ACIT, DELHI vs. VRINDA FARMS PVT LTD, DELHI

आदेश / ORDER

PER SHRI M BALAGANESH, ACCOUNTANT MEMBER: This bunch of appeals 14 appeals filed by the assessee and revenue are 1. directed against the orders passed by the Ld. CIT(A)-28, Delhi arising out of the orders passed by the ACIT, Central Circle -8, New Delhi, under Section 147 of the Income Tax Act, 1961, (hereinafter referred to as ‘the Act’) for Assessment Years 2013-14 to 1017-18 and 2020-21 to 2021-22. Identical issues are involved in all these appeals and hence they are taken up together and disposed of by this common order for the sake of convenience. Both the parties before us mutually submitted that the AY 2013-14 may be taken as the lead case and taken up for adjudication. They submitted that the decision rendered there on shall apply with equal force for other assessment years except with variance in figures in view of identical facts. Accordingly, we take up AY 2013-14 as the lead case.

The effective issue to be decided in this appeal is as to whether the ld 2. CIT(A) was justified in deleting the addition made u/s 68 of the Act in respect of unsecured loans received during the year. Consequentially, whether the ld CIT(A) was justified in deleting the interest paid on such unsecured loans alleged commission expenditure incurred for receiving accommodation entries in the form of unsecured loans.

We have heard the rival submissions and perused the materials 3. available on record. The assessee is engaged in the business of real estate. The assessee filed its original return of income for AY 2013-14 on 23-09-2013 declaring total loss of Rs. 10,43,454. A search and seizure action u/s 132 of the Act was carried out in the case of Filatex Group and related entities on 01- 09-2021. The ld AO noted in the assessment order that on analysis of the material seized u/s 132 of the Act in the case of Filatex group, it was found that seized material contains books of account or documents that pertained to, or any information contained therein relate to, the assessee, which suggest that income chargeable to tax had escaped assessment in the case of the assessee. Accordingly, after taking approval from the competent authority, satisfaction was recorded and notice u/s 148 of the Act was issued on 06-02- 2024. In response to the said notice, the assessee filed its return of income on 13-02-2024, declaring the same total loss of Rs. 10,43,454 as was declared in the original return. The ld AO observed that along with the search and seizure action carried out in Filatex Group, simultaneously search was carried out on an entry operator Shri Joginder Pal Gupta, wherein it revealed that he was involved in providing various accommodation entries through his various shell companies. The analysis of the information available showed accommodation entries in the form of bogus unsecured loans given to M/s. RMP Holdings Private Limited. The profile of M/s. RMP Holdings Private Limited was analysed and found to be linked to a network of other alleged poor credit worthy companies controlled by Shri Ankit Bhageria and his father Late Shri Vimal Bhageria. The financial profile of all the companies controlled by Ankit and Vimal Bhageria was cumulatively studied and it was found that M/s. Filatex India Limited and its related entities were major recipient of accommodation entries provided by shell companies controlled by Shri Ankit Bhageria and Late Shri Vimal Bhageria. The ld AO in pages 3 and 4 of the assessment order listed out the various entities which are alleged to be shell entities controlled by Shri Ankit Bhageria and Late Shri Vimal Bhageria. Totally 34 entities are listed in the said table in pages 3 and 4 of the assessment order. From the above 34 entities. the assessee had transactions in various years with the following parties:-

Sl No. Name of the parties AYs a. RMP Holdings Pvt. Ltd Transactions in AYs 2013-14, 2014-15 and 2015 16 b. AMP Fincap Pvt. Ltd Transaction in AYs 2013-14 and 2014-15 c. Savita Holdings Pvt. Ltd Transaction in AY 2013-14, 3 2015-16 and 2017-18 d. Satsai Finlease Private Limited Transactions in AYs 2017-18, 2020-21 and 2021-22 E. R. N. Khemka Enterprises Transactions in AYs 2015-16 Private Limited and 2017-18 f. Bhageria Finance and Transactions in AY 2013-14 Investment Private Limited

