Siddharth Export Vs ACIT (Delhi High Court)
The issue under consideration is whether AO is correct in treating unsecured loan received by assessee as unexplained credit under section 68?
In the present case, the assessee received an unsecured loan of Rs. 26 lacs through three cheques issued by Ms. Jasmine Kochhar Kapoor, a citizen of GBR (United Kingdom). AO treated unsecured loan received by assessee as unexplained credit under section 68. Tribunal in appellate proceedings confirmed addition made by AO on the ground that assessee failed to prove creditworthiness of lenders and genuineness of concerned loan transactions. Assessee challenged this by way of appeal filed under section 260A before High Court pleading that on filing of bank statement and PAN details and confirmation, burden stood discharged and it shifted on to the Revenue.
The High Court states that creditworthiness of lender could not be said to be proved merely on the strength of bank statement. Assessee did not produce income-tax return of the lender or any confirmation. The purported confirmation had been found to be only a copy of unsigned account of creditor. The source of funds had also not been explained. Furthermore, stand of assessee that since alleged transaction was made through normal banking channels, it was sufficient to prove genuineness of the transaction, could not be accepted. Thus, the credit worthiness and the genuineness of the transaction cannot be said to have been proved so as to shift the onus on the revenue.
Hence HC do not find any infirmity in the impugned order. Therefore, the present appeal filed by assessee is dismissed.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
C.M. No. 46336/2019 (exemption)
1. Exemption allowed, subject to all just exceptions.
2. The application stands disposed of.
ITA 917/2019 & CM. APPLs. 46334-46335/2019
3. The present appeal under Section 260A of the Income Tax Act, 1961 (hereinafter the Act) is directed against the common order dated 26.06.2018 (hereinafter the impugned order) passed by the Income Tax Appellate Tribunal in Appeal (s) No. 7700/2017 for AY-2013-14 and 7752/2017 for AY-2014-15.
4. The appeal is accompanied with an application [CM. APPL. 46334/2019] seeking condonation of gross delay of 445 days in filing the appeal. The grounds and reasons stated in the application seeking condonation of delay are completely bereft of merits. This delay is sought to be justified on account of filing of a misconceived writ petition WP (C) No. 193/2019 to assail the impugned order of ITAT. The said petition was dismissed as withdrawn vide order dated 25.07.2019, whereby, Petitioner was permitted to withdraw the writ petition with liberty to file a statutory appeal accompanied by an application for condonation of delay to challenge the impugned order. The application offers no cogent explanation for the delay in approaching the court, except for narrating the fact of filing of the above noted writ petition, which does not help the petitioner under any circumstances. The writ itself was filed beyond the statutory period of filing the appeal and moreover, the same was withdrawn on the first day of listing and the Appellant cannot vindicate the delay for the above reason. The application thus deserves to be dismissed as it does not disclose any cogent ground or reason for seeking condonation. Nevertheless, we have also heard the counsels on the merits of the case and find no ground to entertain the present appeal for the reasons stated hereinafter.
5. Common facts arising out of the two appeals before the ITAT [ ITA No. 7700/DEL/2017 & ITA No. 7752/DEL/2017] are that the Appellant – M/s Siddharth Export is a partnership firm, engaged in manufacturing and trading (export) of engineering and automobile spare parts since 2002. The assessee filed its income tax return declaring income of Rs. 44,36,580/- for the AY 2013-14 and Rs. 39,94,420/- for the AY 2014-15.
6. In respect of AY 2013-14, assessee received an unsecured loan of Rs. 26 lacs through three cheques as per details mentioned below:
