https://www.taxtmi.com/caselaws?id=753150 ITAT Mumbai allowed the assessee's appeal against addition u/s 68 regarding loan creditors' identity, creditworthiness and genuineness. The AO had disallowed interest expenditure based on a statement by an individual claiming two lending companies were paper companies. However, the individual later retracted his statement through an affidavit alleging coercion. The tribunal held that once the assessee discharged the prima facie burden of proving the loan transactions, the AO should have cross-examined the individual rather than dismissing the retraction affidavit. Since the assessee proved the creditors' credentials and repaid the loans, and the AO relied solely on an untested, retracted statement, the addition u/s 68 was deleted and interest expenditure was allowed. en-us Thu, 02 May 2024 00:00:00 +0530 Sat, 25 May 2024 10:31:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=753150 ITAT Mumbai allowed the assessee's appeal against addition u/s 68 regarding loan creditors' identity, creditworthiness and genuineness. The AO had disallowed interest expenditure based on a statement by an individual claiming two lending companies were paper companies. However, the individual later retracted his statement through an affidavit alleging coercion. The tribunal held that once the assessee discharged the prima facie burden of proving the loan transactions, the AO should have cross-examined the individual rather than dismissing the retraction affidavit. Since the assessee proved the creditors' credentials and repaid the loans, and the AO relied solely on an untested, retracted statement, the addition u/s 68 was deleted and interest expenditure was allowed. Case-Laws Income Tax Thu, 02 May 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=753150