9911796707
TMI Blog2015 (4) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... No doubt Shri Rakesh Kumar has filed return but perusal of the copy of the return filed before us shows that he has gross total income of 1,95,095 out of which deductions have been claimed at 74,639 which means this amount has gone towards some savings and the same is not available in liquid cash. Shri Rakesh Kumar himself have been left with only 1,20,456 which is just sufficient to met household withdrawals. These facts clearly shows creditworthiness of Shri Rakesh Kumar has not been proved. In this case the test of human probability laid down in the case of Sumati Dayal v. CIT [1995 (3) TMI 3 - SUPREME Court] was held to be applicable in the case of cash credits. Therefore, in the case before us clearly the explanation is not satisfactory. It simply seems to be a case where cash was deposited in the account of Shri Rakesh Kumar and loan was shown in his name, therefore, we find nothing wrong with the order of the learned Commissioner of Income-tax in confirming the addition - Decided against assessee. Interest on advances - As submitted by assessee that in fact no loans were given to Shri Karan Bansal and Richa Bansal and the amount was actually a gift and by mistake it was show ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aring both parties we find that during assessment proceedings enquiries were made in connection with the household expenses of the assessee. The family of the assessee consisted of three members including one child who was school going. The expenditure on the child was estimated as under : Nature of expenses (annual) Rs. X No. of persons × 12 months of the financial year Total expenses Conveyance expenses per child 450 × 1 × 12 5,400 Expenses on cloth, refreshment (misc. expenses) 2500 × 1 × 12 30,000 Fee for one child 500 × 12 × 1 6,000 Total expenses 41,400 The expenditure on kitchen was estimated as under : Food item Per head (in Rs. × No. of family members × 365 days of year Total yearly expenses Break fast 25 × 3 × 365 27,375 Lunch 30 × 3 × 365 32,850 Dinner 30 × 3 × 365 32,850 Tea/Milk* 15 × 3 × 365 16,425 Total 1,09,500 * for the day or after dinner Nature of expenses Rs. × months Total expenses Kitchen servant 500 × 12 6,000 Sanitation 300 × 12 3,600 Total 9,600 Other domestic expenses were estimated as under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... white wash at home and other expenses were taken on very higher side on estimation." 5. The learned Commissioner of Income-tax (Appeals) gave part relief and decided the issue vide para 4.2, which is as under : "4.2 I have considered the submission made. It is seen that the entire addition has been made purely on presumption without bringing anything on record establishing that such expenses incurred by the appellant. However, the Assessing Officer has mentioned that the appellant remained silent on in any issue on this account when confronted through the questionnaire served on him. It therefore, appears that the appellant has also failed to give certain details asked or by the Assessing Officer. The family of the appellant consists of only 3 members including one school going child. The financial year pertains to 2007-08. In my opinion, since no specific instances has been brought out by the Assessing Officer ₹ 12,000 per month i.e., ₹ 1,44,000 for the entire year is a fair estimate for household expenses of the appellant. The Assessing Officer is, therefore, directed to take action accordingly." 6. Before us, learned counsel for the assessee submit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri Rakesh Kumar had filed Income-tax return also and he was produced before the Assessing Officer where he clearly admitted that he has given the loan. He contended that bank statement was also filed before the Commissioner of Income-tax (Appeals) copy of which is available at page 4 of the paper book. From the above documents it become absolutely clear that the assessee has proved all the ingredients of the loan transactions. He also referred to the order of the hon'ble Supreme Court in [1995] 211 ITR (St.) 11 wherein the special leave petition in the case of CIT v. Chunnilal : SLP (Civil) No. 21334 of 1994 was dismissed. In that case cash credit in the names of the assessee's wife, son and daughter in law was added back by the Assessing Officer as unsecured cash credits. The Tribunal allowed the payments by holding that cash credit came from the bank accounts held by son, wife and daughter-in-law. The officer could not add back these amount unless he would prove that these persons were benami of the assessee. This clearly shows that even though cash was deposited that cannot be ignored by the Assessing Officer. He also referred to the decision of the hon'ble Punjab an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been proved. The hon'ble Supreme Court in the case of CIT v. P. Mohanakala [2007] 291 ITR 278 (SC) clearly held that in case where explanation offered by the assessee about the nature and source of sums found credited in the books of account is not satisfactory then the same would constitute prima facie evidence against the assessee. In this case the test of human probability laid down in the case of Sumati Dayal v. CIT [1995] 214 ITR 801 (SC) was held to be applicable in the case of cash credits. Therefore, in the case before us clearly the explanation is not satisfactory. It simply seems to be a case where cash was deposited in the account of Shri Rakesh Kumar and loan was shown in his name, therefore, we find nothing wrong with the order of the learned Commissioner of Income-tax and we confirm the same. 14. Ground No. 4 : After hearing both parties we find that during assessment proceedings the Assessing Officer noticed that the assessee has given certain advances to various persons. The assessee was asked why interest was not charged on the same. Ultimately, 12 per cent. interest was calculated on such loans and a sum of ₹ 27,643 was disallowed. 15. On appeal, it w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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