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TMI Blog2022 (11) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee is having regular transactions with M/s. Kunal Gems. Merely because the notice issued u/s.133(6) to M/s. Kunal Gems by the ld.AO had returned unserved, the genuine loan transaction like this carried out by the assessee cannot be doubted and disbelieved. Hold that assessee had duly proved all the three ingredients of section 68 of the Act Viz. Identity of lender, credit worthiness of the lender and genuineness of transaction. The interest claimed by the assessee in the sum of Rs. 15,016/- on the said loan has been allowed as deduction by the revenue in A.Y.2007-08. Hence, have no hesitation to direct the ld.AO the delete the addition made u/s. 68 - Appeal of the assessee is allowed. - ITA No. 625/Mum/2022 - - - Dated:- 28-10-202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m house property and income from other sources. The return of income for the A.Y. 2007-08 was filed by the assessee on 03/07/2008 declaring total income of Rs. 2,14,066/- . No scrutiny assessment was framed on this return. Subsequently, this assessment was sought to be reopened by issuing notice u/s. 148 of the Act dated 24/03/2014 on the ground that assessee had taken accommodation entries from M/s. Kunal Gems through bogus loans amounting to Rs. 21,00,000/-. The main grievance of the revenue is that the assessee had borrowed unsecured loans from entity allegedly belonging to Shri. Pravin Jain. Accordingly, the ld.AO sought to examine the veracity of receipt of unsecured loan of Rs. 21,00,000/- by the assessee from M/s. Kunal Gems in the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s asked to prove the genuineness of transaction with Kunal Gems. The assessee apart from refurnishing the aforesaid documents submitted that the loan has been repaid to M/s. Kunal Gems in AY.2009-10 AY.2011-12 . Since assessee could not produce the lender for examination before the ld.AO, the ld.AO proceeded to treat the unsecured loan of Rs. 21,00,000/- as unexplained cash credit u/s. 68 of the Act on the ground that assessee could not prove the genuineness of transaction. This action of the ld.AO was upheld by the ld.CIT(A). 7. I find that assessee had borrowed loan of Rs. 21,00,000/- from M/s. Kunal Gems in A.Y. 2007-08 through regular banking channels. The assessee has claimed interest payment of Rs. 15,016/- to M/s. Kunal Gems as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Kunal Gems as genuine. There is absolutely no reason to disbelieve the next loan transaction of Rs. 21,00,000/- from the same party. The entire loan has been repaid by the assessee in A.Y.2011-12. The search in the case of Pravin Jain happened in Oct. 2013 wherein it transpired that he was engaged in providing accommodation entries through various entities and one such entity was M/s. Kunal Gems. The transaction of receipt of loan and repayment of loan had happened prior to the search action in the case of Pravin Jain. Once the loan transactions are settled, the assessee obviously will not have the latest address of the lender that to after a gap of few years. It is not the case of the revenue that the assessee is having regular transact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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