on the Group. During the course of the search and survey operation on the Group. During the course of the search and survey operation on the Appellant, substantial i Appellant, substantial incriminating material has been found, ncriminating material has been found, relating to accommodation entries taken by the Appellant, which has relating to accommodation entries taken by the Appellant, which has relating to accommodation entries taken by the Appellant, which has already been discussed in great details in the earlier part of the already been discussed in great details in the earlier part of the already been discussed in great details in the earlier part of the appellate order. The same is not repeated here for the sake of brevity, appellate order. The same is not repeated here for the sake of brevity, appellate order. The same is not repeated here for the sake of brevity, but it is relied upon to prove that there is incriminating material on elied upon to prove that there is incriminating material on elied upon to prove that there is incriminating material on record to hold that the appellant has taken accommodation entries record to hold that the appellant has taken accommodation entries record to hold that the appellant has taken accommodation entries by paying entry charges.” by paying entry charges.” 7.2 We find that there is no specific reference of find that there is no specific reference of any any incriminating material for sustaining the additio material for sustaining the addition in dispute of n in dispute of ₹32,50,000/- which was made by the which was made by the Assessing Officer under section 68 of the under section 68 of the Act.
7.3 In view of above, In view of above, both the conditions of the decision of the the decision of the Hon’ble Delhi High Court High Court (supra) in the case of Kabul Chawal in the case of Kabul Chawal (supra) that for making addition under section 153A of the (supra) that for making addition under section 153A of the (supra) that for making addition under section 153A of the Act, firstly, the assessment proceedings should be pending as of the date firstly, the assessment proceedings should be pending as of the date firstly, the assessment proceedings should be pending as of the date
Shri Sanjay Shantilal Jain 9 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 of the search and secondly, there should be incriminating material of the search and secondly, there should be incriminating material of the search and secondly, there should be incriminating material for making the addition, are for making the addition, are not fulfilled. Therefore, the Ld. CIT(A) is not fulfilled. Therefore, the Ld. CIT(A) is not justified in sustaining the additions challenged by the assessee not justified in sustaining the additions challenged by the assessee not justified in sustaining the additions challenged by the assessee in ground No. 5 to 7 of the appeal. The grounds of the appeal of the in ground No. 5 to 7 of the appeal. The grounds of the appeal of the in ground No. 5 to 7 of the appeal. The grounds of the appeal of the assessee are accordingly allowed. assessee are accordingly allowed. Assessment Year: 2009 2009-10 8. The grounds raised by the assessee in assessment year 2009- The grounds raised by the assessee in assessment year 2009 The grounds raised by the assessee in assessment year 2009 10 are reproduced as under: 10 are reproduced as under:
“1. (a) On facts and circumstances of the case, the Ld. CIT(A) (a) On facts and circumstances of the case, the Ld. CIT(A) (a) On facts and circumstances of the case, the Ld. CIT(A)-50, Mumbai erred in not holding that the order passed u/s. 143(3) r.w.s. Mumbai erred in not holding that the order passed u/s. 143(3) r.w.s. Mumbai erred in not holding that the order passed u/s. 143(3) r.w.s. 153A by the DCIT, CC 153A by the DCIT, CC-8(3), Mumbai ("Assessing Officer) is without 8(3), Mumbai ("Assessing Officer) is without jurisdiction, invalid and bad in law. jurisdiction, invalid and bad in law. (b) The Ld. CIT(A) (b) The Ld. CIT(A) has grossly erred in facts and law in not has grossly erred in facts and law in not appreciating the explanations and material placed on record as well appreciating the explanations and material placed on record as well appreciating the explanations and material placed on record as well as true content of the seized material and taking the wholistic view of as true content of the seized material and taking the wholistic view of as true content of the seized material and taking the wholistic view of the matter by telescoping the real income of the assessee. the matter by telescoping the real income of the assessee.
The Ld. CIT( 2. The Ld. CIT(A) erred in facts and law in upholding the addition of A) erred in facts and law in upholding the addition of interest amounting to Rs. 5,19,530/ interest amounting to Rs. 5,19,530/- on alleged bogus loan taken in on alleged bogus loan taken in A.Y. 2008-09.
