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Facts
The assessee's case was reopened under Section 147 of the Income Tax Act for AY 2015-16. The addition of ₹60 lacs as unexplained cash credit related to a loan from M/s Bluemotion Exports Pvt. Ltd. was confirmed by the CIT(A).
Held
The Tribunal held that since the loan was repaid and interest was paid after TDS, it cannot be treated as an unexplained cash credit. The court relied on the Gujarat High Court's decision in CIT vs. Ayachi Chandrashekhar Narsangji.
Key Issues
Whether the loan treated as an unexplained cash credit by the AO and confirmed by the CIT(A) is sustainable when the loan has been repaid and evidence provided by the assessee.
Sections Cited
147, 148, 133(6), 68, 144B
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Income Tax Appellate Tribunal, “A” BENCH, KOLKATA
This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 12.08.2024 for the AY 2015-16.
The only issue pressed at the time of hearing is against the order of ld. CIT (A) confirming the addition of ₹60 lacs as made by the ld. AO in respect of loan taken from M/s Bluemotion Exports Pvt. Ltd. as unexplained cash credit.
The facts in brief are that the assessee filed the return of income on 30.09.2015, declaring total income of ₹60,75,580/-. The case of the
In the appellate proceedings, the ld. CIT (A) confirmed the addition.
After hearing the rival contentions and perusing the materials available on record, we find that the assessee has raised unsecured loan from the above said party of ₹60 lacs on which interest was duly paid after deducting Tax Deducted at source, which was also deposited in the Government revenue. We also note that the loan was repaid by the assessee on 01.04.2015 and the interest outstanding was paid on 16.04.2015. Therefore, the loan taken by the assessee cannot be added as unexplained cash credit. The case of the assessee find force from the decision of Hon'ble Gujarat High Court in the case of CIT vs. Ayachi Chandrashekhar Narsangji (2014) 42 taxmann.com 251 (Gujarat), wherein it has been held that where the loan has been repaid no addition can be made in respect thereof. Even on merit, the assessee has filed all the evidences such as loan confirmation, bank
In the result, the appeal of the assesseeis allowed.
Order pronounced in the open court on 17.03.2025.