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TMI Blog2024 (2) TMI 603X X X X Extracts X X X X X X X X Extracts X X X X ..... their income is disproportionate to the loan advanced without making any verification in the case of the depositors. During the course of assessment proceedings and through additional evidence, the appellant has submitted the ITR reflecting the PAN and address details, relevant bank statement and confirmation of the creditors. Thus the assessee can be said to have discharged the onus laid upon them. CIT(A) has rightly held that, AO has rejected the evidences furnished by the appellant without establishing falsity of the documents filed by the assessee. Personal identities of these investors were proved, the sources have been proved, the ITRs and the subsequent repayments has been examined. Having so examined the CIT(A) came to a conclusion that the AO is not justified treating the unsecured loans received u/s. 68. Appeal of the Revenue is dismissed. - SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND DR. B. R. R. KUMAR, ACCOUNTANT MEMBER For the Appellant : Sh. Sampath, Adv. and Sh. V. Rajkumar, Adv. For the Respondent : Sh. Vivek Kumar Upadhyay, Sr. DR ORDER Per Dr. B. R. R. Kumar:- The present appeal has been filed by the revenue against the orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terial available on record. 9. The appellant has filed the confirmation of few parties and copy of acknowledgement of their income tax return for various assessment year to prove the genuineness of the transaction and creditworthiness of the parties. The ld. CIT(A) called remand report from the Assessing Officer on the additional evidences filed and also examined the submission of the assessee on the comments of the Assessing Officer on the remand report. 10. The evidences filed comments of the AO and the submissions of the assessee with regard to all the twenty five parties are as under: S No. Name of the lender Amount received Comments from AO Assessee s submission PARTIES WHERE AO HIMSELF AGREES ABOUT TIL CREDITWORTHINESS 1 Abhinav Kumar HUF (Family HUF) 6,50,000 ITR for AY 2011-12, 2012-13 and 2013-14. As per ITR, the party has creditworthiness however, no eligible copy of bank statement has been provided to ascertain the amount of transfer of unsecured loan to the assessee company. No confirmation from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e income is a skewed approach and not justifiable. Even if one was to adopt the approach of the Ld Assessing Officer, a sum up of last 5 years taxable income will make it amply clear that the creditors did have capacity to advance the amount of loan. In most of these cases, the ld. Assessing Officer has relied on the ground that the money was received by the creditor and the transfer made to the assessee were in close proximity of time, some even on the very next day. This is a factual matter and there is nothing in law barring a person to transfer money even on the very same day as is received by them Income of the depositor are mainly interest income on money advance. 4 Bhaveshbhai Talshaji Patel 5,00,000 As per ITR for AY 2010-11 and 2011-12, the party has shown income at Rs 1,55,000 and Rs 1,56,655 respectively. The party has no creditworthiness and even no bank statement or confirmation provided. 5 Geetaben Chiragbhai Patel 5,00,000 Only ITR provided for AY 2010-11, the party has filed income at Rs 1,28,905. No bank statement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntire amount to the assessee company on 19.10.2011. The party has no creditworthiness to extend such amount of loan to the assessee company. 12 Vaghabhai Ratnabhai Patel 5,00,000 As per ITR provided for AY 2011-12 and 2012-13 the party has shown income at Rs 1,54,709, Rs 1,78,640. As per Bank statement Legible (по сору), appears that the party has received money of Rs 5,00,000 unknown From entity and transferred next day to the company. The party has no creditworthiness to extend such amount of loan to the assessee company. 13 Ramesh bhai Hiralal Mandaliya 4,50,000 As per the only ITR provided for AY 2012-13, the party has shown income at Rs 1,53,910. As per bank statement, the party has received money from unknown entity on 21.12.2011 and transferred the entire amount of Rs 4,50,000 the assessee company on 22.12.2011. The party has no creditworthiness to extend such amount of loan to the assessee company. 14 Geetika Gupta (R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or Al 2012-13, 2013-14 and 2014-15, relevant bank statement and confirmation vide submission dated 19.02.2015. Without providing any specific basis, the Ld AO has simply disallowed the amount arbitrarily. 18 Manjitbhai Dondabhai Gamit 10,00,000 As per ITR for AY 2011-12, 2013-14 and 2014-15, the party has shown income at Rs 1,61,048, Rs 1,94,580 and Rs 1,98,244 respectively. As per the bank statement, the party has received Rs 10,00,000 through RTGS from Raju enterprise and R Bariya Exports and On 22.12.2011, the whole amount Of Rs 10,00,000 Was transferred to the assessee company. This shows that the party has no creditworthiness to extend such amount of loan and money received by him were from unknown entities. The disallowance in this case is simply arbitrary and without any basis. The La AO himself provides the source of the creditor being amount received from Raju Enterprise and Bariya exports. If the La AO is attempting to go into source of source of source, it is a never ending process and highly prejudicial to the assessee company who has no knowledge of the funding of the creditor. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of the creditor. The Ld Assessing Office has erroneously only used taxable income for his analysis which is computed after certain deductions and allowances and the financial capacity of the creditor is based on factors more than taxable income. The credit capacity of a creditor cannot appropriately judged from the taxable income of the creditor. 21 Mukesh Rajendra PRasad 10,00,000 As per ITR for AY 2013-14 and 2014-15 provided, the party has shown income at Rs 1,73,290 and Rs 1,93,290 respectively. No other details have been provided. The party has no creditworthiness extend such amount of loan to the assessee company. 22 Narpit Mahipat Chodhri As per ITR for AY 2012-13, AY2013-14 and 2014-15, the party has shown income at Rs 1,60,411, Rs 1,93,280 and Rs 1,94,580 espectively. As per bank statement the party has received money through RTGS/transfer from unknown entity on 21.12.2011 and on 22.12.2011 the money was transferred to the assessee company. The party has creditworthiness to extend such amount of loan to the assessee company. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidences to prove the identity and creditworthiness of the persons with whom the transactions have been entered into . 12. The ld. CIT(A) categorically held that, the assessee has explained in respect of each unsecured loan. 13. On going through the entire details, we find that the assessee has furnished all the required documents during the course of assessment proceedings and additional evidences in appellate proceedings. The AO has disregarded the creditworthiness of the lenders stating that they did not have sufficient sources or that their income is disproportionate to the loan advanced without making any verification in the case of the depositors. During the course of assessment proceedings and through additional evidence, the appellant has submitted the ITR reflecting the PAN and address details, relevant bank statement and confirmation of the creditors. Thus the assessee can be said to have discharged the onus laid upon them. The ld. CIT(A) has rightly held that, AO has rejected the evidences furnished by the appellant without establishing falsity of the documents filed by the assessee. The personal identities of these investors were proved, the sources have been pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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