OLIRIA FOODS AND BEVERAGES LIMITED,JAIPUR vs. INCOME TAX OFFICER, JAIPUR

1. High Creditors/liabilities 2. Unsecured Loans 3. Expenditure of personal nature 2.1 On selection of case, a notice u/s 143(2) of the I.T. Act, 1961 was issued on 01.06.2023 which was duly served on the assessee and hearing was fixed on 16.06.2023. The assessee did not respond to the said notice.

Notice u/s 142(1) of the I.T. Act, 1961 dated 28.09.2023 was issued to the assessee asking it to furnish the details called for in respect of issue flagged with the case. The notice was duly served upon the assessee. The assessee did not respond to the notice. Since the assessee failed to respond to the said notice, a letter dated 19.10.2023 was issued to the Act. The assessee failed to respond to the said letter. Since the assessee failed to respond to the letter, another opportunity was given and notice u/s 142(1) of the I.T. Act, 1961 was issued to the assessee on 26.10.2023 asking it to furnish the details called for on or before 02.11.2023. However, the assessee did not file its reply. For the sake of natural justice, as per provisions of section 144B(1)(ix) of the IT Act, one more opportunity was given to the assessee to show cause as to why the assessment should not be completed to the best of its judgment invoking the provisions under section 144 r.w.s. 147 of the Act. Accordingly, a Show Cause Notice u/s 144 r.w.s 147 of the Act was issued on 21.12.2023 asking to submit response on or before 28.12.2023. The assessee responded and sought adjournment. The assessee filed its reply on 06.01.2024 and furnished copy of ITR along with computation of income, Audit Report and details of shareholders etc. Centralized communication was also sent to the assessee on 18.01.2024 to which the assessee replied on 20.01.2024 and furnished details of unsecured loan. Another notice 142(1) of the I.T. Act was issued to the assessee on 01.02.2024 requesting the assessee to furnish the details of trade creditors/liabilities. The assessee sought adjournment which was granted, and the assessee was requested to details of sundry creditors on 15.02.2024. After examining all the submissions of the assessee and the information available on record, a detailed Show Cause Notice [SCN] was issued to the assessee on 21.02.2024 proposing the additions and requiring compliance on or before 28.02.2024. The assessee sought adjournment and filed reply on 04.03.2024 and furnished GST reconciliation and confirmation from the parties from whom unsecured loan was availed by the assessee.

2.2 On examination of details gathered / available on records and the return of income filed by the assessee for the AY 2022-23, ld. AO noticed that during the year under consideration, the assessee has declared sales turnover to the tune of Rs. 19,85,47,600/- whereas as per 26AS details sales turnover declared by the assessee to the GST department was Rs. 19,90,07,490/-. Hence there is a difference of Rs. 4,59,890/- between the turnover declared by the assessee in its ROI filed with the department and turnover declared by the assessee in its GSTR-3B return filed with GST department. The assessee did not provide any justification as to why there was a difference in turnover declared by it in Income tax return and GST return. Thus, the assessee was asked to reconcile and explain the Notice dated 21.02.2024, the assessee submitted that the difference was due to sale of fixed assets which was shown in books under the relevant head of 'Fixed Assets' in Balance sheet and thereby reconciled that turnover figure. Ld. AO noted that the assessee did not furnish any supporting documents in support of its claim. In the absence of any conclusive documentary evidence and since the assessee has already claimed the expenditure incurred during the year, the difference in turnover, i.e. Rs. 4,59,890/- was added back to the returned income of the assessee filed for the AY 2022-23.

2.3 Ld. AO noted that during the year under consideration, the assessee company has availed fresh unsecured loan of Rs. 10,24,75,690/- from its directors or shareholders. In response to the notice u/s 142(1) of the I.T.

Act, the assessee furnished ledger, copy of ITR and bank account statement in confirmation of loan availed. The assessee vide its response to SCN also, the assessee furnished only ledger and copy of ITR of some of the lenders from whom unsecured loan was availed. On examination of the bank account statement of the lenders, ld. AO noticed that lending of unsecured loan to the assessee is done in an unusual manner. An amount and immediately transferred to the bank account of the assessee. All other transactions in the bank account of the lender are of very small monetary value. All the lenders have filed ITR in the range of Rs. 3,00,000/- to Rs. 4,00,000/-. ITR and bank account statement of some of the lenders submitted by the assessee were reproduced in the order of the assessment vide page 6 to 28. Based on that papers so filed he noted that the genuineness of the transaction and creditworthiness of the lenders are not established. Ld. AO to test check those loan creditor a letter u/s. 133(6) of the Act was issued to 8 persons, asking from them the ledger of the assessee in their books of account, bank statement along with other details were sought and the compliance was to be made by 10.02.2024. In response to the notice issued u/s 133(6) of the Act, replies have been received from all the above 8 persons. The replies of the above persons and unsecured loan confirmation details submitted by the assessee were examined and taken on record by ld. AO. Upon examination of those details in case of bank statement submitted by Hiralbhai Maheshchandra Rangrej, ld. AO noted that an amount of Rs. 10,00,000/- was credited on 19.05.2021 and on 20.05.2021, the amount was transferred to the assessee. On examination of statement of bank account, it was also Rs. 17,297/- and closing balance of the said account as on 31.03.2022 was Rs. 8,669/-. Apart from this transaction, all other transactions are of very small monetary value. On careful perusal of the statement of bank account of Mr. Hiralbhai Maheshchandra Rangrej, it appears that Mr. Hiralbhai Maheshchandra Rangrej is an accommodation provider of the unsecured loan as the credit worthiness of the party could not be established.

Receiving an amount of Rs. 10,00,000/- on 19.05.2021 and transferring the same to the assessee as an unsecured loan on 20.05.2021 indicates that Mr. Hiralbhai Maheshchandra Rangrej has been acted as an accommodation entry operator / agent. Whereas in the case of bank account statement submitted by Mansukhbhai Dalsukhbhai Parmar also, the same pattern is noticed. On 22.04.2021, an amount of Rs.5,73,795/- was credited and on 23.04.2021, an amount of Rs. 6,00,000/- was transferred to the assessee. Again on 29.06.2021, an amount of Rs. 10,00,000/- was credited and on 30.06.2021, the same amount was transferred to the assessee. On careful perusal of the statement of bank account of Mr. Mansukhbhai Dalsukhbhai Parmar, it appears that Mr. Mansukhbhai Dalsukhbhai Parmar is an accommodation entry provider of the unsecured loan as the credit worthiness of the party could not be 10,00,000/- on 29.06.2021 and transferring the same to the assessee as an unsecured loan on 23.04.20218 30.06.2021 respectively indicates that Mr. Mansukhbhai Dalsukhbhai Parmar has been acted as an accommodation entry operator/agent. In the bank account submitted by Mr. Natvarbhai Varsanbhai Bariya (HUF), it was noticed that on 21.05.2021, an amount of Rs. 7,00,000/- was credited and immediately after this, Rs. 7,00,000/- was transferred to the assessee on 24.05.2021. There is no other transaction in this account except a few small amount transactions. Thus, this is not a normal business transaction. This is nothing but an accommodation entry in the form of unsecured loan. The same pattern is also noticed in the bank account of Mr. Nareshkumar Shankarlal Solanki wherein an amount of Rs. 6,00,000/- and Rs. 4,00,000/- was credited on 24.05.2024 and Rs. 10,00,000/- was transferred to the assessee on the same day. In case of Mr. Shivrambhai Adabhai Chaudhari also, an amount of Rs. 9,00,000/- was credited in his bank account on 25.05.2021 and on the same day, amount of Rs. 9,00,041.80 was transferred to the assessee. Further, bank account statement in respect of Mr. Abhishek Pravinbhai Prajapati and Smt.

Shardaben Dilipbhai Solanki was not furnished by the assessee. On examination of the bank statement of Smt. Manjulaben Dineshbhai Maheta, 24.05.2021, an amount of Rs. 7,00,000/- was transferred to the assessee.

Except this transaction, all other transactions are of very small monetary value. In the case of Smt. Mamtaben Pravinbhai Prajapati also, it was noticed that Rs. 4,80,000/- was credited in her bank account on 17.04.2021 and the same amount was transferred to the assessee on 20.04.2021. The same pattern is also noticed in the bank account of Mr. Rajeshkumar Dhulalal Nai. On 24.05.2021, an amount of Rs. 8,00,000/- was credited in his account and on the same day, an amount of Rs. 8,00,011.80 was transferred to the assessee. All other transactions are of very small amount. On examination of the bank statement of Shri Ramanbhai Chandubhai Parmar, it was noticed that Rs. 4,93,000/-was credited on 28.06.2021 and on 29.06.2021, amount of Rs. 4,90,000/- were transferred to the assessee. Similarly, an amount of Rs. 4,07,000/- was credited in the account on 30.06.2021 and amount of Rs. 4,10,000/- was transferred to the assessee on 01.07.2021. On examination of the bank account of Kajal Balubhai Prajapati also, the same pattern is noticed. The bank statement submitted by Kajal Balubhai Prajapati was reproduced in the assessment order. Similarly, the bank statement submitted by Shailesh Rasiklal Sanghvi (HUF) was examined and it was noticed that Rs. 14,28,897/- was on 28.05.2021. On 31.05.2021 Rs. 2,21,000/- was credited in his account and on the same day Rs. 7,50,011/- was transferred to the assessee. No other significant transaction is noticed in the said bank account. Ld. AO thus noted that all the lenders have acted as accommodation entry providers as the creditworthiness of the lenders and genuineness of unsecured loans could not be ascertained. The transactions are not normal business transactions. The assessee also did not explain the nature of these unsecured loans nor furnished complete documents. Therefore, it is reasonably concluded that the unsecured loans to the tune of Rs. 10,24,75,690/- are nothing but accommodation entries. Having observed so ld. AO issued a show cause notice dated 21.02.2024 and the assessee furnished the reply on 04.03.2024, ld. AO considered the reply of the assessee and found that the same were not acceptable based on the reasons as discussed herein above. Hence, he holds that the transaction of accommodation entry in the form of unsecured loan to the tune of Rs. 10,24,75,690/- during the A.Y. 2022-23 and was added as the income of the assessee u/s. 68 of the Act. an appeal before the ld. CIT(A) challenging the finding of the ld. AO. The appeal of the assessee was decided by ld. CIT(A) by observing as under :

“Decision :I have carefully considered the facts of the case, above submission of the appellant as well as gone through the observation and findings of the AO 's assessment order. I find the AO on perusal of submission of the appellant, in course of scrutiny assessment proceedings , is of opinion that all the lenders have acted as accommodation entry provider as the creditworthiness of the lenders and genuineness of unsecured loans could not be ascertained and consequently he (the AO) draws inferences that the transactions are not normal business transactions since the assessee did not explain the nature of these unsecured loans, nor furnished complete documents. On the other hand it is observed from the submission of the appellant that despite providing all the relevant documents the AO has made addition invoking section 68 illegally, unjustifiably based on suspicion, surmises, guesswork and conjectures. On careful observation of return of income vis-a vis tax audit report it is observed that unsecured Loan of Rs. 10,24,75,690/- was taken from the various (120 Numbers) shareholders for "0" rate of interest for which the shareholders details and loan details as shown in the return of income (ROI) is reproduced as under:

As far as Purpose of Unsecured Loan and/or objective of Unsecured Loan is concerned I find the appellant is miserable failed to divulge the reason for taking this huge interest free Loan from its shareholders. The need for any business exegency or any kind of business purpose or any other purpose remain unestablished by the appellant with supporting evidence. Interest free Loan receiving at the beginning of the Financial Year under consideration and repayment within the very next beginning of Financial Year forced me to hold that such loan transaction was made not for any business exigencies but for some other inherent pre-conceived benefit or any kind of benefit including providing entry & tax evasion.

In course of appeal proceedings it is observed from the Tax Audit report for the A.Y 2022-23 vide sl. no. 40 of form 3CD as per below:

In view of above report it is observed despite turnover increases from Rs. 4,67,60,488/- in preceding previous year to Rs. 19,64,96,990/- this preceding year, Gross profit to Turnover ratio decreases / reduces from 32.60% to 17.27% this preceding year. Simultaneously Net profit to Turnover ratio decreases / reduces from 6.00% to 1.34% in the year under consideration. The above two ratios again increases in the next financial year i.e in the F.Y 2022-23 i.e in the A.Y 2023-24 from 17.27% to 27.91% and from 1.34% to 2.73% respectively when the purported loan has been repaid though the turnover figure has been changed from Rs. 19,64,96,990/- to 19,84,96,990/- as well as Net profit amount changed from Rs 26,87,244/- to Rs. 38,47,296/-along with change of net profit % from 1.34 to 1.94 as per the reproduction of the relevant portion of the Audit report as under :

Oliria Foods and Beverages Limited vs. ITO In view of above after considering the submission of the appellant I find that the appellant have claimed to have established the genuineness of loan transaction undoubtedly. But I find from the assessment order that the AO has doubted genuineness of said transactions not only in assessment order but also he has established how the loan transactions are rigged and are not being genuine.

