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TMI Blog2021 (1) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... AO as the assessee had not submitted the copy of PAN and balance sheets of the concerned loan creditors before the ld. AO. The said deficiencies were set right by the assessee by filing additional evidences before the ld. CIT(A). Hence, the said additional evidences need to be admitted and had to be examined as to its evidentiary value. None of the aforesaid factual observations recorded by the ld. CIT(A) had been controverted by the ld. DR before us with cogent evidences. We find that the ld. DR reiterated the contentions made by the ld. AO in his assessment order. We find after that, much water has flown in the instant case by way of additional evidences and by way of two remand reports from the ld. AO etc. - Decided against revenue. - ITA No.1250/Mum/2016 - - - Dated:- 30-12-2020 - Shri M. Balaganesh, AM And Shri Ram Lal Negi, JM For the Revenue : Shri Oommen Tharian For the Assessee : Shri Veerkumar Shah ORDER PER M. BALAGANESH (A.M): This appeal in ITA No.1250/Mum/2016 for A.Y.2010-11 arises out of the order by the ld. Commissioner of Income Tax (Appeals)-32, Mumbai in appeal No.CIT(A)-32/IT-447/ITO-15(2)(1)/13-14 dated 23/12/2015 (ld. CIT(A) i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e remark left . The notice was duly served on M/s. Khushi Gems Pvt. Ltd., but no compliance was made by the said party. Accordingly, the ld. AO vide letter dated 19/03/2013 issued a show-cause notice to the assessee asking her to establish the identity and creditworthiness of the persons from whom unsecured loans were taken by producing the above mentioned parties before the ld. AO. The assessee s authorized representative filed written submissions dated 22/03/2013 before the ld. AO but could not produce the above mentioned three persons. The ld. AO in the absence of parameters for verification of unsecured loans concluded that the unsecured loans remained unverifiable and unexplained and accordingly, proceeded to treat the same as unexplained cash credit and made addition u/s.68 of the Act while completing the assessment. 3.2. The assessee submitted before the ld. CIT(A) that she had furnished copy of confirmations from the aforesaid three parties, their bank statements together with their return of income before the ld. AO. The assessee once again submitted before the ld. CIT(A) the copy of confirmation from these parties, their bank statements, their balance sheets, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r submitted that a sum of ₹ 2.25 Crores given to the assessee as loan was duly reflected in the balance sheet of Shriram Exports. Similar observation was also made by the Addl. CIT in respect of third loan creditor i.e. Khushi Gems Pvt. Ltd., The Addl. CIT also pointed out in the remand report that all these three parties were covered by a search action u/s.132 of the Act as part of the search on the Surat Diamond Group and have during the course of search admitted on oath that they are not conducting genuine business who are engaged in giving accommodation entries. 3.3. The ld. CIT(A) forwarded both the remand reports received from the Assessing Officer to the assessee for her rebuttal. The assessee filed a rejoinder to the remand reports before the ld. CIT(A) by stating that the entire details that are available with the assessee and that could be filed in the instant case had been duly filed by the assessee before the authorities. The assessee also submitted in the rejoinder that entire borrowings had been duly repaid by the assessee and interest was also paid on such borrowings. It was also pleaded that the ld AO had duly allowed deduction towards interest paid on such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that he is a proprietor of Kothari Impex and Director of Khushi Gems Pvt. Ltd. 3.5. The ld. CIT(A) duly appreciated the aforesaid transactions and factual submissions made by the assessee together with all the supporting evidences and deleted the addition made u/s.68 of the Act. The ld. CIT(A) also with regard to admission of additional evidences had dedicated an exclusive paragraph in para 11.1 in his appellate order stating that the assessee had infact submitted basic details of confirmations before the ld. AO which was not found satisfactory by the ld. AO as the assessee had not submitted the copy of PAN and balance sheets of the concerned loan creditors before the ld. AO. The said deficiencies were set right by the assessee by filing additional evidences before the ld. CIT(A). Hence, the said additional evidences need to be admitted and had to be examined as to its evidentiary value. 4. Aggrieved by the decision of the ld. CIT(A), the revenue is in appeal before us by filing regular grounds as well as additional ground for the admission of additional evidences as stated supra. 5. We find that assessee had ultimately submitted the following documents in respect of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant submits that the PAN Cards prove the identity of these parties. Before the AO also documents were produced to prove the genuineness of the transactions which inter alia included the confirmations from these parties. However the AO brushed this aside on the grounds that the identity itself was not proved. On remand, the AO has fairly conceded that the loans availed by the appellant was shown as advance in the balance sheets now filed. However the AO held on to his ground that the genuineness was not proved because these parties were not credit worthy to advance loans of such magnitude. I am unable to appreciate this position of the AO. The AO himself states in his remand report, not once but twice that the turnover of these parties is in hundreds of Crores. In the same breath he states that these parties are not credit worthy. The AO goes on to state that these parties have confessed during search that they have not conducted genuine business but only given accommodation entries. This has been rebutted by the appellant stating that not only have these parties retracted their confession, but that the loans have been repaid through banking channels subsequently. I find that apart ..... X X X X Extracts X X X X X X X X Extracts X X X X
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