TaxTMI 
TaxTMI 
2026 (4) TMI 1470
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....ial and commercial projects in Uttar Pradesh. The assessee filed its return of income on 25.09.2011, declaring total income of INR 9,14,95,371/-. This being the year of search, notices u/s 143(2) was issued, followed by notices u/s 142(1) of the Act which were issued from time to time. The AO by alleging that assessee had purchased the goods which remained unverified and accordingly, made the addition of INR 22,18,88,782/-. Besides this, addition of INR 6,25,00,000/- was made u/s 68 on account of loans taken from Four parties by alleging that the assessee has failed to prove the genuineness of the transactions and creditworthiness of the lenders. 3. Aggrieved by the said order, assessee preferred appeal before Ld.CIT(A) who vide order dated 02.08.2024, allowed the appeal of the assessee. 4. Aggrieved by the said order, Revenue is in appeal before the Tribunal by taking various Grounds of appeal mentioned in the appeal memo. 5. Both the Grounds of appeal raised by the Revenue are with respect to the deletion of addition of INR 6,25,00,000/- made u/s 68 of the Act on account of undisclosed loans. 6. Before us, Ld.CIT DR for the Revenue submits that AO at page 4 of the ass....
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....leted the additions made by AO and requested for the confirmation of the same. 9. Heard the contentions of both parties at length and perused the material available on record. It is observed that though during the course of assessment proceedings, assessee has not filed details with respect to the lender companies however, during the course of appellate proceedings, assessee has filed all the relevant details as additional evidence in order to establish the identity and creditworthiness of the lender companies and genuineness of the transactions. The details so submitted are as under:- (i) Copy of PAN of lenders; (ii) Copy of confirmations of lenders; (iii) Copy of acknowledgement of ITR of lenders; (iv) Audited financial statement of lenders; (v) Copy of Memorandum of Associate and certification of incorporation of lenders; (vi) Copy of Board resolution and copy of foreclosure of leans issued by the lenders. 10. It is further observed that all these details were sent to the AO for his comments on merits however, the AO in the Remand Report, has not doubted the same and had not made adverse comments. It is further observed....
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....appellant's case even otherwise also fell within the category of circumstances mentioned in Rule 46A(i)(d) and therefore the documents by the appellant were accepted and taken on record. iv) From the above it is clear that the CIT (Appeal) had duly forwarded the Additional evidences filed under Rule 46A by the appellant to the AO to provide his comment both on: 1. Facts & 2. On Merits The CIT (Appeal) in his order has stated that assessing Officer had offered no comments on merits of the Additional evidences filed by the appellant, other than that they must not be admitted on the grounds that sufficient opportunity had been provided to the appellant. The CIT (Appeal) had duly considered this argument in his order and had given a finding that only one questionnaire dated 8.11.2012 had been issued to the appellant and therefore the case even otherwise fell within the category of circumstances mentioned in Rule 46A(i)(d). Thus, from the facts of the case, it is seen that the additional evidences had been duly provided to the Assessing Officer to give his comments both on facts and merits under Rule 46A, but the Assessing Officer has not....
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....PCIT vs. Overtop Marketing (P.) Ltd., (2023) 148 taxmann.com 94, High Court of Culcutta. - Pr. CIT vs. Hi-Tech Residency (P.) Ltd., (2018) 257 taxman 335 (SC). - Pr. CIT vs. Hi-Tech Residency (P.) Ltd., (2018) 257 taxman 390 (Del). - CIT vs. Real Time Marketing Pvt. Ltd., (2008) 306 ITR 0035 (Del). - CIT vs. Jai Kumar Bakliwal, (2014) 366 ITR 0217 (Raj). - Aravali Trading Co. vs. ITO, (2010) 187 Taxman 0338 (Raj). - CIT vs.Metachem Industries, 245 ITR 160, High Court of Madhya Pradesh. - Nemi Chand Kothari vs. CIT &Anr., (2003) 264 ITR 0254 (Gau). - CIT vs. Shri Ram Narain Goel, (1997) 224 ITR 0180 (P &H). In the case of PCIT vs. Ojas Tarmake (P.)Ltd., (2023)1556 taxman.com 75, High Court of Gujarat, the Hon'ble High Court has held that "Section 68 of the Income-tax Act, 1961-Cash credit (Unsecured loan)-Assessment Year 2013-14- During the assessment proceedings it was noted that assessee had shown particulars of unsecured loan received during the relevant assessment year Assessing Officer issued letter under section 133(6) in creditors of unsecured loans Thereafter, Assessing Officer made add....
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.... a regular loan transaction and does not appear as some questionable arrangement, being very transient, having being taken & returned in less than a month on its own. 3. The appellant has submitted that the correspondence could be served upon through Postal authorities (India Post) on the lender companies at the addresses as derived from the Master data of these companies available on MCA portal. The submissions made by the appellant are relevant to the present date and the present addresses of the four lender companies. However, they present irrefutable evidence towards the facts that these companies are not non-existent. They are active and operational even on date. The fact that the correspondences have been through the Postal Authorities (India Post) further, lends credence to the contention of the appellant that these companies exist even on date, and these companies are at the same time making compliances to the required statutory regulations. These submissions considered with the other facts and evidences placed on record and as have been discussed in prior paras, by the appellant provide supporting evidence towards the facts that the correspondences throug....
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....he appellant and after considering the facts and evidences on record, I find that the appellant has discharged its onus regarding the genuineness of the transactions made by the appellant with the four lenders i.e., M/s Bhola Motor Finance Pvt. Ltd., M/s P Seven General Finance (P.) Ltd., M/s Toor Finance Company Ltd. & Vemuri Finvest Pvt. Ltd. 4.2 The Assessing Officer in his assessment order has raised no questions on the creditworthiness of the lenders. However, the appellant in his submissions made before the CIT (Appeal)-III, New Delhi had furnished the details regarding the creditworthiness of the lenders. These details submitted for the F.Y. 2009-10 were as below: - The copy of audited financial statements of the M/s Bhola Motors where the net worth has been shown at Rs. 20 Crores. - The copy of audited financial statements of the M/s P Seven General Finance (P.) Ltd where the net worth has been shown at over Rs. 29 Crores. - The copy of audited financial statements of the M/s Toor Finance Company Ltd. where the net worth has been shown at Rs. 37 Crores. - The copy of audited financial statements of the Vemuri Finvest Pvt....
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....to appellant company. It is pertinent to point out that the same had never even been questioned by the Assessing Officer in his assessment order for the relevant A.Y. 2011-12. Therefore, from the above submissions of the appellant and after considering the facts and evidences on record, I find that appellant has discharged its onus regarding the creditworthiness of the four lenders i.e., M/s Bhola Motor Finance Pvt. Ltd., M/s P Seven General Finance (P.) Ltd.,M/s Toor Finance Company Ltd. & Vemuri Finvest Pvt. Ltd. 5. To conclude, it is clear from the facts and after considering all the evidences that have been submitted, that the appellant has been able to discharge the burden regarding the Identity, Genuineness & Creditworthiness of the lender parties as required u/s 68 of the I.T.Act, and therefore no addition in this regard is warranted. Hence, in my considered opinion and after taking into account all the facts and evidences as discussed above, the appeal of the appellant is allowed and the addition made of Rs. 6,25,00,000/- made u/s 68 of the I.T. Act, 1961 is deleted. 12. Before us, the Revenue has failed to controvert the findings given by Ld.C....