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Addition u/s. 68 - inguenity of loan - information from the Investigation Wing that the assessee has received accommodation entries - Held that:- There was only one loan taken by assessee from Moderate Credit Crop Ltd. by cheque no. 743431 & 743430 dated 18.08.2015 of ₹ 25 lacs each. The loan was repaid by cheque no. 230415 dated 28.04.2007 of ₹ 45 lacs and cheque no. 530345 dated 03.05.2007 of ₹ 5 lacs. Thus the loan was repaid 3 years before the date of statement taken by Investigation Wing of the Department from the CA Sh. Aseem Kumar Gupta in 2010. Therefore, the department should not take a wrong view of genuine loan taken by the party from another company M/s. Moderate Credit Corp. Ltd. and treat as bogus accommodation entry.

Therefore the addition made cash introduction to the bank account of M/s. Moderate Credit Corp. Ltd. before issuing cheque or no such other transaction however happened with that company. Hence, the genuine transaction made by the assessee company cannot be treated as a sham transaction. It of the opinion that this is a genuine loan transaction which has been repaid by the AO ₹ 50 lacs which was rightly been deleted by the Ld. CIT(A) which does not need any interference on my part, hence, uphold the order of the Ld. CIT(A) on this issue.

Also find that Ld. CIT(A) further observed in his impugned order that the loan is taken from non-related parties/company M/s. Moderate Credit Corp. Ltd. He further observed that it is strange to believe that any non-related party will given loan of ₹ 50 lakh without taking any interest from the appellant company. The loan period 7 months in this FY approximately. Hence he rightly estimated interest @1% per month (i.e. 12% per year simple interest rate) for the above 7 months on principal amount of ₹ 50 lacs which in this FY 2005-. CIT(A) had rightly add this ₹ 3,50,000/- as estimated interest paid by assessee company which was not shown in books of a/cs, and hence reduced the returned loss by this amount. Therefore, the observation of the Ld. CIT(A) that the net assessed loss after giving effect to this order will be Rs. (-) 15,15,832 + 3,50,000 = ₹ 11,65,832/-) is quite genuine and therefore, the addition made of ₹ 3,50,000/- by the Ld. CIT(A) is reasonable, hence, I upheld the same.


 

 

 

 

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