SHRI KAMALJEET,GURGAON vs. ACIT, GURGAON

This appeal filed by the assessee is directed against the order dated 28th January, 2015 of the CIT(A)-1, Gurgaon, relating to assessment year 2009-10.

This appeal was earlier dismissed by the Tribunal for want of prosecution. Subsequently, the Tribunal, vide MA No.405/Del/2016, order dated 26th July, 2019, recalled its earlier order. Hence, this is a recalled matter.

The assessee, in his various grounds of appeal, has challenged the order of the CIT(A) in sustaining the addition of Rs.13 lakhs out of the addition of Rs.31 lakhs made by the AO u/s 68 of the IT Act.

The facts of the case, in brief, are that the assessee is an individual and has filed his return of income on 12th September, 2009 declaring the total income at Rs.16,88,170/-. During the course of assessment proceedings, the AO noted that the assessee has received unsecured loan of Rs.15 lakhs from four parties during the year. Further, an amount of Rs.5 lakh was shown as loan at the beginning of the year from Mr. Mahender Singh. The AO asked the assessee to furnish confirmation along with evidences for credit worthiness and identity of the loan creditors and genuineness of the loan transactions. In absence of any proper details from the assessee and in absence of production of loan creditors, the AO made addition of Rs.31 lakhs to the total income of the assessee being the amount of loan received during the year from three persons as well as certain other loans outstanding.

In appeal, the ld.CIT(A), while deleting the addition, made by the AO on account of other loan creditors, has sustained the addition made by the AO u/s 68 of the Act in respect of the loan of Rs.11 lakh from Shri Tek Ram and a loan of Rs.2 lakh from one Shri Raj Kumar Yadav.

Aggrieved with such order of the CIT(A), the assessee is in appeal before the Tribunal.

We have heard the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the ld.CIT(A) sustained the addition of Rs.11 lakh received from Shri Tek Ram and Rs.2 lakh received from Shri Raj Kumar Yadav on the ground that the assessee failed to produce the above loan creditors before the AO for his examination and failed to discharge the onus cast on him by proving the identity and credit worthiness of the loan creditor and genuineness of the transaction. It is the submission of the ld. Counsel for the assessee that he has filed the copy of income- tax return, PAN card, confirmation of the loan creditors and bank statement of the loan creditors before the AO to substantiate the identity and credit worthiness of the loan creditors and genuineness of the transaction. It is also his submission that Shri Tek Ram has extended a loan of Rs.11 lakh out of his housing loan account with PNB Housing Finance and could not be produced before the AO because of his illness. He had made a request to the AO to depute the Ward Inspector to his residence for recording the statement. It is also his submission that given an opportunity, the assessee is in a position to produce both the loan creditors before the AO for his examination and substantiate to his satisfaction regarding the identity and credit worthiness of the two loan creditors and genuineness of the transaction. Considering the totality of the facts of the case and in the interest of justice, we deem it proper to restore the issue to the file of the AO with a direction to grant one final opportunity to the assessee to produce both the loan creditors before him for his examination and substantiate with evidence to his satisfaction regarding the identity and credit worthiness of the loan creditors and the genuineness of the transaction. It is made clear that the onus is on the assessee to produce both the creditors before the AO for his examination, failing which the AO is at liberty to pass appropriate order as per law. The grounds raised by the assessee are accordingly allowed for statistical purposes.