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TMI Blog2024 (6) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee/appellant be given opportunity to file additional evidence in support of his claim of identity of the parties who advanced loans and their creditworthiness alongwith genuineness of the transactions. In view of the provisions of the Rule 30 of the Appellate Tribunal Rules, 1963 and in the given facts and circumstances, the case is restored to the file of the Ld. AO who shall consider the additional evidence to be filed by the assessee/appellant before the Ld. AO within the period of 60 days from this order. The grounds of the appeal are allowed for statistical purposes. - Shri. Prashant Maharshi, Accountant Member And Shri. Raj Kumar Chauhan, Judicial Member For the Assessee : Shri. Ajay R. Singh/Akshay Pawar, Adv. For the Department : Shri. H. M. Bhatt (Sr. D.R.) ORDER PER RAJ KUMAR CHAUHAN (J.M.): 1. The assessee has instituted the present appeal for the A. Y. 2015-16 wherein the Appellant has challenged the order dated 19.10.2023 of Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as the CIT(A) ], passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as the Act ] has been challeng ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above loan parties alongwith copy of ITR and relevant page of the Bank Statement. In order to verify the identity, genuineness, creditworthiness and modes of operandi of the lenders, notice under section 133(6) was issued to the above-mentioned unsecured loan parties. 5. The matter was referred to the DIT (Investigation) Unit-1, Surat, vide letter dated 11.12.2017 stated that lenders parties are not available on the given address and no business activity was undergoing on the address of the unsecured loan parties. Hence, genuineness of the interest expenditure and identity of the unsecured loan parties remained unexplained. 6. Accordingly, a show cause notice dated 13.12.2017 was issued to the assessee. In response to the show cause notice, the assessee filed submissions vide letter dated 13.12.2017. In the said response, the assessee has given details of the financial documents and property of the unsecured loan creditors. The assessee has taken loan from the parties to utilize the same for business purposes. TDS has been deducted and interest paid Rs. 1,51,31,232/- has been debited to profit and loss account and was carried over as work in progress (WIP). The assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T(A). The First Appellate Authority i.e., the Ld. CIT(A) has dismissed the appeal vide impugned order dated 19.10.2023. Hence, the present appeal has been instituted on the following grounds: - Addition/disallowance of Rs. 3,76,31,232/-: a. The learned CIT (A) erred in upholding the addition/disallowance aggregate of Rs. 3,76,31,232/-, being loan taken of Rs. 2,25,00,000/- during the year and Rs. 1,51,31,232/- being interest paid to 8 parties on loans of previous years (reduced from closing WIP by AO), without appreciating that assessee had duly discharged the burden of proof by producing all the primary evidence namely loan confirmation, ITR audited financial, copies of bank statement of lenders, repayment details etc. in support of the loan parties, therefore the addition/disallowance sustained by the Id. CIT(A) is not justified. b. The learned CIT (A) failed to appreciate that loan parties are assessed to tax, transaction is by A/c payee cheques and all primary evidence were duly filed by the assessee, loans are repaid back by A/c payee cheques, thus assessee has proved identity of parties, genuineness of transaction and creditworthiness of parties beyond doubt because parties h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s which are necessary to prove the genuineness and creditworthiness of the parties from whom the unsecured loans were taken can be permitted under Rule 29 of the Appellate Tribunal Rule, 1963 and for that reasons, the application for additional evidence has been made by the assessee/appellant which may be considered by the Hon ble Tribunal as there was justified reasons for non-production of said additional evidence before the Ld. AO by the assessee/appellant. 12. The Ld. AR on behalf of assessee has relied upon the following citations: - a. PCIT Vs. Ambe Tradecorp (P.) Ltd. [2023] 290 Taxman 471 (Gujrat) [05-07-2022]. b. DCIT Vs. Shri Jayesh R. Thakkar, ITA No. 3407/AHD/2015, A.Y. 2011-12, dated 16.10.2023, (Ahmd-Trib). c. H.R. Mehta Vs. ACIT, (Bombay)[2016] 387 ITR 561 (Bombay) [30.06.2016] d. CIT Vs. Kapoor Chand Mangesh Chand, [2013] 218 Taxman 157 (Allahabad) (Mag.) e. Pr. CIT Vs. M/s. Skylark Build ITXA No. 616 of 2016, dated 24.10.2018, (Bom-HC). f. ACIT-24(3) Vs. Shri. Ramesh Ramswarupdas Jindal, ITA No. 3091 to 3096/M/2017, dated 15/11/2017, (Mum-Trib). 13. In addition, the assessee/appellant has also relied the judgment of the Ld. Coordinate Bench in ITA No. 5615/Mum/2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll. On the contrary, the assessee had filed the entire documents, required to establish the identity of the creditors and their creditworthiness, as well as the genuineness of the transaction. 17. Thus, it is clear that in the case before the Ld. Coordinate Bench, the assessee has filed all the documents before the Ld. AO who had failed to consider the same, therefore, the same were duly considered by the Ld. CIT(A) and for that reasons, the Ld. Tribunal dismissed the appeal of the revenue against the order of the CIT(A). 18. Now the question before us is whether the assessee/appellant can be permitted to file additional evidence in order to establish the identity of the creditors and their creditworthiness as well as genuineness of the transaction. 19. The assessee/appellant has sought permission of the additional evidence under Rule 29 of Appellate Tribunal Rules, 1963. Therefore, let us examine the Rule 29 of the Appellate Tribunal Rules, 1963. Production of additional evidence before the Tribunal: - 29. The parties to the appeal shall not be entitled to produce additional evidence either oral or documentary before the Tribunal, but if the Tribunal requires any documents to be p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dalpatrai. In view of the above, we answer question No. 3 in the negative and in favour of the assessee. In view of the above answer to question No. 3, questions Nos. 1 and 2 need not be answered. 21. The Hon ble High Court of Karnataka in ITA No. 506 of 2018, M/s. Google India Private Ltd. Vs. The Commissioner of Income Tax, order dated 17.04.2021 has been pleased to hold that if additional evidence is to be considered and allowed by the Tribunal, the parties to the proceedings or the affected party should be well aware of the said material/additional evidence, before the same is considered by the Hon ble Tribunal. Para 19 of the judgement of the Hon ble High Court of Karnataka in ITA No. 506 of 2018 referred (supra) is relevant and reproduced as under: 19. In the considered opinion of this Court, keeping in view Rule 29 of the Income Tax (Appellate Tribunal) Rules, 1963 and also keeping in view the fact that the material on the basis of which the order has been passed was not furnished to the appellant at any point time, the order passed by the Tribunal is certainly violative of principles of natural justice and fair play as the appellant was not afforded an opportunity to rebut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uineness of the claim of the assessee/appellant for producing additional evidence. 24. For the above reasons, we find reasons to allow the additional evidence to be filed by the assessee/appellant in order to establish the genuineness of the transactions. It is so because in case the judgment of the Ld. Coordinate Bench is to be considered wherein the identity of the parties, there creditworthiness and genuineness of the transactions were considered because the documents have already been filed before the Ld. AO, hence, the genuineness of the transaction needs to be established independently by the assessee for the relevant A.Y. 2015-16. For that reasons, the end of justice requires that assessee/appellant be given opportunity to file additional evidence in support of his claim of identity of the parties who advanced loans and their creditworthiness alongwith genuineness of the transactions. 25. Rule 30 of the Appellate Tribunal Rules, 1963 provides as under: Mode of taking additional evidence: - 30. Such document may be produced or such witness examined or such evidence adduced either before the Tribunal or before such income-tax authority as the Tribunal may direct. 26. In view o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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