INCOME TAX APPELLATE TRIBUNAL
That on the facts and circumstances of the case, the Ld. CIT (Appeal) was not justified in confirming the addition of Rs.30,00,000/- on account of unsecured loan on mechanical basis even though all transactions in the account are by account payee cheques including the loan amount which has been repaid back in next year.
M/s. Subba Microsystem Limited, 267, Masjid Moth, Udaipark, NDSE-II, New Delhi – 110 049. (PAN: AAACM9827G) (APPELLANT) vs. ACIT, CC – 9, New Delhi. (RESPONDENT) ASSESSEE BY: Shri R.S. Singhvi, Advocate REVENUE by: Smt. Jyoti Legha, Senior DR
IN THE INCOME TAX APPELLATE TRIBUNAL
(DELHI BENCH ‘G’: NEW DELHI)
SHRI I.C. SUDHIR, JUDICIAL MEMBER
BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER
(ASSESSMENT YEAR : 2009-10)
M/s. Subba Microsystem Limited,
267, Masjid Moth, Udaipark, NDSE-II,
New Delhi – 110 049.
ACIT, CC – 9,
ASSESSEE BY: Shri R.S. Singhvi, Advocate
REVENUE by: Smt. Jyoti Legha, Senior DR
PER B.C. MEENA, ACCOUNTANT MEMBER:
This appeal filed by the assessee emanates from the order of CIT (Appeals)-XXXII, New Delhi dated 28.06.2012.
2. The return of income was filed on 30.09.2010 declaring loss of Rs.9,84,397/-. The assessment was finalized at a positive income of Rs.20,15,600/- by making the addition of unsecured loan of Rs.30 lacs.
3. The grounds taken by the assessee read as under:-
“1. That on the facts and circumstances of the case, the Ld. CIT (Appeal) was not justified in confirming the addition of Rs.30,00,000/- on account of unsecured loan on mechanical basis even though all transactions in the account are by account payee cheques including the loan amount which has been repaid back in next year.
2. That on the facts and. circumstances of the case, the CIT(A) was not justified in not accepting or considering the submission and the evidences as provided by the appellant regarding confirmation of loan given by the lending company, copy of its bank statement, and MCA data of the company including its PAN evidencing its identity and existence.
3. That the orders of the lower authorities are not justified on facts of the case, and same are bad in law.
delete any of the grounds of appeal on or before the date of hearing of the appeal as may be necessary and in the interest of the justice, and all the above grounds are without prejudice to each letter.”
The only issue involved is against confirming the addition of Rs.30 lacs on account of unsecured loan.
4. Ld. AR submitted that CIT (A) has mechanically confirmed the addition made by the Assessing Officer while all the transactions in the accounts are through account payee cheques only. The loan was by cheques only. The loan amount has been also repaid in the subsequent year. The ld. AR also submitted that CIT (A) has not accepted or considered the submissions and evidences submitted by the assessee including the confirmation of loan given by the lender company. The copy of the bank statement and details of data submitted before Ministry of Corporate Affairs were filed before Assessing Officer. The PAN number of the lender company was also provided which establishes the identity of the lender. He finally submitted that the assessment was finalized on 30.11.2011. On the request of assessee, summons u/s 131 was issued on 24.11.2011 to the lender company for personal appearance of Principal Officer. The compliance was due on 29.11.2011. There is no evidence on which date the summon was dispatched from the office of Assessing Officer. This was a very short period for service of the summons and compliance thereof. It is not known whether the summon was dispatched and served on the Principal Officer of lender, M/s. Cityneon Dag (India) Pvt. Ltd. He pleaded to set aside the orders of the authorities below.
5. On the other hand, the ld. DR relied on the orders of the authorities below.
6. We have heard both the sides on the issue. As per the provisions of section 68, the onus is on the assessee to explain the source of the amount found to be credited in the books of accounts of the assessee. In this case, the assessee has submitted confirmation from lender, M/s. Cityneon Dag (India) Pvt. Ltd.. The copy of relevant period of bank account of M/s. Cityneon Dag (India) Pvt. Ltd. was also filed. PAN number/ROC details of the lender company were also filed. The Assessing Officer asked the assessee to produce the Principal Officer of the company in person which the assessee could not comply with. On the assessee’s request, summon u/s 131 of the Act was issued on 24.11.2011 and compliance was due on 29.11.2011. From the records, it is not clear whether this summon was served well in time for compliance on 29.11.2011. Summons remained uncomplied on 29.11.2011 for personal presence of Principal Officer of lender company, M/s. Cityneon Dag (India) Pvt. Ltd. The assessment was finalized on 30.11.2011. In our considered view, the time gap between issue of notice and due compliance was short enough to comply with when it is not clear whether summon was served in time. In such a situation, we find it appropriate to restore the issue to the file of the Assessing Officer for deciding de novo. We order accordingly.
7. In the result, the appeal of the assessee is allowed for statistical purposes.
Order pronounced in open court on this 3rd day of May, 2013.
(I.C. SUDHIR) (B.C. MEENA)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Dated the 3rd day of May, 2013
Copy forwarded to:
4. CIT(A)-XXXII, New Delhi.
5. CIT(ITAT), New Delhi.