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Facts
The assessee took a loan of ₹50,00,000/- from M/s Madhudhan Barter Pvt. Ltd., providing loan confirmation, PAN, address, and audited balance sheet. The loan was repaid through banking channels. The AO added this amount as unexplained cash credit under Section 68, deeming the lender a shell company, and the CIT(A) confirmed the addition.
Held
The Tribunal held that once the assessee provides all necessary evidence regarding the loan's genuineness and its repayment through banking channels, and the AO fails to point out any specific infirmity, no addition under Section 68 is warranted.
Key Issues
Whether the addition of a loan amount under Section 68 is valid when the assessee provides documentary evidence of its genuineness and repayment, and no defects are identified by the AO.
Sections Cited
68, 147, 148, 139(5)
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Income Tax Appellate Tribunal, “D” BENCH, KOLKATA
Before: SHRI RAJESH KUMAR, AM & SHRIPRADIP KUMAR CHOUBEY, JM
This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 20.08.2025 for the AY 2018-19.
The only issue raised in the various grounds of appeal is against the confirmation of addition of ₹50,00,000/- by the ld. CIT (A) as made by the ld. AO u/s 68 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) in respect of loan taken from M/s Madhudhan Barter Pvt. Ltd.
The facts in brief are that the assessee filed the revised return of income u/s 139(5) of the Act on 07.02.2019, declaring total income at ₹2,50,05,800/-. The assessee also showed exempt income of
In the appellate proceedings, the ld. CIT (A) confirmed the order of the ld. AO.
After hearing the rival contentions and perusing the materials available on record, we find that the assessee has raised loan from M/s Madhudhan Barter Pvt. Ltd. during the year and filed before the
In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 26.02.2026.