It is observed that the appellant is unable to file any satisfactory reply to justify the logic behind genuine loan received from the shareholders for any specific purpose vis-a vis failed to justify the genuineness of sudden receipt and payment of the interest free loan transaction within a short time span.

The appellant cannot escape from the burden cast upon it and unfortunately in this case the burden is heavy as the facts establish that the transactions which were made by the appellant had phenomenal fall in Gross Profit as well as net profit in the year under consideration.

Despite availing adequate opportunity the appellant is unable to establish and prove that there was no manipulation in the other end and whatever benefits the appellant has reaped was not tainted. I find during the course of assessment, the Assessing Officer (AO) has culled out proximate facts in each of the case took into consideration the surrounding circumstances which came to light after the investigation, took note of the proximity of the time between the receipt and payment of transaction and also the sudden and steep fall of the profits of the of the company and thereafter arrived at a conclusion.

For all the above reasons, I hold that the alleged transaction is obviously made for tax Evasion. Therefore, such transactions are not genuine but pre-conceived resulting in creation of bogus claim and, therefore, are sham transactions. Accordingly I find no infirmity in the order of the AO and resultantly, I have no hesitation in holding that the impugned order of the AO dated 16-03-2024 is based on apropos consideration of facts and law and hence the same does not warrant interference. Therefore, I am of opinion that AO's decision of invoking provision of section 68 of the I.T Act is justified in absence of satisfactory explanation on the part of the appellant. Accordingly I hold alleged unsecured interest free loan as bogus and the addition of Rs.10,24,75,690/- by invoking provision of section 68 of the I.T Act is in order and therefore, stand confirmed. The grounds No. 3,4,5 of appeal of the appellant are dismissed.

In the result, the appeal of the appellant is dismissed.”

5. The first appeal filed by the assessee was decided against the assessee by the ld. CIT(A). Feeling dissatisfied with order, the assessee- grounds of appeal:

“1. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the action of the 1 Learned Assessing Officer in completing the assessment u/s 144/144B of the Income Tax Act, 1961 inspite of making all the compliances against the notice issued by the learned AO.

2. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the addition of Rs. 4,59,890/-made by the Learned Assessing Officer on account of business profit without considering the submission of the assessee that this was sale of assets which was appearing on GST portal and not sales.

3. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the addition of Rs. 10,24,75,690/-made by the Learned Assessing Officer u/s 68 of the Income Tax Act, 1961 inspite of furnishing all evidences regarding identity, creditworthiness and genuineness of the transaction.

4. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the action of the Learned Assessing Officer in making addition of Rs. 10,24,75,690/- without making any enquiry from the loan creditors or without brining any adverse material on record that the transaction is not genuine only on the basis of assumption and presumption inspite of that loan has been repaid in subsequent years.

5. The assessee craves your indulgence to add amend or alter all or any grounds of appeal before or at the time of hearing.”

5.1 While, pendency of the appeal, the assessee also raised following additional grounds of appeal vide application dated 09.01.2025 u/r 11 of the ITAT Rules :

1. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground i.e. assessee failed to specify the purpose of loans without affording any opportunity to the assessee in this regard.

Oliria Foods and Beverages Limited vs. ITO 2. In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground that assessee failed to explain the phenomenal fall in Gross Profit and Net Profit without affording any opportunity to the assessee in this regard. Since, those grounds emanates from the order of the ld. CIT(A) and considering the various decision cited in the application filed by the assessee the bench considered the above additional grounds.

6. To support the various grounds raised by the assessee ld. AR of the assessee filed a detailed written submission which reads as under :

“The assessee is private limited company engaged in the business of manufacturing and processing of food items. The assessee company filed its return of income for assessment year 2022-23, declaring total income of Rs. 45,40,270/- on 04.10.2022. Copy of acknowledgement of return so filed along with computation of total income is available on Paper Book Page No.1. The books of accounts are duly audited and copy of audit report with audited accounts is available on Paper Book Page No.2-39. The case of the assessee was selected for scrutiny through "CASS" for the reason of "high creditors/liabilities and unsecured loans". During the course of assessment proceedings, in response to notice u/s 142(1) issued by the Learned Assessing Officer, the assessee furnished the complete names, addresses, confirmation with PAN, copy of ITRs, copy of bank statement etc. in respect of creditors from whom the assessee had taken unsecured loans to start a new joint venture project. All these unsecured loans were returned to the creditors in subsequent years. During the course of assessment proceedings, the Learned Assessing Officer also conducted independent inquiry from some of the creditors by issuance of notices u/s 133(6). The assessee also furnished detailed reply on 04/03/2024 to the show-cause notice dated 21/02/2024 issued by the Learned Assessing Officer. A copy of this reply dated 04.03.2024 is available on Paper Book Page No. 680 to 687. The confirmation, copy of ITR and copy of bank account of the creditors were also filed before the Learned Assessing Officer. However, the Learned Assessing Officer, without properly appreciating the facts of the case and the written submission and details filed by the assessee, completed the assessment u/s 144 read with Sec. 144B of the Income Tax Act, 1961 on 16/03/2024 by making the following additions :- 1 Addition on account of difference in turnover as per audit Rs. 4,59,890 report and GST return

2 Unexplained cash credits added u/s 68 Rs. 10,24,75,690

Against the order of the Learned Assessing Officer, the assessee preferred appeal before the Learned CIT(A). The learned CIT(A) has confirmed the addition of Rs. 10,24,75,690/- but on different grounds. The Learned CIT(A) has held as under – "As far as Purpose of Unsecured Loan and/or objective of Unsecured Loan is concerned I find the appellant is miserable failed to divulge the reason for taking this huge interest free Loan from its shareholders. The need for any business exigency or nay kind of business purpose or any other purpose remain unestablished by the appellant with supporting evidence. Interest free Loan receiving at the beginning of the Financial Year under consideration and repayment within the very next beginning of Financial Year forced to hold that such loan transaction was made not for any business exigencies but for some other inherent pre-conceived benefit including providing entry and tax evasion……… It is observed that the appellant is unable to file any satisfactory reply to justify the logic behind genuine loan received from the shareholders for any specific purpose vis-a vis failed to justify the genuineness of sudden receipt and payment of the interest free loan transaction within a short time span. The appellant cannot escape from the burden cast upon it and unfortunately in this case the burden is heavy as the facts establish that the transactions which were made by the appellant had phenomenal fall in Gross Profit as well as net profit in the year under consideration. For all the above reasons, I hold that the alleged transaction is obviously made for tax Evasion. Therefore, such transactions are not genuine but per-conceived resulting in creating of bogus claim and, therefore, are sham transactions. Accordingly I find no infirmity in the order of the Assessing Officer and resultantly, I have no hesitation in holding that the impugned order of the Assessing Officer dated 16-03- 2024 is based on apropos consideration of facts and law and hence the same does not warrant interference." Before dismissing the appeal of the assessee on the ground that assessee failed to specify the purpose for which loans were taken, the learned CIT(A) did not provide any opportunity to the assessee for submitting the reply in this regard. Aggrieved with the order of the learned CIT(A) the assessee is in appeal before the Hon'ble Tribunal. It is submitted that while filing appeal the following grounds could not being taken due to inadvertence. The same is being taken as Additional Grounds. The Additional Grounds arise out of the order of the Learned CIT(A). The admission of the same is imperative for imparting justice in the case. The Additional Grounds are as under:-

Oliria Foods and Beverages Limited vs. ITO Additional Ground No. 1 & 2 – (1) In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground i.e. assessee failed to specify the purpose of loans without affording any opportunity to the assessee in this regard.

(2) In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground that assessee failed to explain the phenomenal fall in Gross Profit and Net Profit without affording any opportunity to the assessee in this regard. In the above regard a separate application has been filed for admission of the additional grounds. The Hon'ble Tribunal is humbly requested to admit the additional grounds. The assessee now takes up first the additional grounds for discussion. Additional Ground No.1 – In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground i.e. assessee failed to specify the purpose of loans without affording any opportunity to the assessee in this regard. It is submitted that while completing the assessment order u/s 143(3) on 16.03.2024 the Learned Assessing Officer made additions of Rs. 10,24,75,690/- in respect of cash credits treating the same as unexplained u/s 68 of the Income Tax Act, 1961. The only grounds on which the cash credits were rejected by the Learned Assessing Officer were that the creditors who had advanced loan to the assessee were filing return of income with meager income say Rs. 2 Lakh to 4 Lakh. The other ground on which the cash credits were rejected was in the bank account of the creditors cash was deposited immediately before the loan was granted to the assessee. In view of these facts the Learned Assessing Officer doubted the genuineness of the creditors and held the same being not normal and held the unsecured loans as accommodation entries. The Learned Assessing Officer nowhere referred as for what purpose the loans were taken by the assessee nor any query was raised in this regard. However, in appeal the Learned CIT(A) has observed as under in the appellate order - "As far as Purpose of Unsecured Loan and/or objective of Unsecured Loan is concerned I find the appellant is miserable failed to divulge the reason for taking this huge interest free Loan from its shareholders. The need for any business exigency or nay kind of business purpose or any other purpose remain unestablished by the appellant with supporting evidence. Interest free Loan receiving at the beginning of the Financial Year under consideration and Oliria Foods and Beverages Limited vs. ITO repayment within the very next beginning of Financial Year forced to hold that such loan transaction was made not for any business exigencies but for some other inherent pre-conceived benefit including providing entry and tax evasion" (Page 85 of the appellate order) In view of the aforesaid observation of the Learned CIT(A) it is submitted that the same is totally irrelevant. For determining the genuineness of cash credits. It is of little avail as for what purpose the same were obtained. Further before confirming the addition on this ground, the Learned CIT(A) never afforded any opportunity in this regard. The Learned CIT(A) never asked the assessee to furnish and divulge the purpose for which the loans were taken. The action of the Learned CIT(A) in confirming the cash credits on this ground is against the principles of equity and justice. Therefore, the action of the Learned CIT(A) deserves to be quashed. It is further submitted that although the Learned CIT(A) did not furnish any opportunity to the assessee to disclose the purpose of loans but while filing the appeal the assessee has disclosed in the column 11 (statement of facts) "Here it is worthwhile to mention that during the year under consideration the assessee has entered in MOU with other corporate entity to start a new joint venture project and the whole money was advanced to M/s Nakshatra Corporate Advisors Limited, Nagpur for setting up of new project in joint venture." The Learned CIT(A) perhaps did not go through the facts of the case otherwise he would have avoided confirming the addition on this ground. It is further submitted that during the year under consideration the assessee had entered into an agreement under the name and style "Mandate cum Sourcing Agreement" on 08.03.2021 with Nakshatra Corporate Advisors Limited. A copy of this agreement is available on paper book page no. 688 to 693. The assessee has executed this agreement for acquiring tangible business assets preferably stress assets of Tijaria Polypipes Limited from Bank of India. For this purpose, Nakshatra Corporate Advisors Limited was authorized to coordinate and settle all outstanding dues of Bank of India. The assessee had agreed to pay a sum of Rs. 15 Crore as consultancy fees. The assessee paid Rs. 10,00,00,000/- during the year under consideration from April-2021 to August-2021. Copies of the ledger accounts of Nakshatra Corporate Advisors Limited as appearing in the books of assessee and vice-versa are available on Paper Book Page No. 694 to 698. It is for this purpose i.e. for making payment to Nakshatra Corporate Advisors Limited that assessee had sought loans from various parties. The purpose of loan is thus amply proved. It is further submitted that the assessee did not succeed in obtaining stress assets of Tijaria Poly Pipes Limited. Hence, the loans were thereafter immediately returned. The assessee however, reiterates that notwithstanding the purpose of loan, the assessee has furnished complete documents establishing the genuineness of cash credits. The same otherwise were required to be accepted. The Learned CIT(A) has unlawfully confirmed the additions on wrong and different grounds without affording opportunity to the assessee. The action of the CIT(A) deserves to be nullified. The addition of cash credits confirmed by him deserve to be deleted.

