TaxTMI 
TaxTMI 
2017 (5) TMI 919
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.... of additional depreciation of Rs. 38,15,241/- in assessment order dated 29.12.2011, in proceedings u/s.143(3) of the Income Tax Act, 1961, in short ' the Act'. 2. We come to the former issue of Section 68 addition of Rs. 1,00,00,000/- added as unexplained cash credits in course of the impugned regular assessment and deleted in the lower appellate proceedings. This assessee is a firm. The Assessing Officer noticed it to have availed unsecured loans of Rs. 1crore from M/s. Raj Capital & Finance Pvt. Ltd. He observed that assessee's details submitted revealed after verification that the same were in the nature of accommodation entries taken from the above entity in order to facilitate unaccounted income in business. He further took note of....
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.... is Rs. 2.15 crores, while 'reserves and surplus' are of Rs. 2. 5 Crores which basically consist of share premium. Apparently, the source of loans given to the appellant is from the share capital and the share premium of M/s Raj Capital & Finance Pvt Ltd. The appellant is having regular loan transactions with M/s Raj Capital & Finance Pvt Ltd year after year. 7.3 In fact, out of the loan of Rs. 1,00,00,000 added in the assessment year 2009- 10, a sum of Rs. 75,00,000 has been repaid by the appellant, during the assessment year 2010-11 .In the assessment year 2011-12, further loan of Rs. 25,00,000 has been taken by the appellant. The interest in respect of all the loan taken is being paid and the corresponding TDS is also be....
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.... is assessee's own income routed through the bank accounts of the creditors - Not justified. ....................................................................................................... Creditors have explained the source of deposits in their respective bank accounts. ...................................................................................................... AO was not justified in calling upon the assessee to prove the source of source. ...................................................................................................." 7.5 Some of the case laws relied upon by the appellant are as under :- a. Nabadwip Chandra Roy v/s CIT (1962) 44 ITR 591 ....
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....in case of lender -company may not be justified in view of judgment of the Hon'ble Supreme Court of India in the case of M/s Lovely Exports. Making that addition in the hands of borrower is even more unjustified. 8.3 Even if facts in the case of M/s Raj Capital & Finance Pvt Ltd are found distinguishable from the facts of the case of M/s Lovely Exports (supra ), the addition can only be made in the case of M/s Raj Capital & Finance Pvt Ltd. There is no evidence on record to establish that there were collusive transactions between the appellant, M/s Raj Capital & Finance Pvt Ltd and the share - holders / directors of M/s Raj Capital & Finance Pvt Ltd. If the share - holders of M/s Raj Capital & Finance Ltd or directors of the sa....
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....ining source of the loans to the above entity's balance sheet indicating sufficient reserves, surplus and share premium as followed by repayment in succeeding assessment year. Learned Departmental Representative fails to rebut CIT(A)'s conclusion that the assessee has been having regular loan transactions with the said entity. We notice in this backdrop that hon'ble jurisdictional high court's decision in DCIT vs. Rohini Builders (2002) 256 ITR 360 (Guj) upholding tribunal's conclusion deleting Section 68 addition in view of identical details; squarely applies here. So is their lordships' latter decision in CIT vs. Ayachi Chandrashekhar Narsangji (2014) 42 taxmann.com 251 (Guj) confirming this tribunal's another decision reversing Section 6....