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04-04-2019, Manoj Kumar Jain, Section 269SS, 271D, Tribunal Jaipur

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1 week 2 days ago #9103 by amit
Section - 269SS, 271D, 132, 131
Order Date - 04-04-2019
Favouring - Assessee
Court - Tribunal Jaipur
Appellant - Manoj Kumar Jain
Respondent - ITO
Citation - 419Taxpundit138
Appeal No. - ITA No. 1298/JP/2018
Asstt. Year - 2015-16



These two appeals by the assessee are directed against two separate orders of the ld. CIT(A), Ajmer dated 17.09.2018 & 30.10.2018 arising from assessment order passed U/s 143(3) and penalty levied U/s 271D of the I.T. Act. respectively. First we taken up the quantum appeal in ITA No. 1298/JP/2018 wherein the assessee has raised following grounds:-

“1. The learned Commissioner of Income Tax (Appeals) grossly erred-in-law and on facts in confirming in addition of unexplained interest expenses amount of Rs. 90,000/-. While unsecured loan amount Rs. 10,00,000/- t ansaction is not related to assessee ( Mr. Manoj Kumar Jain.

2. The order confirmed by the learned Commissioner of Income Tax (Appeals) is bad-in-law, based on surmises & conjectures, arbitrary & Cap icious injudicious, against the settled principles of law, as such the same deserved to be amended.”

2. The assessee is an individual and derived income from transport contractor. The assessee filed e-return of income on 29.02.2015 declaring total income of Rs. 7,16,730/-. The Assessing Officer received information from ADIT(Investigation), Kota vide letter dated 15.03.2016 whereby it was informed that a search and seizure action U/s 132 of the Act was carried out on 02.07.2015 in case of Kota Dall Mill Group.

During the said search and seizure action some incriminating documents were found and seized in respect of M/s Badjatya Freight Carrier, Beawar relating to the assessment year 2015-16. Thus, the AO noted from the information that the assessee received loan of Rs. 10,00,000/- in cash from one Shri Ayush Agarwal as per the seized documents. The assessee has also paid unaccounted interest in cash of Rs. 90,000/- during the year. The AO accordingly observed that the transactions were made through cash and hence, the assessee has made violation of provisions of Section 269SS of the I. T. Act. The AO also examined the assessee by recording his statement U/s 131 of the Act on 06.11.2017. The AO accordingly held that the assessee could not give satisfactory reply regarding loan received from Shri Ayush Agarwal and consequently addition of Rs. 90,000/- was made on account of unaccounted/ unexplained interest expenses. The assessee challenged the action of the AO before the ld. CIT(A) but could not succeed.

3. Before us, the ld. AR of the assessee has submitted that in his statement recorded U/s 131 of the Act the assessee has stated that he has not taken any loan from Shri Ayush Agarwal. Even he does not know Shri Ayush Agarwal of Kota Dal Mill group but the AO ignoring statement of the assessee has made the addition of Rs. 90,000/-. The ld. AR of the assessee has further contended that when the assessee is not having any business relation or personal relation with the alleged Shri Ayush Agarwal then how he can lend such a huge amount to the assessee. The ld. AR has referred to the alleged two slips/hundies and submitted that these documents were not signed by the assessee but these are purported to be signed by one Mr. Saurabh Jain therefore, when the assessee has no connection with the alleged person named Shri Saurabh Jain who have signed these documents then, these documents does not relate to the assessee Thus, the ld. AR has submitted that the alleged documents seized in the search and seizure action in the case of Kota Dal Mill group does not establish the fact that the assessee has taken loan. Once the documents are neither signed nor executed by the assessee but merely the name of the assessee concerned is appearing on these documents would not establish the fact of taking loan. The ld. AR has further contended that the assessee has not carried out any transaction either directly or through any broker as alleged by the AO. Further, the Assessing Officer has made the addition based on the document which do not relate to the assessee.

The assessee has also explained the transaction with broker who is a different person and not Shri Shyamji as alleged by the AO. All the transaction with Shyam Broker has been carried out through cheque and are reflected in the books of account of the assessee therefore, the transaction in question does not pertain to the assessee. The Assessing Officer has not carried out any further inquiry to establish the fact that the transaction in the seized documents belong to the assessee.

Therefore, in the absence of any corroborative evidence to show that these documents are related to the assessee no addition can be made in the hands of the assessee. Hence, the ld. AR has submitted that the addition made by the AO on presumption and surmises is liable to be deleted.

4. On the other hand, the ld DR has submitted that the seized documents clearly established the fact that the assessee has paid interest of Rs. 90,000/- on the loan of Rs. 10,00,000/- received in cash. The said seized documents were found in the search and seizure action carried out in case of Kota Dal Mill group. During the appellate proceedings, the ld. CIT(A) has called for remand report from the AO for giving one more opportunity to the assessee. The document is
clearly signed on behalf of M/s Badjatya Freight Carrier by one Shri Saurabh Jain and it also mentioned the name of the broker as Shyan ji. The assessee was having transaction with the said broker though in his

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