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TMI Blog2019 (11) TMI 916X X X X Extracts X X X X X X X X Extracts X X X X ..... No infirmity in the action of the lower authorities. Hence, the addition of ₹ 13,00,000/- is hereby sustained. In respect of Sh. Bhanwar Singh Makori who has contributed ₹ 15,00,000/- towards his capital contribution, the ld. CIT(A) has not accepted the contention of the assessee stating that the assessee has failed to prove his creditworthiness. Before us, it was submitted that he was produced for verification and his statement was also recorded during the course of remand proceedings where he has accepted to have given an amount of ₹ 15,00,000/- in cash by way of his capital contribution. On perusal of his financial statement for the year ended 31.03.2011, we find that he has a capital of over ₹ 1 crore and in the said financial statement, he has also reported his investment in the assessee s AOP. We therefore find that the assessee has discharged the necessary burden cast on it in terms of satisfying the creditworthiness of Sh. Bhanwar Singh and the addition of ₹ 15,00,000 so made is hereby directed to be deleted. In respect of Sh. Mota Ram Saini, the ld. CIT(A) has rejected the contention of the assessee stating that he was neither produced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Sh. Iqbal ₹ 1 lacs 5. Sh. Iqram ₹ 1 lacs Total ₹ 32 lacs 2. Briefly stated, the facts of the case are that the assessee is an association of persons (AOP) which derives income from royalty collection contract. It filed its return of income on 26-03-2012 declaring total income of ₹ 29,22,560/-. During the assessment proceedings, the AO observed that certain members have introduced huge amount of capital for the business aggregating to ₹ 76,45,000/- and after calling for the assessee s explanation and seeking information from the members by invoking section 133(6) of the Act, he made addition of ₹ 76,45,000/- by treating the same as unexplained capital introduction earned from undisclosed sources of income. 3. Being aggrieved, the assessee carried the matter in appeal before he ld CIT(A) and filed various evidences like bank statements, confirmat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es and disputes as is evident from the affidavit of one of the AOP member. He has withdrawn the whole amount of capital. Rather there is a debit balance of ₹ 90,69,452/- as on 31-03-2011 (copy of his ledger account in books of assessee is enclosed). The assessee has also requested specifically to call him for verification of facts but still his attendance was not enforced. Therefore, the capital contribution of ₹ 13 lacs made by him cannot be considered unexplained. Bhanwar Singh Makori (chouhan) V.P.O Makordi, Distt. Nagaur (Raj.) PAN: AYEPS2884C ₹ 15,00,000/- Amount of ₹ 15 lacs was given in cash out of business savings and family s agriculture income kept at home. However, there is no force in this contention as the bank facilities were available in the nearby towns and he being a prudent businessman would not keep the huge cash idle at home. Further the said creditor claimed to have given the amount out of agricultural income but no income from agricultural operation has been declared in the ITR. His confirmation is enclosed. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7; 1 lacs remained unexplained by the assessee. Mere submission of affidavit is not enough to discharge the onus cast upon the assessee. Iqbal is a tractor mechanic from last 32 years having a workshop along with Iqram at Sikar. He earns about ₹ 13,000/- per month, live in his own house, has simple life style and house hold expenses are about ₹ 5,000/- p.m. He has invested the amount in the AOP out of his current year income and savings of earlier years. In support of the same he has filed an affidavit. His confirmation is at. Thus, the source of capital contribution is fully explained. The opening balance is ₹ 3 lacs and no addition has been made in the assessment of earlier years. Hence, no addition can be made in the year under consideration. Iqram Near Anjuman Girls School, Mohalla Qureshiyan, Ward No.30, Sikar (Raj.) ₹ 1,00,000/- The assessee produced no evidence in support of his contention. Thus, the source and genuineness of cash transaction worth ₹ 1 lacs remained unexplained by the assessee. Mere submission of affid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee rely upon of affidavit dated 18/12/2015 from Sh. Vijay Singh Tanwar, one member of the AOP, stating that due to financial dispute with Sh. Yogindra Singh Chouhan, he is not co-operating in the proceedings and submit copy of his diving license, bank account statement. Submission of copy of Driving license and bank account statement of Sh. Yogendra does not prove the genuineness of above transaction. The contention that Sh. Yoginder Singh Chouhan not co-operating is not acceptable as Sh. Sh. Yogender Singh Chohan is one of the member of AOP and he is equally liable