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TMI Blog2017 (10) TMI 1146X X X X Extracts X X X X X X X X Extracts X X X X ..... e. In our considered opinion, it would be in the fitness of things that the assessee is allowed an opportunity to demonstrate with positive evidence that with respect to the sum of ₹ 40,00,000/-, the liability to repay M/s. IL&FS Transportation Network Ltd. continues inspite of the fact that the arrangement envisaged in the Agreement (Memorandum of Understanding) dated 18.04.2008 has not fructified, a fact which is not in dispute. Since the aforesaid aspect requires a factual appreciation of the state of affairs, we deem it proper to restore the matter back to the file of the CIT(A). It is directed that the CIT(A) shall examine the aforesaid aspect on the basis of the material and evidence that the assessee may submit before him. Accordingly, the issue relating to assessability of sum is restored back to the file of the CIT(A) to be decided after hearing the assessee and as per law. - ITA NO. 4698/MUM/2015 - - - Dated:- 12-9-2017 - SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI RAM LAL NEGI, JUDICIAL MEMBER For The Appellant : Shri J.P. Bairagra For The Respondent : Ms. Amrita Ranjan ORDER PER G.S. PANNU, AM : The captioned appeal by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Transportation Network Ltd. had agreed to provide a security deposit not exceeding ₹ 25,00,00,000/-, which is stated to be ₹ 20,00,00,000/- in question, in order to secure its right to have the availability of heavy plant machinery as well as stone quarries as and when it may require. Similarly, the Assessing Officer noted that the assessee had received during the year a sum of ₹ 2,50,00,000/- from one, M/s. Utility Energy Tech and Engineers Pvt. Ltd., which was stated to be as interest-free inter-corporate deposit. The Assessing Officer was not satisfied with the explanations rendered by the assessee with regard to the nature of the aforesaid amounts received. The Assessing Officer noted that immediately after the receipt of monies, the amounts were either transferred to the account of other associate concerns or were used for funding its share trading business. As per the Assessing Officer, the purpose as per the Agreement/Memorandum of Understanding was not fulfilled. For the said reasons, the Assessing Officer concluded that assessee had received said funds without any liability to pay back. Be that as it may, the Assessing Officer concluded as under :- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the impugned order of the CIT(A). In this background, we have heard the rival contentions. 5. A pertinent plea of the assessee is that once the CIT(A) has disagreed with the principal plea of the Assessing Officer about the nature of the amount received from M/s. IL FS Transportation Network Ltd., there was no justification to sustain the addition in respect of part of the amount of ₹ 40,00,000/- merely because the same was not repaid. The learned representative for the assessee pointed out that the liability of ₹ 40,00,000/- was appearing in the Balance-sheet as a refundable security deposit and, therefore, the addition has been wrongly sustained. The learned representative pointed out that even with regard to the addition made by the Assessing Officer in the case of other group concerns, tabulated in para 8.4 of the assessment order, the additions have been either deleted by the CIT(A) or appeals were still pending at the level of CIT(A). In the case of one group concern, namely M/s. Bermaco Energy Systems Ltd., it was pointed out that the advance received from M/s. Utility Energy Tech and Engineers Pvt. Ltd. as well as M/s. IL FS Transportation Network Ltd. in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest-free inter-corporate deposit (ICD) of ₹ 2,50,00,000/- from M/s. Utility Energy Tech and Engineers Pvt. Ltd. The Assessing Officer had discussed the issue in detail in the assessment order, including the manner in which assessee and other group concerns have received monies in the shape of loans and advances, share application monies, advances, etc. from other entities. It would suffice for our purpose to note here that the Assessing Officer was not satisfied with regard to the nature of the amounts received from the two parties in question. According to him, the amounts received were treated by the assessee as if they were its own funds and did not carry any liability to repay. Therefore, he treated the amounts as revenue receipts and brought to tax the same. The CIT(A) has disagreed with the Assessing Officer with respect to the sum of ₹ 2,50,00,000/- received from M/s. Utility Energy Tech and Engineers Pvt. Ltd. and with respect to ₹ 19,60,00,000/- out of the total of ₹ 20,00,00,000/- received from M/s. IL FS Transportation Network Ltd. The findings of CIT(A) in this regard are as follows :- 6.3 I have carefully perused the above and also t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that the amounts received have been repaid by the assessee subsequently and, therefore, he has disagreed with the Assessing Officer s treatment of the amounts being revenue receipts not carrying any liability to repay. It can be seen that the Assessing Officer held that the amount did not carry any liability to repay whereas according to the CIT(A), once the amount has been actually repaid, it could not be treated as assessee s own money so as to merit the addition as made by the Assessing Officer. In the absence of any appeal by the Revenue against such finding of the CIT(A), we may also examine as to whether the said test can be applied in the context of the balance amount of ₹ 40,00,000/- received from M/s. IL FS Transportation Network Ltd. It is not in dispute that the impugned sum of ₹ 40,00,000/- has also been received in pursuance to the Agreement (Memorandum of Understanding) with M/s. IL FS Transportation Network Ltd. dated 18.04.2008. The learned representative for the assessee pointed out that the impugned sum was not repaid, but its liability was still outstanding in the Balance-sheet, and that there was enough justification to say that the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X
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