For better understanding of the facts, the transactions carried out with 4. these parties are explained below:- A. ANM Fincap Private Limited Loan received in AY 2013-14 Rs. 2,83,50,000 Loan repaid in AY 2013-14 Rs. 1,83,50,000 Loan repaid in AY 2014-15 Rs. 1,00,00,000 B. Bhageria Finance, Investment, Private Limited. Loan repaid in AY 2013-14 Rs. 35,00,000 C. RMP Holdings Private Limited Loan received in AY 2013-14 Rs. 1,00,00,000 Loan repaid in AY 2013-14 Rs. 25,00,000 Loan received in AY 2014-15 Rs. 80,00,000 Loan repaid in AY 2014-15 Rs. 1,55,00,000 Loan received in AY 2015-16 Rs. 3,25,00,000 Loan repaid in AY 2015-16 Rs. 3,25,00,000 Additions made by ld AO In AY 2013-14 Rs. 1,00,00,000 In AY 2014-15 Rs. 40,00,000 In AY 2015-16 Rs. 3,10,00,000 D. Savita Holdings Pvt. Ltd Loan received in AY 2013-14 Rs. 25,00,000 Loan repaid in AY 2013-14 Rs. 25,00,000 Loan received in AY 2015-16 Rs. 57,00,000 Loan repaid in AY 2017-18 Rs. 2,00,000 Additions made by ld AO In AY 2013-14 Rs. 25,00,000 In AY 2015-16 Rs. 3,00,000

E. RN Khemka Enterprises Pvt. Ltd Loan received in AY 2015-16 Rs. 10,00,000 Loan repaid in AY 2015-16 Rs. 10,00,000 Loan received in AY 2017-18 Rs. 30,00,000 Loan repaid in AY 2017-18 Rs. 67,00,000 Additions made by the ld AO In AY 2015-16 Rs. 10,00,000 F. Satsai Finlease Pvt. Ltd Loan received in AY 2017-18 Rs. 29,00,000 Loan repaid in AY 2017-18 Rs. 14,00,000 Loan received in AY 2020-21 Rs. 1,12,00,000 Loan received in AY 2021-22 Rs. 30,00,000 Additions made by the ld AO In AY 2017-18 Rs. 4,00,000 In AY 2020-21 Rs. 35,00,000 In AY 2021-22 Rs. 30,00,000

The ld AO noted in the assessment order as under:- 5.

“6.2 It is seen from the ITR profile analysis and physical verification of address of these entities that these companies are merely acting as a pass-through mechanism for routing huge amount of funds through their bank accounts and books of account for providing entries to beneficiary companies and other entities. One of the above- mentioned entities, KG Finvest Limited is directly controlled by SK Jain (a known hawala entry operator) in which he is a director. Another company, M/s RMP Holdings Pvt Limited controlled by Ankit Bhageria, has given entry to Filatex India Limited and its related entities by routing unaccounted income into its books of account through shell entities controlled by Sh. Joginder Pal Gupta. Similarly, other companies have also routed unaccounted income into its books of account to provide entries to Filatex India Limited and other entities. 6.3 All of the above-mentioned entities from which accommodation entries in the form of share premium and unsecured loan have been taken by Filatex India Limited and its related entities are typical shell entity. The books of account of these companies have built a corpus of fund by layering funds through other entities with dubious financial credentials. These companies themselves have very low income and have frequently changing directors operating these companies with such huge corpus. The directors themselves are either non-filers or have very low taxable income. Name of several of these companies have changed in the past, which is often done by shell entities to evade being detected after their names are flagged by banks or other law enforcement agencies. Most of the above entities do not have a functional office and are not found at the address mentioned in their ITRs. Some of the entities which do have existing address are merely operational to receive bank and government letters. There are very few employees operating from such business premises, whose work in turn is to only act as data entry persons for several of the shell entities managed from such premises. These entities mostly tout themselves in government records as NBFCs but are actually shell entities used to route unaccounted income for beneficiaries.” The ld AO noted that the aforesaid entities have very low income 6. compared to the corpus of the funds in their books of account because of which the tax liability of these companies is mostly less than the TDS amount deducted against their PAN in lieu of fake interest payments made to them against such bogus loans. TDS against their PAN is taken as refund by the companies and withdrawn from the bank account. Accordingly, the ld AO treated all those aforesaid entities as shell entities engaged only as entry operators in lieu of earning commission income thereon. The ld AO also noted that Shri Ankit Bhageria was a director in all the aforesaid entities. He also noted that these entities were operating from common address. The ld AO noted that these entities had very minimal bank balances and before making any payment to the assessee herein as unsecured loans, funds were transferred from some other bank account to these entities account and immediately passed on to the assessee, thereby ensuring that those lending entities were never enjoying the funds that were received by it from outsiders. The ld AO noted that since these entities i.e. lender companies were not actually doing any real business and were showing meager income in their respective income tax returns, the ld AO proceeded to doubt the capacity/ creditworthiness of the lender companies to advance unsecured loan to the assessee herein and treated the amounts received during the year from RMP Holdings Private Limited in the sum of Rs. 1 crore and Savitha Holdings Private Limited in the sum of Rs. 25 lakhs as unexplained cash credit taxable u/s 68 of the Act and completed the assessment for AY 2013-14. It is pertinent to note that the ld AO while making an observation that 7. all the aforesaid entities are shell entities having meager taxable income declared in their returns thereby doubting their creditworthiness, had accepted the amounts received from ANM Fincap Private Limited in the sum of Rs. 2,83,50,000 during the year as genuine. However, while making consequential disallowance of interest on 8. unsecured loans, the ld AO disallowed the entire interest paid on unsecured loans in respect of all the four parties i.e. ANM Fin CAP Private Limited, RMP Holdings Private Limited, Savitha Holdings Private Limited and Bhageria Finance and Investment Private Limited in the total sum of Rs. 10,61,435 even though no addition was made in respect of loan received from ANM Fincap Private Limited during the year. Since, the ld AO had sought to treat the amounts amount of unsecured loans received from the aforesaid entities as accommodation entries, the ld AO proceeded to add alleged commission expenditure of Rs. 1,69,250 u/s 69C of the Act for AY 2013-14.

