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TMI Blog2021 (3) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... other fact that most of the loans has been taken either from directors or their relatives and therefore, the identity of the lender could not be doubted. The creditworthiness was established by adducing the bank statements as well as Income Tax particulars. The genuineness got established by confirmation of accounts. Since, the assessee discharged the primary onus, as casted upon him in terms of Sec. 68, of proving these transaction, the impugned loans could not be termed as assessee s unaccounted money. Therefore, no fault could be found in the approach of Ld. CIT(A) in deleting the addition u/s 68 as well as interest disallowance. The ground thus raised before us stand dismissed. Addition u/s 36(1)(va) - HELD THAT:- Addition was deleted by Ld. CIT(A) by relying upon the binding judicial precedent in the shape of decision in CIT V/s Hindustan Organic Chemicals Ltd . [ 2014 (7) TMI 477 - BOMBAY HIGH COURT] Since no contrary decision is on record, our interference is uncalled for. Ground stand dismissed. - I.T.A. No.2899/Mum/2019 And C.O. No.34/Mum/2020 (Arising out of ITA No. 2899/Mum/2019) - - - Dated:- 4-3-2021 - Hon ble Shri Saktijit Dey, JM And Hon ble Shri Manoj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er simply by allowing appeal and deletion additions made. 3. On the facts and in the circumstances of the case and in law, Id.CIT(A) has erred in deleting the quantum addition ignoring that the information on account of accommodation entry of bogus purchase of ₹ 4,70,00,643/- is received from the Investigation Wing, Mumbai of Income Tax Department; that during the search action u/s.132 of the Act carried out on 01/10/2013 in the case of Praveen Kumar Jain Group, are the entry operators and that they had provided accommodation entries in the form of bogus purchases to the assessee company through the companies under his control. 4. On the facts and m the circumstances of the case and in law, ld.CIT(A) has erred in restricting the quantum addition ignoring that the information on account of bogus purchases is received from the DIT(Investigation) Unit-2, Mumbai that the assessee had received accommodation entry from -Natasha Enterprises, Atharva Business Pvt Ltd. and Duke Business Pvt Ltd. (JPK Trading I Put Ltd), the concern controlled by Shri Praveen Kumar Jain. 5. On the facts and in the circumstances of the case and in law, Id.CIT(A) has erred in deleting the addi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for ₹ 470 Lacs from 3 entities, the details of which are extracted in para-3 of the assessment order. Accordingly, case was re-opened vide notice u/s. 148 dated 05/02/2015 which was followed by statutory notices u/s 143(2) 142(1) wherein assessee was directed to file requisite details documentary evidences. Although assessee defended the purchase transactions but Ld. AO disallowed entire purchases and added the same to the income of the assessee as unexplained income u/s 69C. The primary factor to disallow the same was that notices issued u/s 133(6) to the tainted supplied did not elicit satisfactory response. 3.3 The addition u/s 68 stem from the fact that the assessee obtained unsecured loan aggregating to ₹ 261.53 Lacs from 9 entities as tabulated in para-7 of the assessment order. In the absence of documentary evidence to demonstrate fulfilment of primary ingredients of Sec.68, these loans were added as unexplained cash credit u/s 68. Consequently, interest of ₹ 0.69 Lacs paid on these loans to 2 entities was also disallowed. 3.4 The last addition arose on account of assessee s default in payment of employees contribution towards PF (EPF) and E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evenue. In such a case, the approach of Ld. CIT(A) in estimating the additions @5% is quite fair reasonable. We concur with the same and therefore, this ground raised by the revenue stand dismissed. 6.1 Regarding addition u/s 68, the assessee submitted additional evidences u/r 46A which were subjected to remand proceedings. The remand report was duly confronted to the assessee and the assessee assailed the findings of Ld. AO by drawing attention to the documentary evidences as placed on the record, during remand proceedings as well as during appellate proceedings, in support of the transactions. The assessee submitted that the loans were taken from directors and their relatives for meeting working capital requirements. During appellate proceedings, the confirmations of the lenders were submitted along with copy of PAN, bank statements and their respective Income Tax Returns to establish the identity Creditworthiness of the lenders as well as the genuineness of the transactions. 6.2 After due consideration of material on record, remand report and assessee s submissions, Ld. CIT(A) rendered factual findings and deleted the impugned additions by observing as under: - 4.3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is observed that the loan from Mr. Mrs. Shah have been repaid along with interest during the previous year relevant to next assessment year. Owing to these facts, the unsecured loans are considered genuine and directed to be accepted as there is no way by which the appellant could have produced any further details to substantiate his claim. 4.5 Also, in case of unsecured loans taken from the lender Mr. Ranjit Kamat, ITR has not been produced by the lender. It is submitted that Mr. Ranjit Kamat is son of Mr. Prakash Kamat, Promoter Director of the appellant company and the onward Remittance Certificate certified by the bank for the said loan and the self-certificate for source of income in UK and academic qualification have been submitted during the appellate proceedings. This establishes the creditworthiness of the lender. The lender was employed in London and earning salary income, which was advanced as loan to Appellant company. Therefore, the unsecured loan taken from the son of the director is considered genuine and directed to be accepted. 4.6 Shri. Prakash Kamat is the one of the director who is managing the company, Shri Bharat Choramle is another director, who is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... primary ingredients of Sec.68. The confirmations of the lender, bank statements, Income Tax Returns, PAN etc. were duly filed in support of the transactions. It is another fact that most of the loans has been taken either from directors or their relatives and therefore, the identity of the lender could not be doubted. The creditworthiness was established by adducing the bank statements as well as Income Tax particulars. The genuineness got established by confirmation of accounts. Since, the assessee discharged the primary onus, as casted upon him in terms of Sec. 68, of proving these transaction, the impugned loans could not be termed as assessee s unaccounted money. Therefore, no fault could be found in the approach of Ld. CIT(A) in deleting the addition u/s 68 as well as interest disallowance. The ground thus raised before us stand dismissed. 8. The last addition u/s 36(1)(va) was deleted by Ld. CIT(A) by relying upon the binding judicial precedent in the shape of decision of Hon ble Bombay High Court in CIT V/s Hindustan Organic Chemicals Ltd. (366 ITR 1). Since no contrary decision is on record, our interference is uncalled for. Ground No.6 stand dismissed. Conclusion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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