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TMI Blog2019 (4) TMI 1104X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings. In-fact, from the records it emerges that the unaccounted money as alleged by the Assessing Officer was the loan which was repaid subsequently by the assessee. Therefore, there is no need to interfere with the findings of the CIT(A). The appeal of the Revenue is dismissed. - ITA No. 6155/DEL/2015 - - - Dated:- 11-2-2019 - Shri R. K. Panda, Accountant Member And Ms Suchitra Kamble, Judicial Member For the Appellant : Sh. Surender Pal, Sr. DR For the Respondent : Dr. Rakesh Gupta, Sh. Somil Aggarwal, Sh. Deepesh Garg, Sh. Shubham Sobti, Advs ORDER PER SUCHITRA KAMBLE, JM This appeal is filed by the Revenue against the order dated 14/08/2014 passed by CIT(A)-, Muzaffarnagar for Assessment Year 2010-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the CIT(A) erred in deleting the assessee addition as the credit worthiness/capacity to the lender could not be proved by the assessee. Thus, the Ld. DR relied upon the order of the Assessing Officer. The Ld. DR further submitted that the assessee failed to prove the genuineness of the transaction. 6. The Ld. AR relied upon the order of the CIT(A). 7. We have heard both the parties and perused the material available on record. The CIT(A) held as under:- The facts of the case, submissions made by the appellant, remand reports of the AO and rejoinders of the appellant have been carefully considered. It is observed that the appellant during the year had received unsecured loans from 11 different corporate entities aggregating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their existence on paper only, (vi) That no actual business is carried out by the depositor companies and they exist on paper only, (vii) That mere filing of return does not prove the existence, of the depositor companies, and (viii) That the amount credited in the bank account of the depositor companies is siphoned out in a day or two. However, such adverse inference drawn by the AO has no force due to the following reasons:- Regarding replies submitted in response to notice u/s 133(6) of the Act, the submission of the appellant along with evidences shows that in some cases the directors of the depositor companies .were the residents of Ghaziabad and in other cases, the auditors were from Ghaziabad. The AO s obser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the basis of details, evidences and arguments of the appellant, the adverse inference drawn by the AO' in the assessment order as discussed above, is held as baseless and accordingly rejected. From the perusal of the details and evidences placed on record, it is gathered that the unsecured loans were raised from 11 corporate entities through account payee cheques and the advances to the appellant were duly reflected in their audited balance sheets by the respective corporate entities. It is also a matter of fact on record that all the aforesaid companies are assessed to tax and evidence of filing their returns of income was made to the AO. From the order of the AO and remand reports, it is observed that the AO has not brought ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loans. Reliance is placed .on the decision of Hon ble Allahabad High Court in the case of CIT vs. Kapoor Chand Magnesh Chand (2013) 218 Taxman 157 (Allahabad) in appeal No.309 of 2009 and CIT vs. S. Kamaljeet Singh reported in [2005] 147 Taxman 18 (All) besides other proceedings. it is observed that the AO s inference that the lenders companies were not creditworthy on the ground that such companies had shown low profit has no force in as much as the capacity to invest funds by an investor depends upon the availablility of funds with the investors and not on the tax paid/annual income of the investor. The appellant has furnished copies balance sheets of the lender companies to establish the creditworthiness of the lender companies whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the above facts and following the ratio decidende of the Hon ble Courts (supra), it is held that the AO was not justified in making addition of ₹ 3,19,50,000/-. The same is directed to be deleted. Grounds of appeal Nos. l to 9 are allowed. 4. In result, the appeal is allowed. The CIT(A) has given detailed finding and taken into consideration of the submissions made by the assessee as well as the remand report of the Assessing Officer called during Appellate Proceedings. In-fact, from the records it emerges that the unaccounted money as alleged by the Assessing Officer was the loan which was repaid subsequently by the assessee. Therefore, there is no need to interfere with the findings of the CIT(A). The appeal of the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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