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Facts
The Assessee challenged an order by the CIT(A) which dismissed their appeal against the Assessment Order. The Assessing Officer made an addition of Rs. 9,75,97,928/- on account of unexplained cash credits under Section 68 of the Income Tax Act. The CIT(A) upheld an addition of Rs. 57,00,000/- out of this amount.
Held
The Tribunal noted that while the Assessing Officer made an addition of Rs. 9,75,97,928/-, the CIT(A) deleted a significant portion of it. The Tribunal observed that the CIT(A)'s order was silent on the inquiry conducted and did not refer to the evidence provided by the assessee. The Tribunal granted another opportunity to the Assessee to furnish necessary documents and produce the lender.
Key Issues
Whether the addition made by the Assessing Officer and partly confirmed by the CIT(A) on account of unexplained cash credit under Section 68 of the Act is justified, and whether the Assessee was provided with adequate opportunity to furnish evidence.
Sections Cited
143(3), 142(1), 68
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Income Tax Appellate Tribunal, D BENCH, MUMBAI
Per contra, the Ld. Departmental Representative submitted that the 7. Appellant had failed to discharge the primary onus in terms of Section 68 of the Act to prove the genuineness of the transaction and creditworthiness of the lender. Neither during the assessment proceedings nor before the CIT(A) did the Appellant produce any documents substantiating loan transaction such as loan confirmation or bank statement of HJ and thus, failed to explain the nature and source of the credit of INR 57,00,000/-. Further, the Appellant also failed to produce the HJ before the Assessing Officer or the CIT(A).
In rejoinder, the Learned Authorised Representative for the Appellant reiterated that the Appellant had filed its own bank statement as well as address and Permanent Account Number of the Lender. However, the CIT(A) failed to take the same into consideration. The Ld. Authorised Representative for the Appellant further submitted that in case an opportunity is granted, the Appellant would be able to satisfy that the loan transaction under consideration was genuine, and shall also make efforts to produce the lender before the concerned income tax authority. Ld. Authorised Representative for the Appellant also emphasized upon the facts that out of addition of INR 9,75,97,928/- made by the Assessing Officer, the CIT(A) has deleted all additions except addition of INR 57,00,000/- which also represented genuine loan transaction undertaken by the Appellant. (Assessment Year: 2018-19)
We have heard the rival submissions and perused the material on 9. record. We note that while sustaining the addition, the CIT(A) has stated that the Appellant has failed to furnish income tax return of HJ. However, we note that though the Appellant has furnished PAN and address of the lender/HJ, the order passed by the CIT(A) is silent as to inquiry/investigation, if any, carried out by the CIT(A) or the Assessing Officer during the remand proceedings. No reference has been made by the CIT(A) to the ledger account, and bank statements furnished by the Appellant showing receipt of money through banking channels. We further note that out of total addition of INR 9,75,97,928/- made by the Assessing Officer under Section 68 of the Act, already deleted the addition of INR 9,18,97,928/- in respect of loans taken from various parties. In our view, the fact that the Appellant had neither filed income tax return weighed heavily with the CIT(A) while sustaining the addition of INR 57,00,000/-. During the appellate proceedings before us, the Learned Authorised Representative for the Appellant sought another opportunity to discharge the onus cast upon the Appellant under Section 68 of the Act by furnishing relevant details/documents in support of loan transaction of INR 57,00,000/- and also to produce lender/HJ for explaining the source and nature of the credit of INR 57,00,000/-. Keeping in view the facts and circumstances of the present case, we deem it appropriate and in the interest of justice to grant another opportunity to the Appellant and therefore, set aside the order passed by the CIT(A) confirming the addition of INR 57,00,000/- restoring the issue back to the file of the CIT(A) for denovo adjudication as per law. The Appellant is directed to file before the CIT(A) the relevant documents/details/confirmation on which the Appellant wishes to place reliance to support his claim/contentions forthwith on receiving notice of hearing of appeal by the CIT(A). In 5 (Assessment Year: 2018-19) terms of the aforesaid, Ground No. 2(b) raised by the Appellant is allowed for statistical purposes, while all the other grounds raised by the Appellant are dismissed as being infructuous at this stage.
In result, the present appeal preferred by the Assessee is partly 10. allowed
Order pronounced on 05.01.2024.