SUNDER MARKETING ASSOCIATES ,DELHI vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 34(1), DELHI

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ITA 4837/DEL/2025Status: DisposedITAT Delhi24 July 2026AY 2016-174 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the cheques totaling Rs. 3 crores were directly paid to the mining department of Haryana through banking channels, the question of identity and creditworthiness of the assessee for these unsecured loans did not arise. Therefore, the addition could not be sustained.

What were the facts?

The assessee's return for AY 2016-17 was selected for scrutiny. The AO made additions for CSR expenses and unsecured loans. The CIT(A) confirmed the addition of Rs. 3,00,00,000/- on account of unsecured loans.

What were the issues?

Whether the addition of Rs. 3 crores as unsecured loans is sustainable under Section 68 when the funds were directly paid to a government department and not to the assessee.

Which sections of the Income-tax Act were involved?

Section 68,Section 37(1),Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH, ‘H’: NEW DELHI

Before: SH. SATBEER SINGH GODARA & SHRI KRIWANT SAHAY

For Appellant: CA (Virtual)
Hearing: 16.07.2026Pronounced: 24.07.2026

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘H’: NEW DELHI BEFORE SH. SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI KRIWANT SAHAY, ACCOUNTANT MEMBER

ITA No.4837/Del/2025 [Assessment Year: 2016-17] Sunder Marketing vs DCIT Associates, F-8, Second Circle – 34 (1) Floor Parvana Vihar Delhi Apartment, Sector-9, Rohini Delhi PAN No.ACXFS6849J Appellant Respondent Appellant by Sh. Parikshit Aggarwal, CA (Virtual) Respondent by Sh. Bhopal Singh, CIT DR Date of Hearing 16.07.2026 Date of Pronouncement 24.07.2026 ORDER PER KRINWANT SAHAY A.M. Appeal in this case has been filed by the assessee against the order dated 21.07.2025 passed by the Ld. CIT(A), Delhi for the A.Y. 2016-17. Grounds of appeal are as under :-

1.

That on the facts, circumstances and legal position of the case, Worthy CIT(A), NFAC in Appeal No. CIT (A), Delhi- 13/10222/2018-19 has erred in passing order dtd. 21.07.2025 in contravention of provisions of S. 250 of Income Tax Act, 1961 (hereinafter referred to as "Act").

2.

That on facts, circumstances and legal position of the case, Worthy CITA) has erred in confirming the impugned addition of Rs. 3,00,00,000/-/s 68 on account of unsecured loans raised. 3. Ltd. That on facts, circumstances and legal position of the case, the order passed by Ld. AO and then by Worthy CIT(A) deserves to be quashed since the same have been passed without affording reasonable opportunity of being heard to the appellant 4. That the appellant craves for any addition, deletion or amendment in the grounds of appeal on or before the disposal of the same.

2.

Brief facts of the case are that as per the order of the Ld. CIT(A) are as under :-

“The assessee firm filed its return of income for the A.Y. 2016-17 on 28.03.2017 declaring a total income of Rs. 8,39,79,000/-. The case was selected for scrutiny under CASS. Order U/s 143(3) was passed on 26.12.2018 by making a disallowance U/s 37(1) of Rs. 66,16,766/- towards CSR expenses, unsecured loan of Rs. 3,00,00,000/- from Kamlesh Lath and an amount of Rs. 34,21,692/- from Sunder Singh Daman (Sundry Creditor).”

3.

During proceedings before us the ld. Counsel for the assessee argued that the Ld. CIT(A) has erred in confirming the addition of Rs.3,00,00,000/- u/s.68 of the IT Act on account of unsecured loans.

4.

During proceedings before us the Ld. Counsel for the assessee brought it to the notice of the Bench that the photocopies of all the cheques totaling to Rs.3,00,00,000/- were submitted before the Ld. CIT(A) and from the

photocopies of the cheques it is clear that all the cheques have been paid directly to the Director of Mines in the state of Haryana. So nothing has come directly to the account of the assessee. The cheques were issued to the Government and payment was made to the mining department.

5.

Per contra the Ld. DR relied on the orders of the authorities below.

6.

We have considered the findings given by the lower authorities below. From the details filed before the ld. CIT(A) it is clear that all the cheques totaling to Rs.3 crores were directly paid to the mining department State of Haryana through banking channel. Therefore, the question of identity and creditworthiness in such transactions does not arise. Accordingly, the addition made by the AO and confirmed by the Ld. CIT(A) amount of Rs.3 crore u/s.68 of the Act for unsecured loans cannot be sustained. 7. In the result, the appeal filed assessee is allowed on this issue. Order pronounced in the court on 24.07.2026.

Sd/- Sd/- [SATBEER SINGH GODARA] [KRINWANT SAHAY] JUDICIAL MEMBER ACCOUNTANTMEMBER Dated: 24.07.2026 NEHA , Sr.P.S.*

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