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TMI Blog2024 (2) TMI 1222X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 115BBC of the Act. Thus the addition made by the AO is not sustainable and the same is deleted.- Decided in favour of assessee. Addition u/s 68 on account of unsecured loans - consequential denial of benefit of section 11 - assessee has now contended that entire receipt including the loan in question has been applied for charitable purpose and therefore, no addition can be made on account of unsecured loans - HELD THAT:- As we note that the authorities below have not considered this aspect of the matter as to whether the assessee has applied this amount of loan for charitable purpose and consequently the benefit of section 11 would be available to the assessee of not. Thus we set aside this issue to the record of the AO for proper verification of the relevant fact regarding the utilization of the loan amount as well as details and evidences to be produced by the assessee to satisfy the identity and creditworthiness of the creditors as well as genuineness of the transactions. Decided in favour of assessee for statistical purposes. - Shri Vijay Pal Rao, Judicial Member And Shri B.M. Biyani, Accountant Member For the Assessee : S/Shri Sumit Nema, Sr. Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes even though assessee fails to disclose names and addressed of donors [refer - Commissioner of Income Tax v/s NBA Nahata charitable Trust, [2014] 43 taxmann.com 315 (Karnataka). 4. The Ld. A.O has erred in law and on facts in making the addition of Rs. 10,00,000/- to the total income of the appellant on account of treating unsecured loans as the unexplained cash credit u/s. 68 of the Income Tax Act, 1961. 5. That the Ld. A.O has failed to provide the reasonable opportunity to the appellant to establish the identity and credit worthiness of the lenders of unsecured loans to prove the genuineness of unsecured loans. 6. That the Ld. A.O has erred in, not considering the sum of Rs. 10,00,000/- as income, for calculating the application u/s.11 and 12 of the Income Tax Act, 1961 and if done so, it will not result into any taxable surplus and consequently no tax liability shall arise. 4. Ground no.1 to 3 are regarding addition made by the AO u/s 115BBC on account of anonymous donations. Ld. Sr. counsel has submitted that the assessee furnished the name and details of the donors as required u/s 115BBC(3) of the Act but the AO has disallowed the donations of more ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have considered rival submission as well as relevant material on record. The AO has made the addition of donors of above Rs. 50,000/- in para 5 as under: 5. Vide order sheet entry dated 13.02.2014 the assessee was asked to furnish the list of donors along with amount and mode of receipt of donations. Assessee furnished the same on 20.02.2014. On 25.02.2014 the assessee was required to furnish PAN No.. address and Bank accounts of the donors. On 03.03.2014 the assessee furnished a list of donors with address only. PAN no. of very few donors were provided and no bank accounts of the donors were furnished. Considering the huge list of 495 donors, vide order sheet entry dated 03.03.2014 the assessee was required to furnish the PAN Nos., addresses as a proof of identity of the donors of Rs. 50,000/- and above and he was also required to furnish the creditworthiness of the donors. The assessee was also required to furnish bank statement of the donors as a proof of genuineness of transaction. Next hearing was fixed on 14.03.2014. The assessee was also show caused as to why the donations received by him should not be treated as anonymous donations u/s 115BBC of the Income-tax Act in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ticulars in addition to identity, name and address of the person making the contribution, as provided under sub-section (3) of section 115-BBC. Section 2(24)(iia) gives definition of anonymous donation. Appellant (assessee) must first be shown to have received anonymous donation. 6. We have perused the assessment order and found the AO said, inter alia, as reproduced below. During the course of assessment proceedings the assessee produced the relevant documents as per questionnaire through e-proceeding. The Books of account including bank statements, audit report, statement of income and the ledgers furnished for verification were examined. Considering the submissions made and after verification of the documents submitted by the assessee the total income of the assessee trust is hereby accepted. Accordingly, the total income of the assessee is determined at Rs. Nil. [Emphasis Supplied] As aforesaid, the Commissioner in the revision order had reproduced assessee's reply to the show-cause notice, where in paragraph 3.2 the assessee said it had again enclosed therewith, detailed list of donors along with their complete address and amounts of donations given b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of the paper book and submitted that there is deficit of Rs. 2.8 crores as on 31.03.2011 which means the assessee has incurred more than the total receipt during the year under consideration. 11. On the other hand, ld. DR has submitted that the AO in para 6 has given specific finding on this issue that the assessee has failed to satisfy the conditions of proving identity and creditworthiness of the loan creditors as well as genuineness of the transactions. He has relied upon the orders of the authorities below. 12. We have considered rival submission as well as relevant material on record. The AO treated the unsecured loan as unexplained cash credit u/s 68 of the Act and consequently denied the benefit of section 11 of the Act. On appeal the CIT(A) has confirmed addition made by the AO. The assessee has now contended that entire receipt including the loan in question has been applied for charitable purpose and therefore, no addition can be made on account of unsecured loans. At the outset, we note that the authorities below have not considered this aspect of the matter as to whether the assessee has applied this amount of loan for charitable purpose and consequently the ben ..... 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