TaxTMI 
TaxTMI 
2025 (1) TMI 1697
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....y justified in deleting disallowance of Rs. 16,16,297/- u/s 36(1)(iii) of the Income Tax Act, 1961(the Act) even when the assessee had not discharged its onus to prove that it had taken any short term or long term loan from Punjab & Sind Bank or from any entity? 2. Whether on facts and in circumstances of the case, the Ld. CIT(A) is legally justified in deleting disallowance of Rs. 16,16,297/- u/s 36(1)(iii) of the Income Tax Act, 1961(the Act) even when the assessee had failed to prove the test of commercial expediency with regard to interest paid during the year under consideration?" 3. We have heard the rival contentions and gone through the facts and circumstances of the case. We noted that the AO during the course of assessment proceedings, noticed that the assessee has claimed deduction of interest expenses Rs.16,16,297/-. The AO perused the balance sheet and noted that the assessee did not have any long term or short term borrowings. On specific query, the assessee informed that it is debiting interest on account of loan taken by Boulder Realcom Pvt. Limited from Punjab & Sind Bank. The assessee filed a letter from Boulder Realcom Pvt. Ltd. Clarifying that the in....
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....bmitted that The Loan was under the Scheme of "Rent Serutization "where the assessee company also a party to it. The Loan was disbursed to one M/s Bolduer Realcon Pvt. Limited and M/s Boulder Realcon Pvt Limited debited the Interest portion of Appellant. The fact is on file. Appellant further stated that on various opportunity apprises the AO that the company had been sanctioned a loan from Punjab & Sindh Bank and on same, the assessee company has paid interest, and the loan agreement has been already submitted. The same loan has been used by the appellant company for business purpose hence, in view of future prospective view of business, interest expenses of Rs. 16,16,297/- should be allowed." Aggrieved, now Revenue is in appeal before us. 5. We have heard the rival contentions and gone through the facts and circumstances of the case. We noted that the loan was taken by Bolduer Realcon Pvt. Limited from Punjab & Sind Bank under the scheme of "Rent Securitization" and to this "Rent Securitization", assessee was also a party to it. Admittedly, Bolduer Realcon Pvt. Limited was sanctioned loan and assessee became a security holder for the same and ultimately the money was transf....
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....tal income earned by assessee during the relevant financial year 2013-14 relevant to this assessment year 2014-15 at Rs. 26.40 lacs. The assessee has declared these flats as fixed asset and from all the flats declared at a value of Rs. 1.85 Cr. in this balance sheet. This balance flats were given on 19 years lease to Moat Infracon Pvt. Ltd. from July, 2012. The assessee claimed deprecation on the above flats amounting to Rs. 8,78,750/- and also claimed repair and maintenance at Rs. 7.92 lacs. The Assessing Officer disallowed both and aggrieved assessee preferred appeal before Ld. CIT(A). 8. The CIT(A) deleting the disallowance of depreciation by holding that the assessee has disclosed rent received by assessee company under the head income from business, and, therefore, he allowed deprecation by observing in para. 3.3.3 as under:- "3.3.3 The facts of the case and the submission of Appellant have been carefully considered. The Appellant has a rental Income which the Company has declared under the head "Income from Business". The AO has contended that the income received by the assessee is rental income. The concept of composite rent does not exist in the case of assessee....
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....017 has also incorporated provision that if any house property is held as stock in trade and such property is not let during the whole or part of the year, deemed annual value would be NIL for the period of up to one' year from the end of financial year in which certificate of completion of construction or property obtained from the competent authority, hence assessing officer should not be allowed to charge deemed "annual value as rental income for such unsold stock for at least one year i.e in case of Appellant till June 2015. In view of the above discussion, I find the argument of Appellant that Income was disclosed as per law acceptable and also well covered under various judgements mentioned by AR. The deemed Income from house property of Rs. 3,15,000/- is, therefore, deleted. This ground of appeal is, therefore, allowed. Aggrieved against both, Revenue came in appeal before us. 9. We have heard the rival contentions and gone through the facts of the case. We noted that the assessee has received cash through flats rented out to Moat Infracon Pvt. Ltd. amounting to Rs. 26,40,000/- per annum. Admittedly this income from house property and it is a rental income....
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.... during the course of assessment proceedings noticed that the assessee has availed cash credits (Which are under dispute before us) from the following three parties:- (i) M/s Emtex Fabtrade Pvt. Ltd. Rs. 3,00,00,000/- (ii) M/s Aerens Estates Pvt. Ltd. Rs. 6,42,00,00/- (iii) Sh. Sachin Mittal Rs. 87,00,000/- The Assessing Officer required the assessee to explain the identity, creditworthiness and genuineness of transactions in terms of section 68 of the Act. The AO finally concluded that the assessee failed to prove all three ingredients in regard to these three cash credits and, therefore, he made addition of Rs. 10,29,00,000/- being unexplained credit u/s 68 of the Act and finally concluded as under:- "Conclusion:- From the discussion above the following conclusions appears:- i. The claim of the assessee prove false that it has received credits against the agricultural land ii. The assess failed to discharge its onus about the identity of and creditworthiness of the parties and genuineness of the transaction. iii The assessee failed to controvert the findings arrived at by the department. iv. In vi....
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....ord as evidence as well as relied up on various judgments. The main contention on facts of AR are that the copy of accounts and copy of Bank Statement have been submitted to prove that the appellant has received the credits through banking channel and also paid them back through banking channel. Further copy of Bank statement of M/s Aerens Estates Pvt. Ltd of HDFC Bank Flaying account no. 02000b4139871 for the period 22.4.2014 to 28.3.2016 has been submitted to prove that, the same amount which has been taken earlier has been returned back in the upcoming financial years. The AO has not appreciated the facts correctly. This strengthens the view of applicant that the amount has been paid back to M/s Aerens Estates Pvt. Ltd (AEPL) and the same is not the income of the appellant. Further the AO sent inspector to visit the premises of M/s AEPL on 13.05.2017 i.e on second Saturday when even Income Tax department is closed. Office of M/s AEPL remains closed on Saturday and Sunday. Any statement by anonymous person (Sh. Satender Goyal)cannot be taken into note if his identity is not established. Merely his statement that he has never heard about M/s AEPL does not prove the non-existence o....
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....ave been submitted as additional evidence. Also, no question was raised during the assessment proceedings that what is the source of fund to Sri Sachin Mittal. Also, neither the appellant Sachin Mittal was asked for such explanation. The address of Sri Sachin Mittal is duly reflected on confirmation of accounts. ******* Thus in my considered opinion based upon the position of law and facts as discussed above, the appellant has been able to discharge its onus and the AO's action in making addition of the above said amount was contrary to law and facts of the case. Therefore, keeping in view the entire facts of the case and the position of law discussed above, this ground of appeal is decided in favour of appellant and the addition of Rs. 10,29,00,000/- is hereby deleted. Ground No.5 of the appeal is, therefore, allowed. Aggrieved, now Revenue is in appeal before us. 14. We have heard the rival contentions and gone through the facts and circumstances of the case. We noted that the assessee filed additional evidences like copy of accounts, bank statements and try to prove that the credits are done through banking channel and also repaid them (back through banki....