BEEGEEY REALTORS PVT. LTD., ,KOLKATA vs. PR. CIT (CENTRAL) - 2, , KOLKATA

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ITA 790/KOL/2025Status: DisposedITAT Kolkata11 September 2025AY 2021-20225 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 decided two issues: unsecured loans and construction expenses. The assessee did not press the issue of sundry creditors, and the PCIT's order on that aspect was confirmed. Regarding unsecured loans totaling Rs. 189.00 lakhs from five parties (Jajodia Finance Ltd., JNB Sidhu Finance Pvt Ltd, Main Land Finance Pvt. Ltd., Sri Salasar Suppliers Pvt. Ltd., and Topdeal Agencies Pvt. Ltd.), the Tribunal noted that the assessee had provided source of fund, loan confirmations, bank statements, audited financials, and ITR acknowledgments. The AO had also issued and received compliance to notices under Section 133(6), and after examining the details and parties, found the loans to be genuine and largely repaid, leading to satisfaction. Therefore, the assessment on this issue was not erroneous or prejudicial to revenue. Concerning construction expenses of Rs. 73,49,863/-, the Tribunal found that these were debited and transferred to WIP, reflected in the P&L account as change in inventory, with supporting P&L and ledger accounts submitted. The AO had made enquiries and examined purchases and WIP before passing the assessment order. Thus, this issue was also not prejudicial to revenue. Consequently, the revision order under Section 263 was set aside.

What were the facts?

The assessee, Beegeey Realtors Pvt. Ltd., filed its return of income for AY 2021-22 showing a total income of Rs. 1,710/-. Following a search and seizure operation under Section 132 of the Income Tax Act, 1961, related to the Raj Group & Others, the assessee's return was selected for scrutiny. The Assessing Officer (AO) passed an assessment order under Section 143(3) on 31.12.2022, determining an assessed loss of Rs. 1,710/-. The Principal Commissioner of Income Tax (PCIT), exercising revisionary powers under Section 263, found the assessment erroneous and prejudicial to the interest of revenue, citing issues related to unsecured loans, construction expenses, and sundry creditors. The PCIT set aside the assessment order and directed a de novo assessment. The assessee appealed this order to the ITAT.

What were the issues?

The Tribunal had to decide the following issues: 1. Whether the assessment order passed under Section 143(3) was erroneous and prejudicial to the interest of revenue concerning unsecured loans, as revised by the Principal CIT under Section 263. 2. Whether the assessment order passed under Section 143(3) was erroneous and prejudicial to the interest of revenue concerning construction expenses, as revised by the Principal CIT under Section 263. The assessee argued that for unsecured loans, it had furnished documentary evidence including source of funds, loan confirmations, bank statements, audited financial statements, and ITR acknowledgments. The AO had also issued notices under Section 133(6) which were duly complied with, indicating satisfaction with the transactions. Regarding construction expenses of Rs. 73,49,863/-, the assessee contended that these were debited and transferred to Work-in-Progress (WIP), reflected as a change in inventory in the P&L account, and that the AO had made enquiries on this issue before passing the assessment order. Therefore, these issues were not prejudicial to the revenue. The revenue, through the CIT-DR, supported the impugned order of the PCIT.

Which sections of the Income-tax Act were involved?

Section 139,Section 132,Section 143(3),Section 263,Section 133(6)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH KOLKATA

order

: September 11, 2025 ORDER

Per Pradip Kumar Choubey, Judicial Member:

1.

The present appeal has been preferred by the assessee against the order dated 21.02.2025 of the Principal CIT(Central), Kolkata [hereinafter referred to as the “ld. PCIT”] exercising his revision jurisdiction u/s 263 of the Income Tax Act, 1961 [hereinafter referred to as the “Act”].

2.

The brief facts of the case are that the assessee filed its return of income u/s 139 of the Act showing total income of Rs.1,710/-. A search and seizure operation u/s 132 of the Act was conducted in the cases of Raj Group & Others and the assessee being one of the persons/concerns related to Giridhari Lal Goenka, was also covered under the search and seizure operation and during the course of search and seizure operation, various incriminating materials/documents were found and seized. The return of income of the assessee was selected for scrutiny and the case Beegeey Realtors Pvt. Ltd was assessed u/s 143(3) vide order dated 31.12.2022 at an assessed loss at Rs.1,710/-. The ld. PCIT by exercising his revision jurisdiction u/s 263 has found following discrepancies: (i) issue related to unsecured loan, (ii) issue related to construction expenses and (iii) issue related to sundry creditors, 2.1 The ld. PCIT u/s 263 of the Act has found that it is a case of erroneous assessment and it was prejudicial to the interest of the revenue and accordingly, a show-cause notice u/s 263 of the Act was issued and submission was filed by the assessee but the ld. PCIT after going over the submission set aside the assessment order passed u/s 143(3) of the Act and directed the Assessing Officer to make necessary verification/enquiry and pass a de novo assessment order.