Additional Ground No. 2 – In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground that assessee failed to explain the phenomenal fall in Gross Profit and Net Profit without affording any opportunity to the assessee in this regard. It is further submitted that the Learned CIT(A) has again erred in confirming the addition of cash credits on a ground which was neither disclosed to the assessee nor such ground was taken by the Learned Assessing Officer. The Learned CIT(A) has observed in the appellate order as under: -

It is submitted that in the aforesaid para the Learned CIT(A) has discussed the It is submitted that in the aforesaid para the Learned CIT(A) has discussed the It is submitted that in the aforesaid para the Learned CIT(A) has discussed the turnover, GP and NP disclosed by the assessee. It is the case of the Learned turnover, GP and NP disclosed by the assessee. It is the case of the Learned turnover, GP and NP disclosed by the assessee. It is the case of the Learned CIT(A) that "The appellant cannot escape from the burden cast upon it and The appellant cannot escape from the burden cast upon it and The appellant cannot escape from the burden cast upon it and unfortunately in this case the burden is heavy as the facts establish that the unfortunately in this case the burden is heavy as the facts establish that the unfortunately in this case the burden is heavy as the facts establish that the transactions which were made by the appellant had phenomenal fall in Gross transactions which were made by the appellant had phenomenal fall in Gross transactions which were made by the appellant had phenomenal fall in Gross Profit as well as net profit in the year under consideration. Profit as well as net profit in the year under consideration. Profit as well as net profit in the year under consideration." (Page 98 of the appellate order). It is submitted that in the aforesaid observation the Learned CIT(A) has tried to s submitted that in the aforesaid observation the Learned CIT(A) has tried to s submitted that in the aforesaid observation the Learned CIT(A) has tried to give an impression that the loans obtained by the assessee resulted in fall in GP give an impression that the loans obtained by the assessee resulted in fall in GP give an impression that the loans obtained by the assessee resulted in fall in GP and NP. It is in fact very ridiculous on the part of the Learned CIT(A) to observe so. and NP. It is in fact very ridiculous on the part of the Learned CIT(A) to observe so. and NP. It is in fact very ridiculous on the part of the Learned CIT(A) to observe so. He has miserably failed to link the profits with creditors. It is common knowledge iserably failed to link the profits with creditors. It is common knowledge iserably failed to link the profits with creditors. It is common knowledge that GP has got nothing to do with the creditors. However, NP is affected if there is that GP has got nothing to do with the creditors. However, NP is affected if there is that GP has got nothing to do with the creditors. However, NP is affected if there is huge payment of interest to creditors. But in this case no interest has been huge payment of interest to creditors. But in this case no interest has been huge payment of interest to creditors. But in this case no interest has been charged on the loans taken by the assessee. Therefore, the loans were not at all in ns taken by the assessee. Therefore, the loans were not at all in ns taken by the assessee. Therefore, the loans were not at all in anyway connected with GP or NP. The observation of the Learned CIT(A) are anyway connected with GP or NP. The observation of the Learned CIT(A) are anyway connected with GP or NP. The observation of the Learned CIT(A) are absolutely not related with the genuineness of the creditors. Further the purpose of absolutely not related with the genuineness of the creditors. Further the purpose of absolutely not related with the genuineness of the creditors. Further the purpose of loans already stands explained loans already stands explained in the forgoing para. The sum and substance of the in the forgoing para. The sum and substance of the submission of the assessee is that Hon'ble ITAT may kindly disregard the submission of the assessee is that Hon'ble ITAT may kindly disregard the submission of the assessee is that Hon'ble ITAT may kindly disregard the observations of the Learned CIT(A) in toto. The addition made by the Learned observations of the Learned CIT(A) in toto. The addition made by the Learned observations of the Learned CIT(A) in toto. The addition made by the Learned Assessing Officer and so confirmed by the Learned CIT(A Assessing Officer and so confirmed by the Learned CIT(A) may kindly be deleted. ) may kindly be deleted. The assessee now takes up the regular grounds of appeal for discussion The assessee now takes up the regular grounds of appeal for discussion The assessee now takes up the regular grounds of appeal for discussion – Ground No. 1 – In the facts and in the circumstances of the case and in law, the Learned CIT(A) In the facts and in the circumstances of the case and in law, the Learned CIT(A) In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the action of the Learned Assessing Officer in completing has erred in confirming the action of the Learned Assessing Officer in completing has erred in confirming the action of the Learned Assessing Officer in completing the assessment u/s 144/144B of the Income Tax Act, 1961 inspite of making all the assessment u/s 144/144B of the Income Tax Act, 1961 inspite of making all the assessment u/s 144/144B of the Income Tax Act, 1961 inspite of making all the compliances against the notice issued by the learned AO. against the notice issued by the learned AO.

Oliria Foods and Beverages Limited vs. ITO In the case of the assessee assessment proceedings were initiated with the issue of notice u/s 143(2) on 01.06.2023. During the course of assessment proceedings the Learned Assessing Officer issued show cause notice u/s 144 on 21.12.2023. A copy of this notice is available on Paper Book Page No. 699 to 702. Subsequently show cause notice was also issued on 21.02.2024. copy of this notice is also available on Paper Book Page No. 703 to 710. Although assessee complied with all the notices issued by the Learned Assessing Officer and submitted desired information from time to time yet the Learned Assessing Officer has erroneously and unlawfully has completed the assessment u/s 144. This is apparent from the following observation of the Learned Assessing Officer – "3.2.3 For the sake of natural justice, as per provisions of section 144B(1)(ix) of the IT Act, one more opportunity was given to the assessee to show cause as to why the assessment should not be completed to the best of its judgment invoking the provisions under section 144 rws 147 of the IT Act. Accordingly, a Show Cause Notice u/s 144 r.w.s 147 of the IT Act was issued on 21.12.2023 asking to submit response on or before 28.12.2023. The assessee responded and sought adjournment. The assessee filed its reply on 06.01.2024 and furnished copy of ITR alongwith computation of income, Audit Report and details of shareholders etc. A centralized communication was also sent to the assessee on 18.01.2024 to which the assessee replied on 20.01.2024 and furnished details of unsecured loan. Another notice 142(1) of the I.T. Act was issued to assessee on 01.02.2024 requesting the assessee to furnish the details of trade creditors/liabilities. The assessee sought adjournment which was granted and the assessee was requested to furnish the details on or before 15.02.2024. The assessee furnished the details of sundry creditors on 15.02.2024." (from assessment order para 3.2.3) 3.3.2 Unexplained cash credit u/s 68 The assessee has furnished the details of unsecured loan for F.Y. 2021-22. The assessee submitted that during the year under consideration, the assessee company has availed fresh unsecured loan of Rs. 10,24,75,690/- from its directors or shareholders. In response to the notice u/s 142(1) of the I.T. Act, the assessee furnished ledger, copy of ITR and bank account statement in confirmation of loan availed. Vide its response to SCN also, the assessee furnished only ledger and copy of ITR of some of the lenders from whom unsecured loan was availed." (from assessment order para 3.3.2) The perusal of the aforesaid para reveal that the Learned Assessing Officer has observed that assessee furnished:- (i) copy of income tax returns, (ii) computation of income, (iii) details of trade creditors, (iv) details of sundry creditors, (v) audit report, and (vi) details of share holders. In view of furnishing the details nothing remains for compliance on the part of the assessee. Yet, the assessment has been completed by the Learned Assessing Officer u/s 144 as is mentioned in column 13 on the first page of the assessment order. It is submitted that despite compliance of all notices and furnishing of complete information, if the Learned Assessing Officer still thought if fit to complete the assessment u/s 144 then it was Oliria Foods and Beverages Limited vs. ITO first required of him to reject the books of accounts u/s 145(3). The relevant provisions of section 145(3) are quoted below – (i) Method of accounting. 145. (1) Income chargeable under the head “Profits and gains of business or profession” or “Income from other sources” shall, subject to the provisions of sub- section (2), be computed in accordance with either cash or mercantile system of accounting regularly employed by the assessee. (2) The Central Government may notify in the Official Gazette from time to time income computation and disclosure standards to be followed by any class of 34ssesses or in respect of any class of income. (3) Where the Assessing Officer is not satisfied about the correctness or completeness of the accounts of the assessee, or where the method of accounting provided in sub-section (1) has not been regularly followed by the assessee, or income has not been computed in accordance with the standards notified under sub-section (2), the Assessing Officer may make an assessment in the manner provided in section 144. The perusal of the aforesaid section reveals that it is the mandate of section 145 that before completing assessment u/s 144 the Learned Assessing Officer is required to reject the books of accounts u/s 145(3) on the ground that the Learned Assessing Officer was not satisfied with the correctness and completeness of the same or the method of accounting has not been regularly followed. It is submitted that in the entire assessment order the Learned Assessing Officer has not observed nor has given any such finding. In view of this the completion of assessment u/s 144 is bad in law. The same deserves to be quashed. The following case laws are quoted in support – (i) DCIT vs. Swananda Properties Pvt Ltd (2020) 15 ITR OLD 128 (Bom) (ii) CIT Vs. Anil Kumar & Co. (2016) 386 ITR 702 (Kar) (iii) PCIT Vs. Marg Ltd (2017) 396 ITR 580 (Mad) (iv) PCIT Vs. Forum Sales Pvt Ltd. (2024) 468 ITR 392 (Del) It is also relevant to mention that the Learned CIT(A) on the first page of the appellate order has also mentioned that the order appeals was passed u/s 144 of the Income Tax Act, 1961. In the facts and circumstances of the case the order passed u/s 144 deserves to be quashed as the Learned Assessing Officer has not followed the provisions of section 145(3). Ground No. 2 – In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the addition of Rs. 4,59,890/- made by the Learned Assessing Officer on account of business profit without considering the submission of the assessee that this was sale of assets which was appearing on GST portal and not sales.

Oliria Foods and Beverages Limited vs. ITO During the course of appellate proceedings the assessee submitted before the Learned CIT(A) as under: - "It is submitted that the Learned Assessing Officer has made addition of Rs. 4,59,890/- on the ground that sales disclosed in the trading account (audited) was only of Rs.19,84,96,990/- whereas in the GST return, the same was of Rs. 19,90,07,490/-. During the course of assessment proceedings, the discrepancy was explained by the assessee stating that this was because of the fact that there was sales of Rs. 5,10,500/- of fixed assets, which was not part of trading account. A chart reconciling the discrepancy was submitted during the course of assessment proceedings, which has been reproduced by the Learned Assessing Officer on page 5 of the assessment order. The same is scanned below :-

However, although assessee fully explained the discrepancy, yet the Learned CIT(A) in a very causal manner disregarded the submission of the assessee and upheld the addition made by the Learned Assessing Officer. The humble submission of the assessee is that the Hon'ble ITAT may kindly consider the aforesaid submission and grant relief to the assessee. Ground No. 3 & 4– Oliria Foods and Beverages Limited vs. ITO (3) In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the addition of Rs. 10,24,75,690/- made by the Learned Assessing Officer u/s 68 of the Income Tax Act, 1961 inspite of furnishing all evidences regarding identity, creditworthiness and genuiness of the transaction. (4) In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the action of the Learned Assessing Officer in making addition of Rs. 10,24,75,690/- without making any enquiry from the loan creditors or without brining any adverse material on record that the transaction is not genuine only on the basis of assumption and presumption inspite of that loan has been repaid in subsequent years. During the course of appellate proceedings the assessee submitted a detailed submission regarding the addition made u/s 68 in respect of cash credits of Rs. 10,24,75,690/-. In this submission the assessee emphatically explained that the cash credits were genuine. The assesse furnished evidence of the existence of the cash creditors, their identify was established. The PAN were furnished. The financial capacity was also established by way of furnishing their income tax returns and bank accounts. The genuineness of the transactions of loans were also established as the same were through banking channels. It is submitted that despite this the Learned CIT(A) has summarily rejected the submission of the assessee for no reason. The Learned CIT(A) has simply sustained the addition on surmises, guess work and conjectures. The first ground on which addition has been sustained by the Learned CIT(A) is that there was no logic for being the loans received and secondly despite heavy loan there was fall in GP rate. Both these grounds are not even distantly connected with the genuineness of the cash creditors. The Learned CIT(A) has wrongly sustained the addition holding the same as bogus and sham transactions. It is submitted that on record there is no evidence that the cash creditors are bogus or these are sham transactions. The entire exercise both by the Learned Assessing Officer as well as by the Learned CIT(A) in holding the cash creditors as bogus is a futile exercise. The assessee has submitted that the purpose of loans taken was for acquiring stress assets of Tijaria Poly Pipes Ltd as the assessee did not succeed in acquiring the same, the loans were immediately returned. It would further be observed that the amount of loans taken is Rs. 10,24,75,690/- and the same matches with the amount of Rs. 10,00,00,000/- advanced by the assessee to Nakhastra Corporate Advisors Limited. In view of this it is submitted that the addition made by the Learned Assessing Officer and sustained by the Learned CIT(A) may kindly be deleted. The submission made before the Learned CIT(A) is quoted below for ready reference – The grounds No. 3 & 4 are taken together for discussion. The case of the assessee was selected for scrutiny in order to examine creditors and unsecured loans. During the year under consideration, the assessee has availed loans of Rs. 10,24,75,690/- and strangely enough, all these loans have been treated by the Oliria Foods and Beverages Limited vs. ITO Learned Assessing Officer as unexplained and added to the income of the assessee u/s 68 of the IT Act. The grounds on which additions have been made by the Learned Assessing Officer are as under :- (i) Scrutiny of bank account of few creditors .

