TaxTMI 
TaxTMI 
2026 (6) TMI 850
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....2025 passed under section 147 of the Income Tax Act, 1961, for the Assessment Year 2020-21. The word 'Act' herein this order would mean Income Tax Act, 1961. The assessee has also filed Cross Objection. 2. The Revenue has raised following grounds of appeal:- a. Whether on the facts and circumstances of the case, the Ld. CIT(A) is justified in holding that the assessee failed to rebut the presumption u/s 132(1A) and 292C of the I.T. Act, which states that where any document is found in the possession or control of any person in the course of search. it may be presumed that such document belongs to such person and the contents of such documents are true. The assessee has not rebutted the presumption b. Whether on the fact....
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....horities had conducted a search upon Galaxy Group of cases and entry providers Shri Deepak Agarwal and Shri Himanshu Verma on 17.11.2021. Upon examination of seized documents inter alia comprising digital data, it was noted that the assessee was beneficiary of accommodation entries. The factual matrix noted from the order of the ld. AO dated 22.03.2025 is as under:- "2. A search action u/s 132 of the Income tax Act 1961 was conducted on Galaxy Group, Sh. Deepak Agarwal, entry provider and Sh. Himanshu Verma, entry provider on 17.11.2021. During the search and post search, following has been emanating. 3. It has been gathered that Sh. Deepak Agarwal and Sh. Himanshu Verma are involved in providing various types of accommoda....
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....ma. Documents seized during the search contains information which shows that the assessee has obtained accommodation entries. On perusal of information, it has been revealed that assessee has taken the accommodation entries amounting to Rs. 2,00,00,000/- from entity M/s Sarvottam Securities Private Limited and has paid Rs. 50,00,000/- to the same entity which is paper company, controlled and managed by Sh. Himanshu Verma. 8. Accordingly, after getting approval from the competent authority u/s 148 /149 /151 of the Income Tax Act, 1961 (including prior approval u/s 148 Explanation 2 of the Act), a notice u/s 148 was issued to the assessee on 31.03.2024 by the Circle 4(2), New Delhi and assessee was requested to file its return of inc....
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....ted for the business needs of the company as the few existing lenders has recalled/demanded for repayment of their existing loans and respective EMIs due but the Company was not having sufficient fund in bank accounts for making the respective loan and EMIs due thereon. The assessee has further submitted that it has done transaction through banks and TDS was deducted on interest payment. The assessee further submitted that it has repaid loans of Rs. 50,00,000/- to M/s Sarvottam Securities Private Limited in the same AY. The assessee further submitted that it has repaid last installment on 04.11.2020. The assessee has submitted copy of loan agreement, copy of ITR of above entity, bank statement, ledger, copy of incorporation, copy of audited....
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..... 7. The ld. CIT- DR, Shri Rajesh Kumar, vehemently argued in favour of the order of the AO. It was urged that the factum of indulgence of assessee with accommodation entry providers is clearly brought out by the ld. AO in his order. On the issue of repayment of loan during the year under consideration, the ld. DR placed reliance upon the decision of Hon'ble ITAT Mumbai in its order dated 05.09.2024 in ITA No. 3258 to 3260/Mum/2023 in the case or J.K. Global. It was stated that it has been held in the impugned order that repayment of loan would not take away the blame of accommodation entry. 8. We have heard rival submission in the light of material available on records. We have noted that the ld. AO has vividly demonstrated in his as....