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Issues involved: Appeal filed by Revenue u/s 260A of Income Tax Act challenging Tribunal's order regarding addition of unsecured loan u/s 68 of Act.
Details of the judgment: 1. Issue: Justification of addition of unsecured loan - The Revenue contended that the addition of Rs. 1.21 crores was justified under Section 68 as the Assessing Officer invoked it due to lack of confirmation from Pankaj Aggarwal. - CIT(Appeals) confirmed the addition, which was later partially sustained by the Tribunal. 2. Issue: Assessee's submission and evidence - Assessee provided detailed information about the unsecured loan from Pankaj Aggarwal, including PAN details and loan account. - Assessee explained that the loan was part of a joint venture agreement with Ceylon Biscuits Ltd., Sri Lanka, and the source of funds was established. 3. Issue: Tribunal's decision on addition - Tribunal deleted the addition of Rs. 98.50 lakhs, stating that the amount was an unsecured loan from a shareholder, Pankaj Agarwal. - Tribunal noted that no evidence suggested Pankaj Aggarwal was involved in illegal activities like Hawala operations. 4. Issue: Lack of confirmation letter - Despite the factual evidence provided by the assessee, CIT(Appeals) upheld the addition, questioning certain payments and receipts without concrete proof. - Tribunal found no merit in the Revenue's appeal, emphasizing that Section 68 conditions were not met as the transaction was genuine and entered into for business reasons. 5. Conclusion - The Tribunal dismissed the appeal, highlighting that the issues were factual and the addition was not justified under Section 68. No costs were awarded in the matter.
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