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2022 (4) TMI 1310 - AT - Income TaxAddition u/s 68 - interest free loan taken by the assessee - creditworthiness remains unproved to the satisfaction of the AO - HELD THAT:- As could be seen that the assessee has furnished various documentary evidences before lower authorities to establish the primary requirements of Sec.68. These documents have been listed in preceding para 5.2 and the copies of these documents have been placed on record. It could be seen that the assessee has received advances from Shri P. Ravi through banking channels on various dates. The assessee has even repaid amount of ₹ 5 Lacs to the lender during the year, lender has filed copy of PAN Card, confirmation letter and its bank statements. It could be seen that there are no cash deposits in the bank account of lender before advancing the amount to the assessee. The credits to assessee have been sourced by lender out of banking channels only. Similarly, the transactions with Abhishek Mundhra HUF are through banking channels. The copy of PAN and confirmation letter is on record. The loan has been partly satisfied in the subsequent year by repayment and transfer entries. The copy of Income Tax Return and bank statement is also on record. No cash transactions have been observed in the account of lender before transfer of money to the assessee. The last entity Mundhra Bullion Private Ltd. has confirmed the transactions. The transactions are through banking channels only. The copy of PAN and Income Tax return of the lender is on record. The perusal of bank statement would reveal that there are no immediate cash deposits and the payments to the assessee have been sourced out of banking channels only. On the basis of all these documents, it could be well said that the assessee had duly discharged the onus of establishing the identity of the lenders, their respective creditworthiness as well as genuineness of the transactions. So far as the allegations of Ld. AO that the loans are interest free is concerned, the circumstances under which the loans were obtained by the assessee was duly explained before lower authorities and the same has already been enumerated in preceding para 5.1. Therefore, the impugned additions, in our considered opinion, has rightly been deleted by Ld. CIT(A). Accordingly, the impugned order could not be faulted with. The revenue has relied on the decision of Hon’ble Supreme Court in the case of Pr.CIT Vs. NRA Iron & Steel Pvt. Ltd. [2019 (3) TMI 323 - SUPREME COURT] which is completely on different facts. In that case, the assessee had received share capital / premium and as per field enquiries, the investor entities were found to be non-existent entities. The primary onus as casted u/s 68 could not be discharged by the assessee and the entire transactions were held to be bogus and lacked credibility. The facts of the case before us are totally different wherein the entities have filed confirmation letters and filed requisite documents as required under law. The investor entities have appeared before Ld. AO in response to summons and confirmed the transactions. Therefore, the ratio of cited decision is not applicable here. - Decided against revenue.
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