RISHI AGRO PRODUCTS,KOLKATA vs. I.T.O., WARD - 36(1), KOLKATA

ITA 1032/KOL/2026Status: DisposedITAT Kolkata07 October 2026AY 2018-20197 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the addition made by the AO under Section 68 of the Income Tax Act, 1961, was not sustainable. The Tribunal noted that the assessee had furnished all the necessary details and evidence regarding the loan creditors, including audited financial statements, ITRs, sources of funds, bank statements, and loan confirmations. Crucially, the Tribunal observed that the assessee had repaid the loans in the subsequent financial year. The Tribunal found that the AO had relied on the investigation wing's report without conducting independent inquiries into the evidence provided by the assessee. The ratio decidendi is that once an assessee furnishes all documentary evidence for loan transactions, including the identity, creditworthiness, and genuineness of the creditors, and has also repaid the loans, the provisions of Section 68 are not applicable. The Tribunal followed the decisions of the Hon'ble Calcutta High Court and the Hon'ble Gujarat High Court, which held that if an assessee provides all evidence and repays the loans, additions under Section 68 are not warranted. The order of the Ld. CIT(A) was set aside, and the AO was directed to delete the addition. The appeals were allowed.

What were the facts?

The assessee, Rishi Agro Products, filed appeals against the orders of the National Faceless Appeal Centre (NFAC), Delhi, for Assessment Years (AY) 2017-18 and 2018-19. The Assessing Officer (AO) had made an addition of ₹80,00,126/- as unexplained cash credit under Section 68 of the Income Tax Act, 1961. This addition was based on information from the investigation wing that the assessee was a beneficiary of bogus accommodation entries in the form of unsecured loans from Gyaneshwar Vyapaar Pvt. Ltd. and Jatashiv Plaza Pvt. Ltd., which were allegedly controlled by the Banka Group. The AO reopened the assessment under Section 148. The assessee provided details like names, addresses, PANs, confirmations, and bank statements for these loans. The Ld. CIT(A) confirmed the AO's addition. The assessee contended that all necessary details and evidence were furnished, and the loans were repaid in the subsequent financial year.

What were the issues?

1. Whether the addition of ₹80,00,126/- as unexplained cash credit under Section 68 of the Income Tax Act, 1961, is justified when the assessee has furnished all details and evidence regarding the unsecured loans, including names, addresses, PANs, confirmations, and bank statements, and has also repaid the loans in the subsequent financial year? Assessee's contentions: The assessee argued that it had provided all requisite documentation to the AO, including audited financial statements, ITRs, sources of funds, bank statements, loan confirmations, and MCA data. The assessee further contended that the loans were repaid in the subsequent financial year, as evidenced by the confirmations submitted. The assessee relied on decisions of the Hon'ble Calcutta High Court in cases like PCIT-2, Kolkata Vs. Rahul Premier India Agency Private Limited and PCIT Vs. Alom Extrusions Ltd., and the Hon'ble Gujarat High Court in Ambe Tradecorp (P.) Ltd. vs. CIT. Revenue's contentions: The revenue, through the AO, treated the loans as accommodation entries based on information from the investigation wing concerning the Banka Group. The revenue did not present specific arguments against the assessee's submissions in the provided text, but the AO's action implies a challenge to the genuineness and creditworthiness of the loan creditors.

Which sections of the Income-tax Act were involved?

Section 68,Section 148,Section 143(2),Section 142(1),Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D” BENCH, KOLKATA

Before: SHRI RAJESH KUMAR, AM & SHRIPRADIP KUMAR CHOUBEY, JM

For Appellant: Shri Manish Tiwari, AR
For Respondent: Shri Praveen Das Chowdhury
Hearing: 29.09.2026Pronounced: 07.10.2026

Per Rajesh Kumar, AM:

These are appeals preferred by the assessee against the orders of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] even dated 29.01.2026 for the AY 2017-18 7 2018-19. A.Y. 2017-18

2.

The only issue raised by the assessee is against the order of ld. CIT (A) confirming the addition of ₹80,00,126/- as made by the ld. AO in respect of unsecured loans by treating the same as unexplained cash credit u/s 68 of the Act.

ITA no. 1031 & 1032/KOL/2026 Rishi Agro Products; A.Ys. 2017-18 & 2018-19

3.

The facts in brief are that are that the assessee filed the return of income in resp

The order continues below.

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