Income Tax Inclusion of Rs. 23 Crores Quashed; Reconsideration Ordered by Appellate Authority in Four Weeks.

The HC allowed the writ petition, quashing the appellate order that confirmed the inclusion of Rs. 23 Crores as income under Section 68 of the Income Tax Act, 1961. The matter was remanded to the appellate authority for reconsideration, with instructions to issue a reasoned order within four weeks.

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Issues involved:
The petitioner challenges the appellate order rejecting the appeal regarding the inclusion of a sum of Rs. 23 Crores as income under Section 68 of the Income Tax Act, 1961.

Details of the Judgment:

Issue 1: Inclusion of Rs. 23 Crores as income under Section 68 of the Income Tax Act
The petitioner filed income tax returns for the assessment year 2020 - 2021, declaring a total income of Rs. 53,10,01,450. The assessing officer included Rs. 23 Crores as income under Section 68 and proposed to tax it under Section 115BBE. The petitioner claimed the sum represented a genuine unsecured loan from M/s.Magunta Exports, Nellore. However, the assessing officer and the appellate authority did not accept this claim due to lack of evidence regarding the genuineness of the transaction and the credit-worthiness of the company. The appellate authority confirmed the addition of Rs. 23 Crores without providing supporting reasons. The court found the appellate authority did not independently apply its mind and interfered with the appellate order, quashing it and remanding the matter for reconsideration with directions to provide a reasoned order within four weeks.

Conclusion:
The High Court allowed the writ petition, quashed the impugned order, and remanded the matter for reconsideration by the appellate authority with directions to provide a reasoned order within a specified time frame.

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