The ld CIT(A) noted that assessee had furnished the copy of income tax 9. returns of the lenders, copy of relevant bank statements of the lenders, copy of audited financial statements of the lenders together with confirmation from the lenders before the ld AO. The ld CIT(A) also noted that assessee was even able to produce the response to notices issued u/s 133(6) of the Act by collecting the replies from the lender companies and furnishing to the ld AO. After these replies and furnishing of documents, no further enquiries were sought to be made by the ld AO. Further, the ld CIT(A) also placed reliance on the coordinate bench decision of this Tribunal in assessee’s own case for AY 2016-17 wherein the loans received from RMP Holdings Private Limited and Savitha Holdings Private Limited were held as genuine and having sufficient creditworthiness wherein the additions made u/s 68 of the Act were deleted. The ld CIT(A) also noted that assessee had duly repaid the loans in respect of each of the party either in this year or in subsequent years through regular banking channels. The ld CIT(A) based on the documents placed on record which were not found to be deficient in any manner and also by placing reliance on the decision of the Tribunal in assessee’s own case for AY 2016-17 proceeded to delete the addition made u/s 68 r.w.s. 115BBE of the Act in respect of unsecured loans received from RMP holdings Pvt. Ltd and Savitha Holdings Private Limited in AY 2013-14 by holding them as genuine loans. The ld CIT(A) while doing so, also gave a categorical finding that all the three ingredients of Section 68 of the Act have been duly complied with by the assessee in respect of each of the lender companies. Since the loan amounts were treated as genuine, the interest paid on unsecured loans was consequentially directed to be allowed. Since, the loans received were accepted as genuine and not accommodation entries, the addition made u/s 69C of the Act on account of alleged commission expenditure was also sought to be deleted by the ld CIT(A).

The ld DR vehemently argued that in AY 2016-17, RMP Holdings Private 10. Limited loan transaction was not at all there and hence the reliance placed by the ld CIT(A) on the tribunal decision for AY 2016-17 is misconceived. This argument of the ld DR prime facie is found to be correct. But we find that this Tribunal had an occasion to consider the veracity of almost all the lender companies above while passing the orders for the assessee herein in ITA No. 4849/Del/ 2024 and CO No. 13 and 19/Del/2025 for AY 2016-17 dated 29-10- 2025 had considered the veracity of the loans received from RN Khemka Enterprises Private Limited, Bhageria Finance Investment Private Limited, Savitha Holdings Private Limited, Fidus Finance and Satsai Finlease Private Limited and accepted the loans received thereon as genuine. Further, we find that this Tribunal in the bunch of cases of Filatex India Limited in ITA No. 4635/Del/2024 and others dated 30-06-2025 had considered the loans received from ANM Fincap Private Limited, RMP Holdings Private Limited, Bhageria Finance Investment Private Limited, RKG Finvest Pvt. limited had accepted the loans received as genuine and had deleted the addition made u/s 68 of the Act. In yet another order in the case of Nouvelle Securities Private Limited in ITA No. 485/Del/2024 and CO No. 21/Del/2025 for AY 2016-17 dated 06-02 2026, this tribunal had accepted the loans received from ANM Fincap Private Limited, Savitha Holdings Private Limited, RN Khemka Enterprises Private Limited and Satsai Finlease Private Limited as genuine and deleted the addition made u/s 68 of the Act. In view of the various tribunal orders adjudicating the issue of loans received from the impugned lender companies qua the assessee, wherein practically all the six lender companies have been accepted as genuine and additions made on account of loan transactions were deleted. Under these circumstances, we do not find any infirmity in the order of ld CIT(A) placing reliance on Tribunal order for AY 2016-17 as it would cover five lender parties and the other remaining lender RMP Holdings Private Limited is covered in other Tribunal orders referred supra. In the instant case, we find that the assessee has even furnished the 11. replies filed by the lender companies, wherever sought for by the learned AO, in response to notice under section 133(6) of the Act. These documents are enclosed in the paper book as follows:- RMP Holdings Private Limited Reply to section 133(6) notice enclosed in Pages 44 to 50 of the Paper Book in Asst Year 2013-14 Reply to section 133(6) notice enclosed in Pages 53 to 60 of the Paper Book in Asst Year 2014-15 Reply to section 133(6) notice enclosed in Pages 60 to 67 of the Paper Book in Asst Year 2015-16

