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2020 (2) TMI 789 - AT - Income Tax
Unexplained unsecured loan and interest - Addition u/s 68 - HELD THAT:- Lenders of assessee are income-tax assessees whose PAN have been disclosed, AO cannot ask assessee to further prove genuineness of transactions without first verifying such fact from income-tax returns of lenders.
In view of the foregoing, we are of the considered opinion, that addition sustained by the CIT (A) were not justified. Hence these grounds of appeal of the assessee are allowed.
Unexplained investment / expenditure - HELD THAT:- We find that the assessee has filed copy of acknowledgement of return of income, contra confirmation for Kalpesh K Gosalina incurred for compound wall, copy of bills and proof of payment made though cash book. The payment has been shown in balance sheet as capital expenditure. This expenditure is not claimed in Profit & Loss Account. Therefore, disallowance of it is not justified. The assessee has filed copy of Adinath Textile AND cashbook of Adinath Textile. Hence, source of expenditure is explained and expenditure being capital in nature cannot be disallowed. Accordingly, this addition is deleted.