The Learned Assessing Officer has mentioned on page 6 of the assessment order that examination of the bank account of some of the depositors revealed that in the relevant account, amount of the same value which has been advanced to the assessee has been deposited immediately before transferring to the assessee. The Learned Assessing Officer has entertained doubts and suspicion about such nature of deposits in the bank account before transferring the same to the assessee. Secondly, the Learned Assessing Officer has further observed that besides the amount transferred to the assessee, the other transactions in the bank account are of small monetary value. The Learned Assessing Officer has further observed that the return of income filed by these depositors discloses income ranging from Rs. 3 lac to Rs. 4 lac. In view of these facts, the Learned Assessing Officer was of the view that the genuineness of transaction and creditworthiness of the lenders was not established. It is submitted that the above general observations have been made by the Learned Assessing Officer by examining cursorily a few IT returns and bank accounts of the depositors. He has examined only seven IT returns and two bank accounts whereas the number of depositors is 121. The sample size of the Learned Assessing Officer was not adequate enough to make general observations. Over and above this, each cash credit is individually different and cannot be compared with any other cash credit. So the Learned Assessing Officer was not justified to make any general observation without examining all the cash credits. (ii) Notice u/s 133(6) to eight persons

The Learned Assessing Officer has mentioned on page 29 of the assessment order that notices u/s 133(6) were issued in 8 cases noted below. Relevant page 29 is scanned below :-

Oliria Foods and Beverages Limited vs. ITO The Learned Assessing Officer has mentioned that replies were received in respect of the above 8 persons and these were examined and taken on record. This shows that the Learned Assessing Officer was satisfied with the replies of the depositors and no adverse observations has been made by the Learned Assessing Officer in respect of these eight persons. (iii) Examination of bank accounts of few depositors In addition of the above examination of depositors, the Learned Assessing Officer has further discussed on Page 30-35 the bank accounts of certain depositors, a few of them are discussed below, which shows that the Learned Assessing Officer did not examine the bank accounts in proper perspective. After examining the bank accounts of these depositors, the Learned Assessing Officer has made the same observations that amounts in the accounts has been credited only a few days earlier to transferring the same to the assessee. Further, apart from the amount transferred to the assessee, other transactions are of insignificant amount. In some cases, the opening and closing balances were of little amount. On the basis of these facts, the Learned Assessing Officer has given a finding that the depositors are only accommodation entry providers and creditworthiness of the parties could not be established. It is submitted that the Learned Assessing Officer was not justified in making addition by making superficial allegations. The examination of bank account of the depositors is not wholesome. The Learned Assessing Officer was not justified to hold that the depositors were entry providers without bringing any material on record. There is no material with the Learned Assessing Officer to hold that there was round-tripping of the amounts. It is not the case of the Learned Assessing Officer that he was in possession of evidence that the assessee paid cash in lieu of the amount received from the respective parties as share application money. The additions have been made by the Learned Assessing Officer more on the basis of suspicion, guess work and conjecture and not on evidence. The Learned Assessing Officer did not appreciate the evidences furnished before him in the shape of confirmations, Income Tax returns and copy of bank account. The action of the Learned Assessing Officer in treating the entire cash credits of Rs.10,24,75,690/- as unexplained under section 68 is assailed and contested as under :- (a) IT returns and bank statements in respect of all cash-creditors numbering 121

It is submitted that in respect of all the 121 depositors, deposits totaling to Rs. 10,24,75,690/-, the assessee is furnishing a chart containing the name of the creditors, their complete address, Permanent Account Number, Amount of loan and source of deposit with evidences, i.e. copy of bank account of the creditors, their confirmation, leger account of the assessee showing repayment of the loan along with date, copy of bank account of the assessee in support of repayment of Oliria Foods and Beverages Limited vs. ITO loan etc. The chart along with copies of these documents are available on Paper Book Page No. 40-679. It is submitted that identity of each depositor is established beyond doubt on furnishing of PAN and ITR. The genuineness of transaction of deposit is further proved as the same is through banking channel. The capacity of the depositor is further proved as there are large scale transactions in the bank account of each depositor. It is not a case where the bank account contains only a loan transaction of deposit made to the assessee by the depositor. In the facts and circumstances of the case, theld Assessing Officer was not justified in treating all the deposits as unexplained by making surface inquiries and uncalled for observations in respect of few depositors. The facts of each depositor are different and these required to be examined independently. The action of the Learned Assessing Officer in summarily rejecting the submissions of the assessee and treating all the deposits as unexplained was most unjustified. All the deposits are genuine and deserve to be accepted. (b) Examination of bank account of depositors The Learned Assessing Officer has made sweeping generalizations by making superficial observations in respect of the bank account of the depositors. First of all, the assessee takes up for discussion certain cases which the Learned Assessing Officer has made basis and has discussed the same on Page 29 to 35 of the assessment order. These are discussed as under :-

1.

2. Mansukhbhai Dalksukhbhai Parmar :Rs.16,00,000 It is submitted that the Learned Assessing Officer has failed to critically examine the bank account of the creditor furnished before him. There is no denying the fact that amount received through banking channel a few days before has been transferred to the assessee. But all these transactions are not in cash. There is no deposit in cash in the bank account. Further, after depositing amount with the Oliria Foods and Beverages Limited vs. ITO assessee, there are transactions of deposit of Rs.5,73,795/- on 22/4/2021 and Rs. 11,77,916/- on 18/6/2021. These amounts have also been utilized by the depositor in advancing the amount to other depositors. The multiplicity of these heavy transactions establish beyond doubt the capacity of the depositor and genuineness of the deposit Rs. 16,00,000/- with the assessee. Further, the amount of Rs. 16,00,000/- has been repaid to the creditor through cheuqe on 06/01/2023. In view of this position, the loan deserves to be accepted notwithstanding the faulty observations of the Learned Assessing Officer, who has avoided observations regarding other heavy transactions.

3. Natwar Bhai Varsanbhai Bariya, HUF Rs.7,00,000/- It is submitted that the Learned Assessing Officer has wrongly observed that Natwar Bhai Varsanbhai Bariya (HUF) was an entry provider. The ld Assessing Officer has not observed the fact that on 3/4/2021 also, there is a transaction of Rs. 2,00,000/-. Therefore, the Learned Assessing Officer was wrong in observing that besides the transaction of Rs. 7,00,000/- deposited with the assessee on 24/5/2021, other transactions are of small amount transactions. It is to be stated here that the loan of Rs. 7,00,000/- has been repaid by the assessee through cheque 31/3/2023. In view of this, the observation of the Learned Assessing Officer is wrong. The deposit is genuine and requires to be accepted.

4. Shivrambhai Adabhai Choudhari : Rs 9,00,000 In this case also, the observations of the Learned Assessing Officer are in respect of a part of the bank account. The Learned Assessing Officer has restricted his observation to the deposit on 28/5/2021, which has been transferred on the same date to the assessee. However, on 25/5/2021 also, there is transfer of amount to some other party and on this very date, there is transfer of Rs. 3,70,000/-. These facts show that the multiple transactions of heavy amounts reflect that the assessee was having capacity to deposit money with the assessee. The Learned Assessing Officer has ignored the fact that it is not only on 28/5/2021 that amount of Rs. 9,00,000/- has come in the bank account which has been transferred to the assessee, but on 24/5/2021 also, Rs. 12,69,422/- also came to the account through RTGS and the same was transferred on 25/5/2021 to some other parties. These facts establish that the depositor was having capacity to deposit Rs. 9,00,000/- with the assessee. Further, the loan of Rs. 9,00,000/- has been repaid by the assessee on 2/1/2023 through cheque. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the loan is genuine and the same deserves to be accepted.

5. Kajal Babulal Prajapati : Rs.10,50,000/- (S.No.59) The Learned Assessing Officer has not made any detailed comment on the bank account of the depositor. The Learned Assessing Officer has simply observed that examination of the bank account of Kajal Babulal Prajapati disclosed the same pattern.

Oliria Foods and Beverages Limited vs. ITO The observation of the Learned Assessing Officer are not correct. The perusal of bank account of the depositor discloses that besides depositing money with the assessee, the depositor has advanced Rs. 2,00,000/- on 8/7/2020 to Rahul Bhai and similarly, Rs 5,00,000/- has been advanced to Piyush Patel on 9/11/2020. All these transactions are through RTGS. The multiplicity of transactions of heavy amounts establish the capacity of the depositor to deposit amount with the assessee. Further, the loan of Rs. 10,50,000/- has been repaid by the assessee on 4/1/2023 through cheque. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted.

7. Naresh Kumar Shankarlal Solanki : 10,00,000/- In respect of this depositor also, the Learned Assessing Officer has made a very restricted observation that amount of Rs. 6,00,000/- and Rs. 4,00,000/- was credited in the account of the depositor on 24/5/2021 and transferred to the account of the assessee on the same date. However, the Learned Assessing Officer has ignored the other transactions available in the bank account of the depositor. The opening Balance as on 13/4/2021 is of Rs. 10,02,579/-. Further, amount has come in the account of the depositor of Rs. 1,74,000/- on this very date, i.e. 13/4/2021. Again the depositor has advanced Rs. 10,00,000/- on 13/4/2021 to M/s Shiv Buildingcom. This shows that the assessee was making advances to other parties also. The deposit with the assessee is not a lone transaction. Further, all transactions are through RTGS. There is no cash deposit in the account of the depositor. Further, the loan of Rs. 10,00,000/- has been repaid by the assessee on 10/01/2023 through cheque. Copy of ledger account is available on Paper Book page number cited supra. Thus, the amount advanced to the assessee is well explained and deserves to be accepted.

Oliria Foods and Beverages Limited vs. ITO 3,95,500/-. These amounts have been advanced on 13/2/2019 to Spintex through RTGS , Rs.12,40,000/-. There is again a credit of Rs. 3,46,500/- on 14/10/2020 and out of this, Rs. 1,96,500/- has been advanced to Jinal Rahul on 17/10/2020. The assessee has received Rs. 6,00,000/- on 26/5/2021 against credit of Rs. 5,99,900/- on 25/5/2021. The above details of multiple transactions fully explain the capacity of the depositor. Further, the loan of Rs.6,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (4) Bhavnaben Pravin Bhai Vaghani : Rs.6,00,000/-(S.No.18) Copy of Bank account with Karur Vysya Bank Ltd for the period 19/9/2020 to 26/5/2021 is available on Paper Book. The examination of the bank account reveals that there is credit of Rs. 5,40,000/- on 09/10/2020 and of Rs. 3,96,000/- on 12/10/2020. Out of this, amount of Rs. 6,00,000/- has been advanced on 12/10/2020 to Arham Wealth Management. Further, there is another credit of Rs. 3,00,000/- on 13/10/2020 on account of receipt from Gujrati Textiles through RTGS. The depositor has advanced a sum of Rs. 7,00,000/- on this very date to Arham Wealth. Again on 25/5/2021, there is credit in the account of the depositor of Rs.6,00,000/- on account of receipt from Vagani Bhavnaben through RTGS. Same has been advanced to the assessee on 26/5/2021. Thus, the source of deposit of Rs. 6,00,000/- stands fully explained. Further, the loan of Rs.6,00,000/- has been repaid by the assessee on 16/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted.

