2025 (12) TMI 785

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....einafter referred to as "Act"] for the Assessment Year [A.Y.] 2012-13. 2. In the instant case, the assessment was reopened on the basis of investigation conducted by the DDIT(Investigation) Unit 4(2), Kolkata in the case of M/s KCA Allied Services Pvt. Ltd., wherein, it was revealed that suspicious transactions of large amounts were conducted through the bank account of Company and its allied concerns, in a very short span of time. The assessee is one of the beneficiaries, by way of accommodation entry of unsecured loan of Rs. 15,00,000/- from M/s Akul Multi Trade Pvt. Ltd., which is a bogus paper/shell concern, through which such loan entry is made. Consequent to the investigation, statements of Directors M/s KCA Allied Services Pvt. Lt....

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..... However, the AO has noted that all the lender entities were controlled by a group as discussed in assessment order in detail, which has been found by the Investigation Wing to be engaged in providing accommodation entries. The statements of Shri Rajesh Bhutoria and others clearly establish that these companies had no real business and were merely used as conduits. It is settled law that mere furnishing of PAN or filing of returns does not ipso facto establish creditworthiness or genuineness of the transaction. The assessee was required to prove three essential ingredients (i) identity of the creditor, (ii) creditworthiness, and (iii) genuineness of the transaction. While identity may not be in dispute, the assessee has failed to establish....

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....O details of payer/investor 1.2 CIN Master Data (ROC) of payer/investor 1.3 Confirmation of Account & Ledger Account 1.4 Own bank statement highlighting receipt & repayment of advance 1.5 Bank statement of the payer/investor 1.6 Memorandum of Understanding 1.7 I.T Acknowledgement receipt of payer/investor 1.8 Balance sheet of the payer/investor 2. M/s. Aarjav Commodities Pvt Ltd-Rs. 10,00,000/- 2.1 PAN/AO details of payer/investor 2.2 CIN Master Data (ROC) of payer/investor 2.3 Confirmation of Account & Ledger Account 2.4 Own bank statement highlighting receipt & repayment of advance 2.5 Bank statement of the payer/investor 2.6 Memorandum of Understanding ....

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....nts have been made by the then Assessees to the parties and verified by the Assessing Officer. And, therefore, the Hon'ble High Court considering the repayment as one of the main grounds in deletion of the addition, affirmed the deletion of addition. 10. This Court further observes that Hon'ble Gujarat High Court in the case of Commissioner of Income Tax vs. Rajkot-I vs. Ayachi Chandrashekhar Narsangji (ITA 992 of 2013) decided on 2nd December, 2013 (citation 2014)42 taxmann.com 251 (Gujarat) has also came across with a situation, wherein, the amount of loan was repaid in the subsequent year, which was accepted by the Revenue and, therefore, the Hon'ble High Court affirmed the view of the Tribunal in deleting the addition. 11. Further....