THE DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-5(1) , MUMBAI vs. M/S SAKET INFRA PROJECTS PRIVATE LIMITED, MUMBAI

The DCIT, Vs. M/s. Saket Infra Central Circle 5(1), Projects Pvt Ltd., Room No. 1928, L3-308,the Summit 19th Floor, AirIndiaBldg, Bay, Service Road, WE Nariman Point, Highway, Vile Parle (E) Mumbai-400021. Mumbai –400057. PAN/GIR No. : AAKCS4532L Appellant .. Respondent Appellant by : Shri.Dr. Kishor Dhule CIT-DR & Smt. Neeraja Sharma.DR Respondent by : Shri. JP Bairagra, Shri Ashiskumar Bairagra & Shri Akhilesh Pevekar. AR Date of Hearing 06.02.2023 Date of Pronouncement 02.05.2023 आदेश / O R D E R PER BENCH: The revenue has filed the appeal against the order of Commissioner of Income Tax (Appeals)-53, Mumbai passed u/s 250 of the Act. The revenue has raised the following grounds of appeal:

1. Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 36,447/- on account of bogus purchase ignoring the M/s Saket Infraprojects Pvt Ltd, Mumbai. - 2 -

fact that the assessee failed to prove the genuineness of purchases, and any expenditure in respect of which payments by account payee cheques is not enough evidence to prove the genuineness of the transaction ?" 2 Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) is justified in deleting the addition of Rs. 9,50,514/- as alleged bogus jobwork and labour expenses ignoring the facts that the assessee failed to prove the genuineness of these expenses and to produce evidences to substantiate the genuineness ?" 3 Whether on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 2,63,22,250/- u/s 68 of the Act in respect of unsecured loans ignoring the facts that the assessee has not proved the genuineness of the transaction, identities of most of the creditors and credit- worthiness of the parties to the satisfaction of the AO, so as to discharge the primary onus?" 4 "The appellant craves to leave, to add, to amend and / or to alter any of the ground of appeal if need be.

, submissions of the assessee, findings of the scrutiny assessment, remand report, provisions of law, judicial decisions and up held the validity of reasseement proceedings u/sec147 of the Act and granted relief in other grounds of appeal observing at page

8. Para 5 to 9 of the order read as under:

5. Ground No.2 is regarding disallowance of Rs.36,447/- as alleged bogus purchases.

5.1 For A.Y. 2013-14, the AO has disallowed purchases from Transcreek Engineers Pvt Ltd. of Rs.36,447/-The issue regarding disallowance of purchases from Transcreek Engineers Pvt. Ltd. has been discussed in Para 7 of the appellate order for A.Y. 2014-15. The facts of the case, findings of the AO in the assessment M/s Saket Infraprojects Pvt Ltd, Mumbai. - 6 - order and the submission made by the appellant are similar to that for A.Y. 2014-15. For A.Y. 2014-15, the disallowance made by the AO in respect of alleged bogus purchases from Transcreek Engineers Pvt. Ltd has been deleted Thus, following the decision taken on this issue in A.Y. 2014-15, the disallowance made by the AO in respect of bogus purchases in A.Y. 2013-14 is also deleted.

Accordingly, Ground No.2 of the appeal is allowed.

6.1 For A.Y. 2013-14, the AO has disallowed bogus job work and labour expenses of Rs.24,000/- from Jaiswal Transport, Rs.9,26,514/- from Gem Singh Rathod. The issue regarding disallowance of bogus job work and labour expenses from Jaiswal Transport has been discussed in Para 9 of the appellate order for A.Y2014- 15 and that in the case of Gemsingh Rathod is discussed in Para 19 of the appellate order for A.Y2015-16The facts of the case, findings of the AO in the assessment order and the submission made by the appellant are similar to that for A.Y. 2014-15 and A.Y. 2015-16. Thus, following the appellate orders for A.Y.2014-15 & 2015-16, the disallowance of job work and labour expenses is also deleted for A.Y.2013-14. Accordingly, Ground No. 3 of the appeal is Allowed.

