Loading judgment…
Facts
The Assessing Officer made an addition of Rs. 11,00,000/-, comprising Rs. 10,00,000/- from M/s. Olympic Corporation and Rs. 1,00,000/- from M/s. Ritesh Patel & Sons, treating them as unexplained cash credits under Section 68 of the Income Tax Act. These loans were received by the assessee in 2016.
Held
The Tribunal found that both amounts were repaid by the assessee before the filing of the return of income and prior to the completion of the assessment proceedings. Therefore, the Tribunal concluded that the addition made under Section 68 of the Act was not sustainable.
Key Issues
Whether the addition of Rs. 11,00,000/- as unexplained cash credits under Section 68 of the Income Tax Act, 1961, is sustainable when the amounts were repaid by the assessee before filing the return of income and completion of assessment proceedings.
Sections Cited
Section 68 of the Income Tax Act, 1961, Section 250 of the Income Tax Act, 1961, Section 143(2) of the Income Tax Act, 1961
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “B” BENCH, AHMEDABAD
Before: DR. B.R.R. KUMAR, VICE-MS. SUCHITRA R. KAMBLE
(Appellant) .. (Respondent) Appellant represented by : Shri Chetan Agarwal, AR Respondent represented by: Shri Veerbadram Vislavath, Sr DR Date of Hearing 13.01.2026 Date of Pronouncement 13.01.2026 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:-
Delay Condoned.
This appeal has been filed by the Assessee against the order dated 30.07.2025 passed by the Ld. Commissioner of Income Tax (Appeals), Ahmedabad-12 (‘Ld. CIT (A)’ in short), under Section 250 of the Income-tax Act, 1961 (‘the Act’ in short) for Assessment Year 2017-18.
The sole grievance raised by the assessee in its appeal reads as under:- “The Ld. CIT(A) as erred in law as well as on fact in upholding an addition of Rs.11,00,000/- made by the Ld. AO u/s 68 of the Act.”
The brief facts of the case are that the Assessing Officer made an addition of Rs. 10,00,000/- on account of loan received from M/s. Olympic Corporation and Rs. 1,00,000/- on account of amount received from M/s. Ritesh Patel & Sons, treating the same as unexplained cash credits u/s 68 of the Act. Notice under section 143(2) of the Act was issued on 10.08.2018. The assessee had filed its return of income on 31.10.2017 declaring a total income of Rs. 35,95,670/-.
We have carefully considered the submissions and examined the material placed on record. We find that the amount of Rs. 10,00,000/- was received from M/s.
Shaurya Developers Vs. DCIT Asst.Year :2017-18 - 2– Olympic Corporation on 13.07.2016 and was repaid on 24.05.2017. Similarly, the amount of Rs. 1,00,000/- received from M/s. Ritesh Patel & Sons on 28.07.2016 was repaid on 25.04.2017. It is an undisputed fact that both the amounts were repaid by the assessee before the filing of the return of income as well as before the completion of the assessment proceedings. In view of these facts and circumstances, we hold that the addition made u/s 68 of the Act is not sustainable.
In the result, the appeal of the assessee is allowed.
Heard, dictated and pronounced in open court on 13.01.2026