DEPUTY COMMISSIONER OF INCOME TAX 25(1), MUMBAI vs. M/S.TIRUPATI DEVELOPERS, MUMBAI

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ITA 569/MUM/2018Status: DisposedITAT Mumbai29 November 2024AY 2011-12Bench: SHRI NARENDRA KUMAR BILLAIYA (Accountant Member), SHRI AMIT SHUKLA (Judicial Member)1 pages

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

AI SummaryAllowed

What did the Tribunal hold?

The Judicial Member reversed the CIT(A)'s order and allowed the Revenue's grounds. The Accountant Member remitted the matter back to the AO. The Third Member, however, confirmed the Judicial Member's order, establishing it as the majority decision. Consequently, the grounds raised by the Revenue were allowed, and the CIT(A)'s order was reversed.

What were the facts?

The appeals arose from additions made by the Assessing Officer under Section 68 for unsecured loans for assessment years 2009-10, 2010-11, and 2011-12. The CIT(A) had deleted these additions, but the Revenue appealed to the Tribunal. A difference of opinion arose between the Judicial Member and the Accountant Member, leading to the appointment of a Third Member.

What were the issues?

Whether the documentation provided was sufficient to prove the genuineness of unsecured loans, especially when the lenders were found to be non-existent, and if subsequent repayment is enough to discharge the onus under Section 68.

Which sections of the Income-tax Act were involved?

Section 68,Section 255(4),Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘E’ BENCH

Before: SHRI NARENDRA KUMAR BILLAIYA & SHRI AMIT SHUKLA

For Appellant: Shri Vishwas Mehendale
For Respondent: Shri R.R.Makwana
Hearing: 29/11/2024Pronounced: 29/11/2024

आदेश / O R D E R

PER AMIT SHUKLA (J.M): In the aforesaid case there was a difference of opinion between the ld. Judicial Member and ld. Accountant Member

1.

in the aforementioned appeal filed by the Revenue. Accordingly, u/s.255(4) of the Act, the Hon’ble President had appointed ld. Third Member to decide the issue. The questions for which the matter was referred were as under:-

1)Whether meticulous paper work to prove the transaction in question by bringing on record PAN, bank statement, copy of ledger account are sufficient to justify the alleged transactions of bogus unsecured loans in the absence of explaining the nature and source of credit, particularly when lender's entities in question are found to be not existing, is enough to discharge the onus under section 68 of the Act.? 2) Whether when the notice issued under section 133(6) of the Act received back with the report that no such entities are in existence and the assessee has failed to discharge the onus to produce the lender parties before the AO as required under section 68 of the Act, the subsequent repayment by the assessee qua the alleged bogus loans is enough to grant the relief to the assessee? 3) Whether, in the facts and circumstances of the case, the assessee can be considered to have discharged the onus placed upon him u/s. 68 of the Act to prove the cash credit ?

2.

In all these appeals, the substantive issue involved was addition u/s.68 for the addition of Rs.3.1 Crores for the A.Y.2009-10; Rs.2.29 Crores for A.Y.2010-11; and Rs.95 lakhs for A.Y.2011-12. The ld. CIT(A) had deleted the addition for all the years against which Revenue had come in appeal before the Tribunal. The ld. Judicial Member had reversed the finding of the ld. CIT(A) citing various reasons and allowed Revenue’s grounds. However, ld. Accountant Member in his separate order had remitted the matter back to the file of the ld. AO after giving certain directions. The ld. Third Member vide order dated 10/11/2024 has confirmed the finding and order of the ld. Judicial Member’s allowing the Revenue’s appeal in 568/Mum/2018 and 569/Mum/2018. Once the order of the ld. Judicial Member has been confirmed by the ld. Third Member, accordingly the and Others M/s. Tirupati Developers observation and the finding of the ld. Judicial Member is held to be majority judgment and consequently, the grounds raised by the Revenue in all the three years are allowed and the order of the ld. CIT(A) is reversed. Addition thus made by the ld. AO is confirmed.

3.

In the result all the three appeals of the Revenue are allowed.

Order pronounced on 29th November, 2024.

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