BIMAL HANSARIA,JAIPUR vs. ITO, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR Jh Hkkxpan] ys[kk lnL;] ds le{k BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER vk;dj vihy la-@ITA No. 850/JP/2016 fu/kZkj.k o"kZ@Assessment Year : 2003-04 cuke Bimal Hansaria, Income Tax Officer, Vs. Plot No. 103, Martin Ambience, Ward 4(2), Corol Apartment, D-57, Amba Jaipur. Bari, Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AAJPH 2108 P vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri S.L. Poddar & Ms. Isha Kanongo(Adv) jktLo dh vksj ls@ Revenue by : Smt. Poonam Roy (DCIT) lquokbZ dh rkjh[k@ Date of Hearing : 25/10/2017 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 13/11/2017 vkns'k@ ORDER PER: BHAGCHAND, A.M. This is an appeal filed by the assessee emanates from the order of the ld. CIT(A)-2, Jaipur dated 23/08/2016 for the A.Y. 2003-04.

ITA 850/JP/2016_ 2 Bimal Hansaria Vs. ITO

147/144 of the Act was made at an income of Rs. 23,21,850/- on

28/12/2010 and addition U/s 68 of the Act was made at Rs. 19,15,740/-,

addition on account of interest disallowed of Rs. 2,02,673/- and addition

U/s 69C of Rs. 38,315/-.

the assessee. The Hon’ble ITAT vide its order dated 11/3/2014 while

deciding the ITA No. 84/JP/2012, set aside the issue to the file of the ld.

CIT(A) with the following observation:

"We have considered the submissions of both the parties and carefully gone through the material available on record. In the present case, it is noticed that the Assessing Officer framed the assessment ex-parte under section 144 of the Act and the Ld. CIT(A) confirmed the action of the Assessing Officer by observing that there were mistakes in the PANs of the depositors given by the assessee. He also mentioned that the Assessing Officer in his remand report informed that the summons issued to certain depositors were returned on account of wrong address or incomplete address, however, the Ld. CIT(A) did not comment on the details furnished by the assessee which are placed at page nos. 1 to 67 of the assessee's paper book wherein the confirmation, acknowledgement of return of income, copy of PAN card and bank statements etc. of the depositors were given. It therefore, appears that the Ld. CIT(A) while confirming the action of the Assessing Officer had not appreciated the facts in right perspective and also did not provide opportunity to the assessee for correcting the clerical mistakes, if any, in PANs. We, therefore, considering the totality of the facts, deem it appropriate to set aside this issue back to the file of the Ld. CIT(A) to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee."

ITA 850/JP/2016_ 3 Bimal Hansaria Vs. ITO

Thus, on the issue of addition U/s 68 of the Act, the Hon’ble ITAT has

observed that the ld. CIT(A) while confirming the action of the Assessing

Officer, has not appreciated the facts in right perspective and also did not

provide opportunity to the assessee for correcting the clerical mistakes, if

any, in PANs. It was also observed by the Hon’ble ITAT that the CIT(A) has

not commented on the details furnished by the assessee, which are placed

at page 1 to 67 of the paper book submitted by the assessee. These

documents includes the confirmation, acknowledgement of return of

income, copy of PAN card and bank statements etc. of the depositors.

addition. Now the assessee is in appeal before the ITAT by taking following

grounds of appeal:

ITA 850/JP/2016_ 4 Bimal Hansaria Vs. ITO

of Rs. 15,07,240/- made U/s 68 of the Act. On this issue, while pleading on

behalf of the assessee, the ld AR of the assessee has submitted that the

assessee has submitted confirmation from all these depositors. The

assessee has also submitted acknowledgement of returns, copy of PAN and

in certain cases, copy of bank statements. He also submitted that the all

these persons were assessed to income tax. They have confirmed the

accounts of the assessee. The amounts were received by cheques. He

submitted a chart whereby details regarding each and every depositor has

been provided. He also relied on the following case laws:

(i) Aravali Trading Co. Vs. ITO (2008) 8 DTR (Raj) 199

(ii) Kanhaiya Lal Jangid Vs CIT (2008) 217 CTR 354 (Raj).

(iii) Asstt.CIT Vs. Swami Complex (P) Ltd. (2007) 111 TTJ (JP)

531.

authorities below.

submitted correct PAN of all the depositors. He has also submitted

confirmation from all these depositors. In the case of M.S. Jewellers, which

is a proprietory concern of Satya Prakash Khandelwal, it is noticed that the

ITA 850/JP/2016_ 5 Bimal Hansaria Vs. ITO

amount of Rs. 50000/- were received by cheque. The assessee submitted

PAN and confirmation of the depositor alongwith full address. It is also

noticed from the account of the depositor that there was a opening balance

of Rs. 3,54,000/-. Thus, the amount of Rs. 50,000/- received by the

assessee by cheque was actually return of balance outstanding with M.S.

Jewellers, proprietory concern of Satya Prakash Khandelwal, therefore, the

ld. CIT(A) was not justified in sustaining the addition.