to tax proceedings nothing has bring on record such to prove their contention. Similar contention was taken during the course of assessment proceedings. The claim of the assessee cannot be relied upon as legal, judicial action has been taken against the person after period of more than 5 years has elapsed. ii) Further, it has been argued that out of above amount of ₹ 51,45,000/-, an amount of ₹ 38,45,000/- was not capital contribution, this was the money credited to his account on cancellation of demand draft issued from AOP on 25/02/211 and 26/02/2011 in favour of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sh. Bhanwar Singh Chouhan engaged in the business of property dealing and contract business and also claimed agriculture income. Copy of land holding of family furnished. Further, to verify the source creditworthiness and genuineness of transaction, it has been stated that the amount of ₹ 15 lacs were given in cash out of business savings and family agriculture income kept at home. Bank facilities are available in the nearby towns, therefore it can not be believed that a person having banking facility kept substantial amount of ₹ 15.00 lacs at home. In this regard on enquired it has been stated that हमारे परिवार के सदस्य कृषि आमदनी घर पे ही रखते है To examine the trend of keeping large amount at home, a question was raised to provide detail of amount deposited in the bank during demonization period. In re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actorily explained by the appellant. Under these circumstances the addition of ₹ 2,00,000/- is herby upheld. 7. Sh. lqbal S/o Yasin Khan, Sikar. Sh. lqbal contributed ₹ 1,00,000/- in cash to the assessee's capital. Regarding the above addition the AO submitted in his report dated 16.01.2019 as under:- An amount of ₹ 1,00,000/- credited in the name of above person as capital contribution. Sh. lqbal was produced for verification and statement recorded. In his statement he accepted to have given an amount of ₹ 1,00,000/- as capital contribution. During the statement it has been stated that he is a tractor mechanic and runs a tractor workshop at Jaipur road, Sikar and having monthly practice of ₹ 15,000/-The fund was given to M/s Vijay Group of companies out of past savings. No other supporting documents were submitted. Copy of statement is enclosed herewith. Sh. lqbal submitted before the AO that he runs a tractor workshop at Jaipur road, Sikar earned monthly income of ₹ 15,000/- and claimed to have given ₹ 1,00,000/- from this income. However I f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he credit have got to be distinguished. Moreover, the surrounding circumstances and preponderance of probabilities are also to be taken into consideration in judging the evidence adduced by the assessee. It is well established principle of law that in the case of cash credits, it is the duty of the assessee to establish the identity of the creditor, capacity of the creditor to advance the loan and genuineness of the credit: The mere fact that confirmation has been filed or even affidavits have been filed or the money has been received by cheque is not enough to discharge the onus. The same principles of law have been laid down in the following cases:- (i) CIT v. Nivedan Vanijya Niyojan Ltd. [2003] 263 ITR 6231 (Cal.); (ii) Rajshree Synthetics (P.) Ltd. v. CIT [2002] 256 ITR 331 2 (Raj.); (iii) Shankar Industries v. CIT [1978] 114 ITR 689 (Cal.) (iv) CIT v. Precision Finance (P.) Ltd. [1994] 208 ITR 4653 (Cal.). 7. We have heard the rival contentions and perused the material available on record. During the course of assessment proceedings, on perusal of the partners/members ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibution by Sh. Yogindra Singh Chouhan. It is no doubt true that there is movement in his personal account maintained with the assessee s AOP, however, the fact of the matter is that the explanation regarding the source of the capital introduction by way of cash and the creditworthiness of Sh. Yogindra Singh Chouhan remained unsubstantiated till date and initial onus cast on the assessee is not satisfied in the instant case. In light of the same, we do not see any infirmity in the action of the lower authorities. Hence, the addition of ₹ 13,00,000/- is hereby sustained. 9. In respect of Sh. Bhanwar Singh Makori who has contributed ₹ 15,00,000/- towards his capital contribution, the ld. CIT(A) has not accepted the contention of the assessee stating that the assessee has failed to prove his creditworthiness. Before us, it was submitted that he was produced for verification and his statement was also recorded during the course of remand proceedings where he has accepted to have given an amount of ₹ 15,00,000/- in cash by way of his capital contribution. Further, on perusal of his financial statement for the year ended 31.03.2011, we find that he has a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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