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TMI Blog2024 (4) TMI 1217X X X X Extracts X X X X X X X X Extracts X X X X ..... rovisions of section 115BBE would not be attracted. Since the issue is common for all the assessment years and based on the same seized material and nature of transactions therefore, this finding is applicable for all the assessment years. Appeal of assessee allowed. - SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI B.M. BIYANI, ACCOUNTANT MEMBER For the Assessee : Shri P.D. Nagar, AR For the Revenue : Shri Ashish Porwal, Sr. DR ORDER PER VIJAY PAL RAO, JM: These three appeals by assessee are directed against the composite order of the Commissioner of Income Tax (Appeal)-3, Bhopal dated 25.10.2023 for A.Y. 2020-21, 2017-18 2016-17 respectively. The assessee has raised common ground in these three appeals. The grounds raised for A.Y. 2020-21 are reproduced as under: 1) That the Ld. Commissioner of Income tax (A) erred in law in holding that a sum of Rs. 35.00 lacs remained unexplained which was received in cash against booking of premises converted into temporary loan on cancellation of booking. He erred in not appreciating the fact that receipt of advance against booking of office/show-room premises is normal business activity and in case such booking is cancelled due to various rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 132 of the Act on 12.01.2021 at the business and residential premises of the partners of the assessee firm. During the course of search and seizure proceedings several incriminating documents were found which were inventoried to BS-1 to BS-4 as well as LPS- 1. Based on the entries in the seized material the assessee surrendered inter alia the income on account of these booking amounts converted into unsecured loans and the details of the surrendered amount on this account are as under: Assessment year Amount of loan accepted 2016-17 Rs. 3,50,000/- 2017-18 Rs. 39,20,000/- 2020-21 Rs. 35,00,000/- Total Rs. 77,70,000/- 3.1 The AO in the assessment order has held that the above said loan of Rs. 77,70,000/- as found recorded in the seized documents has been accepted in cash from different parties and not recorded in the regular books of account. Therefore, the same is treated as unexplained money u/s 69A r.w. section 115BBE. The assessee challenged the action of the AO treating the unsecured loan as unexplained money u/s 69A r.w section 115BBE before the CIT(A) but could not succeed. 4. Before the Tribunal the Ld. AR of the assesse has submitted that during the course of search and seiz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness that on cancellation of booking the advance is refund to the buyers along with interest and therefore, the assessee has converted booking advance amount into unsecured loan which is a business receipt as receiving the booking advance is normal business activity and on cancellation by the prospective buyers the assessee requested the buyers to convert the same into temporary loan to be repaid along with interest. Thus, the Ld. AR has submitted that the provisions of section 69A are not attracted in the case of the assessee when the entries of unsecured loan in the seized material was not in the form of any money, bullion, jwellery or other valuable article. Further it was only liability which was subsequently discharged by repayment of the loans. Therefore, these unsecured loans taken by the assessee outside the book cannot be treated as unexplained money as per the provisions of section 69A of the Act.In support of his contention he has relied upon the decision of Delhi Benches of the Tribunal dated 27.10.2023 in case of DCIT vs. Tapesh Tyagi in ITANo.1344/Del/2021. 5. On the other hand Ld. DR has relied upon the order of the authorities below and submitted that the AO as we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed material, the name of the lenders, date of the loan along with amount which was accepted and interest paid on the same. All these details are found recorded in the seized material itself and therefore, the entries in the seized material are self-explanatory to extent of nature and source of these unsecured loans. It is not the case of introduction of cash credit in the books of accounts and assessee failed to discharge the onus of proving identity, creditworthiness of the creditors and genuineness of the transactions. Once the transactions are recorded in the seized material giving all the details regarding nature and source of the transactions then question of further explaining the nature and source of these transactions does not arise. Since these transactions were not recorded in the books of account therefore, the assessee surrendered these amount to tax. The provisions of section 69A are attracted in the case where the assessee is found to be owner of any money, bullion, jewellery or other valuable articles and the same are not recorded in the books of account, and the assessee failed to offer any explanation about the nature and source of acquisition of money, bullion, je ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pute, assessee offered the amount of Rs. 30.20 crores as income. Thus, the aforesaid facts clearly establish that at the time of search and seizure operation itself, assessee has explained the source of the amount offered as income to be the profit derived from commodity trade , which is in the nature of business income. It also appears that the departmental authorities have no dispute with regard to the explanation of the assessee regarding the source of the surrendered income. 8. As rightly observed by the learned First Appellate Authority, section 69A uses word may , which implies that if explanation offered by the assessee regarding source of money, bullion, jewellery or other valuable articles is satisfactory, it cannot be treated as unexplained money under Section 69A of the Act. In the facts of the present appeal, there is nothing on record to suggest that assessee's explanation regarding the source of the income offered has either been doubted or disputed at the time of search and seizure operation or even during the assessment proceedings. Therefore, in our view, the income offered by the assessee cannot be treated as unexplained money under Section 69A of the Act. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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