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TMI Blog2024 (1) TMI 1035X X X X Extracts X X X X X X X X Extracts X X X X ..... AO has not thrown back the onus of the above three ingredients back on the assessee by making adequate enquiry or throwing back the evidences available and also granting assessee and a point unity of cross-examination. Therefore the CIT - A has held that assessee has discharged initial onus cast upon section 68 of the act which has not been discredited by the assessing officer by making adequate enquiry and further the assessing officer has violated the provisions of the principles of natural justice by not granting the evidences available with the AO for making evidence and not granting an opportunity of cross examination of the statement of the persons used by the AO. Nothing was shown to us that the order of CIT-A is not sustainable. Accordingly we confirm the order of the learned CIT A in deleting the addition u/s 68 of the income tax act by the assessing officer. Decided in favour of assessee. - Shri Prashant Maharishi, Am And Ms. Kavitha Rajagopal, JM For the Assessee : Shri Jaiprakash Bairagra, AR For the Revenue : Shri Ashok Kumar Ambastha, DR ORDER PER PRASHANT MAHARISHI, AM: 01. This appeal is filed by the assessee against the appellate or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax permanent account number, iv. ledger confirmation and v. Financial statement of both the parties. 07. The assessee also submitted that he has taken loan by account payee cheque, interest have been paid through account payee cheques and further these loans have been repaid by account payee cheques. Assessee also requested LD AO to provide information received from Investigation Wing and to ask the parties to make available for cross-examination. 08. The learned AO considered the submission of the assessee and rejected the same holding that one Mr. Rajendra Jain in a statement recorded under section 132 (4) of the IT act has admitted that the entities from whom the assessee has taken loan are controlled and managed by him. Proprietor of lender also confirmed the same in statement recorded under section 131 of the act. Accordingly the learned assessing officer held that alleged loan of Rs. 1 crore received from exports and ₹ 1.5 crore from Kanavati Impex Private Limited are added to the total income of the assessee under section 68 of the act. Accordingly the assessment order under section 143 (3) of the income tax act, 1961 was passed on 29/3/2015 wherein the tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 21 and the order is deemed to have been passed in pleading the legal hair of the assessee. Despite that the learned CIT A passed the order in the name of the diseased assessee on 30/1/2023. 012. When the appeal was heard earlier it was found that the form number 36 filed by the learned AO has made the respondent who is a diseased assessee and therefore such appeal filed by the revenue is not valid. Now the revised form number 36 and additional ground of appeal as been filed by the learned assessing officer by filing amended form number 36 wherein Hetal N Shah legal hair of the assessee has been made the respondent and additional ground is raised holding that in terms of provisions of section 159 of the act the appeal of the revenue may be admitted. 013. On careful consideration of the fact that the revenue has revised form number 36 and as the learned CIT A despite knowing that the assessee has passed away passed the appellate order in the name of diseased assessee, the revised form number 36 is accepted and the appeal of the revenue is now found to be valid. Therefore, the arguments of the assessee with respect to the invalidity of the appeal of the learned assessing off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the issue is squarely covered in favour of the assessee by the decision of the honourable Supreme Court in case of Andaman Timbers industries (281 CTR 241). Further reliance was placed on the decision of other honourable High Court s in 151 taxmann.com 486. The assessee further stated that that when the loan is repaid that no addition can be made under section 68 relying on the decision of the honourable Bombay High Court in case of principal Commissioner of income tax versus Skylark build in ITA number 616 of 2016. He further stated that when the statement given by the parties have been retracted, it loses its evidentiary value and therefore no cognizance can be taken of the same. In such circumstances, the assessing officer should have examined those persons and given an opportunity to the assessee of cross-examination. For this proposition, he relied upon the decision of the honourable Supreme Court in case of Mehta Parikh co VS CIT 30 ITR 181 and of the coordinate bench in ITA number 5783/M/2017. The learned authorized representative further relied on the decision of the honourable Delhi High Court in case of 191 taxman 51 (Delhi) (322 ITR 396) wherein it has been held that w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ihant exports has the total assets of Rs. 51.92 crores as per the balance sheet submitted it has also the sundry creditors of 51.91 crores. In case of the loan taken from company the total assets of that, company is amounting to ₹ 59.20 crores. The assessing officer has made the addition based on the statement of the parties wherein the statement were retracted later on by filing an affidavit which was submitted before the learned CIT A and the assessing officer such retraction is for filed by the affidavit dated 10/10/2013 before the assessment order is passed. In view of this, the statement loses its relevance it have been retracted. In such a situation needs to be found out that whether assessee has discharged its initial onus or not as shown under section 68 of the income tax act. If the assessee has discharged its onus, it is for the assessing officer to examine such evidences and throw back the onus on the assessee back. It can be done by making adequate enquiry and proving that the evidences placed by the assessee of identity and creditworthiness of the parties and the genuineness of the transaction are not valid. In the present case, the assessee has placed all thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that cross-examination of the said dealers could not have brought out any material which would not be in possession of the Appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the Appellant wanted to cross-examine those dealers and what extraction the Appellant wanted from them. 6. As mentioned above, the Appellant had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of cross-examination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of cross-examination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross-examination and make the remarks as mentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y and foundation for invoking the provisions of section 68 of the income tax act as held by the honourable Supreme Court. This mandatory in assessing officer should have made any enquiry and thereafter if assessee fails to prove to the satisfaction of the assessing officer and the necessary ingredients of provisions of, then only in the assessing officer is empowered to make the addition. In the present case before us the assessee officer has not made any enquiry unlimited submitted by the assessee but has simply relied upon the statement recorded by the investigation wing which were subsequently retracted. And even those statements along with the opportunity of cross-examination of the persons making statement was not allowed to assessee. In view of this, we are not in a position order of the assessing officer. 022. The learned CIT A while allowing the appeal of the assessee has also categorically held that assessee has discharged his onus cast upon him under section 68 of the act by proving the identity and creditworthiness of the lender along with genuineness of the transaction by producing the confirmation, Ledger, bank statement of the lender and the income tax returns. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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