2018 (4) TMI 1666

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....said loan. 2. The Assessing Officer received information from DGIT(Inv), Mumbai that search and seizure action u/s. 132 of the Act was carried out in the case of Bhanwarlal Jain Group concern on 3.10.2013, wherein it was found that Mr. Bhanwarlal Jain and his son Mr. Rajesh Jain have floated various concerns and have provided accommodation entries in the form of bogus unsecured loan, bogus capital gains etc. The Assessing Officer noticed that the assessee has taken loan of Rs. 25 lakhs from a concern M/s. Rose Impex, which belonged to Mr. Bhanwarlal Jain group. Accordingly, the Assessing Officer reopened the assessment of the year under consideration by issuing notice u/s. 148 of the Act. The Assessing Officer also noticed that Mr. Bhanw....

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....ted his statement and hence the Assessing Officer could not have taken support of the statement given by Mr. Bhanwarlal Jain. The Learned AR further submitted that the assessee is required to discharge initial onus placed upon it u/s. 68 of the Act i.e. the assessee is required to prove three main ingredients viz., identity of creditor, creditworthiness of creditor and genuineness of the transaction. He submitted that the assessee has furnished confirmation of loan obtained from Rose Impex, PAN of Rose Impex which proves the identity of creditor. The assessee has also furnished bank statement of creditor as well as assessee in order to show that the transactions were carried out through banking channels. From the bank statement of Rose Impe....

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.... 6. On the contrary, learned DR submitted that the employees of Mr. Bhanwarlal Jain have not retracted the statement given by them. He submitted that one of the employees Mr. Lunkaran Parasmal Kothari has explained the modus operandi as to how cash is received against accommodation entries given by way of unsecured loans. He submitted that the learned CIT(A) has pointed that the huge fund have been transferred in the bank account of Rose Impex before giving loan to the assessee. Further it was noticed that lender did not have own funds for giving loans to the assessee. The Learned DR placed reliance on the decision rendered by Mumbai Bench of ITAT in the case of Shri Suresh L. Satyani (ITA No. 3452/Mum/2016 dated 25.4.2017), wherein additi....

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....nd before giving loan to the assessee, perusal of the bank account of Rose Impex would show that the funds have been transferred were through banking channels only and not by way of depositing cash. The assessee has also furnished bank statement to show that the above said loans have been repaid on 25.3.2013. Since transactions of taking loan and repayment of loan have taken place through banking channel, in our view, the genuineness of transaction also stands proved. The assessee has furnished financial statement of Rose Impex. Perusal of the balance sheet would show that the loan of Rs. 25 lakhs given to the assessee is duly reflected in the balance sheet of the assessee. Further, it can be noticed that Rose Impex has taken loans from var....