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TMI Blog2019 (9) TMI 1135X X X X Extracts X X X X X X X X Extracts X X X X ..... nk statements of the lenders and an affidavit from them confirming the entire loan transactions with the assessee. We find that the ld AO had merely disregarded this affidavit by stating that the same lacks verification. Even in this case, no verification was carried out by the AO either u/s 133(6) or u/s 131 of the Act to clear the doubts that were in mind of the ld AO with regard to the veracity of the loan creditors. It is not in dispute that these loan creditors are duly assessed to income tax and their income tax assessment particulars together with their addresses were on record. We find that both these parties had duly affirmed in their affidavit that they were engaged in respective businesses for the past 15 and 30 years respectively. Hence the availability of source in their hands stands proved beyond doubt - Decided in favour of assessee Net income under the head Income from Business - gross receipts minus direct expenditure - HELD THAT:- We find that the CIT-A in Asst Year 2013-14 had accepted the fact that the assessee was engaged in the actual business of consultancy to SRA projects of Kamla Mills group, wherein he has to negotiate with the slum dwellers / squat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd - ₹ 20,00,000/- Nikita M Gogar - ₹ 10,00,000/- Usha J Chauhan - ₹ 10,00,000/- ₹ 1,18,00,000/- The assessee was asked to establish the identity, creditworthiness and genuineness of unsecured loans. The assessee furnished a copy of acknowledgement of return of income and confirmation of said parties. 3.1. With regard to Arabian Sea Food, the ld AO observed that on verification of copy of acknowledgement of return, the said entity had returned a loss of ₹ 9,75,086/- and accordingly concluded that it did not have creditworthiness to advance monies to the assessee. The assessee also undertook to produce the party before the ld AO for examination but failed to do so. In these circumstances, the ld AO concluded that the assessee had not proved the three main ingredients of section 68 of the Act viz, identity of the creditor, creditworthiness of the creditor and genuineness of transactions with regard to lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ld AO added the sum of ₹ 10,00,000/- as unexplained cash credit in the assessment with regard to loan received from Smt Usha Chauhan. 3.5. Accordingly, the loans received from aforesaid parties in the total sum of ₹ 1,18,00,000/- was added as unexplained cash credit u/s 68 of the Act in the assessment. 4. The assessee pleaded that the following documents were submitted before the ld AO :- a) Name and address of the lenders together with their PAN. b) Copy of loan confirmation duly signed by the assessee as well as the concerned lender from whom the loan has been taken. c) Copy of return of income of the parties from whom loan has been taken. d) Bank pass book of two parties highlighting the relevant loan transactions. e) PAN card copy of lenders. f) Affidavits from Smt Nikita Mahesh Sagar and Smt Usha Chauhan wherein they had affirmed that they were carrying on business of tailoring and embroidery works for the past 15 and 30 years respectively. The said affidavit also contained their income tax assessment particulars and also their r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quires to be deleted. 6. Aggrieved, the revenue is in appeal before us. 7. We have heard the rival submissions and perused the materials available on record. At the outset, we find that the assessee had furnished the complete details of the loan creditors in the instant case before the ld AO as detailed hereinabove. With regard to Arabian Sea Food and Shatrunjaya Estates Pvt Ltd , the assessee had not produced the bank statement of the loan creditors as the same was not in the control of the assessee and this fact was also informed to the ld AO at the time of assessment proceedings. The main grievance of the ld DR was that the assessee had not submitted the bank statements of these two loan creditors before the ld AO and hence creditworthiness of those parties were not proved by the assessee. We find that the ld AO having known that the assessee was not having control over the bank statements of lending entities, could have issued notice u/s 133(6) of the Act or summons u/s 131 of the Act to those parties seeking for their bank statements. In the instant case, the ld AO had failed to do so. All the primary documents that are in possession of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed by the revenue are dismissed. Assessee Cross Objection No. 92/Mum/2017 8. At the outset, we find that there is a delay of 52 days in preferring this cross objection by the assessee before us. In this regard, we find that the assessee had filed an affidavit stating that he was dependent on his chartered accountant as he he was not conversant with income tax laws and that his chartered accountant had not advised him at that point in time to prefer cross objections before this tribunal. This was further supplemented by a separate affidavit from the concerned chartered accountant. Hence in these circumstances, in the interest of substantial justice , we are inclined to condone the delay of 52 days in preferring the cross objection before us by the assessee and admit the same for adjudication. 9. The grounds raised in the cross objections are as under:- 1. On the facts and circumstances and in law, the learned ACIT 33(3), Mumbai (ACIT) erred in assessing Business Income as Income from Other Sources. 2. Without prejudice to the above, the learned ACIT erred in assessing Business Income of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Asst Year 2010-11 - ₹ 51,25,750/- E- Return filed on 30.8.2010 Asst Year 2012-13 - ₹ 2,33,43,493/- E- Return filed on 29.3.2013 We find that the ld CITA in Asst Year 2013-14 in Appeal No. CIT(A)-45/ACIT-33(3)/ITA-160/2016-17 dated 23.7.2018 had accepted the fact that the assessee was engaged in the actual business of consultancy to SRA projects of Kamla Mills group, wherein he has to negotiate with the slum dwellers / squatters and get them agree/vacated with compensation/ incentive or an alternate accommodation in the constructed SRA tower. For this he used to get the money from the builders which he used to deposit in the bank account. The ld CITA in that order categorically observed that assessee was doing similar business in earlier years and nature of business was mentioned as service sector in the audit report. Hence it is proved beyond doubt that assessee was deriving business income during the year under consideration. Hence we direct the ld AO to treat the ne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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