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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI VIJAY PAL RAO & SHRI B.M. BIYANI
आदेश / O R D E R
Per B.M. Biyani, A.M.:
Feeling aggrieved by appeal-order dated 12.03.2024 passed by learned Commissioner of Income-Tax (Appeals)-NFAC, Delhi [“CIT(A)”] which in turn arises out of assessment-order dated 26.11.2018 passed by learned ITO, Mandsaur [“AO”] u/s 143(3)/147 of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2011-12, the assessee has filed this appeal on the grounds as mentioned in Form No. 36.
The background facts leading to present appeal are such that the assessee-individual filed original return of AY 2011-12 declaring a total income of Rs. 2,97,470/- on 30.03.2012. Subsequently, the AO, on the basis of information received from ADIT(Inv)-I, Udaipur collected from a search u/s 132 upon Chetak Group of Nimbahera, re-opened assessee’s assessment u/s 147 vide notice dated 28.03.2018 u/s 148 and called assessee to file return. In response, the assessee requested the AO to treat the original return as having been filed in response to notice u/s 148. The AO accepted assessee’s request. Thereafter, the AO issued notices u/s 143(2)/142(1) to scrutinize assessee’s case. Ultimately, the AO completed re- opened assessment vide order dated 26.11.2018 u/s 143(3)/147 after making two additions, namely (i) addition of Rs. 25,61,500/- on account of unsecured loan given to M/s U.B. Investment (prop. Shri Vikram Anjana), and (ii) addition of Rs. 1,00,000/- on account of unsecured loan given to M/s Uday Bheru Lal Anjana (proprietor Shri Manohar Lal Anjana).
Aggrieved, the assessee carried matter in first-appeal and raised objections against validity of proceeding done by AO as well as merits of the additions but did not get any relief. Now, the assessee has come in next appeal before us assailing the orders of lower authorities.
Ld. AR for assessee made a vehement submission attacking the legality of proceeding done by AO as well as the merits of additions made by AO. Per contra, Ld. DR relied upon orders of lower-authorities.
Having heard learned Representatives of both sides and after perusing case record, we find that the AO re-opened assessment of assessee after recording following reasons:
Thus, the basis of re-opening adopted by AO was an information received from ADIT(Inv.)-1, Udaipur that the assessee has provided a bogus loan of Rs. 4,00,000/- during the financial year 2010-11 to Shri Vikram prop. of M/s U.B. Investment. Ld. AR for assessee submitted that the assessee has not given any loan during the financial year 2010-11 and the allegation made by AO is factually wrong. Ld. AR carried us to the assessment-order passed by AO to demonstrate that since there was no loan of Rs. 4,00,000/- given by assessee, the AO was unable to make any addition qua the alleged loan transaction of Rs. 4,00,000/-. The AO, however, made addition of loan of Rs. 25,61,500/- given to M/s U.B.
Investment and loan of Rs. 1,00,000/- given to Shri Manohar Lal Anjana proprietor of M/s Uday Bheru Lal Anjana even those loans were also given in earlier year which is evident from the A/c Confirmations filed to AO and also placed in Paper-Book. The department is not able to file any evidence to show that a loan of Rs. 4,00,000/- as alleged in the reasons was given by assessee during financial year 2010-11. In that view of matter, the reason recorded by AO is incorrect and consequently, the re-assessment proceedings taken by AO based on such incorrect reason is not sustainable.
Hence, we quash the order of re-assessment passed by AO. The assessee succeeds in this appeal.
Resultantly, this appeal is allowed.
Order pronounced in open court on 07.10.2024.