SRINIVASA RAO BATHINI,WARANGAL vs. INCOME TAX OFFICER, WARD-1, WARANGAL

The brief facts of the case extracted from ITA No.1181/ Hyd/2024 for the A.Y 2011-12 are that, the assessee, an individual, is engaged in the business of commodity trading, has not filed his return of income for the A.Y 2011-12. The ITA Nos 1181 and 1182 of 2024 Srinivasa Rao Bathini Page 2 of 8

Being aggrieved by the assessment order, the assessee preferred an appeal before the learned CIT (A). Before the learned CIT (A), the assessee has filed certain additional evidences in the form of affidavits along with Pattadar Pass Book from the persons from whom he has received loans in cash. The learned CIT (A) forwarded the additional evidences filed by the assessee to the Assessing Officer for his comments and remand report. The Assessing Officer in the remand report, dated 21/09/2023 commented upon the additional evidences filed by the assessee and also given reasons for additional evidences on two additions made during the assessement proceedings. The learned CIT (A) after considering the relevant evidences filed by the assessee and also taken into account the remand report of the Assessing Officer observed that, on a careful perusal of the copy of the affidavits, it is very clear that they are stereotype and the appellant claims to have received loans in cash from 4 persons, all of them claims to have been agriculturists, without any evidence to prove their genuineness and creditworthiness. Further, in respect of 2 persons, the appellant has not filed any details including their PAN Nos to prove the creditworthiness. Therefore, observed that the appellant has failed to prove the creditworthiness and genuineness of the transactions in respect of loans received in cash and therefore, rejected the arguments of the assessee and sustained the additions made towards loans u/s 68 of the I.T.

Being aggrieved by the order of the learned CIT (A), the assessee is in appeal before the tribunal.

The learned Counsel for the assessee referring to the remand report dated 21/09/2023 submitted that, the Assessing Officer has verified the additional evidences filed by the assessee and found them to be correct and therefore, once the Assessing Officer satisfied the evidences with regard to loans received from various persons, then the learned CIT (A) cannot travel beyond the remand report of the Assessing Officer and allege that, the assessee has failed to prove the genuineness of the transaction and creditworthiness of the parties. The learned Counsel for the assessee further referring to the affidavit filed by the parties submitted that, all of them have filed affidavit along with copy of Pattadar Pass Book and claimed that, they have given loans to the appellant. The learned CIT (A) neither disbelieved the affidavit filed by the assessee, nor carried out any independent inquiries with the creditors to ascertain the nature of the transactions. The learned CIT (A) without carrying out any further inquiry, simply sustained the additions made by the Assessing Officer, even the Assessing Officer has accepted the genuineness of the transactions in the remand proceedings. Therefore, he submitted that the additions made by the Assessing Officer should be ITA Nos 1181 and 1182 of 2024 Srinivasa Rao Bathini Page 5 of 8

The learned DR, on the other hand, supporting the orders of the learned CIT (A) submitted that, the appellant has not proved identity of the parties, genuineness of the transactions and creditworthiness of the loan creditors which is evident from the affidavits filed by the parties where 4 of them claims that they are having agricultural income and given loan in cash. Further, 2 remaining creditors claimed to have been engaged in the business, but no supporting evidences including the ITR filed for the relevant A.Y has been filed. The learned CIT (A) after considering the relevant evidences has rightly sustained the additions made by the Assessing Officer and thus, the order of the learned CIT (A) should be upheld.

We have heard the arguments of both the parties, perused the material available on record and gone through the orders of the authorities below. The facts borne out from the record shows that the appellant has made cash deposits into the Bank Account and explained the source out of loans from various persons. The assessee claims to have received loan from 8 persons amounting to Rs.27,10,000/- and filed affidavits along with copy of Pattadar Pass Book. Out of 8 persons, 4 persons

In so far as the addition of Rs.1.00 lakh towards deduction u/s 80C of the I.T. Act, 1961 is concerned, the appellant has not filed any evidences including receipts for payment of LIC premium and tuition fees. In absence of any ITA Nos 1181 and 1182 of 2024 Srinivasa Rao Bathini Page 7 of 8

In the result, appeal taken by the assessee in ITA No.1181/Hyd/2024 for the A.Y 2011-12 is dismissed.

The facts and issues involved in this appeal are identical to the facts and issues which we had considered in ITA No.1181/Hyd/2014 for the A.Y 2011-12. The assessee has made cash deposits into bank account and explained the source out of loans claims to have been received from 17 persons amounting to Rs.95.00 lakhs. The assessee could not establish the genuineness of the transaction and creditworthiness of the loan creditors which is evident from the findings of the facts recorded by the learned CIT (A) in light of the affidavits filed by the assessee. A similar issue has been considered by us in appellant’s own case for the A.Y 2011-12 where the Assessing Officer has made addition towards loans u/s 68 of the I.T. Act, 1961 and the same has been upheld by the learned CIT (A). The assessee has challenged the additions before the Tribunal and after appraisal of the relevant facts, the ITAT has confirmed the addition made by the Assessing Officer. Since facts are exactly identical for the year under consideration, the reasons given by us in preceding paragraph No.7 shall mutatis mutandis apply to this appeal, as ITA Nos 1181 and 1182 of 2024 Srinivasa Rao Bathini Page 8 of 8