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Income Tax Appellate Tribunal, “B” BENCH, KOLKATA
Before: SHRI RAJESH KUMAR, AM & SHRI PRADIP KUMAR CHOUBEY, JM
This is an appeal preferred by the assessee against the order of the Commissioner of Income-tax (Appeals), Kolkata-26, (hereinafter referred to as the “Ld. CIT(A)”] dated 14.07.2025 for the AY 2020-21.
The issue raised in ground no.2 is against the order of learned CIT (A) confirming the addition of ₹15,00,000/- as made by the learned AO on account of unexplained cash credit u/s 68 of the Act in respect of loan taken from the EAPL.
2.1. The facts in brief are that the assessee filed the return of income on 16.01.2021, declaring total income of ₹128,90,00,980/-. The assessment was framed u/s 143(3) vide order dated 30.09.2022,
2.2. In the appellate proceedings, the learned CIT (A) dismissed the appeal of the assessee by observing that the lender company has net worth of ₹10 crores and has shown profit of less than 1 lacs from operation. The learned CIT (A) noted that in 2018-19, the said
2.3. After hearing the rival contentions and perusing the materials available on record, we find that the assessee filed all the evidences before the learned AO as well as before the learned CIT (A). The documents qua the loan raised from Eiffel Agencies Pvt. Ltd. and the authorities have failed to point out any defect or discrepancy in the same and mainly relied on the report of the search team that the assessee has received accommodation entries through these companies. In our opinion, mere fact that the loan creditors company had low income in the form of operating profit or no fixed assets or incurred very low expenses is not the criteria as has been held in the case of CIT vs. Ms. Mayawati 338 ITR 563 dated 03.08.2011. Also, the Hon’ble Hurisdictional High Court in case of PCIT vs. Sreeleathers [2022] 143 taxmann.com 435 (Calcutta)/[2022] 448 ITR 332 (Calcutta)[14-07-2022], has held that where the assessee has furnished all the evidences with the AO and then no addition can be made if /ao has not done any enquiry. The Hon’ble Court has held as under:
“‘In the absence of any such finding, it is held that the order passed by the Assessing Officer was utterly perverse and rightly interfered by the Commissioner (Appeals). The Tribunal re-appreciated the factual position and agreed with the Commissioner (Appeals). The Tribunal apart from taking into consideration, the legal effect of the statement of AKA also took note of the fact that the notices which were issued by the Assessing Officer under section 133(6) to the lenders where duly acknowledged and all the lenders confirmed the loan transactions by filing the documents which were placed before the tribunal in the form of a paper book. These materials were available on the file of the Assessing Officer and there is no discussion on this aspect. Thus, the tribunal rightly dismissed the appeal filed by the revenue. [Para 5]’
The second issue raised by the assessee is against the confirmation of addition of disallowance of interest amounting to ₹13,315/- paid to EAPL which was disallowed by the learned AO. This issue is consequential to the ground no.2, and accordingly, the order of learned CIT (A) is set aside and AO is directed to delete the addition.
In the result, the appeal of the appeal of the assessee is allowed.
Order pronounced in the open court on 02.12.2025.