(5) Bhumika Rakeshbhai Prajapati : Rs.6,00,000/- (S.No.19)

Copy of Bank account with Karur Vysya Bank Ltd for the period 05/01/2019 to 27/5/2021 is available on Paper Book. The examination of the bank account reveals that there is credit of Rs. 2,88,400/- on 02/04/2019, which has been advanced on 4/4/2019. Again, there is credit of Rs. 5,00,000/- on 26/4/2019 through RTGS from P.S. Traders. The depositor has again advanced this amount on 30/04/2019. There is again credit of Rs. 5,45,000/- on 15/9/2020 as received through RTGS from Navadiya Chirag and of Rs. 2,00,000/- on 16/9/2020 from Paresh Ramisha. Out of these receipts, depositor has advanced Rs. 6,00,000/- on 17/9/2020 to Unique Transactions and Rs. 2,00,000/- to Pandav on 19/9/2020. Further, there is receipt of Rs. 6,00,000/- on 26/5/2021 through RTGS from Bhumika and the same has been advanced to the assessee on 27/5/2021. The multiple transactions running into several lacs establish the financial capacity of the depositor. Further, the loan of Rs.6,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Thus, the deposit of Rs. 6,00,000/- in the hands of the assessee is fully explained and the same deserves to be accepted. (6) Denish Rajendra Kumar Patel (Rs.6,00,000)

Oliria Foods and Beverages Limited vs. ITO Copy of Bank account with Karur Vysya Bank Ltd for the period 01/08/2019 to 27/5/2021 is available on Paper Book. The examination of the bank account reveals that there are multiple credits on 09/10/2019 totalling to Rs.5,00,000/-., which has been advanced on 10/10/2019 to Paresh R Patel. Again there is credit of Rs. 5,00,000/- on 17/10/2019 from Rana N. and Rs. 5,25,000/- has been advanced to Vinov V. Patel on 19/10/2019. The bank account further reveals credit of Rs. 5,25,000/- on 10/08/2020 by way of RTGS from Vinod and the same has been advanced through RTGS to Sai Somnath Deb on 11/8/2020. Again, there are credits on 11/8/2020 of Rs. 5,00,000/- which has again been advanced on 15/9/2020 to Unique Construction through RTGS. The assessee has received Rs. 6,00,000/- on 27/5/2021 against deposit in the bank account of Rs. 6,00,000/- on 26/5/2021 through RTGS from Daimeco Patel. In view of the aforesaid facts and multiple transactions, the financial capacity of the depositor is well- established. Further, the loan of Rs.6,00,000/- has been repaid by the assessee on 30/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the case of the assessee of Rs.6,00,000/- deserves to be accepted as explained. (7) Dharmesh Gordhanbhai Raval : Rs.9,00,000/- Copy of Bank account with Karur Vysya Bank Ltd for the period 31/12/2018 to 27/5/2021 is available on Paper Book. The examination of the bank account reveals that there is deposit of Rs. 4,90,900/- on 2/4/2019 by way of clearing from Green Design. The depositor has advanced Rs. 5,00,000/- on 8/4/2019 to Mukesh Kanhiyalal Shah. Again there is a credit in the bank account on 9/4/2019 of Rs. 4,00,000/- from Ambaram Bhai Devaliya and this amount has been advanced on 10/04/2019 to Mukesh Kanhialal Shah. There is again a credit for Rs.2,10,500/- on 21/3/2020 which has been advanced to Dipesh Kumar N Adani on 26/3/2020. The account further reveals credits of Rs. 5,00,000/- on 21/9/2020 and the same has been advanced to Mukesh Shah on 24/9/2020. Similarly, there is credit of Rs. 3,46,500/- on 14/10/2020, which has been advanced on 17/10/2020 to Pandav, Rs.1,96,500/-. The account further reveals credit of Rs. 8,99,996/- on 26/5/2021 and this amount has been advanced to the assessee on 27/5/2021. In view of the facts discussed above and the multiple transactions running into several lacs, the financial capacity of the depositor is fully established. Further, the loan of Rs.9,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. The deposit in the hands of the assessee of Rs. 9,00,000/- stands explained the same deserves to be accepted. (8) Dimple Bhargav Bhai Sagarka : Rs.10,00,000/- Copy of Bank account with Associate Co-operative Bank Ltd. for the period 5/2/2020 to 1/6/2021is available on Paper Book. The examination of the bank account reveals that there is deposit of Rs. 8,00,000/- on 6/11/2020, which has been advanced on the same date to Meet Enterprises through RTGS. Again, there is receipt of Rs. 8,00,000/- on 5/2/2021 through RTGS from Meet Enterprises and the same has been advanced on 7/2/2021 to Shailesh. The perusal of the bank account further reveals deposit of Rs. 10,00,000/- on 1/6/2021 through RTGS Oliria Foods and Beverages Limited vs. ITO from MK Trading and the same has been deposited with the assessee. The transactions of heavy amount establish the financial capacity of the depositor. Further, the loan of Rs.10,00,000/- has been repaid by the assessee on 16/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Hence, the deposit in the hands of the assessee of Rs. 10,00,000/- is fully explained and the same deserves to be accepted. (9) Dimpleben Chintal Kumar Surati : Rs.5,00,000/- Copy of Bank account with Surat District Co-operative Bank Ltd for the period 7/4/2021 to 24/09/2021 is available on Paper Book. The examination of the bank account reveals that there is credit of Rs. 5,27,408/- as receipt from Dhami Developers on 7/4/2021 and Rs. 5,00,000/- has been advanced on 8/4/2021 to Shreyans Jain. Further, Shreyans Jain has returned the amount on 17/4/2021 and the same has been advanced to the assessee on 19/4/2021. The trail of amount establishes that the source of deposit with the assessee is fully explained. There are further transactions in the account as credit of Rs. 3,00,000/- on 18/6/2021 and again credit of Rs. 3,38,230/- on 7/7/2021 and Rs. 5,00,000/- on 24/9/2021. The depositor has advanced Rs 3,00,000 on 8/7/2021 to Ranchhod Bhai and Rs. 5,00,000/- to Dharma Impex on 24/9/2021. It is submitted that the bank account establishes the fact that the deposit with the assessee is not the lone transaction in the bank account of the depositor. The multiple transactions running into several lacs also establish beyond doubt the financial capacity of the depositor. Further, the loan of Rs.5,00,000/- has been repaid by the assessee on 31/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (10) Dinesh Bhai Raman Bhai Bariya : Rs.9,80,000 Copy of Bank account with Bank of India for the period 1/4/2021 to 14/8/2021 is available on Paper Book. The examination of the bank account reveals that there is credit of Rs. 15,65,374/- on 23/6/2021 as received through RTGS from Unique Const. The amount has been advanced on 25/6/2021 to various parties. There is again a credit of Rs. 4,91,000/- on 27/6/2021 and Rs. 4,90,000/- has been advanced to the assessee on 29/6/2021. Again there is a deposit of Rs. 4,89,000/- in the account on 30/6/2021 through RTGS and on 1/7/2021, Rs. 4,90,000/- has been advanced to the assessee. The multiple transactions running into several lacs establish the financial capacity of the depositor. Further, there are no cash deposits in the bank account. Further, the loan of Rs.9,80,000/- has been repaid by the assessee on 08/02/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. In view of this, the amount deposited with the assessee is fully explained and the same deserves to be accepted. (11) Dinesh Bhai Velabhai Bavariya : Rs. 9,11,500/- Copy of Bank account with Associate Co-operative Bank Ltd. for the period Nov. 2020 to 30/06/2021 is available on Paper Book. The examination of the bank account reveals that there is credit of Rs. 6,00,000/- in Nov. 2020 and the same has been advanced to Meet Enterprises. Again there are credits of Rs. 2,00,000/, Rs. 2,00,000/- and Rs. 9,00,000/- in March, 2021. Out of these deposits, Rs. 10,00,000/- has been advanced in March, 2021 to Rishab. Again there is credit of Rs. 9,11,500/- in June, 2021 as received through RTGS from MK Trading Co., which has been deposited with the assessee. Therefore, the source of amount of Rs. 9,11,500/- is well-established and the same deserves to be accepted. Further, the multiple transactions running into several lacs also establish the financial capacity of the depositor. Further, the loan of Rs.9,11,500/- has been repaid by the assessee on 16/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (12) Divyesh K Kania : Rs. 5,00,000/- Copy of Bank account with Karur Vysya Bank for the period 1/8/2019 to 31/5/2021 is available on Paper Book. The examination of the bank account reveals the following credits and debits :-

Name of party Date Deposited in bank Withdrawn from the bank account (Cr) account (Dr. Narayan Impex 22/10/2019 2,65,000 RN Enterprises 22/10/2019 2,30,000 S&L Impex 24/10/2019 5,00,000 Bhoomik 24/10/2019 5,00,000 S&L Impex 25/10/2019 5,00,000 Apex Traders 19/12/2019 5,00,000 Sanol Impex 20/12/2019 5,00,000 Kania Divya 29/5/2021 5,00,000 Oliria Foods 31/5/2021 5,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.5,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. In view of this, deposit with the assessee is fully explained and the same deserves to be accepted.

(13) Gelabai Krashnbhai Kateshiyta : Rs 10,50,500/- Copy of Bank account with Associate Co-operative Bank Ltd for the period 23/4/2021 to 03/03/2022 is available on Paper Book. The examination of the bank account reveals that besides the transaction of deposit with the assessee, the depositor has also advanced Rs.8,00,000/- on 3/3/2022 to FCB Design. Thus, this fact establishes the financial capacity of the depositor. The deposit in the hands of the assessee stands fully explained. Further, the loan of Rs.10,50,000/- has been repaid by the assessee on 10/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (14) Harish Somabhai Parmar : Rs. 7,50,000/- Copy of Bank account with Bank of India for the period 1/4/2021 to 13/8/2021 is available on Paper Book. The examination of the bank account reveals the following credits and debits :- Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr. Unique Construction 12/5/2021 8,25,575 Shah Harsh Rakesh Kr. 17/5/2021 1,75,000 Suresh Bharat Bhai 17/5/2021 1,80,000 Chintan Bhai 17/5/2021 1,90,000 Ashok Damji Bhai 17/5/2021 2,05,000 Ashok Damji Bhai 18/5/2021 2,05,000 Shah Harsh Rakesh Kr 18/5/2021 1,75,000 Chintan Bhai 18/5/2021 1,90,000 Suresh Bharat Bhai 18/5/2021 1,80,000 Oliria Foods 20/5/2021 4,00,000 Oliria Foods 21/5/2021 3,50,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.7,50,000/- has been repaid by the assessee on 31/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted.

(15) Harshaben Ghanshyam Bai Patel : Rs. 9,80,000 Copy of Bank account with Bank of India for the period 11/6/2020 to 07/08/2021 is available on Paper Book. The examination of the bank account reveals the following credits and debits :- Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr. Sumangal Infra 7/10/2020 5,54,968 Alpha Infra 8/10/2020 5,00,000 Vara 17/6/2021 11,77,916 Arvindbhai Dhirubhai 19/6/2021 2,50,000 Hariya Vinabehan 19/6/2021 3,00,000 Harvind Kr. Nagardas 19/6/2021 3,00,000 Jitendra Mafatlal 19/6/2021 3,00,000 RTGS PNB 28/6/2021 4,95,000 Oliria Foods 29/6/2021 4,90,000 NEFT Jio 29/6/2021 4,85,000 Oliria Foods 1/7/2021 4,90,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.9,80,000/- has been repaid by the assessee on 09/02/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (16) Jagruti Ben Dinesh Bhai Bariya : Rs. 9,00,000/-

Copy of Bank account with Bank of India for the period 23/4/2021 to 20/06/2021 is available on Paper Book. The examination of the bank account reveals the following credits and debits :-

Name of party Date Deposited in Withdrawn from bank account the bank account (Cr) (Dr. Unique Constructions 18/5/2021 9,36,145 Oliria Foods 20/5/2021 4,50,000 Oliria Foods 21/5/2021 4,50,000 Panchani Ramesh Bhai 17/8/2021 11,98,019 GIT Creations 19/8/2021 1,72,000 Pragati Developers 19/8/2021 4,95,000 Pragati Developers 20/8/2021 4,55,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.9,00,000/- has been repaid by the assessee on 16/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (17) Jayanti Bhai Prajapati : Rs. 6,00,000 Copy of Bank account with Karur Vysya Bank for the period 01/04/2020 to 31/5/2021 is available on Paper Book. The examination of the bank account reveals the following credits and debits :- Name of party Date Deposited in Withdrawn from bank the bank account account (Cr) (Dr. Azlon Textiles 14/10/2020 15,00,000 Arham Wealth Management 14/10/2020 5,00,000 Arham Wealth Management 14/10/2020 10,00,00 Ganesh Electricals P. Ltd 2/2/2021 8,41,500 Kavin Kumar Choksi 2/2/2021 8,41,500 Prajapati Jayanti Bhai 29/5/2021 6,00,000

Oliria Foods 31/5/2021 6,00,000 The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.6,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (18) Jinal Rahul Rajput : Rs. 7,00,000/- Copy of Bank account with Surat Peoples Co-operative Bank Ltd. for the period 07/11/2019 to 1/6/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr. By Clg 30/06/2020 2,50,000 RTGS Paraesh Ramjibhai 16/10/2020 5,15,587 Patel Balubhai Jivanbhai Nariga 17/10/2020 1,96,500 Unique Const 19/10/2020 7,00,000 Tr. 1/6/2021 6,99,675 Oliria Foods 1/6/2021 7,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.7,00,000/- has been repaid by the assessee on 28/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (19) Kajal Balubhai Prajapati : Rs. 10,50,000 Copy of Bank account with Karur Vysya for the period 28/3/2020 to 1/6/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr.