3.

Aggrieved by the said order, the assessee preferred appeal before us. The ld. AR in the course of argument did not press the issue related to sundry creditors and he raised issues related to unsecured loan and construction expenses. Regarding the issue of unsecured loan, the submission of the ld. AR is that in the course of assessment proceedings, the assessee furnished documentary evidences such as source of fund, loan confirmation, copy of bank statement, audited financial statement and ITR acknowledgement and not only that, the Assessing Officer had also issued notices u/s 133(6) of the Act and the same were duly complied. Accordingly, the ld. AR stated that the order passed by the ld. CIT(A) in the aforesaid two issues are bad in law and are liable to be set aside.

Beegeey Realtors Pvt. Ltd 3.1 Regarding the issue of claim of construction expenses, the submission of the ld. AR is that the construction expenses of Rs.73,49,863/- was debited in year under consideration and transferred fully to the WIP which was reflected in the P & L A/c as change in inventory and the assessee has duly submitted the P & L A/c and ledger A/c. The ld. AR has submitted that the Assessing Officer had made enquiries regarding the said issue before passing the order u/s 143(3) of the Act. Hence, the issue of claim of construction is not prejudice to the interest of the revenue which requires interference by ld. PCIT u/s 263 of the Act.

4.

Contrary to that, the ld. DR supports the impugned order.

5.

Upon hearing the submissions of ld. counsels of the respective parties, we are going to decide only two issues i.e. unsecured loan taken as the assessee and construction expenses and the assessee did not press the issue regarding sundry creditors and on the issue of sundry creditors, the order passed by the ld. CIT(A) is confirmed. Now, looking into the facts of the case on the issue of unsecured loan, we find after going over the facts of the case that the assessee has taken loan of Rs.189.00 lakhs from the following parties:

Name and Address of PAN Loan Net Worth Loan Repaid Party Taken of the in AY Amount Lendor(Rs.) (Rs.) Jajodia Finance Ltd AAACJ8457D 36,00,000 6005.89 AY2021-22 69A, Lenin Sarani, Lakhs 3rd Floor, Kolkata 700013 JNB Sidhu Finance AABCJ0370Q 10,00,000 2,697.16 AY 2021-22 Pvt Ltd Lakhs 69A, Lenin Sarani, 3rd Floor, Kolkata 700013 Main Land Finance AACCM3533D 20,00,000 9927.83 A.Y 2023-24 Beegeey Realtors Pvt. Ltd Pvt. Ltd. Lakhs 69A, Lenin Sarani, 3rd Floor, Kolkata 700013 Sri Salasar Suppliers AADCS8457R 23,00,000 2422.87 A.Y 2021-22 Pvt. Ltd. lakhs 69A, Lenin Sarani, 3rd Floor, Kol-13. Topdeal Agencies Pvt. AABCT0268R 100,00,000 2242.73 NA Ltd. lakhs 69A, Lenin Sarani, 3rd Floor, Kol-13.

5.1 We further find that he assessee has filed the copy of the source of fund, loan confirmation duly signed by the parties, copy of bank statement, audited financial statement, ITR acknowledgement before the Assessing Officer and not only that the Assessing Officer had also issued notices u/s 133(6) of the Act and the same were duly complied and the Assessing Officer was duly satisfied with the transaction and then accepted the same. It is further pertinent to mention here that the Assessing Officer after going over the details and examination of the parties has found that majority of the loans has been repaid and thereafter, he assessed the income of the assessee.

6.

Regarding the issue of claim of construction expenses, we find that the said construction expenses of Rs.73,49,863/- was debited in the year and transferred the same fully to the work-in-progress which was duly reflected in the P & L A/c as change in inventory. We also find that the assessee has duly submitted the P & L A/c and ledger A/c apparently showing the reflection of the expenses. We note that that during the assessment proceedings, the Assessing Officer called for the details in respect of the said claim and the Assessing Officer examined the purchase and work-in-progress and had made enquiries regarding the said issue before passing the order u/s 143(3) of the Act. Hence, we do Beegeey Realtors Pvt. Ltd not find that the issue of claim of construction is prejudice to the interest of the revenue which and we uphold the order u/s 143(3) of the Act passed by the Assessing Officer on this issue.

7.

Keeping in view the above discussion, we find that the order passed u/s 143(3) of the Act by the Assessing Officer cannot be said to be prejudicial to the interest of the revenue on the aforesaid two counts as the assessee has duly disclosed the entire thing before the Assessing Officer. Hence, the revision order u/s 263 of the Act passed by the ld. PCIT is set aside.

8.

In the result, the appeal of the assessee is allowed.

Kolkata, the 11th September, 2025.

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