2024 (7) TMI 1535

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....of the loan from eight parties which was genuine and the disallowance was not called for. 3. Brief facts of the case are that the assessee is a partnership firm engaged in saree business. E-return for assessment year 2018-19 filed on 30.10.2018 declaring a loss of Rs. 12,64,310/-. Case of the assessee selected for scrutiny assessment under CASS for two issues, namely (i) unsecured loans and (ii) transactions with Company, whose registration has been cancelled by the Ministry of Corporate Affairs. Notices under section 143(2) and 142(1) were issued and duly served upon the assessee. Various information was called for in the questionnaire to which necessary reply was made. The ld. Assessing Officer observed that the assessee has shown unsecured loans amounting to Rs. 7,32,58,026/-. To verify the said unsecured loan, the assessee was asked to furnish the details along with details of loans and advances taken. The assessee filed a list which contains 60 (sixty) names. The ld. Assessing Officer after examining the list noticed that in few cases either no PAN or wrong PANs were mentioned. The ld. Assessing Officer thereafter issued notice under section 133(6) of the Act to a....

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....ls) has confirmed the addition under section 68 of the Act amounting to Rs. 1,26,50,000/- on account of three reasons, firstly some on the basis of A.O's analysis, some on the basis of wrong PAN and some for no PAN. The details of the same is listed below:- Sr. No.  Name Amount of loan 1. Mukund Chhaparia Rs.20,00,000/- 2. Anju Chowdhury Rs.20,00,000/- 3. Murari Lal Bharatiya Rs.10,00,000/- 4. Premchand Gupta HUF Rs.10,00,000/- 5. Sharda devi Sarawgi Rs. 5,00,000/- 6. Bansal Traders Rs.11,50,000/- 7. Zori Varieties Rs.25,00,000/- 8. Ganpati Developers Pvt. Ltd. Rs.25,00,000/- Interest expenditure claimed on above stated unsecured loan has also been disallowed. 8. After going through the details filed by the assessee and the disallowance made by the lower authorities, we will first examine the applicability of section 68 of the Act for each party separately. Section 68 of the Act has direct bearing and the same provides that "when any sum is found credited in an assessee's books for a previous year, and the assessee provides no satisfactory explanation about its nature and source, the su....

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....nd considerable income of Rs. 14,53,140/- is declared. Loan confirmation letter is filed along with the copy of bank statement. Considering the income declared by the cash creditor, we do not find any reason to doubt the nature and source of unsecured loan of Rs. 10,00,000/- taken by him. Thus section 68 of the Act has been wrongly invoked. 9(d). Premchand Gupta HUF- Rs. 10,00,000/- Details placed at pages no. 16 to 22 of the paper book, wherein loan confirmation is filed and copy of ITR for A.Y. 2017- 18 is placed along with financial statement and bank statement. All these details along with the fact that cash creditor is regularly assessed to tax leaves no doubt regarding identity, creditworthiness and genuineness of the transaction with this cash creditor and thus no addition u/s 68 of the Act is called for. 9(e). Sharda Devi Sarawgi- Rs. 5,00,000/- We note that details have been filed at pages 23 to 36 of the paper book. Reply to notice under section 133(6) of the Act has been filed directly by the ld. Assessing Officer. Income of Rs. 20,98,300/- declared in the income tax return furnished on 18.07.2018. Bank account shows suffi....

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....AN or just confirmed on the basis of analysis of ld. Assessing Officer. After going through the details, we are satisfied that the assessee has successfully explained the identity and creditworthiness of the cash creditors and genuineness of the transactions with sufficient evidences and that nature source of the alleged cash credit is explained to our satisfaction and therefore, provisions of section 68 of the Act are not attracted. Similar type of issue had come up before this Tribunal in the case of M/s. Parwati Lakh Udyog (supra), wherein also loans from individual/other persons were taken but since complete details regarding PAN, Bank statement, financial statement and income tax returns details were filed, addition under section 68 of the Act was deleted. Para 9 of this order reads as under:- "9. Apropos Ground Nos. 1 & 2, raised by the revenue against the addition made under section 68 of the Act and disallowance of interest expenditure paid thereon, we notice that the assessee has placed complete details including PAN Nos. , bank account statements, financial statements and income tax details of each of the cash creditors. The ld. Assessing Officer has no....