DY. CIT , CIRCLE-1, JAMSHEDPUR vs. JAI MANGLA SPONGE IRON PVT LTD,, JAMSHEDPUR

Shri Khub Chand Pandya, ld. Sr.DR is represented on behalf of the revenue and Shri Nitin Kumar Pasari, ld A.R. is represented on behalf of the assessee and.

It was submitted by the ld. Sr.DR that during the impugned assessment year 2015-16, the assessee had received ₹ 1.85 crores as interest free loan from Bipasa Vyapaar Pvt. Ltd. and an amount of ₹ 49.55 lacs from M/s Aradhana Goods Pvt. Ltd.. It was a submission that in the course of assessment, the Assessing Officer had issued notices under Section 133(6) and also called for details in respect of the said unsecured loans. The notices returned unserved. It was a submission that consequently, the Assessing Officer treated the same as DCIT Vs Jai Mangla Sponge Iron P Ltd. unexplained income of the assessee and held that the said two concerns were paper transactions. It was a submission that on appeal, the ld. CIT(A) had deleted the addition on the ground that the assessee had produced the returns of income of the two lenders and their balance sheets, Profit and Loss account accounts and relevant bank statements. It was a submission that as the creditworthiness of the two lenders were not proved, the addition as made by the Assessing Officer is liable to be confirmed and the order of the ld. CIT(A) reversed.

In reply, the ld. AR of the assessee drew our attention to the paper book filed wherein at page 46 is the confirmation of amounts wherein in respect of Bipasa Vyapar Pvt. Ltd., an amount of ₹ 1.85 crores has been shown. This amount has been repaid between 06/10/2020 and 08/10/2020. It was a submission that the loans have also been repaid to the said two concerns. In respect of Aradhana Goods Pvt. Ltd. also, the amount has been repaid on 06/10/2020 admittedly without any interest. It was a submission that the amounts have also been returned, the same should not be now treated as unexplained income of the assessee.

We have considered the rival submissions. A perusal of the order of the ld. CIT(A) shows that the ld. CIT(A) has considered the balance sheet, Profit and Loss account and the bank transactions in respect of two lenders. Before us also, the assessee has placed the ledger accounts showing the repayment of the said two interest free loans. As loans no more continuing in the hands of the assessee. There is no purpose in doing a postmortem study in respect of the two transactions. This being so as no specific error has pointed out in the order