In the case of Rishab Marble, proprietory concern of Rajeev Jain, the

assessee has submitted full address, alongwith PAN. He has also submitted

confirmation. He has also submitted Income tax return of Rishab Marble

and also copy of relevant account. From perusal of this, it is found that this

amount was received through banking channels. The depositor has

confirmed the deposit. He has also submitted IT return of the depositor

with full address and PAN, therefore, in my considered view, the assessee

was able to discharge the onus U/s 68 of the Act in respect of this

depositor while establishing the identity of the person, genuineness of the

transaction and creditworthiness of the depositor.

In the case of Pushpa Jalan, the assessee has given full address,

PAN, copy of IT return U/s 143(1) was also submitted. Copy of relevant

bank account was also submitted. The amount received by the assessee

through cheque is duly reflected in the bank account of Pushpa Jala held

ITA 850/JP/2016_ 6 Bimal Hansaria Vs. ITO

with Canara bank Special Bench account No. 7004. She has confirmed the

transaction. Thus, in this case also, the assessee was able to discharge the

onus U/s 68 by establishing the identity, genuineness of transaction and

creditworthiness of the depositor.

In the case of Saloni Hansaria, the assessee provided correct

address, PAN, confirmation and income tax assessment records. From

perusal of the confirmation, it is noticed that this amount was old

outstanding and brought forward balance was reflected in the account. The

amount was received by cheque. Confirmation was submitted, therefore, in

this case also, the assessee was able to establish the identity, genuineness

of transaction and creditworthiness of the depositor. Hence, this addition is

deleted.

Similarly in the case of Ashok Hansaria, the assessee has furnished

full address, confirmation, copy of IT returns, PAN. All the transactions

were through cheques. In this case also, the assessee was able to

discharge the onus U/s 68 of the Act. Hence, the addition is deleted.

In the case of Sita Ram Gupta, the assessee provided full address,

his PAN. In the earlier occasion, there was a clerical mistake in providing

PAN but subsequently, the assessee has submitted correct PAN of this

depositor. All the transactions were through cheuqes. Therefore, I find no

merit in sustaining the addition.

ITA 850/JP/2016_ 7 Bimal Hansaria Vs. ITO

In the case of Rajat Medical and provision, a proprietory concern of

Radha Gopal Gupta. The assessee has furnished full address alongwith PAN

and confirmation. The ld. CIT(A) simply confirmed the addition by stating

that the copy of bank account of the depositor was not furnished. All the

transactions were through cheques. The assessee was able to discharge

the onus U/s 68 of the Act by establishing the identity, genuineness of

transaction and creditworthiness of the depositor. Hence, the addition is

directed to be deleted.

In the case of Radha Mohan Gupta, the assessee provided full

address, his PAN. In the earlier occasion, there was a clerical mistake in

providing PAN but subsequently, the assessee has submitted correct PAN of

this depositor. All the transactions were through cheuqes. Therefore, I find

no merit in sustaining the addition.

In the case of Govind Ram, the assessee has furnished full address

alongwith PAN and confirmation. The ld. CIT(A) simply confirmed the

addition by stating that the copy of bank account of the depositor was not

furnished. All the transactions were through cheques. The assessee was

able to discharge the onus U/s 68 of the Act by establishing the identity,

genuineness of transaction and creditworthiness of the depositor. Hence,

the addition is directed to be deleted.

ITA 850/JP/2016_ 8 Bimal Hansaria Vs. ITO

In the case of Giriraj Agarwal, the assessee has furnished full address

alongwith PAN and confirmation. All the transactions were through

cheques. The assessee was able to discharge the onus U/s 68 of the Act by

establishing the identity, genuineness of transaction and creditworthiness

of the depositor. Hence, the addition is directed to be deleted.

In the case of Amit Kumar Sanan, the assessee has furnished full

address alongwith PAN and confirmation. All the transactions were through

cheques. The assessee was able to discharge the onus U/s 68 of the Act by

establishing the identity, genuineness of transaction and creditworthiness

of the depositor. Hence, the addition is directed to be deleted.

In the case of Neelam Kasat, the assessee has submitted full

address, alongwith PAN. He has also submitted confirmation. He has also

submitted Income tax return and also copy of relevant account. From

perusal of this, it is found that this amount was received through banking

channels. The depositor has confirmed the deposit. He has also submitted

IT return of the deposits with full address and PAN, therefore, in my

considered view, the assessee was able to discharge the onus U/s 68 of the

Act in respect of this depositor while establishing the identity of the person,

genuineness of the transaction and creditworthiness of the depositor.

In the case of Pushpa Holani, the assessee has submitted full

address, alongwith PAN. He has also submitted confirmation. He has also

ITA 850/JP/2016_ 9 Bimal Hansaria Vs. ITO

submitted Income tax return and also copy of relevant account. From

perusal of this, it is found that this amount was received through banking

channels. The depositor has confirmed the deposit. He has also submitted

IT return of the deposits with full address and PAN, therefore, in my

considered view, the assessee was able to discharge the onus U/s 68 of the

Act in respect of this depositor while establishing the identity of the person,

genuineness of the transaction and creditworthiness of the depositor.

