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Facts
The assessee filed an appeal against an order that added Rs.38,52,498/- as an unexplained cash credit, alleged to be an accommodation entry. This addition was based on findings during a search.
Held
The tribunal found no nexus between the searched entity and the alleged accommodation entries. Therefore, the addition made by the lower authorities was deemed to have no merit and was deleted.
Key Issues
Whether the addition made as unexplained cash credit is sustainable without proving the nexus with the searched entity and accommodation entries.
Sections Cited
147, 68
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
ORDER This assessee’s appeal for Assessment Year 2014-15, arises against the CIT(A)-, Delhi-25’s DIN & order No. ITBA/APL/S/250/2024-25/1072578016(1) dated 27.01.2025, in proceedings u/s 147 of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties at length. Case file perused.
It is noticed during the course of hearing that both the learned lower authorities have added an amount of Rs.38,52,498/- alleged to have been received by the assessee as accommodation entry in the relevant previous year which stands added as unexplained cash credit u/s 68 of the Act.
Faced with this situation, the Revenue could hardly dispute that even going by leaned Assessing Officer’s detailed R V Commodities Pvt. Ltd. discussion in para 4 at page 5, a categorical finding has been recorded that the amount in question was recovered from Sh. Alok Kumar Agarwal during the course of a search. The tribunal find no reason to sustain the impugned addition in the assessee’s hands as the crucial nexus with the searched entity vis-à-vis the alleged accommodation entries has nowhere been proved in the learned lower authorities findings. That being the case, I find no merit in the impugned addition of Rs.38,50,000/- which stands deleted.
All other pleadings on merits herein stand rendered academic.