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2016 (6) TMI 974 - AT - Income TaxReopening of assessment - investment from unexplained sources u/s. 69B - genuity of loan - Held that:- The reason and purpose for transferring the loan receivable from assessee to ‘Sanson Developers Properties’ by the lender San Finance Corporation as on 31-03-2006 is very important to come to conclusion and adjudicate this appeal to understand the entire factual matrix and pith and substance of the nature and substance of entire loan transaction which the assessee has not clarified. The assessee has merely stated that the loans are outstanding in the books of lender M/s San Finance Corporation while the fact of the matter is that the said San Finance Corporation by passing journal entry on 31-03-2006 has removed/erased the loan outstanding of ₹ 16,50,650/-- due from the assessee from its books of account and the amount of ₹ 16,50,650/- stood transferred to being receivable from ‘Sanson Developers Properties’ as on 31- 03-2006 and the receivable from assessee in books of San Finance Corporation was reduced to Nil as on 31-03-2006. It is almost after one year on 31-03-2007, the said amount of ₹ 16,50,650/- was transferred back to the debit of the assessee as being receivable by said San Finance Corporation by passing a journal entry on 31-03-2007 of the amount of ₹ 16,50,650/-. No clarification and explanation has been given by the assessee with respect to above entries. Revenue also has not made any enquiry and examination to understand the reason and purpose of transferring the entry by San Finance Corporation by debiting to the account of ‘Sanson Developers Properties’ as on 31-03-2006 with ₹ 16,50,650/- and removing the name of the assessee as borrower of the said loans from San Finance Corporation from its books of accounts as on 31-03-2006 and bringing the loan receivable from assessee to ‘Nil’ as on 31-03-2006 , before fastening liability on the assessee. Thus, in the interest of justice, this matter need to be set aside to file of the AO for de-novo enquiries and examination to bring on record the pith and substance of the nature of entire loan transactions undertaken by the assessee with the said San Finance Corporation to evaluate its genuineness. For reopening , it cannot be held that the A.O. has formed any opinion with respect to the investment made by the assessee in the flat in the Adarsh Co-operative Housing Society Limited. Information has been received by the Revenue that the assessee has invested an amount of ₹ 66,08,512/- and based upon that the Revenue has reopened the case and the notices has been issued within four years from the end of the assessment year by issuing notice u/s 148 and 142(1) of the Act dated 21st July, 2011 and since the Revenue has received cogent tangible material having live link/nexus with the reasons to believe that the income has escaped assessment , the return of income was originally processed and accepted u/s 143(1) and not u/s 143(3) r.w.s. 143(2) of the Act and the Revenue has re-opened the assessment within four years of the end of the assessment year, we hold that the Revenue has rightly invoked the provisions of section 147/148 of the Act and we uphold the reopening of the assessment. Decided partly in favour of assessee for statistical purposes.
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