Shri Sanjay Shantilal Jain 10 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018
(a) The Ld. CIT(A) erred in facts and law in upholding the addition 3. (a) The Ld. CIT(A) erred in facts and law in upholding the addition 3. (a) The Ld. CIT(A) erred in facts and law in upholding the addition of loan aggregating to Rs. 38,75,000/ of loan aggregating to Rs. 38,75,000/- as unexplained cash credit ained cash credit u/s. 68 of the Act. (b) The Ld. CIT(A) erred in facts and law in not appreciating that the (b) The Ld. CIT(A) erred in facts and law in not appreciating that the (b) The Ld. CIT(A) erred in facts and law in not appreciating that the addition of Rs. 38,75,000/ addition of Rs. 38,75,000/- cannot be made u/s. 68 of the Act devoid cannot be made u/s. 68 of the Act devoid of any incriminating material found in the course of search once the of any incriminating material found in the course of search once the of any incriminating material found in the course of search once the assessment had already attained finality prior to the date of search nt had already attained finality prior to the date of search nt had already attained finality prior to the date of search (c) The Id. CIT(A) has even erroneously mentioned the fact in para (c) The Id. CIT(A) has even erroneously mentioned the fact in para (c) The Id. CIT(A) has even erroneously mentioned the fact in para 17.2 of his order that no assessment order u/s. 143(3) is passed prior 17.2 of his order that no assessment order u/s. 143(3) is passed prior 17.2 of his order that no assessment order u/s. 143(3) is passed prior to search.
All the above grounds are independent and w 4. All the above grounds are independent and without prejudice to ithout prejudice to each other.” 9. At the outset the outset Ld. counsel of the assessee submitted that of the assessee submitted that assessee is not pressing ground No. assessee is not pressing ground No. 1 and 2 of the appeal and of the appeal and therefore both these grounds are dismissed as infructuous. therefore both these grounds are dismissed as infructuous. therefore both these grounds are dismissed as infructuous.
In respect of the ground No. In respect of the ground No. 3, wherein the addition made of n the addition made of ₹38,75,000/- of unexplained cash credit terms of section 68 of the of unexplained cash credit terms of section 68 of the of unexplained cash credit terms of section 68 of the Act has been challenged by the assessee. been challenged by the assessee. The Ld. counsel Ld. counsel submitted that no assessment was pending as of the date of the search was pending as of the date of the search and was pending as of the date of the search addition has been made without reference to any incriminating addition has been made without reference to any incriminating addition has been made without reference to any incriminating
Shri Sanjay Shantilal Jain 11 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 material therefore following the decision of the Hon’ble Delhi High material therefore following the decision of the Hon’ble Delhi High material therefore following the decision of the Hon’ble Delhi High Court in the case of Kabul Chawala Court in the case of Kabul Chawala (supra), the additio addition need to be deleted. The Ld. DR on the other hand relied on the order DR on the other hand relied on the order DR on the other hand relied on the orders of the lower authorities.
We find that assessment under section 143(3) of the We find that assessment under section 143(3) of the Act for the We find that assessment under section 143(3) of the year under consideration was completed by the year under consideration was completed by the Assessing Officer Assessing Officer on 15/12/2011. This fact has been mentioned by the 15/12/2011. This fact has been mentioned by the Assessing Officer Assessing Officer in para 5 of the impugned a of the impugned assessment order. Thus there was no ssessment order. Thus there was no pendency of the assessment as on date of the search. The addition pendency of the assessment as on date of the search. The addition pendency of the assessment as on date of the search. The addition under section 68 of under section 68 of ₹38,75,000/- has been made by the has been made by the Assessing Officer observing as under: observing as under:
“6. The assessee has claimed following loans taken during the The assessee has claimed following loans taken during the The assessee has claimed following loans taken during the year under consideration other than those from family members or ear under consideration other than those from family members or ear under consideration other than those from family members or close relatives: close relatives: Sr. No. Name of the Party Amount (₹) ₹) 1. Rajesh Jain 1,00,000/ 1,00,000/- 2. Swami Samarth Medical 35,00,000/ 35,00,000/- 3. Chandadevi Ranmal 1,00,000/ 1,00,000/- 4. Sukhidevi Ranmal 1,00,000/ 1,00,000/- 5. Riti D. Jain 75,000/- 75,000/
Shri Sanjay Shantilal Jain 12 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018
Total 38,75,000/- 38,75,000/ 6.1 The assessee has furnished only confirmation of the party and no 6.1 The assessee has furnished only confirmation of the party and no 6.1 The assessee has furnished only confirmation of the party and no supporting documents as regards genuineness of loans are furnished supporting documents as regards genuineness of loans are furnished supporting documents as regards genuineness of loans are furnished As discussed above, the details were furnished on 29.03.2016 and it As discussed above, the details were furnished on 29.03.2016 and it As discussed above, the details were furnished on 29.03.2016 and it to make any verification. The amount is appearing was not possible was not possible to make any verification. The amount is appearing as liability in the balance she of the assessee and the onus is on the as liability in the balance she of the assessee and the onus is on the as liability in the balance she of the assessee and the onus is on the assessee to explain cash credit appearing in his books of accounts as assessee to explain cash