ITO, NEW DELHI vs. SH. MUKESH YADAV, NEW DELHI

This appeal by the Revenue is directed against the order passed by the CIT(A) on 30.03.2013 in relation to the Assessment Year 2006-07.

The first ground is against the deletion of addition of Rs.3,50,000/- on account of unsecured loan.

Briefly stated, the facts of the case are that the Assessing Officer, in the assessment made u/s 144, added a sum of Rs.3,50,000/-, being unsecured loan shown from Shri Hamant Yadav. The assessee furnished material/explanation about the genuineness of the loan before the ld. first appellate authority, who sent the same to the AO for comments. As the Assessing Officer did not adversely comment upon this unsecured loan in his remand report, the ld. CIT(A) deleted the addition.

We have heard the ld. DR and perused the relevant material on record. There is no appearance from the side of the assessee despite notice. It is observed that the ld. CIT(A) has deleted the addition of Rs.3,50,000/- on the basis of the remand report in which the Assessing Officer did not adversely comment upon the evidence placed on record by the assessee in support of the genuineness of the loan received from the real brother. We, therefore, uphold the same. This ground fails.

The second ground is against the deletion of addition of Rs.35,55,150/-, being cash deposits in the bank account. This addition comprises of two amounts, namely, Rs.19 lac and Rs.16,55,150/-. The Assessing Officer made the addition because of the completion of assessment u/s 144. The assessee filed evidence before the ld. CIT(A) in support of the cash deposits in the bank account. The ld. CIT(A) got convinced with the assessee’s contentions after obtaining remand report from the Assessing Officer. He accepted the assessee’s contention for offer of income at Rs.1,09,691/- u/s 44AF at 5% of deposits amounting to Rs.27,05,150/-.

After hearing the ld. DR and going through the relevant material on record, we find that the first transaction is cash deposits of Rs.19 lac in HDFC Bank account. Page 6 of the impugned order deals with this amount. The assessee submitted detailed narrations of Rs.19 lac explaining the source of deposit. Such narrations were forwarded to the Assessing Officer who did not make any adverse comment on the same in his remand report. Once the Assessing Officer has chosen not to speak anything against such evidence, it shows that he impliedly accepted the genuineness of the transaction. As such, there can be no question of making any addition.

As regards the remaining amount of addition of Rs.16,55,150/-, we find from para 4.4 of the impugned order that the Assessing Officer, during the remand proceedings, issued summons u/s 131 to the persons who had given cash to the assessee which amount was deposited in the bank account. All of them accepted the fact of having made deposits with the assessee, a property dealer, for purchasing some property. In view of the foregoing discussion, it is clear that the source of deposit made by the assessee in the bank has been satisfactorily explained and hence there can be no question of such an addition of Rs.35,55,150/-. However, it is clarified that the addition of Rs.1,09,691 sustained by the ld. CIT(A) on the basis of the assessee’s admission for application of section 44AF, stands as such since the assessee is not in appeal.

In the result, the appeal filed by the Revenue is dismissed. The decision was pronounced in the open court on 28th March, 2017.