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TMI Blog2025 (1) TMI 1484X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT(A) is quite unsustainable in the eye of law and hence ground no. 2, 2.1, and 2.2 is hereby allowed.
Denial of exemption u/s 10(13A) of the HRA alleging absence of proof regarding payment of actual rent - As relevant that alleging absence of proof regarding payment of actual rent is unwarranted more so when the eligibility to claim HRA exemption is not disputed by the Revenue. It is also submitted that strangely the Ld. CIT(A) while deciding the appeal, ignored the back account statement submitted before him and dismissed the plea by stating that in the absence of actual rent paid by the assessee the submissions of him not accepted and above all it is highly relevant that the case of the assessee / appellant for the subsequent assessment years i.e. 2018-19 was also selected for scrutiny assessment wherein identical issue relating to exemption of HRA was examined in detail and thereafter the assessing officer fully allowed the claim to appellant without any deviation / disallowance. We find substance in submissions which is supported with relevant material on record and hence this ground of appeal is allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... d in law in not quashing/ deleting addition of Rs. 24,09,000 on account of denial of exemption under section 10(13A) of the Act of house rent allowance (HRA) alleging absence of proof regarding payment of actual rent. 4.1 That the CIT(A) erred on facts and in law in not appreciating that the appellant had duly submitted his bank statements demonstrating payment of actual rent made by the appellant. 4.2 That the CIT(A)/AO erred on facts and in law in making aforesaid disallowance by disregarding various other evidence placed on record by the appellant including rent agreement and Form-16 issued by the employer, in respect of exemption towards HRA. 5. That on the facts and circumstances of the case and in law, the assessing officer erred in levying interest under section 234B and 234C of the Act. The appellant craves leave to add, to alter, amend or vary the above grounds of appeal at or before the time of hearing. 3. Facts of the case may be summarized as that the income tax return declaring income of Rs. 1,39,65,310/- was filed electronically by the assessee / appellant on 28.19.2017 and subsequently, the case was selected for scrutiny under CASS. In the course of proceedi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and took a Rs. 1,00,00,000/- loan thereafter, which is being subject matter of the disallowance and repaid another of Rs. 1,00,00,000/- few months thereafter. So, aggregate loan taken during the year was Rs. 1,00,00,000/- and the aggregate loans repaid during the year was Rs. 3,00,00,000/- and all about transactions have been undisputedly carried out through banking channels. 7.1 The Ld. AR vehemently submitted that the addition of Rs. 1,00,00,000/-, which is made u/s 68 of the Act is beyond jurisdiction, illegal and bad in law for the reasons that in order to establish the genuineness, creditworthiness and identity of the amount received, the assessee / appellant has duely placed on record various documentary evidence which establishes and unequivocally proves all the ingredients of section 68 of the Act and once the assessee furnishes a reasonable explanation, the onus, it is trite law, shifts to the Revenue. 7.2 The Ld. AR further submitted that it is established position of law that the assessee has to provide documents to prove the identity and creditworthiness of the creditor as well as genuineness of the transaction and identity established if any information regarding PAN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment after examination. In this regard, also submitted that no adverse inference ever been drawn by the Revenue regarding abovesaid transactions in completed scrutiny assessment of earlier years for which the Ld. AR referred page no. 64-73 of PB, of assessment orders passed in the case of appellant for earlier years and subsequent years, which sufficient to establish the reality. It was also submitted that in this case transaction in question is between wife and husband and not with the third party, the funds received from wife are here own funds. 7.5 The Ld. AO observed in the assessment order that it is found that the lender has disclosed income for AY 2017-18 of mere Rs. 48,99,980/- which is not commensurate with the loan amount forwarded and per contra, the Ld. AR submitted that the creditworthiness of the lender doubted on the basis of above fact. In this context, it is submitted on behalf of the assessee appellant that the Mrs. Freyan Jamshed Desai is a resident individual and is regularly assessed to tax as per the provisions of the Act. For the year under consideration Mrs. Freyan Jamshed Desai filed her return of income on 25.07.2017 declaring income of Rs. 48,99,980. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. Ground no. 3 not pressed by the assessee and need not be adjudicated 11. Regarding ground no. 4 to 4.2, the Ld. AR submitted that the addition of Rs. 24,09,000/- on account of denial of exemption u/s 10(13A) of the Act of the HRA alleging absence of proof regarding payment of actual rent and not appreciated that assessee / appellant duly submitted his bank statement demonstrating payment of actual rent made by the appellant and disregarding the various other evidences placed on record by the assessee including rent agreement and Form 16 which was duly issued by the employer, in respect of exemption towards HRA in question. The Ld. AR also submitted that in order to satisfy his claim, he has submitted lease deed dated 02.05.2014 between the applicant and landlords, bank account statements of the applicant, highlighting the rent paid entries, form 16 issued by the employer, calculation of HRA exemption and PAN of the landlords. It is submitted that the Ld. AO ignored the above documentary evidences and proceeded to make disallowance of HRA exemption of Rs. 24,09,000/- under section 10(13A) of the Act by stating that there is no any proof regarding payment of actual rent. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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