7.1 For A.Y2013-14, the AO has made addition of unsecured loans of Rs2,63,22,250/ During the M/s Saket Infraprojects Pvt Ltd, Mumbai. - 7 - appellate proceedings, the appellant has explained that during the A.Y.2013-14the appellant has taken unsecured loans of Rs.40,00,000/from Vardhan Diamonds Private Ltd, Rs.70,00,000/- from Antique Exim Private Limited, Rs.25,00,000/from Yogesh Construction and Rs.20,00,000/- from Chaitanya Gems Private Ltd totaling to Rs.1,55,00,000/-. Further, during the A.Y.2013-14, the appellant has paid interest on unsecured loan i.e. interest of Rs. 1,08,22,250/- paid to 13 parties.

The issue regarding addition of unsecured loans from the said 4 parties has been discussed in Para 10 of the appellate order for A.Y2014-15. The facts of the case, findings of the AO in the assessment order and the submission made by the appellant are similar to that for A.Y. 2014-15. For A.Y2014-15, the addition made by the AO in respect of unsecured loans has been deletedThus, following the appellate order for A.Y2014- 15, the addition made by the AO in respect of unsecured loans received from these 4 parties in A.Y. 2013-14 is also deleted

The appellant received fresh loans from 4 parties on which interest of Rs.22,26,500/- was paid and interest of Rs.85,95,750/- was paid on earlier loans taken from 9 parties. For A.Y.2013-14, the addition in respect of fresh unsecured loans received from these 4 parties have been deleted In respect of loans taken from 9 parties prior to A.Y2013-14the AO has not taken adverse view in respect of such loans taken prior to A.Y2013-14. Therefore the addition of interest in respect of unsecured loans for A.Y.2013-14 is deleted

Accordingly, Ground No.4 of the appeal is Allowed.

M/s Saket Infraprojects Pvt Ltd, Mumbai. - 8 - The CIT(A) has considered the submissions, details and relied on the similar findings and decision of the appellate authority in the subsequent assessment years and deleted the additions made in respect of bogus purchases, job works, and labour expenses, addition of unsecured loans and interest disallowance and partly allowed the assessee appeal. Aggrieved by the order of the CIT(A), the revenue has filed the appeal before the Honble Tribunal.

6. We heard the rival submissions and perused the material on record. The grievance of the revenue that, the CIT(A) has erred in deleting the additions of the bogus purchases expenses, bogus job work & labour and unsecured loans and interest disallowance .The Ld.AR submitted that the assessee has cooperated in submitting the information in the assessment proceedings, whereas the A.O has ignored the information, evidences and Audited financial statements. The Ld. AR emphasized that the assessee has discharged its burden by submitting the details/information in the original assessment proceedings and in the remand proceedings. Whereas in respect of bogus purchases and job work&labour expenses, the assessee has submitted the details of PAN, income tax returns, copies of bills, ledger confirmation, bank statement. But the AO has made addition as the parties were not produced and the payments were not proved. In the appellate proceedings before the CIT(A), the assessee has filed additional evidence and CIT(A) has admitted the evidence and issued directions to the A.O. and called for the report. In the remand proceedings before the M/s Saket Infraprojects Pvt Ltd, Mumbai. - 10 - A.O, the parties have appeared and furnished the details and the A.O. has recorded the submissions. The third disputed issue with respect to unsecured loans and interest paid, the assessee has obtained loans from various parties during the year and the transactions were reflected in the financial statements. The assessee has submitted the documentary evidence with PAN number of lender, address, contact number, confirmation, Income tax returns, bank statement, audited balance sheet, MCA data and GST details.

7. The CIT(A) has called for the remand report from the AO on the additional evidence and in the remand proceedings the parties have appeared before the AO and the statement was recorded. Further the assessee also submitted the audited financial statements, confirmations, Bank statements, copy of the income tax return, Form no 16A to substantiate the genuineness and credit worthiness of loan creditors. The CIT(A) has considered the facts, circumstances and remand report and observed that the assessee prima-facie has complied the ingredients required u/s 68 of the Act of identity, genuineness and M/s Saket Infraprojects Pvt Ltd, Mumbai. - 11 - creditworthiness. Further, the CIT(A) relied on the judicial decisions and test checked the genuineness and creditworthiness of the lenders and the CIT(A) came to a reasonable conclusion that the assessee has discharged its burden on submitting the information. We considered the facts, circumstances and submissions as discussed above are of the view that the CIT(A) has passed a reasoned and conclusive order. Accordingly we do not find any infirmity in the order of the CIT(A) and uphold the same and dismiss the grounds of appeal of the revenue.