2021 (12) TMI 437 - AT - Income Tax

Unexplained investment u/s 68 - admission of additional evidences - HELD THAT - On perusal of the bank statement of Rajneesh Dhawan it is observed that he was having sufficient fund available in the bank account by way of encashment of fixed deposits to advance loan to the assessee. It is also observed that the assessee has availed the loan of ₹ 1 crore from Rajneesh Dhawan on interest chargeable @0.75% p.m and the assessee, while paying such interest has also deducted tax at source - Yamini Bhat has filed her return of income for assessment year 2016-17 on 23-01-2017 - it is a fact on record that the bank statement of Rajneesh Dhawan and the tax credit certificate in Form 26AS as well as the income-tax return copy of Smt. Yamini Bhat are being filed for the first time before this Tribunal as additional evidence. Though, prima facie, it appears that both the loan creditors are having creditworthiness and are capable of advancing the loans to the assessee; however, the additional evidences require factual verification. Considering the fact that the additional evidences sought to be furnished before us will have a crucial bearing on deciding the disputed issue, we are inclined to admit them. However, since the departmental authorities did not have an opportunity to verify them, adhering to the rules of natural justice, the departmental authorities have to be given an opportunity to verify them - we are inclined to restore the issue to the file of learned Commissioner (Appeals) for not only considering the additional evidences filed before him but also before us, as well - appeal is allowed, for statistical purpose.

Summary

Issues:
Addition made of ?1,40,00,000 as unexplained investment under section 68 of the Income-tax Act, 1961.

Analysis:
The appellant, a resident individual engaged in the business of builders and developers, appealed against an order adding ?1,40,00,000 as unexplained investment under section 68 of the Act for the assessment year 2013-14. The assessing officer noticed unsecured loans from various parties and requested loan confirmations and income-tax return copies of lenders. Some lenders did not provide the required documents, leading to the addition of the loan amounts to the appellant's income. The appellant contended that the loans were genuine, supported by confirmations and other documentary evidence. The counsel argued that additional evidence was available post-appeal, proving the genuineness of the transactions. The departmental representative emphasized the lack of supporting evidence initially. The appellant sought admission of additional evidence to establish the creditworthiness of lenders and genuineness of transactions.

The tribunal observed that the loans were received through banking channels, with documentary evidence supporting the creditors' identities. Fresh evidence was submitted, including bank statements and tax documents. The bank statement of one lender showed sufficient funds for the loan, and the appellant had paid interest with tax deductions. Another lender's income tax return and related documents were filed for the first time before the tribunal. While the creditors seemed creditworthy, further verification of additional evidence was deemed necessary. The tribunal decided to admit the additional evidence but directed the authorities to verify it, ensuring natural justice. The issue was remanded to the Commissioner (Appeals) for thorough examination of the new evidence and a decision after due process. The appeal was allowed for statistical purposes.

In conclusion, the tribunal acknowledged the appellant's efforts to prove the genuineness of the loans through additional evidence. The decision to remand the issue for further verification and examination of new evidence by the Commissioner (Appeals) was based on the importance of the additional evidence in resolving the dispute fairly.