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Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC-3’ NEW DELHI
Before: SMT DIVA SINGH
Date of Hearing 20.06.2016 Date of Pronouncement 19.08.2016 ORDER
PER DIVA SINGH, JM
The present appeal has been filed by the assessee assailing the correctness of the order dated 19.06.2014 of CIT(A)-II, New Delhi pertaining to 2007-08 assessment year.
Assailing the addition of Rs.1,28,134/- made by the AO which was sustained in appeal by the CIT(A). The Ld.AR submitted that no evidence has been relied upon to make the addition. Inviting attention to the assessment order and the impugned order, it was submitted that the so called statement of Sh.Pradeep Kumar Bansal, husband of Smt.
Shashi Bala Bansal has been relied upon to make the addition. No effort has been made to confront the same to his wife who has given the loan to the assessee. The conclusion of the CIT(A) that Sh. Pradeep Kumar Bansal was assessee’s witness is incorrect as the assessee had received the loan from Smt. Shashi Bala Bansal and it is not her statement
I.T.A .No.-4151/Del/2014 that the loan was bogus. The fact that the statement was recorded at the back of the assessee and was never confronted to the assessee it was submitted had been agitated before the CIT(A) also. The argument was rejected, observing that the party was the witness of the assessee. It was his submission that the plethora of evidence filed in support of the claim of the identity and capacity as well as the genuineness of the loan taken could not have been ignored merely relying upon the so called statement of the husband of Smt.
Shashi Bala Bansal. It was stated that the husband has expired but Smt. Shashi Bala Bansal is very much alive and as per the documents available it is evident that the said lady had given a loan of Rs.2 lacs in the immediately preceding assessment year. Thus the capacity of giving loan of Rs.1 lac in these circumstances it was submitted cannot be doubted. It was his submission that the assessee has paid back the loan of Rs.2 lacs wherein TDS to the extent of Rs.17,23,984/- has been deducted and a copy of the return of Smt. Shashi Bala Bansal for 2007-08 AY i.e. the year under consideration in these circumstances would show that she has claimed the said TDS in the said year. The copy of the return filed it was submitted is at page 4 and the computation of the total income is attached alongwith the same and is supported by the claim of TDS paid to her, copy placed at Paper Book page 6. Copy of the PAN of the said lady it was submitted was available at page 8 supported by the payment through the banking channel and the receipt back of the loan also through banking channels was available at page 9 to 11. It was submitted that all these evidences could not have been ignored merely relying upon the statement of her husband which too was never confronted to the assessee. Reliance was placed on 167 ITR 849 & 330 ITR 498 so as to contend that no addition could have been made.
I.T.A .No.-4151/Del/2014
The Ld.Sr.DR, Sh. F.Khan relying upon the assessment order and the impugned order submitted that the assessee was given an opportunity to produce the said person in support of the claim of having received loan and since the assessee did not produce the said person, summons were issued. In response to the same Sh.Pradeep Kumar Bansal husband of Smt.
Shashi Bala Bansal attended and categorically stated that bogus loan of Rs.1 lac was given to M/s R.L.Traders. Thus no further evidence was required. However, the Ld.Sr.DR was unable to respond to the query why the statement recorded in the course of the assessment proceedings was not confronted to the assessee and moreover how the statement of the husband was considered relevant where evidently the amount had been advanced by the wife. In the facts it is the statement of the wife which would be the relevant statement and why her statement was not recorded the order is silent. The Ld.Sr.DR submitted that probably there was not much time left to complete the proceedings.
The Ld. AR on the other hand submitted that the assessment order is dated 04.12.2009 and the summons were issued on 02.11.2009 thus since the case was not becoming time barred the AO had adequate time to confront the statement.
The arguments of the parties have been taken into consideration alongwith the facts and circumstances as brought out in the orders of the authorities. Considering the same, I am of the view that the order under challenge cannot be said to be a speaking order as not only there is no discussion on relevant facts namely the reasons for disregarding the plethora of evidences relied upon by the assessee in support of the identity, creditworthiness and genuineness of the transaction but even otherwise the said Authority has misdirected itself by holding that there was no need to confront the statement of Sh.
I.T.A .No.-4151/Del/2014 Pradeep Kumar Bansal as he was assessee’s witness. The loan had been advanced by Smt.
Shashi bala Bansal the Principal Person of M/s Soluna Resorts and not her husband thus why has the statement of the husband been relied upon. As admittedly it is the statement of the wife which should have been taken and if the facts stated are contrary to the record then the witness becomes the Revenue’s witness or a hostile witness and thus must be confronted to the assessee. Moreover, the said statement has not even been confronted to the assessee and has been made available to the assessee only during the appellate proceedings and only the relevant extract has been extracted in the impugned order. The order of the CIT(A) in the circumstances cannot be said to be a speaking order addressing the facts and the arguments advanced. The impugned order accordingly is set aside and the issue is restored back to the CIT(A) with a direction to pass a speaking order in accordance with law. Needless to say that the assessee shall be afforded a reasonable opportunity of being heard.
In the result the appeal of the assessee is allowed for statistical purposes. The order is pronounced in the open court on 19th August 2016.