M/s Green Design 2/7/2020 2,00,000 Rahul Bhai 8/7/2020 2,00,000 Gordhan 9/11/2020 3,83,000 Petiga 9/11/2020 1,17,000 Piyush 9/11/2020 5,00,000 Ben Prajapati 1/6/2021 8,00,000 Oliria Foods 1/6/2021 8,00,000 Gordha 1/6/2021 2,00,000 Oliria Goods 1/6/2021 2,50,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.10,50,000/- has been repaid by the assessee on 04/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. In view of this, deposit with the assessee is fully explained. (20) Kalaben Hareshbhai Prajapati : Rs. 5,00,000 Copy of Bank account with Andhra Bank for the period 27/6/2019 to 09/08/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :- Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr.

Bhara 11/9/2019 5,00,000 Bharat 12/9/2019 2,00,000 Bharat 12/9/2019 3,00,000 Bhara 16/9/2019 4,00,000 Javan 16/9/2019 5,00,000 Bharat 17/9/2019 3,50,000 Bharat 17/9/2019 2,25,000 Bharat 17/9/2019 3,25,000 Neft SPCEN. 29/5/2021 5,00,000 Oliria 31/5/2021 5,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.5,00,000/- has been repaid by the assessee on 30/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (21) Kalpana S. Rathod : Rs. 5,00,000

Copy of Bank account with Federal Bank for the period 15/4/2019 to 1/6/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr.

Ashok Bhai 10/09/2019 5,50,000 Bharat Kanhialal Shah 11/092019 2,50,000 Kanhialal Shah 11/6/2019 3,00,000 Shantiben 16/9/2019 6,00,000 Javanji 16/9/2019 4,00,000 Kanhialal Shah 17/9/2019 2,75,000 Kanhialal Shah 17/9/2019 3,25,000 Kanhialal Shah 17/9/2019 4,00,000 Diamosco 1/6/2021 5,00,000 Oliria 1/6/2021 5,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.5,00,000/- has been repaid by the assessee on 30/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (22) Mitesh Shah HUF : Rs. 13,00,000

Copy of Bank account with ICICI Bank for the period 15/4/2019 to 1/4/2020 to 13/8/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :- Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr.

Paresh Ramjibhai Patel 31/8/2020 5,10,750 Bhagal 1/9/2020 1,45,000 Kalpesh Gamnilal 2/9/2020 1,85,000 Nitesh Bhai Raman Bhai 2/9/2020 1,80,000 Harsidhu Industries 24/12/2020 5,00,000 Bhagal 28/12/2020 2,50,000 Bhagal 29/12/2020 2,60,000 TU Builders 21/4/2021 6,00,000 T. RTGS 22/4/2021 2,00,000 Oliria Foods 23/4/2021 8,00,000 RTGS SPCBR 25/5/2021 4,99,996 Oliria Foods 26/5/2021 5,00,000 G Mistry Associates 13/8/2021 6,98,420

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.13,00,000/- has been repaid by the assessee on 13/02/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (23) Prakash Bhai Khimjibai Patel : Rs. 9,50,000/- Copy of Bank account with Associate Co-operative Bank Ltd for the period 1/12/2020 to 6/9/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :- Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr.

Th. RTGS 1/3/2021 10,00,000 Monica Fab. 1/3/2021 10,00,000 Blue Moon Textiles 3/4/2021 7,00,000

Haripriya 3/4/2021 7,00,000 Shiv Enterprises 5/5/2021 9,52,070

Oliria Foods 5/5/2021 9,50,000 RTGS 6/9/2021 11,30,654 Haripriya 6/9/2021 11,30,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.9,50,000/- has been repaid by the assessee on 30/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (24) Pravinbhai Dhirubhai Prajapati : Rs. 5,00,000 Copy of Bank account with Surat District Co-operative Bank Ltd for the period 5/4/2021 to 4/10/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr. Dhami Developers 5/4/2021 5,27,319 Shreyans Jain 8/4/2021 5,00,000 Shreyans Jain 17/4/2021 5,00,000 Oliria Foods 19/4/2021 5,00,000 Sandeepbhai Jayantbhai 26/8/2021 7,63,190 Pragati Developers 31/8/2021 7,50,000 Unique Const. 30/9/2021 10,00,000 Pragati Dev. 4/10/2021 10,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.5,00,000/- has been repaid by the assessee on 06/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (25) Tejabhai Ratanbhai Rajput : Rs. 8,00,000/- Copy of Bank account with Associate Co-operative Bank Ltd for the period 30/09/2019 to 25/5/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr.

Starworld 5/3/2021 10,17,206 Bandhan FTL 6/3/2021 9,00,000 Th. RTGS 6/5/2021 8,00,000 Oliria Foods 25/5/2021 8,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.8,00,000/- has been repaid by the assessee on 19/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (26) Upendra Somabhai Paramar : Rs. 8,00,000/- Copy of Bank account with Bank of India for the period 1/4/2021 to 23/8/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr. Vara 17/6/2021 9,42,333 S.C. Patel 18/6/2021 1,00,000 HS Parmar 18/6/2021 1,00,000 Amruta Enterprises 19/6/2021 45,000 Hemant Kr. Mafatlal 19/6/2021 2,00,000 Ashwani Nagbhai 19/6/2021 2,00,000 Vinod Sambhai 19/6/2021 2,50,000 S.O.L Limited 28/6/2021 4,94,000 Oliria Foods 29/6/2021 4,90,000 S.O.L. Ltd 29/6/2021 4,06,000 Oliria Foods 1/7/2021 4,10,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.8,00,000/- has been repaid by the assessee on 31/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (27) Variya Kanteben Vikrambhai : Rs. 7,00,000/- Copy of Bank account with Karur Vysya Bank for the period 24/8/2020 to 1/6/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :-

Name of party Date Deposited in bank Withdrawn from the account (Cr) bank account (Dr.

Gujari Textiles 13/10/2020 9,00,000 Tara Patel 13/10/2020 5,00,000 Arham Wealth Management 13/10/2020 8,00,000 Anil Bhai 14/10/2020 1,00,000 Arham Wealth Management 14/10/2020 7,00,000 Variya Kant 1/6/2021 6,99,999 Oliria Foods 1/6/2021 7,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.7,00,000/- has been repaid by the assessee on 30/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. (28) Vihabhai Gagabhai Luhar : Rs. 7,00,000/- Copy of Bank account with Associate Co-operative Bank Ltd for the period 4/12/2020 to 25/5/2021 is available on Paper Book. The examination of the bank account reveals the following major credits and debits :- Name of party Date Deposited in bank Withdrawn from account (Cr) the bank account (Dr.

Th.RTGS 23/2/2021 6,00,000 Jalondhara 23/2/2021 6,00,000 RTGS 24/2/2021 8,00,000 Neft Real Stars 24/2/2021 8,00,000 Th. RTGS 1/3/2021 5,00,000 Babu Bhai 5/3/2021 5,00,000 MK Trading 25/5/2021 7,00,000 Oliria 25/5/2021 7,00,000

The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. Further, the loan of Rs.7,00,000/- has been repaid by the assessee on 19/1/2023 through banking channel. Copy of ledger account is available on Paper Book page number cited supra. Therefore, the deposit in the hands of the assessee deserves to be accepted. The above transactions in the bank account establish the financial capacity of the depositor. There are no cash deposits in the bank account. The deposit with the assessee is not the lone transaction in the bank account. In view of this, deposit with the assessee is fully explained.

SCRUTINY OF THE BANK ACCOUNTS ESTABLISHES GENUINENESS OF THE DEPOSITS It is submitted that the examination of the bank accounts both of those which were discussed by the Learned Assessing Officer in the assessment order numbering nine and other bank accounts which have been discussed above numbering 28 disclose the following features, which establish that the depositors were genuine and not entry providers. All the depositors were in a capacity a deposit amount with the assessee. These features are discussed hereunder :- 1. It is submitted that assessee is not the only person who has received deposits from the above depositors. The scrutiny of the bank accounts, as discussed above, reveals that most of these depositors have advanced money to big and well-known concerns, like, Arham Wealth Management, Unique Construction etc. The name of these well-known concerns give credibility to the depositors. It is not the case of the revenue that deposits advanced by these depositors to persons like Arham Wealth Management or Unique Construction was also treated unexplained. It is further submitted that the Learned Assessing Officer treated the depositors as entry providers just on the basis of assumption and presumption.

3. The Learned Assessing Officer has not brought any material on record to establish that there was round-tripping of money. It is no the case of the Learned Oliria Foods and Beverages Limited vs. ITO Assessing Officer that cash was paid to these persons in lieu of obtaining deposits. The Learned Assessing Officer has wrongly observed that loans have been advanced to the assessee in an unusual manner. The Learned Assessing Officer has not explained that how the deposits with the assessee were in an unusual manner. It is further submitted that the transactions in the bank account are through RTGS, which is an approved electronic mode of transferring money. There is nothing unusual in transferring money through RTGS.

4. The scrutiny of all these bank accounts discussed above further establishes that before advancing money to the assessee, there was no deposit in cash in the bank account. All major transactions in the bank account are through electronic mode of transfer. The mode of transfer is beyond suspicion.

5. It is further submitted that in a large number of cases, the copies of bank accounts submitted are for a year or more. Therefore, it cannot be said that bank account was just opened for advancing money to the assessee. The bank accounts of the depositors are of regular nature and these are in various banks and not in one bank. This also establishes that money received by the assessee was in a normal and regular course and not in arranged manner.

6. It is further submitted that as per copy of ledger accounts, the money received by the assessee has been returned in the subsequent years. Returning money further establishes that the deposits received by the assessee were genuine.

7. In view of these facts, the deposits may kindly be treated as genuine. The additions have been made in a most unusual manner. The Learned Assessing Officer has examined the bank accounts only of few depositors (only eight depositors) and that too faultily. Then addition has been made in the case of 121 depositors more on the basis of suspicion, assumption and presumption. It is settled principle of law that suspicion, however strong cannot take the place of evidence. The following cases are quoted in support :- (i) Uma Charan Shaw & Brothers 37 ITR 271 (SC) (ii) CIT vs. Anupam Kapoor 299 ITR 179 (P&H) (iii) CIT vs. Dhiraj Lal Girdhari Lal 26 OTR 736 (iv) Dhakeshwari Cotton Mills 26 ITR 775 (SC) (v) State vs. Gulzari Lal Tondon 1979 AIR 1382 (SC) (vi J.A. Naidu vs. State of Maharastra 1979 AIR 1537 (SC) From the discussion made above, it may kindly be seen that :-

(1) All the creditors are assessed to income and they are borne on the register of the Income Tax Department, having Permanent Account Number. (2) In the case of every creditor, the amount has been received through banking channel (3) All of them are assessed to income-tax and filing regular returns of income. (4) Thus, their identity, creditworthiness and genuineness of transaction stands established. (5) Further the amount of loan has been repaid by the assessee through banking channel on subsequent years.

