9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (12) TMI 259 - AT - Income TaxUnsecured loan u/s 68 - whether assessee has proved identity and creditworthiness of the parties? - HELD THAT - It is very clear that there is no doubt of whatsoever with regard to genuineness of transactions. No doubt, bank might not have given narration with regard to cheque no., address and PAN while giving credit to the bank account of the assessee. But, fact remains that the assessee has filed all those details, including confirmation letter from loan creditors which matches with credit in the bank account of the assessee on 28.02.2008. Therefore, we are of the considered view that the assessee has filed necessary evidences to prove genuineness of transactions. Since, there is no dispute with regard to identity and creditworthiness of the loan creditors and further the assessee has filed necessary evidence to prove genuineness of transactions, CIT(A) has erred in sustaining additions made by the AO towards unsecured loans u/s.68. Hence, we set aside order of the CIT(A) and direct the Assessing Officer to delete addition made towards unsecured loans u/s.68 - Decided in favour of assessee.
Issues involved:
1. Addition of unexplained credit under section 68 of the Income Tax Act. 2. Denial of set off unabsorbed depreciation against the income. 3. Assessment of deemed income under section 68 of the Act. 4. Violation of principles of natural justice in passing the order. Detailed Analysis: Issue 1: Addition of unexplained credit under section 68 of the Income Tax Act The case involved the assessee appealing against the addition of ?20,00,000 as unexplained credit under section 68 of the Income Tax Act. The Tribunal noted that the assessee had proven the identity and creditworthiness of the loan creditors, and the only dispute was regarding the genuineness of the transactions. The Tribunal disagreed with the CIT(A)'s doubts about the transactions, as the bank statements provided by the assessee clearly showed the source of the funds. The Tribunal held that the assessee had provided sufficient evidence to prove the genuineness of the transactions, and therefore, directed the Assessing Officer to delete the addition made towards unsecured loans under section 68 of the Act. Issue 2: Denial of set off unabsorbed depreciation against the income The Tribunal also addressed the denial of set off unabsorbed depreciation against the income brought to tax under section 68 of the Act. The assessee argued that they were eligible for the set off based on the provisions of Section 115BBE and judicial trends. The Tribunal found merit in the assessee's arguments and held that the denial of set off was unjustified. The Tribunal directed the Assessing Officer to allow the set off of unabsorbed depreciation against the income determined under section 68 of the Act. Issue 3: Assessment of deemed income under section 68 of the Act The Tribunal discussed the assessment of deemed income under section 68 of the Act and emphasized the importance of assigning such income to the appropriate head for computation purposes. The Tribunal highlighted that the disputed sum should be categorized under 'income from business' or 'income from other sources' rather than being presumed as a standalone addition under section 68 of the Act. Issue 4: Violation of principles of natural justice in passing the order The Tribunal also addressed the issue of violation of principles of natural justice in passing the order. The assessee raised concerns about not being given a proper opportunity before the impugned order was passed. The Tribunal acknowledged the importance of natural justice principles and emphasized that any order passed in violation of these principles would be considered nullity in law. In conclusion, the Tribunal allowed the appeal filed by the assessee, setting aside the CIT(A)'s order and directing the Assessing Officer to delete the addition of ?20 lakhs made towards unsecured loans under section 68 of the Income Tax Act.
|
