TaxTMI 
TaxTMI 
TaxTMI 
2025 (5) TMI 828
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....sessment year 2018-19, whereby the Ld. CIT(A) deleted the addition of Rs. 5,00,00,000/- made by the Assessing Officer ("AO") under section 69 of the Act, treating it as unexplained investment in the hands of the assessee vide order dated 14.03.2024 passed under section 147 read with section 144B of the Act. Facts of the Case 2. The facts of the case, as emanating from the record, are that the assessee company, Sunpoint Trading Limited (formerly known as Sun Finlease (Gujarat) Limited), engaged in investment and financing activities, had e-filed its return of income for A.Y. 2018-19 on 29.09.2018, declaring total income at 'NIL'. The assessment under section 143(3) of the Act was originally completed on 22.03.2021 accepting the returned in....
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....Capital Reserves were only Rs. 70,12,853/- and General Reserve stood at Rs. 65,405/-, which were grossly insufficient to justify the alleged advance of Rs. 5 crores. The AO further observed that the assessee company had failed to substantiate the source of the alleged investment with corroborative documentary evidence. While the assessee relied on ledger accounts and Form 26AS of M/s. Shankar Growth Fund Pvt. Ltd., it could not establish the creditworthiness of the assessee for making such a substantial advance. The financial profile of the assessee, as reflected in its returned income (NIL) and lack of significant reserves or borrowings during the relevant period, did not support the capability of extending a loan of Rs. 5 crore. The AO al....
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....interest payments and deductions, Order passed in the case of M/s. Shankar Growth Fund Pvt. Ltd. accepting the returned income and not making any corresponding addition, Certificate of registration with RBI as an NBFC, confirming lending activity as part of its regular business and explanation for the mismatch in opening balances on account of accounting treatment. 7. The Ld. CIT(A) issued a notice for remand report to the AO on 04.07.2024 and posted the case for hearing on 23.07.2024. Despite multiple reminders dated 24.07.2024, 07.08.2024, 27.08.2024, 19.09.2024 and 01.10.2024, the Assessing Officer did not submit the remand report. On the basis of material on record, the CIT(A) accepted the assessee's contention that the amount in q....
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....ments to substantiate the source of fund advanced to M/s Shankar Growth Fund Ltd. (b) The CIT(A) has erred in law and on facts in accepting the reasoning that the addition in the hands of appellant is untenable merely because no addition was made in the recipient's case. (c) The Ld. CIT(A) has erred in admitting additional evidences submitted by the assessee without recording the reasons for their admission, which is in violation of Rule 46A(2) of Income Tax Rules. (d) The Ld. CIT(A) has erred in relying upon the additional evidences without providing sufficient opportunity to the Assessing Officer to examine the additional evidences and submit remand report under rule 46A(3) of Income Tax Rules. (e) The appellant craves leave t....
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....ents, and contra-confirmation from the borrower, all of which were placed before the CIT(A), and submitted that the same fully established the genuineness of the transaction. It was also pointed out that the Department had accepted the transaction in the borrower's assessment for A.Y. 2018-19, where no adverse inference was drawn. 11. We have carefully considered the rival submissions and perused the orders of the lower authorities as well as the material placed on record. The principal issue in the present appeal is whether the CIT(A) was justified in deleting the addition of Rs. 5,00,00,000/- made by the Assessing Officer under section 69 of the Act, treating the same as unexplained investment allegedly advanced by the assessee to M/s. S....
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.....2024, 27.08.2024, 19.09.2024, and 01.10.2024 to the Assessing Officer. However, no report was furnished despite adequate opportunity. In such circumstances, the CIT(A) had no option but to proceed on the basis of available material and documentary evidence filed by the assessee. The assessee had disclosed all relevant facts and placed supporting evidence which remained uncontroverted by the Revenue at the appellate stage. 15. As regards the objection under Rule 46A, we find that the CIT(A) had called for remand comments and provided full opportunity to the Assessing Officer. The failure of the AO to respond cannot be a ground to vitiate the order of the CIT(A), particularly when the evidences were contemporaneous, relevant, and necessary ....