Savita Holdings Private Limited Reply to section 133(6) notice enclosed in Pages 70 to 76 of the Paper Book in Asst Year 2013-14

Reply to section 133(6) notice enclosed in Pages 89 to 95 of the Paper Book in Asst Year 2015-16

R N Khemka Enterprises Private Limited Reply to section 133(6) notice enclosed in Pages 121 to 127 of the Paper Book in Asst Year 2015-16

Satsai Finlease Private Limited Reply to section 133(6) notice enclosed in Pages 49 to 55 of the Paper Book in Asst Year 2017-18

Reply to section 133(6) notice enclosed in Pages 49 to 55 of the Paper Book in Asst Year 2020-21

Reply to section 133(6) notice enclosed in Pages 54 to 60 of the Paper Book in Asst Year 2021-22

We find that notice under Section 133(6) of the Act issued to the 12. lenders were duly complied by the lenders by filing the necessary replies directly before the Learned AO and no discrepancies whatsoever was pointed out in the details filed by these companies. Instead, the Learned AO had made only general observations with respect to the capacity of the lender companies. We also find that the loans taken from the lenders had either been fully repaid or partly repaid either during the year or in subsequent years. In the instant case, the additions have been made solely based on the statement recorded from the third parties which were taken under exceptional circumstances and which were also duly retracted by the respective persons through affidavits filed before the Learned AO. Therefore that statement deserves no credence. The assessee on its part had furnished the following documents with respect to the lender companies:- a) Bank statements of lender companies b) Audited financial statements of lender companies c) Copy of ITR acknowledgement of the lender companies d) Ledger account of lender companies duly certified.

No deficiency whatsoever was found by the ld AO on the said 13. documents furnished by the assessee except making general and vague observations as stated earlier. Hence the ld CIT(A) rightly held that the assessee had duly discharged the three ingredients of section 68 of the Act viz. identity of the lenders, creditworthiness of the lenders and genuineness of transactions. These factual findings went completely uncontroverted by the revenue before us. Hence we do not find any infirmity in the order of the learned CITA in this regard for all the years under consideration. Accordingly, the grounds raised by the revenue are dismissed for all the years.

The Cross Objections preferred by the assessee for various assessment 14. years are only supportive of the order of the learned CITA. Hence dismissed as infructuous.

In respect of appeal filed by the revenue in ITA No. 3352/Del/2026 for 15. AY 2015-16 and CO filed by the assessee in CO 198/Del/2026 for AY 2015-16, we notice these are only duplicate appeals as evident from the grounds raised thereon. The grounds raised thereon have already been taken into consideration while adjudicating the issues on merits hereinabove. Hence, these two appeals are dismissed.

In the result, all the appeals of the revenue and all the cross objections 16. of the assessee are dismissed.

Order pronounced in the open court on 16-Oct-2026. 17.

-Sd/- -Sd/- MAHAVIR SINGH M BALAGANESH VICE PRESIDENT ACCOUNTANT MEMBER Delhi Dated: 16/10/2026 AK Keot Copy to: ACIT, OFFICE OF THE AASISTANT COMMISIONER OF INCOME TAX,ROOM NO 1 332 A, 3RD FLOOR ,ARA CENTRE, JHANDEWALAN EXTNSION, NEW DELHI-110055, DELHI VRINDA FARMS PVT LTD, VRINDA FARMS PVT LTD 43, COMMUNITY CENTRE , NEW FRIENDS 2 COLONY , NEW FRIENDS COLONY S.O ZALIT NAGAR SO SOUTH EAST DELHI, DELHI-110025, DELHI 3 THE PCIT / CIT, 4 THE D.R., ITAT, DELHI BENCH 5 GUARD FILE