In view of the above facts and the legal position, it was wrong on the part of the ld. AO to state their identity, creditworthiness and genuineness of transaction is not established. It is, therefore, requested that the addition made by the ld.AO deserves to be deleted. Favourable case laws In support of the submissions made above, wherein it has been strongly pleaded that the assessee has received unsecured loans money from persons who are having PAN, who have given the loans through banking channels, the identity of the creditors is not in doubt, they are filing income tax returns regularly, in view of this, the unsecured loan received from them deserves to be accepted as explained, the assessee quotes the following decisions :- (1) COMMISSIONER OF INCOME TAX vs. ORISSA CORPORATION (P) LTD. SUPREME COURT OF INDIA (1986) 52 CTR 0138, (1986) 159 ITR 0078, Held Income—Cash credit—Burden of proof—Assessee had given the names and addresses of the creditors—It was in the knowledge of the Revenue that the said creditors were income-tax assessees—Their index number was in the file of the Revenue—Revenue, apart from issuing notices under s. 131 at the instance of the assessee, did not pursue the matter further—Revenue did not examine the source of income of the said alleged creditors to find out whether they were creditworthy or were such who could advance the allowed loans—Tribunal came to the conclusion that the assessee has discharged the burden that lay on him then it could not be said that such a conclusion was unreasonable or perverse or based on no evidence— (2) Aravali Trading Co. V/s ITO (2008) 8 DTR (Raj) 199 Hon’ble Rajasthan High Court The Hon’ble High Court held that once the the existence of the creditors is proved and such person own the credits which are found in the books of the assessee, the assessee's onus stand discharged and the latter is not further required to prove the source from which the creditors could have acquired the money deposited with him either in terms of section 68 or on general principle.

(3) CIT Vs. Jai Kumar Bakliwal (2014) 101 DTR 377 (Raj)

Once the amount was advanced by the creditors by account payee cheque from their respective bank accounts and the creditors were being assessed to income tax, the capacity of the creditor and genuineness of the transaction stood proved. Addition u/s 68 not sustainable. (4) Commissioner of Income Tax Vs. Heeralal Chaganlal Tak HIGH COURT OF RAJASTHAN (2002) 176 CTR 0495, (2002) 257 ITR 0281, (2002) Income—Cash credit—Burden of proof—Identity of the creditor is established—He has confirmed the loan—Whether the amount was advanced by the alleged Oliria Foods and Beverages Limited vs. ITO creditor or not is basically a question of fact—Tribunal is the final fact-finding body—Finding of the Tribunal accepting the genuineness of the loan and deleting the addition could not be said to be perverse. (5) DEPUTY COMMISSIONER OF INCOME TAX vs. MAHALAXMI TMT PVT. LTD. (2021) 190 ITD 582 (ITAT, Pune) Assessee has discharged its onus by furnishing the necessary details such as a confirmation of the parties, copy of ITR- V, copy of bank statement of parties along with their balance sheet, share certificate, MOA, AOA etc. in support of identity of the parties and genuineness of transaction and credit worthiness of the parties. Similarly, there is also no dispute to the fact that all the transactions were carried out through the banking channel. What is the inference that flows from a cumulative consideration of all the aforesaid contending facts is that the assessee has discharged its onus imposed under section 68. Accordingly the AO had a suspicion that the investors as discussed above were acting as the conduit for converting the unaccounted money of the assessee in the guise of share capital /share application money and premium on shares. Conversely the AO has not brought anything on record suggesting amount credited in the books of assessee does not belongs to respective parties but the same belongs to the assessee.

(6) Balaji Healthcare Pvt. Ltd Vs. ITO (ITA No.566&567) dated 30/1/2019 (ITAT, Jaipur)

Without examination or investigation in the case of the investors or disputing the documents or controverting the facts submitted by the assessee, the addition in the hands of the company cannot be sustained.

(7) CIT Vs. H.S. Builders 78 DTR 169 (Raj)

Deposit of cash in the account of the creditor just before giving loans to the assessee company would not lead to the conclusion that the money was deposited by the assessee company. Therefore, the ITAT was justified in deleting the addition. (8) Lalitha Jewellery mart (P) Ltd Vs. DCIT (2018) 99 taxmann.co, 408 (Mad)

Where the assessee company had completely explained sources of investments received by it by way of share application money, it had also disclosed identity of such investors and all payments had been received through banking channels, amount of share application money could not be treated as assessee’s undisclosed income under section 68.

(9) DCIT Circle 3(1)(I) vs. Orient News Prints Ltd (2018) 259 Taxman 408 (SC)

Where in order to prove the genuineness of share transactions, assessee brought on record all relevant facts, such as, names, address, PAN of share applicants, it was thereupon the duty of the AO to obtain separate confirmation from concerned Oliria Foods and Beverages Limited vs. ITO parties, if required, and where he failed to do so, it could not be a ground to re- open assessment. In the light of discussion made above, it is clear that the Learned Assessing Officer was not justified to hold that the depositors were accommodation entry providers without bringing any material on record. The addition made by the ld. AO is illegal and unjust and based on suspicion, surmises, guesswork and conjectures and the same deserves to be deleted. Ground No. 5 – The assessee craves your indulgence to add, amend or alter all or any grounds of appeal before or at the time of hearing. Not pressed. Your Honor is requested to decide the appeal in favour of the assessee by considering the grounds and submissions made above and oblige.”

7. In addition ld. AR of the assessee also submitted an application for admitting the additional evidence which reads as under :

In the above regard it is submitted that the learned AO has completed the assessment u/s 144 of the Income Tax Act, 1961 on 16.03.2024 and the Learned CIT(A) has decided the appeal of the assessee on 17.12.2024 dismissing the same. The Learned CIT(A) has dismissed the appeal of the assessee on grounds which were not taken by the Learned Assessing Officer and which were not disclosed to the assessee also. In view of this assessee has to take additional grounds for the support of the same additional evidence is also required to be furnished. In view of this the Hon'ble Tribunal is humbly requested to admit the additional evidence which are necessary for substantiating the additional grounds arising out of the order of the Learned CIT(A). The additional evidences are part of paper book page no. 688 to 698. The additional evidences are crucial for the discharge of justice. Therefore, these may kindly be admitted.

3. The above additional evidences are essential for admitting and adjudicating the grounds taken by the assessee for imparting justice to the assessee. It also goes to the root of the matter for deciding the appeal.

The position is that the Tribunal can admit the additional evidence if it requires it to enable it to pass orders (iii) Electra (Jaipur) Pvt Ltd. vs. IAC 26 ITD 236 If evidence produced by assessee is genuine, reliable and proves assessee's case than assessee should not be denied opportunity of it being produced even if he first time produces same before appellate authority. (iv) Smt. Prabhavati S. Shah Vs. CIT 231 ITR 1 (Bom.) Production of additional evidence – assessee taking loans from two creditors – ITO treating loans as income from undisclosed sources as summons could not be served on creditors – Assessee wanting to prove genuineness of loan by relying on fact that amount borrowed and repaid by cheques. Assessee producing Photostat copies of cheques and certificate from Bank before AAC . AAC refusing to admit additional evidence. AAC should have considered evidence produced by assessee regarding loan. (v) CIT Vs. Gani Bhai Wahab Bhai 232 ITR 900 (MP) There is no prohibition for taking additional evidence at the appellate stage, the only condition being that the Department should not be prejudiced and should be given reasonable opportunity to rebut this additional evidence. In this case, no such request was made by the representative of the Department whether they disputed this certificate or not. Therefore, there is no illegality committed by the Tribunal which accepted the certificate of 46 per cent of the yield. In this view of the matter, the additional evidence entertained by the Tribunal cannot be said to be bad. (vi) Smt. Surinder Kaur Vs. ITO (2008) 118 TTJ 710 (Luck) Where additional evidence sought to be produced before Tribunal was a certificate relating to assessee's claim for deduction of a sum and if was relevant to decide Oliria Foods and Beverages Limited vs. ITO claim of assessee, same was to be admitted for substantial cause and to enable tribunal to pass appropriate order in matter. (vii) Mascon Global Ltd. Vs. Assistant Commissioner of Income Tax (2010) 37 SOT 202 (Chennai) Rule 29 permits the Tribunal to admit the additional evidence for any substantial cause. In view of the aforesaid facts and decisions the Hon’ble ITAT is requested to admit the additional evidence filed by the assessee in the shape of agreement and decide the case favourably.

8. As regards the additional grounds or raised the same were supported by the following written submission :

In this case, appeal for assessment year 2022-23 stands filed on 23/12/2024 against order of the Learned CIT(A), NFAC, Delhi passed on 17/12/2024. However, while filing the appeal, due to inadvertence, following grounds could not be taken. These grounds are purely of facts on record and arise out of the order of the learned CIT(A). These additional grounds require some additional evidence for which a separate application is being filed along with this application. The admission of the additional grounds is imperative for imparting justice in the case of the assessee. Therefore, the Hon'ble Tribunal may kindly admit the additional grounds, which are as under :- Additional Ground No.1 In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground i.e. assessee failed to specify the purpose of loans without affording any opportunity to the assessee in this regard. Additional Ground No.2 In the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 10,24,75,690/- on a different ground that assessee failed to explain the phenomenal fall in Gross Profit and Net Profit without affording any opportunity to the assessee in this regard. The additional grounds arise out of the order of the learned CIT(A), hence, the same deserve to be admitted by the Hon'ble Bench. The following decisions are quoted in support – (i) National Thermal Power Co. Ltd. Vs. CIT (1998) 229 ITR 383 (SC)

Oliria Foods and Beverages Limited vs. ITO The view that the Tribunal is confined only to issues arising out of appeal before the CIT(A) takes too narrow a view of the powers of the Tribunal. Undoubtedly, the Tribunal will have the discretion to allow or not allow a new ground to be raised. But where the Tribunal is only required to consider a question of law arising from the facts which are on record in the assessment proceedings such a question should be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. (ii) Ravindra Arora vs. Assistant Commissioner of Income Tax (2018) 404 ITR 452 (Rajasthan High Court) ITAT is bound to accept additional ground if facts are on record. (iii) Sharwan Beniwal Vs. Income Tax Officer Bikaner dated 14.01.2009 ITAT can admit additional ground of appeal later on in case the issue raised is legal and goes to the root of the matter. (vi) Jora Singh Vs. ITO (2010)

42. DTR 409 (Lucknow) Admissibility of additional ground : validity of assessment. Notice u/s 148 issued even when lime limit of issuing notice u/s 143(2) was available. A pure question of law – additional ground is admitted. (v) CIT Vs. Kerala State Co-operative Marketing Federation Learned. (1992) 193 ITR 624 (Ker) An appellant before the Tribunal can raise any new or additional point for the first time in appeal before the Tribunal. (vi) Mahindra & Mahindra Ltd. Dy. CIT (2009) 122 TTJ 577 (Mub)(SB) Appeal (Tribunal)-Additional ground-Question of limitation-Special Bench having been constituted for deciding the question of limitation on the request of Revenue, the objection as to raising of additional ground by assessee is not maintainable now Further, there can be no embargo on any party to raise a legal ground for the first time before the Tribunal provided the relevant material for deciding that question already exists on record and no further investigation of facts is required- Question of limitation goes to the very jurisdiction of the matter-It is not only the right of the parties but also the duty of the Tribunal to consider the question of limitation notwithstanding the fact that it is not raised before it-Additional ground admitted. (vii) Sunil Kumar Pugalia (HUF) Vs. ITO (2009) 120 TTJ 1001 (Jodh) Appeal (Tribunal)- Additional ground-Admissibility-Ground challenging jurisdiction of AO to initiate reassessment proceedings not raised before AO or CIT(A)-Being a pure question of law can be raised before the Tribunal for the first time.

In view of the aforesaid facts, the Hon'ble Tribunal is requested to kindly admit the additional grounds.

9. To support the contention so raised in the written submission reliance was placed on the following evidence / records :

Sr. Particulars Page No. No.

1. Copy of acknowledgement of return of income filed on 04/10/2022 with 1 computation of total income

2. Copy of audit report along with audited accounts 2-39

3. Chart of 121 creditors, containing their names, complete addresses, PAN, Amount 40-52 of deposit and source of deposit etc.

4. Evidences in support of identity of the creditors, their creditworthiness and genuineness of transactions – i.e.

(i) Copy of confirmation of all cash-creditors. 53-172

(ii) Copy of Income Tax returns of the cash creditors. 173-286

(iii) Copy of bank account of the cash creditors through which the amount has been 287-485 advanced to the assessee.

(iv) Copy of ledger account showing repayment of loans to the creditors by the 486-609 assessee through banking channel.

(v) Copy of bank statement of the assessee through which the loan was repaid to the 610-679 creditors.

