Supreme Court upholds assessment order on unsecured loans after PCIT's section 263 revision challenge fails

SC dismissed special leave petition challenging HC judgment that upheld ITAT's decision setting aside PCIT's revision order u/s 263. The case involved unsecured loans where PCIT claimed AO failed to enquire about creditworthiness, identity of loan providers, and genuineness of transactions. HC found that AO had raised necessary queries regarding unsecured loans, was satisfied with assessee's details, and accepted identity, creditworthiness and genuineness of cash creditors, taking a plausible view under the Act while completing assessment u/s 143A r/w 143(3). ITAT correctly held that PCIT made only general observations without specific findings about what information AO failed to call for, and PCIT didn't comment on such information during revision proceedings before declaring assessment order erroneous and prejudicial to revenue interest.

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The Supreme Court, with Justices Pamidighantam Sri Narasimha and Atul S. Chandurkar presiding, after hearing the Additional Solicitor General, granted condonation of delay but declined to interfere with the impugned High Court judgment. The Court held, "we are not inclined to interfere with the impugned judgment and order passed by the High Court," and accordingly dismissed the Special Leave Petition. All pending applications were disposed of.

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