TaxTMI 
TaxTMI 
2025 (12) TMI 720
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....the following details: i) Confirmation of loan creditor, ii) Bank statements of company as well as loan creditor in which loan transaction is reflected, iii) Copy of return of income filed for AY 2016-17 by the loan creditor with computation of income. 4. From the various details furnished by the assessee the Assessing Officer noted that the assessee has shown total loan creditors of Rs.3,52,53,595/- which includes the following creditors: a) Aagam Capital Ltd. Rs.88,96,067/- b) Risa International Rs.1,15,00,000/- 5. He, therefore, asked the assessee to produce the authorized person of the loan creditors for verification along with documentary evidence. The assessee in response to the same filed the details like copy of return of income, computation of income, copy of audit report, copy of unsecured loans along with confirmation and other relevant details etc. 6. While perusing the record the Assessing Officer noted that during the course of search action u/s 132 of the Act, the statement of Mr Abhinandan Jain, Director of M/s. Risa International was recorded u/s 132(4) of the Act. He noted that an information u/s 133(6) o....
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.... of documents such as PAN, copies of ITRs, account confirmations, repayment with interest and TDS thereon cannot by itself discharge the burden cast upon the assessee u/s 68 of the Act. He further noted that true identity of the lender company Risa International Ltd is not proved although the lender claims to be in the business of textile trading and investment. However, search action in the Ranka Group, where the lender was also covered, has proved conclusively that Risa International Ltd is just a paper company used by the beneficiaries of Ranka Group to provide accommodation entries. Rejecting the various explanations given by the assessee the Ld. Counsel for the assessee made addition of Rs.1,15,00,000/- u/s 68 of the Act. 10. In appeal the Ld. CIT(A) upheld the addition made by the Assessing Officer u/s 68 of the Act. 11. Aggrieved with such order of the Ld. CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds: 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A), erred in confirming addition of unsecured loan amounting to Rs.1,15,00,000/- under section 68 of the Act by treating a genuine loan as accom....
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.... para 4 of the assessment order he submitted that the assesse, in response to the notice issued by the Assessing Officer, has filed the details like copy of return of income, computation of income, copy of audit report, copy of unsecured loans along with confirmation and other relevant details etc. Further the loans were repaid subsequently along with interest. 13. Referring to the decision of the Hon'ble Delhi High Court in the case of Sheela Overseas Pvt. Ltd vs. PCIT vide ITA No.546/2023, order dated 28.05.2025, he submitted that the Hon'ble High Court in the said decision has held that amendment to section 68 of the Act introduced by virtue of the Finance Act, 2022 makes it abundantly clear that section 68 of the Act, as was in force prior to 01.04.2023, did not require the assessee to explain the source of the source of funds other than share capital money, share capital, share premium or any amount of such nature. Thus, the enlargement of the assessee's onus to explain the source of the source of sums credited as unsecured loans necessitated the amendment to section 68 of the Act to expressly provide for the same. He submitted that the Hon'ble High Court in the said decisi....
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....such as PAN, copies of ITRs, account confirmations, repayment with interest and TDS thereon, bank statement etc to prove the identity and creditworthiness of the loan creditor and genuineness of the transaction. The director of Risa International Ltd, lender company has appeared before the Assessing Officer in response to the summons u/s 131 of the Act and has confirmed to have extended the loan of Rs.1,15,00,000/- out of collections from sundry debtors. He has also stated to have extended the loan to the company where his father-in-law is the Director. It is also his submission that in view of the amendment to section 68 of the Act prior to 01.04.2023 the assessee is not required to explain the source of the source of funds other than share capital money, share capital, share premium or any amount of such nature. 17. We find some force in the arguments of the Ld. Counsel for the assessee. It is an admitted fact that the assessee during the course of assessment proceedings has filed various details such as return of income, computation of income, copy of audit report, copy of unsecured loans along with confirmation and other relevant details etc. This fact has been admitted by t....
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....1 after duly considering all the submissions of the assessee, particularly dated 24-12-2018 and material brought on record." Document 2 1. Please Identify yourself. Ans- Myself is Abhinandan Suresh Jain , Age-40 years. I am wholetime director of Risa International Ltd., Mumbai. I am CA. My mobile no. is 9820548835. 2. Please state about the activities of Company. Ans- M/s. RÃ¥sa International Ltd., is engaged in steel, textiles and real estate. 3. As per ledger of loan account extract, Risa International Ltd., has given loan to Prem Grain Pvt. Ltd. It is seen that loan of Rs.1, 15,00,000/- was given. You do not have any business relationship with this concern , then please furnish the reasons for advancing loan? Ans- M/s. Prem Grain Industries Pvt. Ltd. is company in which my father-in-law is Director. This is the reason of giving the loan to M/s. Prem Grain Industries Pvt. Ltd. 4. In the Summons u/s 131 of the Act, it was requested to furnish the sources of credit in Bank account of M/s. Risa International Ltd. immediately before the lending loan to M/s. Prem Grain Industries Pvt. Ltd. as under- Amt. pald to Risa International. Date of loan Amt. credit I....