ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE - 6, PUNE vs. M/S. SHIRDI COUNTRY INNS PVT.LTD, PUNE

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ITA 130/PUN/2018Status: DisposedITAT Pune04 July 2022AY 2013-145 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that the CIT(A) should have sought the AO's comments on the additional evidence before deleting the addition. The matter was set aside and restored to the AO for fresh adjudication.

What were the facts?

The Assessing Officer made an addition of Rs. 8,32,12,400/- on account of unsecured loans from four parties. The assessee failed to furnish complete details to prove the genuineness, identity, and capacity of the lenders. The CIT(A) deleted the addition based on additional evidence without seeking the AO's comments.

What were the issues?

Whether the CIT(A) was justified in deleting the addition on account of unsecured loans without seeking the AO's comments on the additional evidence filed by the assessee.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH, ‘A’ PUNE

Before: SHRI R.S. SYAL & SHRI S.S. VISWANETHRA RAVI

For Appellant: Shri Hari Krishan
For Respondent: Shri Kalika Singh

आदेश / ORDER

PER R.S. SYAL, VP : This appeal by the Revenue is directed against the order dated 29-09-2017 passed by the CIT(A)-4, Pune in relation to the assessment year 2013-14. 2. The only issue raised is against the deletion of addition of Rs.8,32,12,400/- made by the Assessing Officer u/s. 68 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’).

M/s. Shirdi Country Inns Pvt. Ltd.,

3.

Briefly stated, the facts of the case are that the assessee is engaged in the business of Hotels and Hospitality. The Assessing Officer (AO) observed during the course of assessment proceedings that the assessee had shown to have received unsecured loans amounting to Rs.8,32,12,400/- from 4 parties namely, (1) L.K. Corporation – Rs.3,63,12,400/-; (2) Saroj Holding – Rs.2,56,00,000/-; (3) K.R. Chem (Rajesh Srichand Jeswani) – Rs.1,06,50,000/-; and (4) St. Laurn Hotels Pvt. Ltd. – Rs.80,00,000/-. The assessee was called upon to furnish confirmations, returns of income, balance sheet and statement of the lenders. The assessee could not furnish such details except confirmation of unsecured loans and submitted that the parties have denied to produce the computations and returns of their income. The AO discussed all these 4 unsecured loans one by one and observed that in two cases, the jurisdictional AOs of the concerned alleged lenders, reported that they had not filed the income-tax returns. Consequently, addition of Rs.8.32 crore was made. The assessee furnished additional evidence before the ld. CIT(A) in support of the genuineness of these four creditors.

1.

M/s. Shirdi Country Inns Pvt. Ltd., Getting convinced, the ld. CIT(A) deleted the addition. Aggrieved thereby, the Revenue has come up in appeal before the Tribunal.

4.

We have heard both the sides and gone through the relevant material on record. It is seen that the assessee, despite specific requisition by the AO, failed to furnish complete details to prove the genuineness of the transactions, Identity and Capacity of the four creditors under consideration. The assessee furnished relevant evidence before the ld. CIT(A) in order to prove the genuineness of the transactions, who, without calling for any remand report from the AO, simply deleted the addition. In our considered opinion, the present backdrop of the facts warranted the ld. CIT(A) to seek comments of the AO on the additional evidence filed by the assessee before deleting the addition.

Without going into the merits of the genuineness of the creditors or otherwise individually, we are of the considered opinion that it would be in the fitness of things if the impugned order is set aside and the matter is restored to the file of the AO. We order accordingly and direct him to decide this issue afresh as per law after allowing reasonable opportunity of hearing to the assessee.

The assessee in such proceedings will be at liberty to file any M/s. Shirdi Country Inns Pvt. Ltd., fresh evidence in support of the genuineness of the creditors as it feels expedient.

5.

In the result, the appeal is allowed for statistical purposes. Order pronounced in the Open Court on 04th July, 2022.

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