In the case of Ram Babu Gupta, the assessee has furnished full

address alongwith PAN and confirmation. All the transactions were through

cheques. The assessee was able to discharge the onus U/s 68 of the Act by

establishing the identity, genuineness of transaction and creditworthiness

of the depositor. Hence, the addition is directed to be deleted.

In the case of Krishna Bright Metal Ind., a proprieotry concern of

Krishan Kumar Khatuwala, the assessee has furnished full address

alongwith PAN and confirmation. All the transactions were through

cheques. The assessee was able to discharge the onus U/s 68 of the Act by

establishing the identity, genuineness of transaction and creditworthiness

of the depositor. Hence, the addition is directed to be deleted.

The different Hon’ble High Courts and the Coordinate Bench of Jaipur ITAT

in the following cases have decided such type of issue, which is as under:

(i) Aravali Trading Co. Vs. ITO (2008 8 DTR (Raj) 199

ITA 850/JP/2016_ 10 Bimal Hansaria Vs. ITO

Once the existence of the creditors is proved and such person own the credits which are found in the books of the assessee, the assessee's onus stands discharged and the later is not further required to prove the source from which the creditors could have acquired the money deposited with him either in terms of section 68 or on general principle.

(ii) Kanhiva Lai Jangid Vs. CIT (2008) 217 CTR 354 (Rai.)

Income-Cash credit-Burden of proof-Assessee having filed confirmation from the creditor where the creditor affirmed advancement of loan to assessee, no addition under s. 68 could be made in the hands of assessee on the ground that the creditor could not satisfactorily explain the source of loan- Burden on the assessee in such cases does not extend to prove the source of the creditor from where he made the advance to the assessee.

(iii) Asstt. CIT Vs. Swami Complex (P) Ltd. (2007) 111 TTJ (JP) 531

Where complete addresses of the creditors were furnished by the assessee and some of the creditors were being assessed and were having PAN's the Assessing Officer was not justified in adding the cash credits in question without verifying the confirmations filed by them by summoning the creditor and as such the addition of cash credits standing in their names was not justified.

(iv) Asa Ram Mukand Lal Vs. Asstt. CIT (1999) 64 TTJ (Del) 466

Cash credit - genuineness - Assessing Officer has not brought anything on record as an alleged to show that the loan is not genuine and that it was assessee's own money as alleged by him. He has not examined the parties who are said to have advanced money to creditor M by means of cheques. Addition cannot be sustained.

ITA 850/JP/2016_ 11 Bimal Hansaria Vs. ITO

(v) Prem Lata Sharma Vs. ITO (ITAT Jaipur Bench) ITA No. 8/JP/2009 dated 24.07.2009

Section 68 - Assessee obtained loan of Rs. 25 lac from 18 different persons. Assessee furnished confirmation and copy of Bank account in respect of 5 persons only. Assessing Officer required to produce all the creditors. Assessee fails to produce them. Assessing Officer issued summons to the creditors but none appeared, ultimately assessee surrendered the loan amount. CIT(A) confirmed the addition. Before the ITAT it was submitted that all the creditors are income tax assessee and confirmations and PAN were filed before the Learned Assessing Officer. Surrender was made to purchase peace of mind and to avoid litigation. Tribunal deleted the addition.”

In view of the above facts and circumstances, I delete the addition and this

ground of assessee’s appeal is allowed.

interest paid by the assessee to the deposits of Rs. 2,02,673/-.

deleted the addition made U/s 68 of the Act on which, interest was

paid by the assessee. Since the depositors had been found genuine,

therefore, in consequence of that the payments of interest on this deposit

is also held to be genuine. Hence, this ground of assessee’s appeal is also

allowed.

Rs. 38,315/- made U/s 69C of the Act. From perusal of the order of the ld.

ITA 850/JP/2016_ 12 Bimal Hansaria Vs. ITO CIT(A), it is noticed that the ld. CIT(A) has not adjudicated upon the

ground raised by the assessee in his appeal before him. Since this ground is

not decided by the ld. CIT(A), hence the same is dismissed.

Sd/- ¼Hkkxpan½ (BHAGCHAND) ys[kk lnL;@Accountant Member

Tk;iqj@Jaipur fnukad@Dated:- 13th November, 2017 *Ranjan आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू vihykFkhZ@The Appellant- Shri Bimal Hansaria, Jaipur. 1. izR;FkhZ@ The Respondent- The ITO, Ward 4(2), Jaipur. 2. vk;dj vk;qDr@ CIT 3. vk;dj vk;qDr¼vihy½@The CIT(A) 4. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. xkMZ QkbZy@ Guard File (ITA No. 850/JP/2016) 6.

vkns'kkuqlkj@ By order,

सहायक पंजीकार@Aेेज. त्महपेजतंत