credit appearing in his books of accounts as assessee to explain cash credit appearing in his books of accounts as per the provisions of section 68 of the Income Tax Act 1 at is to per the provisions of section 68 of the Income Tax Act 1 at is to per the provisions of section 68 of the Income Tax Act 1 at is to establish identity of the party, genuineness of transaction and establish identity of the party, genuineness of transaction and establish identity of the party, genuineness of transaction and creditworthiness of the party. The assessee failed to offer any creditworthiness of the party. The assessee failed to offer any creditworthiness of the party. The assessee failed to offer any explanation at all on this liability as appearing in his balance sheet. explanation at all on this liability as appearing in his balance sheet. explanation at all on this liability as appearing in his balance sheet. Mere filing of confirmation is not sufficient in view o Mere filing of confirmation is not sufficient in view of decision of f decision of Hon'ble Supreme Court in the case of Durgaprasad More 82 ITR 510. Hon'ble Supreme Court in the case of Durgaprasad More 82 ITR 510. Hon'ble Supreme Court in the case of Durgaprasad More 82 ITR 510. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. The Hon'ble Kerala High Court in the case of M/s. Diza Holdings Pvt. td 120 Taxmann 539 has held as under: td 120 Taxmann 539 has held as under:
On the terms of section 68, the burden is on the assessee to offer a On the terms of section 68, the burden is on the assessee to offer a On the terms of section 68, the burden is on the assessee to offer a satisfactory explanation about the nature and source of the amount explanation about the nature and source of the amount explanation about the nature and source of the amount found credited in the books of the assessee. It is also clear at the found credited in the books of the assessee. It is also clear at the found credited in the books of the assessee. It is also clear at the mere furnishing of particulars is not enough. The mere fact that payment is of particulars is not enough. The mere fact that payment is of particulars is not enough. The mere fact that payment is by way of account payee cheque also not conc by way of account payee cheque also not conclusive. Therefore, the lusive. Therefore, the Assessing Officer was entitled to consider whether notwithstanding Assessing Officer was entitled to consider whether notwithstanding Assessing Officer was entitled to consider whether notwithstanding the fact that the payments were not made by cheques, whether the the payments were not made by cheques, whether the the payments were not made by cheques, whether the assessee had satisfactorily explained the nature and sour e of the assessee had satisfactorily explained the nature and sour e of the assessee had satisfactorily explained the nature and sour e of the s of the assessee. The Assessing amounts found credited in the book amounts found credited in the books of the assessee. The Assessing Officer was satisfied that the so Officer was satisfied that the so- alled depositors did not have that alled depositors did not have that resources to make such deposits resources to make such deposits.
Shri Sanjay Shantilal Jain 13 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018 6.2 Hence, the onus lies on the assessee to establish th cash credit 6.2 Hence, the onus lies on the assessee to establish th cash credit 6.2 Hence, the onus lies on the assessee to establish th cash credit appearing in his books of accounts which the assess appearing in his books of accounts which the assessee failed to ex ee failed to ex lain. Hence, addition of Rs.38,75,000/ lain. Hence, addition of Rs.38,75,000/- is made to the total income of o the total income of the assessee u/s.68 Tax Act. Penalty proceed ee u/s.68 Tax Act. Penalty proceedings is initiated ings is initiated u/s.271(1)(c)c the Income Tax Act for c the Income Tax Act for furnishing inaccurate furnishing inaccurate particulars of income. particulars of income.
7. In view of the above 7. In view of the above discussion, total income of the assessee is discussion, total income of the assessee is computed Amount ( Amount (₹) Income as per return of income Income as per return of income 42,07,350/ 42,07,350/- Add: Interest on bogus loans as discussed above. Add: Interest on bogus loans as discussed above. 5,19,530/ 5,19,530/- Add: u/s 68 as discussed above. Add: u/s 68 as discussed above. 38,75,000/ 38,75,000/- Assessed Total Income Assessed Total Income 86,01,880/- 86,01,880/ 12. On perusal of the above finding of the perusal of the above finding of the Assessing Officer Assessing Officer, we find that there is no reference of any incriminating material for find that there is no reference of any incriminating material for find that there is no reference of any incriminating material for making the addition. The Ld. CIT(A) has also not mention making the addition. The Ld. CIT(A) has also not mention making the addition. The Ld. CIT(A) has also not mentioned any specific incriminating document material found during the course of specific incriminating document material found during the course of specific incriminating document material found during the course of the search, for sustaining the addition in dispute. Therefore, the search, for sustaining the addition in dispute. Therefore, the search, for sustaining the addition in dispute. Therefore, following our finding in assessment year 2008 following our finding in assessment year 2008-09, the addition in 09, the addition in dispute in the assessment year consideration is also d dispute in the assessment year consideration is also d dispute in the assessment year consideration is also deleted. The ground No. 3 of the appeal is accordingly of the appeal is accordingly allowed.
Shri Sanjay Shantilal Jain 14 & 6122/M/2018 ITA Nos. 6121 & 6122/M/2018
In the result, both the appeals of the assessee are allowed In the result, both the appeals of the assessee are allowed In the result, both the appeals of the assessee are allowed partly.