9911796707
TMI Blog2022 (11) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... his appeal has taken the following grounds of appeal: " For that 1. The Appellant denies the liability to be assessed at total income of Rs.6,03,32,614 against returned income of Rs NIL and as also confirmed by Ld CIT(A) NFAC 2. The L'd CIT(A) NFAC erred in confirming the addition made by L'd A.O amounting to Rs 4,73,20,190 without appreciating the fact that purported receipt by the appellant is sum total of many credit entries on account of frequent transactions between inter group entities since last many years. 3. The L'd CIT(A) NFAC erred in confirming the disallowance of interest of Rs.1,30,12,424 by erroneous calculation on entire balance including that on opening balance carried forward from previous year. 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act was issued to the said company and reply was received. The Assessing Officer also sent an inspector to enquire about the existence of the said M/s ABC Financial Services Pvt. Ltd.. The inspector reported that though there was no sign board of the said company, however, he met there Shri Binod Agarwal, partner cum staff of the company. He reported that the company was a Non-Banking Financial Company (NBFC). The Assessing Officer also issued summons u/s 131 for personal appearance of the director of the said company and in response Sri Mahadev Lal Agarwal, appeared and delivered his statement. Sri Mahadev Lal Agarwal also explained to the Assessing Officer that the previous name of the said company was Agarwal Wire Industries Pvt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otally wrong and ultimately he made the addition only on the basis of that creditworthiness of the lender company was doubtful. The ld. counsel for the assessee has further submitted that the lender company was the group company of the assessee which was a NBFC (Non Banking Financial Company). That the said lender company was duly registered with the Registrar of Companies and that the director of the said company was one of the partners of the assessee firm. The ld. counsel has further drawn our attention to the following chart: Particulars A.Y. 2014-15 A.Y. 2015-16 A.Y. 2016-17 A.Y.2017-18 Revenue from Operation Other Income 1,17,03,490.77 21.00 1,26,70,493.00 - 1,40,57,048.00 63,440.00 1,73,62,023.16 - Total Income 1,17,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of Rs.13.72 crores. He, therefore, has submitted that the Assessing Officer totally ignored that the assessee during the year has repaid an amount of Rs.13.72 crores as against the loan during the year of Rs.4.73 crores by way of various running transaction during the year and that the closing balance was at Rs.4.20 crores only as against opening balance of Rs.12.02 crores. The ld. counsel has further invited our attention to the income tax return of M/s ABC Financial Services Pvt. Ltd. placed at paper book pages 190 to 194 to submit that the said lender company for the assessment year 2013-14 had returned a very high total income of Rs.5,53,94,060/- and paid high taxes. The ld. counsel has further submitted that the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merits. As noted above, not only the lender company responded to the notices issued u/s 133 of the Act but also the director of the said company appeared in response to notice u/s 131 of the Act, even the inspector also met the director cum employee of the lender company at the given address. The assessee has duly proved not only the identity, creditworthiness of the lender company but also the genuineness of the transaction by way of demonstrating about the running account of the assessee with the said company and that the total loan liability of the assessee company during the year being decreased. In view of this, we do not find justification on the part of the lower authorities in making the impugned additions and the same are accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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