2025 (6) TMI 1032

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....of appeal." 3. Facts of the case, in brief, are that the assessee is a firm engaged in the business of civil construction and furnished its return of income declaring total income at Rs.Nil. The case was selected for scrutiny and notices u/s 143(2) and 142(1) respectively were issued to the assessee. The Assessing Officer found that the assessee has shown unsecured loan amounting to Rs. 11,06,49,590/- in its balance sheet but detail and confirmation was not filed before the Assessing Officer, therefore, identity, creditworthiness of creditors and genuineness of transactions were not proved. Since the assessee has not responded any of the abovementioned notices, one last opportunity was given to the assessee and a show-cause notice u/s 144 was issued but the assessee also did not responded to the show-cause notice, therefore, the assessment was completed u/s 143(3) r.w.s. 144 on a total income of Rs. 12,13,56,220/-. The above assessed income includes addition of Rs. 11,06,49,590/- u/s 68 of the Act relating to the amount of unsecured loan shown by the assessee and Rs. 1,07,06,628/- towards disallowance of expenses claimed by the assessee as interest paid on above unsecured loan. ....

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....AR produced three paper books in support of his contentions wherein various documents were produced before the Bench which were also furnished before Ld. CIT(A). Accordingly, Ld. AR requested before the Bench to dismiss the appeal filed by the Revenue. 7. We have heard Ld. Counsels from both the sides and perused the material available on record including the paper books & case laws furnished by the assessee. In this regard, we find that the Assessing Officer made addition of Rs. 12,13,56,218/- out of which Rs. 1,07,06,628/- was interest paid on unsecured loan and Rs. 11,06,49,590/- was total outstanding unsecured loan. Ld. CIT(A) while deciding the appeal filed by the assessee deleted the whole of the addition of Rs. 1,07,06,628/- made by the Assessing Officer towards interest on unsecured loan and restricted the addition on account of unsecured loan of Rs. 11,06,49,590/- to Rs. 2,50,000/- only. We find that the Revenue has challenged the deletion of addition of unsecured loan amounting to Rs. 1,67,04,328/- only, which pertain to 7 persons as mentioned in the preceding paragraphs of this order. In this regard, we find that Ld. CIT(A) has deleted the unsecured loan by observing ....

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....lowed." 8. Now, we shall discuss each unsecured loan one by one which was deleted by Ld. CIT(A) & which is challenged by the Revenue. With regard to sum of Rs. 92,53,724/- appearing in the name of Vishalkumar K. Jain and Rs. 49,18,604/- appearing in the name of Vishalkumar K. Jain (HUF), we find that during the period under consideration a credit entry was recorded in the books of the assessee in the name of these two persons for the first time. It was contended before the Bench that both the above loans were not obtained during the year but they were transferred in the name of Vishalkumar K. Jain & Vishalkumar K. Jain (HUF) and the above credit entry was already appearing in the books of the firm since last many years in the name of Kantilal Jain & Kantilal Jain (HUF) regarding loan & capital respectively. However, we find that Kantilal Jain expired in the year 2010 and it is claimed that since then these two credit entries were appearing in the books of accounts of the assessee firm. We further find that Ld. CIT(A) has deleted both the above unsecured loans by observing that no new loan has been obtained either from Vishalkumar K. Jain or from Vishalkumar K. Jain (HUF). In thi....

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....nder, confirmation letter and the copy of bank account statement of the lender was not produced before Ld. CIT(A), we hold that Ld. CIT(A) was not justified in accepting the above said loan of Rs. 12,00,000/- received during the year from Nikeetaa Vijay Kering. Accordingly, we set-aside the order passed by Ld. CIT(A) wherein he deleted the addition made by the AO towards unsecured loan of Rs. 12,00,000/- received from Nikeetaa Vijay Kering, and remand the issue back to the file of the Assessing Officer to decide the issue afresh after providing reasonable opportunity of hearing to the assessee. 10. With regard to a sum of Rs. 10,00,000/- appearing in the name of Manjula N. Parmar, we find that the Assessing Officer in his remand report has mentioned that the copy of income tax return was not furnished by the assessee. We find that with respect to Manjula N. Parmar the assessee had produced bank account statement of the lender before Ld. CIT(A) along with confirmation letter, however, copy of income tax return of Manjula N. Parmar was not furnished before Ld. CIT(A). Accordingly, we find that the identity of the creditor and genuineness of the transaction is proved but the credit....