2025 (10) TMI 32

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....cle, Meerut under Section 143(3)/147 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') for Assessment Years 2013-14 to 2015-16. ITA No. 1708/Del/2024 (AY: 2013-14) 2. The brief facts leading to the case is this that the original assessment for the year under consideration was completed under Section 143(3) of the Act. Subsequently, the assessment was reopened under Section 147 of the Act by issuing a notice dated 08.01.2021 upon recording reasons that the assessee company has taken accommodation entries/unsecured loan of Rs. 6 lakhs from one Shri Hans Kumar who is an accommodation entry provider. Relevant to mention that such reopening was done on the basis of an information received from Investigation Wing. The asses....

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....ess of the transaction by showing loan receipts through banking channel rather cheque transfer and interest was also paid thereon. As the assessee's payment of interest establishes the genuineness of the transaction as no assessee would pay interest on its own unaccounted funds the same could not be doubted. Further that Shri Hans Kumar already declared income of Rs. 8,40,600/- for AY: 2013-14 which was higher than the loan amount of Rs. 6 lakhs; the creditworthiness therefore, could not be questioned. In support of the above submissions he has drawn our attention particularly to pages 26, 34 & 36 of the paper book filed before us wherein the Assessing Officer has not made any addition for AY: 2014-15 on the unsecured loans taken from Shri ....

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....he ground that assessee company has taken accommodation entry of Rs. 82 lakhs by transferring unaccounted money from various layers of accounts to the account of the assessee. The assessee duly filed its return of income in reply to the notice under Section 148 of the Act on 30.01.2021 declaring nil income. Notice under Section 143(2) was issued on 28.06.2021. Questionnaire was issued under Section 142(1) on 07.10.2021 followed by the questionnaire dated 18.11.2021 and 17.12.2021 whereupon the assessee duly filed its reply. It is the case of the Revenue that upon detailed investigation carried out by Investigation Wing, Kolkata, it revealed that unaccounted money was routed through the intermediary accounts on different entities which was t....

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....ugh, this particular aspect of the matter was raised before the Ld. CIT(A) no deliberation is being forthcoming from the First Appellate Authority. We find substance in such argument advanced by the Ld. Counsel appearing for the assessee and we find that when no show cause has been issued to the assessee in regard to the donation received by the assessee and addition made thereon without asking for any explanation from the assessee the same is nothing but a violation of principle of natural justice. In fact, addition cannot be made on the items which is not part of the show cause. Ld. DR has not been able to justify such addition made by the Ld. AO confirmed by the First Appellate Authority. Having regard to the entire aspect of the matter ....