TaxTMI 
TaxTMI 
2024 (7) TMI 888
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.... Act dated 17th December, 2018, passed by the Income Tax Officer, Ward-25(1)(1), Mumbai, was dismissed. 02. The assessee is aggrieved and has preferred this appeal raising following grounds:- "1. On the facts and circumstances of the case, the National Faceless Appeal Centre (NFAC), Delhi (hereinafter referred to as the "NFAC"] erred in passing the order dated 27th December, 2023 upholding the action of the Income Tax Officer, Ward - 25(1)(1), Mumbai [hereinafter referred to as "Ld. A.O.'] in passing the assessment order dated 17th December 2018 under section 143(3) read with section 147 of the Income Tax Act, 1961 [hereinafter referred to as "the Act"] determining total income of the Appellant at Rs. 40,75,000/- as against ....
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....loan amounting to Rs. 40,75,000/- borrowed from Nazer Impex Pvt. Ltd as unexplained cash credit under section 68 of the Act is unjustified and the same may be deleted. iv. The NFAC further failed to appreciate that the Ld. A.O. has made the addition relying on the statements of certain parties obtained during the search and seizure action carried out under section 132 of the Act on the said parties, without providing the appellant an opportunity to cross examine them. Thus the impugned addition of Rs. 40,75,000/- is made against the gross violations of principals of natural justice and the same may be deleted. 3. The Appellant denies any liability to pay interest under sections 234A, 23418 and 234C of the Act. Hence, the s....
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....ition of Rs.40,75,000/- under Section 68 of the Act. 04. The assessee preferred the appeal before the learned CIT (A), wherein the addition was confirmed for the reason that assessee failed to substantiate the creditworthiness of the lender and genuineness of the transactions. He further held that M/s Nazar Impex Pvt. Ltd. has a meager profit of Rs.2.83 lacs and net worth only Rs.17 lacs which did not correspond to the amount of loan of Rs.40,75,000/- given to the assessee. The assessee aggrieved with that and is in appeal before us. 05. The learned Authorized Representative submitted on identical facts in earlier year the addition of Rs.50 lacs was made on account of bogus loan in the hands of the assessee, In ITA No.1064/Mum/2023, f....
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....uently, how it can be stated that assessee has proved the genuineness and creditworthiness of the transactions at the time of receipt of such sum. He submits that therefore, there is no error in the order of the lower authorities. 07. We have carefully considered the rival contentions and perused the orders of the lower authorities. We have also perused the order of the SMC in ITA No.1064/Mum/2023, for A.Y. 2013-14 dated 14th July, 2023, in case of the assessee, wherein the addition was made in the hands of the assessee under Section 68 of the Act of Rs.50 lacs on account of accommodation entries from M/s Nazar Impex Pvt. Ltd. entity operated by accommodation entry provider Mr. Rajendra Jain, was deleted. The facts in this case shows tha....
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....000/- has been obtained by the assessee naturally, such transactions will appear in the bank statement of the lender as well as the bank statement of the assessee. This evidence does not help in either proving the creditworthiness nor the genuineness of the transactions. Merely transactions are through banking channel does not prove the creditworthiness of the lender and genuineness of the transaction. Furthermore, it is apparent that Mr. Sanjay Choudhary is the director of the lender. Search was conducted on the same person on 3rd October, 2013, wherein he was found to be on accommodation entry provider through this company. It is not denied by the assessee that M/s Nazar Impex Pvt. Ltd., the lender in this case is not the company operated....
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....ion. In this case, the assessee was directed to produce the lender but no efforts were made by the assessee to produce the lender. Thus, the enquiry by the learned Assessing Officer was prevented by the assessee. It is rather unusual that a company which gives loan to the assessee from year to year of huge sum and assessee fails to produce that party in each of the year and still gets away from the rigors of section 68 of the Act. The decision of the Hon'ble Bombay High Court reported in 423 ITR 531 is in favor of the Revenue which categorically says that assessee is duty bound to explain the identity of the creditor, genuineness of the transaction and creditworthiness of the creditor. The learned Assessing Officer did not ask the asses....