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TMI Blog1987 (5) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... -------------------------------------------- Sl. No. Name of the creditor Date Amount How Remarks Rs. given -------------------------------------------------------------------------------------------------------------------------------------------------- 1. Sardar Singh20-5-7855,000 Cash Assessee is the son of this creditor's sister-in-law. 2. Paramjit Singh20-5-7852,300 Cash He is the assessee's maternal uncle. 3. Gurdeep Singh30-5-785,000 Cash He is the assessee's younger brother. -------------------------------------------------------------------------------------------------------------------------------------------------- All these cash creditors filed confirmatory letters and their affidavits before the ITO. The cash creditors Sardar Singh and Gurdeep Singh were examined before the ITO whereas the third one, Paramjit Singh was examined before the learned CIT(A). We now take the case of each cash creditor separately. 3. Sardar Singh claimed to have advanced Rs. 55,000 to the assessee out of his savings from agricultural income derived from 38-39 acres of land in village Jhundla, District Karnal jointly owned with his two sons Arvinder Pal Singh, Tejinder Pal Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, ---- 27,0001-5-78 Karnal The fact that Sardar Singh has not only land in his joint name but also in his individual name has not been belied. He stated in cross-examination that the net income was Rs. 1.5 lakhs. The land had 5 tubewells. The sale of the agricultural produce to the three commission agents referred to above was also corroborated by him. He stated that although there was no bank account in his individual name but there was a joint account in the State Bank at Karnal in his and his sons' names. Though Sardar Singh stated that he did not remember the exact date of advancing the loan to the assessee he specifically stated in reply to question No. 21 by the ITO that the loan was given in 1978 in May-June. He stated that earlier he used to keep Rs. 60,000--Rs. 70,000 at home but now the money is deposited in the bank account. He said that Rs. 55,000 were paid to the assessee in lump sum when he came to the assessee and that interest was charged at the rate of 12% p.a. He stated that the assesses had repaid Rs. 31,000 with interest up to31-3-1981. The statement of the assessee was also recorded. He stated that the repayments had been made by him through bearer cheques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of giving the loan to the assessee but he did state that he gave it somewhere towards the end of May 1979. He stated that the loan was given in cash atDelhias he used to visitDelhialmost every month. Regarding the details he stated that he brought Rs. 2,000 fromPunjaband Rs. 3,000 from the locker of his mother's almirah atDelhiwhere he kept his money. He also duly explained about cash gifts received by his children. So as the contradiction regarding the repayment of the loan is concerned no questions were asked from the assessee nor the contradiction was put to Gurdeep Singh. In our view the indentity and capacity of this creditor as well as the genuineness of the transaction of loan could not have been doubted on the basis of the evidence on the record. We are of the view that this cash credit was duly explained, and established. We hold accordingly. This should be deleted from assessee's total income. 9. The third cash credit is of Paramjit Singh of Rs. 52,000. It was disbelieved by the ITO as he was not produced by the assessee. 10. The learned CIT(A) gave to the assessee an opportunity to produce this cash creditor as he could not be produced before the ITO because of d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h paid the money due that he could do anything in the matter ; (ii) that this fact was orally told to the learned CIT(A) and it is only after the receipt of the impugned order of the learned CIT(A) that the additional evidence in question was handed over by Paramjit Singh to him. On behalf of the assessee reliance was also placed on the following decisions on the question of reception of additional evidence at this stage by the Appellate Tribunal :-- (i) Velji Deoraj Co. v. CIT [1968] 68 ITR 708 (Bom.) ; (ii) Kali Charan Ram Chander v. CIT [1978] 112 ITR 405 (Cal.) (iii) CIT v. Kum. Satya Setia [1983] 143 ITR 486 (MP). The reception of additional evidence was opposed by the learned Departmental Representative on the basis of the written comments obtained from the ITO. In short it was submitted that there had been no denial of opportunity ; that the additional evidence amounted to the improvement of the assessee's case ; that it was not clear when the additional evidence was procured and that the additional evidence related to 1980-81 to 1985-86. 12. We have considered the rival submissions of both the sides as also the decisions referred to above. The additional evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n pursuance of the notice dated19-12-80that the return was filed by him on22-3-1984under section 148. He, therefore, upheld the levy of interest. 14. Before us the learned counsel for the assessee referred to the decisions of the various High Courts on this point namely (i) Gates Foam Rubber Co. v. CIT [1973] 90 ITR 422 (Ker.) ; (ii) P.A. Abdul Muthalif Rowther v. ITO [1976] 102 ITR 694 (Ker.) ; (iii) Smt. Kamla Vati v. CIT [1978] 111 ITR 248 (Punj. Har.) ; (iv) CIT v. Smt. Jagjit Kaur [1980] 126 ITR 540 (All.) ; (v) CIT v. Ganeshram Nayak [1981] 129 ITR 43 (Ori.) ; (vi) Monohar Gidwany v. CIT [1983] 139 ITR 498 (Cal.) ; (vii) D. Swarup, ITO v. Gammon India Ltd. [1983] 141 ITR 841 (Bom.) ; (viii) Charles D'Souza v. CIT [1984] 147 ITR 694 (Kar.) ; and (ix) B. Babu Co. v. Sixth ITO [1986] 26 Taxman 205 (Kar.). He pointed out that the amendment made by the Taxation Laws (Amendment) Act, 1984 whereby an assessment made for the first time under section 147 shall be regarded as a regular assessment, is only prospective w.e.f.1-4-85. Lastly he submitted that in view of the divergence of opinions, the view favourable to the assessee had to be taken. In this rega ..... X X X X Extracts X X X X X X X X Extracts X X X X
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