5. Copy of reply dated 04.03.2024 made before the Learned Assessing Officer 680-687

6. Copy of agreement with Nakshatra Corporate Advisors Limited executed on 688-693 08.03.2021

7. Copies of the ledger accounts of Nakshatra Corporate Advisors Limited as 694-698 appearing in the books of assessee and vice-versa

8. Copy of notice dated 21.12.2023. 699-702

9. Copy of show cause notice issued on 21.02.2024 703-710

Officer on account of business profit without considering the submission of the assessee that this difference is for sale of assets which was appearing on GST portal and in fact was not regular sale of the assessee. The relevant facts to the issue are that ld. AO noticed that during the year under consideration, the assessee has declared sales turnover to the tune of Rs. 19,85,47,600/- whereas as per 26AS details sales turnover declared by the assessee to the GST department was Rs. 19,90,07,490/-. Hence there was a difference of Rs. 4,59,890/- between the turnover declared by the assessee in its ROI filed with the revenue and turnover declared by the assessee in its GSTR-3B return filed with GST department.

Ld. AO alleged that the assessee did not provide any justification as to why there was a difference in turnover declared by it in Income tax return and GST return. Thus, the assessee was asked to reconcile and explain the difference by issue of show cause notice. In reply to the Show Cause Notice dated 21.02.2024, the assessee submitted that the difference was due to sale of fixed assets which was shown in books under the relevant head of 'Fixed Assets' in Balance sheet and thereby reconciled that turnover figure. Ld. AO noted that the assessee did not furnish any supporting documents in support of its claim. In the absence of any claimed the expenditure incurred during the year, the difference in turnover, i.e. Rs. 4,59,890/- was added back to the returned income of the assessee.

When the matter carried to ld. CIT(A) he has confirmed the addition by holding that “I find there is no reflection of sale of fixed assets in the profit & loss account in the I.T Return. Therefore, I do not find any infirmity in the order of the AO in making addition of difference of Turnover i.e. Rs.4,59,890/- with the returned total income.”

While arguing ground no. 2 the ld. AR of the assessee submitted that neither the lower authority has appreciated the facts of the case nor commented upon as to why the reconciliation of turnover as reflected in the GST record and in the books is not correct. But he simply confirmed the addition of Rs. 4,59,890/- on the ground that sales disclosed in the trading account (audited) was only Rs.19,84,96,990/- whereas in the GST return, the same was Rs. 19,90,07,490/-.

While assessment proceedings, the discrepancy was explained by the assessee stating that this was because there were sales of Rs.

5,10,500/- of fixed assets, which was not part of trading account. A chart reconciling the discrepancy was submitted during assessment proceedings, the assessment order which is reproduced herein below:-

Both the lower authority confirmed that addition on the grounds that the assessee could not support this contention with the evidence and therefore, the difference of turnover was added as income of the assessee.

The above reconciliation so relied and available on record shows that both the turnover will never match as the GST records shows the business sales plus capital assets sales. Whereas in income tax turnover for business sales is routed through the Profit and loss account and sale of capital ld. AO derived the difference of Rs. 4,59,890/- plus other income of Rs. 50,605/- as reflected in the above chart if added the actual difference to Rs. 5,10,495/- and the assessee shows they sold the vibrating machine sales and electric transformers for that amount of Rs. 5,10,500/- as reflected.

Thus while reconciling the turnover of the GST both records need to be considered which is getting verified from the records already placed on record. Therefore, we see no reasons to confirm that addition and therefore, the same is directed to be deleted. Based on this observation, ground no. 2 raised by the assessee is allowed.

The brief facts on the issue are that the ld. AO noted that during the year under consideration, the assessee company has availed fresh unsecured loan of Rs. 10,24,75,690/- from its directors or shareholders. In response to the notice u/s 142(1) of the I.T. Act, the assessee furnished ledger, copy of ITR and bank account statement in confirmation of loan availed. The assessee vide its response to SCN also, furnished all the details for those 120 loan creditors. But ld. AO noted that the genuineness of the transaction assessment proceeding ld. AO to test check those loan creditors a letter u/s. 133(6) of the Act was issued to 8 persons, out of 120 creditors. In that letter issued to those 8-person ld. AO asked them to provide the ledger of the assessee in their books of account, bank statement along with other details were sought and the compliance was to be made by 10.02.2024. In response to the notice issued u/s 133(6) of the Act, replies have been received from all the above 8 persons.

On examination of the bank account statement of the lenders, ld. AO noticed that lending of unsecured loan to the assessee is done in an unusual manner and thereby he discussed all that observation in the assessment order that there are transaction of exact value or near to the value is deposited in the lender's bank account and immediately transferred to the bank account of the assessee. He also noted that all the transactions in the bank account of the lender were very small monetary value, and they have filed the ITR in the range of Rs. 3,00,000/- to Rs. 4,00,000/-. ITR and bank account statement of some of the lenders submitted by the assessee were reproduced in the order of the assessment vide page 6 to 28 by the ld.

AO. On that test check result ld. AO noted that all the lenders have acted as accommodation entry providers as the creditworthiness of the lenders and are not normal business transactions. The assessee also did not explain the nature of these unsecured loans nor furnished complete documents.

Therefore, it is reasonably concluded that the unsecured loans to the tune of Rs. 10,24,75,690/- are nothing but accommodation entries. Having observed so ld. AO issued a show cause notice dated 21.02.2024 and the assessee furnished the reply on 04.03.2024. Ld. AO considered the reply of the assessee and found that the same were not acceptable based on those reasons as discussed herein above. Hence, he holds that the transaction of accommodation entry in the form of unsecured loan to the tune of Rs. 10,24,75,690/- during the A.Y. 2022-23 and was added as the income of the assessee u/s. 68 of the Act.

When the matter was carried before the ld. CIT(A) he confirmed the addition on a different ground holding that the assessee failed to specify the purpose of loans without affording any opportunity to the assessee. Ld.

CIT(A) also taken a view to confirm that the addition is required to be confirmed as the assessee failed to explain the phenomenal fall in Gross profit and net profit without affording any opportunity to the assessee in this regard and he has not discussed as to whether the addition made u/s. 68 is not.

The assessee challenged that order of the ld. CIT(A) which was on the different finding than that of the ld. AO. To challenge that finding the assessee raised additional ground to challenge that finding. While doing so ld. AR of the assessee submitted that the ld. CIT(A) though indirectly admitted that all the unsecured loans are duly supported by the confirmation, Bank statement and ITR of the depositor and therefore, he has confirmed the addition without giving proper opportunity to the assessee on a difference facts and contention which were never confronted to the assessee. Be that it so may so the bench is of the view that when the assessee has provided the details so as to prove the identity, genuineness and credit worthiness there is no reason to sustain the addition on the other ground. The reasons discussed by the ld. CIT(A) were raised in the assessment order and the ld. CIT(A) has not given an opportunity to be heard to the assessee before holding so and even the ld. CIT(A) has not rejected the book results before commenting upon those results for challenging the gross profit and net profit supported by the audited books of accounts under the income tax Act as well as under the companies Act. ground ] submitted that the assessee proved that legal liability casted upon by the Act so as to prove the identity, genuineness and creditworthiness were proved by placing on record the confirmation [ paper book page 53- 172], bank statement [ paper book page 287-485] and ITR [ paper book page 173-286] which will prove the primary burden cast upon the assessee.

The assessee filed all the document by a paper book and ld. AO through the ld. DR did not object on any of the records and therefore, there is no reason to that the assessee has not filed all the records to prove the burden cast upon them. Even ld. AO issued 133(6) letters asking for the details which were complied by all the 8 parties out of 120 depositors details available with the ld. AO. The assessee further submitted that the use of funds obtained by way of unsecured loans were required to be used for acquiring an unit which was available on stress sale. But since the deal could not be materialized the assessee repaid those amounts so taken and for that ledger accounts were placed on record [ paper book page 486-609].

The assessee has also placed on record copy of bank account from where those loans were repaid [ paper book page 610-679]. Even the assessee placed on record the purpose of the taking huge loan by placing on record the agreement with Nakshatra Corporate Advisers Private Limited [ page to counter the other finding of the ld. CIT(A) that the assessee used the fund to reduce the gross profit and net profit because ld. CIT(A) has not commented upon the evidence so submitted about all the unsecured loan creditors. The bench feels that the additional evidence so filed is in support of the contention already on record. Thus, we admit those additional evidence and considered to decide the appeal because ld. CIT(A) has not given an opportunity to the assessee on this matter those record were not filed. As repayment issue is already discussed by the ld. CIT(A) [ page 85 last para] those records were not considered as additional evidence. As is evident from the record that the assessee has repaid all those unsecured loans which proves that loans were taken from the identified persons / entities. Ld. CIT(A) has not commented upon as to why and how when the assessee has placed on record all the documents which are required under law are not correct and he went on to confirm the addition on difference facts shows that even he has not commented on the veracity of the evidence placed on record. Considering the overall facts placed on record and as relied by the ld. AR of the assessee on the decision our own Hon’ble Rajasthan High Court in the case of Aravali Trading Co. V/s ITO (2008) 8 DTR (Raj) 199 wherein High Court held that ; Oliria Foods and Beverages Limited vs. ITO 21. Accordingly the Tribunal, and the Assessing Officer had seriously erred and misdirected themselves in law by not correctly appreciating the legal principle about necessity of establishing such nexus once the assessee has discharged his onus by proving the existence of the depositors and the depositors having accepted their deposits with the assessee. Once this onus is discharged the presumption raised under section 68 stands rebutted and it becomes burden of revenue to prove that source of such deposits is traceable to assessee before the same can be treated as undisclosed income of the assessee concerned.

Thus, we note that the assessee has proved discharge their burden and the revenue could not bring anything contrary no addition can be sustained as held by our own High Cout. Looking to the other aspect as argued that that the assessee has repaid all the unsecured loan so taken and therefore, even as held by Hon’ble Bombay High Court in the case of Principal Commissioner of Income-tax v. Bairagra Builders (P.) Ltd [2024] 164 taxmann.com 162 (Bombay) has held that ;

4. The record shows that the disallowance of the unsecured loans of Rs.40 Lakhs was based on search and seizure action conducted on one Mr. Praveen Kumar Jain during which he is said to have recorded a statement that he had provided accommodation entries to a few beneficiaries, one of which is the Respondent. The said statement was retracted after the search and seizure was completed. The statement recorded during the search and seizure, ignoring the retraction and other Oliria Foods and Beverages Limited vs. ITO documentary evidence brought to bear in the assessment, is the basis of the assessing officer treating the unsecured loans as fake.

5. The two companies that lent the unsecured loans namely, Javda India Impex Ltd. and Lexus Infotech Ltd. were said to be companies controlled by the said Mr. Jain. The assessing officer added the sum of Rs.40 Lakhs as unproven cash credit and correspondingly disallowed the interest amount on the said loan.

6. The CIT-Appeals, upon a review of the documentary evidence on the record, which included supporting bank statements, the identities of the directors of the two companies, the tax returns filed by those companies and the confirmation of loans given by the Respondent concluded that the disallowance of the loan as being fake ought to be reversed.

8. Having heard the Learned Counsels for the parties and having reviewed the record, we do not find this to be a fit case for an appeal, that raises any substantial question of law- a prerequisite for this Appeal to be entertained. This is not a case of accounting entries masquerading as purchase of goods or services. The evidence on record, has led to the questions of fact being answered concurrently in two rounds of review, in favour of the Respondent. Therefore, no substantial question of law arises in the matter, and therefore, the Appeal is dismissed. Respectfully following the judgment as referred and evidence placed on record we see no reason to sustain the addition of Rs. 10,24,75,690/-.

Thus, ground no. 3 & 4 and additional ground no. 1 & 2 raised by the assessee are allowed.

Ground no. 1 being technical becomes academic as we have considered the grounds of appeal on merits. Ground no. 5 being general does not require any finding.

Order pronounced in the open court on 17/04/2025.

Sd/- Sd/- ¼ Mk0 ,l- lhrky{eh ½ ¼ jkBksM deys'k t;UrHkkbZ ½ (Dr. S. Seethalakshmi) (Rathod Kamlesh Jayantbhai) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 17/04/2025 *Ganesh Kumar, Sr. PS आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. The Appellant- Oliria Foods and Beverages Limited, Jaipur 2. izR;FkhZ@ The Respondent- ITO, Ward 1(2), Jaipur 3. vk;dj vk;qDr@ The ld CIT 4. vk;dj vk;qDr¼vihy½@The ld CIT(A) विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत 5. 6. xkMZ QkbZy@ Guard File (ITA No. 1531/JP/2024) vkns'kkuqlkj@ By order,

सहायक पंजीकार@Aेेज. त्महपेजतंत