M.A.CASTLE INFRASTRUCTURE CO.,MUMBAI vs. INCOME TAX OFFICER 31(2)(3) ERSTWHILE INCOME TAX OFFICER 24(3)(2), MUMBAI

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ITA 6221/MUM/2017Status: DisposedITAT Mumbai28 August 2019AY 2011-124 pages

In favour of the Revenue: the assessee's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessee failed to prove the identity, creditworthiness, and genuineness of the unsecured loan creditors. Therefore, the lower authorities were justified in treating the unsecured loans as unexplained cash credits.

What were the facts?

The assessee firm received unsecured loans, but failed to provide confirmations and details for a significant portion of these loans to the Assessing Officer and the CIT(A). The assessee also did not appear before the appellate authorities.

What were the issues?

Whether the unsecured loans received by the assessee are unexplained cash credits under Section 68 of the Income Tax Act due to failure to prove identity, creditworthiness, and genuineness of lenders.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “D”, MUMBAI

Before: SHRI C.N. PRASAD, HONBLE & SHRI RAJESH KUMAR, HONBLE

For Respondent: Shri D.G. Pansari
Hearing: 13.06.2019Pronounced: 28.08.2019

O R D E R PER C.N. PRASAD (JM) 1. This appeal is filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)-42, Mumbai [hereinafter in short “Ld.CIT(A)”] dated 02.12.2016 challenging the order of the Ld.CIT(A) in sustaining the deletion made u/s. 68 of the Act.

2.

Briefly stated the facts are that, while completing the assessment u/s. 143(3) of the Act, the Assessing Officer noticed that during the year under consideration assessee firm received unsecured loans of (A.Y: 2011-12) M.A. Castel Infrastructure Co. ₹.1,10,21,700/- and required the assessee to submit the confirmations and prove the identity, creditworthiness and genuineness of the lenders. Assessee has provided confirmations and details in respect of M/s.Winsway Infrastructure Pvt. Ltd., for an amount of ₹.1,91,300/-. The assessee could not provide any confirmations and the details in respect of the balance unsecured loans amounting to ₹.1,08,30,400/- and since the assessee failed to submit the loan confirmations and related documents to prove the identify, credit worthiness and genuineness of the unsecured loans the Assessing Officer treated ₹.1,08,30,400/- as unexplained cash credits u/s. 68 of the Act and accordingly made addition.

3.

Before the Ld.CIT(A) the assessee could not provide any confirmations nor any details in respect of the unsecured loans. The assessee did not appear before the Ld.CIT(A) in spite of several notices issued by the Ld.CIT(A) as brought out in the order. In the absence of any evidences produced by the assessee the addition made by the Assessing Officer was sustained by the Ld.CIT(A).

4.

In spite of issue of notice none appeared on behalf of assessee nor any adjournment was sought. In fact, the notice issued by the Tribunal fixing the date of hearing on 22.01.2019 returned unserved with the remark of the postal authorities that the assessee has “left”. Thus, we proceed to dispose off this appeal on hearing the Ld.DR.

(A.Y: 2011-12) M.A. Castel Infrastructure Co. 5. Ld. DR submitted that the assessee could not produce any confirmations in respect of unsecured loans either before the Assessing Officer or before the Ld.CIT(A) to prove the identity, creditworthiness, and genuineness of the unsecured loans received by the assessee and therefore the Assessing Officer is rightly justified in treating the said unsecured loans as unexplained cash credits which the Ld.CIT(A) has rightly affirmed the same.

6.

Heard Ld. DR and perused the orders of the authorities below. We find that the assessee could not prove the identify, creditworthiness and the genuineness of the unsecured loan creditors with evidences. Even before us assessee could not produce any evidences to prove the identify, creditworthiness and the genuineness of the creditors. In these circumstances, we do not find any infirmity in the orders passed by the lower authorities in treating the unsecured loans as unexplained cash credits u/s. 68 of the Act. Grounds raised by the assessee are dismissed.

7.

In the result, appeal of the assessee is dismissed.

Order pronounced in the open court on the 28th August, 2019

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