2018 (6) TMI 1282 - AT - Income Tax

Addition made u/s 68 - onus to discharge the burden so cast upon assessee - Held that:- The proviso to section 68 of the Act was introduced by the Finance Act, 2012 w.e.f. 01/04/2013, thus, it would be effective only from Assessment Year 2013-14 onwards and not to the earlier years. The legislature did not introduce the proviso to section 68 of the Act with retrospective effect nor does the proviso so introduce states that it was introduce ‘for removal of doubts’ or that it is ‘declaratory’, therefore, it is not open to give it to retrospective effect by proceeding on the bases that the addition of proviso to section 68 is immaterial. Thus, we find merit in the argument of the ld. counsel for the assessee.

All documents submitted neither disproved by AO nor any evidence was brought on record to falsify the claim of the assessee or the authenticity of these documents. Thus, it can be said that the assessee discharged its onus as provided under section 68 of the Act.

The interest was paid through banking channel by the assessee on such loans. It is also noted that so far as the disallowance of interest portion is concerned, the same was deleted by the ld. FAA and has not been challenged before this Tribunal by the Revenue further fortifies the case of the assessee. The loans were repaid along with interest before the date of survey i.e. 17/10/2014 and no cash was found during survey further fortifies the claim of the assessee. All the concerned parties appeared before AO during remand proceedings, AO recorded their statement and nothing adverse was pointed out even Shri Pravin Jain himself appeared before the Ld. Assessing Officer and even during remand proceedings enquiries were carried out and no adverse remark was made by the ld. Assessing Officer. The assessee as well as the other parties furnished all possible documents evidencing that the loans are not bogus.

No cash was found deposited in the accounts of alleged six parties, thus in the presence of plausible explanation by the assessee, relevant material, and requirement of fulfillment of ingredients, enshrined in section 68 of the Act, we find that onus cast upon the assessee has been duly discharged - decided in favour of assessee