9911796707
TMI Blog2021 (3) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... balance sheet does not arise and the AO erred in making the addition u/s 69B of the Act. Coming to the action of the Ld. CIT(A) he confirmed the addition u/s 69A of the Act treating it as unexplained money in possession of the assessee u/s 69A of the Act which is also erroneous, since the source of loan is acknowledged by the AO as from Vijaya Bank and therefore the question of unexplained money does not arise and so addition u/s. 69A of the Act is not legally sustainable. Therefore, the addition made by the authorities below on the facts and circumstances of the case is erroneous and, therefore, even though for whatever reason/over-sight the assessee had not disclosed the loan as liability in the balance sheet and since the incurring of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during the FY 2011-12 relevant to AY 2012-13 and closing balance stood at ₹ 2,33,950/- (Dr.). According to the AO, the assessee had not shown the liability in his accounts i.e. either in M/s United Industries or in his personal account. According to AO, he asked the Ld. A.R of the assessee to explain as to why the amount of ₹ 2,33,950/- should not be added to the total income of the assessee, since the corresponding asset had not been reflected in the Balance sheet as on 31.03.2012. According to AO, the Ld. A.R of the assessee could not offer any satisfactory explanation on this issue. Hence, the amount of ₹ 2,33,950/- was added by the AO to the total income of the assessee as undisclosed investment u/s 69B of the Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alance amount against loan amounting to ₹ 2,33,950/- u/s 69B of the Act. During the appellate proceedings, the Ld. A.R argued that, the amount in question was not an investment but it was a loan, and that too, to a personal loan. Therefore, the Ld. AO was not justified in making the addition u/s 69B. 5.2. I have considered the facts of the case. First of all, the Ld. A.R has stressed that the loan was of personal nature and hence it was not required to be recorded in the appellant s balance sheet. I find this argument unacceptable. Any financial transaction whether it is for business or for the individual, needs to be recorded in the balance sheet. The Income Tax Act has no general provision exempting the personal transactions f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO that the assessee had paid interest to the tune of ₹ 48,831/- during the FY 2011-12 relevant to AY 2012- 13 and closing balance stands at ₹ 2,33,950/- (Dr.). However, The AO observed that the assessee had not shown the liability in his accounts i.e. either in M/s United Industries or in his personal account. He confronted the assessee about non-disclosure of this loan liability in his balance sheet. And, according to AO, since the corresponding asset has not been reflected in the balance sheet as on 31.03.2012, he show-caused the assessee as to why the unclosed loan amount of ₹ 2,33,950/- should not be added to the total income of the assessee. According to the AO since the assessee could not offer any satisfactory expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken the loan of ₹ 2,33,950/- from Vijaya Bank for his personal requirement and contended that there was no requirement to reflect the same in his balance sheet. However, the said contention of assessee was repelled by the Ld. CIT(A) and as per him, since the assessee has not disclosed this loan amount as a liability in the balance sheet, the same need to be taxed u/s 69A and not u/s. 69B as made by the AO. So, Ld. CIT(A) has taxed it u/s 69A of the Act treating it as unexplained money in possession of the assessee. This action of Ld. CIT(A) is assailed before me by the assessee. This Tribunal does not countenance this impugned action of the Ld. CIT(A) for the reason that it is a common knowledge that a liability (loan) cannot be in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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