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TMI Blog2017 (4) TMI 817X X X X Extracts X X X X X X X X Extracts X X X X ..... sit in the bank accounts of the three persons for advancing loan and their categorical admission confirming loan during the remand proceedings, we are of the considered view that the loans aggregating to ₹ 38,50,000/- cannot be charged to tax in the Assessee’s hands u/s 68 particularly in absence of any contrary evidence brought on the record by the AO. Hence, we find that Ld. CIT(A) has rightly observed that the assessee is not required to explain source of source of the fund gets buttressed by the amendment made in section 68 with effect from 01.04.2013, which empowers the AO to examine source of source in case of share application money from 01.04.2013 and no other cases prior to that. This amendment further does not give power to the AO to examine source of source of non-share capital cases and that too prior to 01.04.2013. Undisputedly; the assessee has given complete addresses and credit worthiness of the persons from whom she has taken loans. CIT(A) observed that there is no material which may even raise doubt about the genuineness of the loans. Therefore, it was rightly held that the AO has erred in taxing above mentioned loans aggregating to ₹ 38,5O,OOO/- u/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal. 5. On the contrary, Ld. Counsel of the assessee relied upon the order of the Ld. CIT(A) and stated that Ld. CIT(A) has passed a well reasoned order which does not need any interference and requested that the same may be upheld. 6. We have heard both the parties and perused the relevant records, especially the order of the Ld. CTI(A). We find that Ld. First Appellate Authority has elaborately discussed and adjudicated the issue No. 1 vide para no. 3.3 to 3.4 at page no. 9 10 of the impugned order and issue no. 2 vide para no. 4 to 4.1 at page no. 16 to 18 of the impugned order, which are reproduced hereunder- 3.3 I have carefully considered the facts of the case, perused the impugned order remand report of the AO and considered submission rejoinder of the appellant. The AO objected to admission of additional evidence under Rule 46A of the I. T. Rules. It may be seen from the details that additional evidences filed before me are produced for purpose of deciding the issue involved in this appeal. These evidences only enable me to pass an order on the issue one way or other. In Venkataramiah vis A Seetharama Reddy AIR 1963 SC 1526 interpreting the words any ot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P) Ltd. vs Inspecting Asstt. CIT 26 ITD 236(Del) CIT vs K Ravindranathan Nair 265 ITR 217(Ker) Prabhavati S. Shah vs CIT 231 ITR l(Bom) Manish Buildwell (Delhi High Court; order dated 20.11.2011) 3.5 After admission of the additional evidence; the AO, in view of the decision of the Hon'ble Delhi High Court in the case of Manish Buildwell (supra), vide this office letter dated 09.10.2013, was directed to carry out the enquiry/investigation as deemed fit to verify the genuineness of the above mentioned loans. The AO, after conducting enquiry from the above mentioned three parties, submitted her report vide letter dated 10.12.2013. It is worth mentioning here that the AO has not offered any comment on the outcome of enquiry/investigation carried out by her. Further, there is nothing new in the second report dated 10.12.2013 as it does not include the AO's comment on the outcome of enquiry/investigation. To a large extent, it is just reiteration of old report . .4. I have carefully considered the submissions of the appellant and perused the record. The AO has admitted the identity of the above mentioned three persons from whom the appellant ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of source in case of share application money from 01.04.2013 and no other cases prior to that. This amendment further does not give power to the AO to examine source of source of non-share capital cases and that too prior to 01.04.2013. Undisputedly; the appellant has given complete addresses and credit worthiness of the persons from whom she has taken loans. Further, I have also analyzed the facts of this case with that of the case of the CIT Vs Nova Promoters Finlease (P) Ltd.,[2012] 342 ITR 169 (Del) and find that these two cases are distinguishable on facts and thus, I hold that the decision of Nova Promoters Finlease (P) Ltd. (supra) is not applicable in the appellant's case. After examining the materials available on the records, I am of the view that there is no material which may even raise doubt about the genuineness of the loans. Therefore, it is held that the AO has erred in taxing above mentioned loans aggregating to ₹ 38,5O,OOO/- u/s 68 in the hands of the appellant. Therefore, it is deleted. The AO shall allow consequential relief of ₹ 38,5O,OOO/-. However, the AO is directed to pass on the information to the AOs of the above mentioned three person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusion of the assessment proceedings vide impugned order.) and that too when the requisite details were required to be called from third persons. Thus, it appears that the assessee has reasonable cause in ensuring compliance. Therefore, in our considered opinion, the Ld. CIT(A) has rightly held that it is a fit case for admission of additional evidence. Hence, all the documents submitted by the assessee were rightly admitted for deciding this appeal on merit and in the interest of justice by placing reliance on the following case laws: Shahrukh Khan vs DCIT 13 SOT 61(Mum) ITO vs Dwarka Prasad 63 ITD l(TM)(Patna) Rachhpal Singh vs ITO 94 ITD 79 (Asr) Electra Jaipur (P) Ltd. vs Inspecting Asstt. CIT 26 ITD 236(Del) CIT vs K Ravindranathan Nair 265 ITR 217(Ker) Prabhavati S. Shah vs CIT 231 ITR l(Bom) Manish Buildwell (Delhi High Court; order dated 20.11.2011) We further find that after admission of the additional evidence; the AO, in view of the decision of the Hon'ble Delhi High Court in the case of Manish Buildwell (supra), vide this office letter dated 09.10.2013, was directed to carry out the enquiry/investigation as deemed fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the genuineness of transactions in accordance with the provisions of section 68. It is a settled law that the assessee is not answerable to explain source of source of the fund. In light of the fact that there is no cash deposit in the bank accounts of the three persons for advancing loan and their categorical admission confirming loan during the remand proceedings, we are of the considered view that the loans aggregating to ₹ 38,50,000/- cannot be charged to tax in the Assessee s hands u/s 68 particularly in absence of any contrary evidence brought on the record by the AO. Hence, we find that Ld. CIT(A) has rightly observed that the assessee is not required to explain source of source of the fund gets buttressed by the amendment made in section 68 with effect from 01.04.2013, which empowers the AO to examine source of source in case of share application money from 01.04.2013 and no other cases prior to that. This amendment further does not give power to the AO to examine source of source of non-share capital cases and that too prior to 01.04.2013. Undisputedly; the assessee has given complete addresses and credit worthiness of the persons from whom she has taken loans. Fu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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