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2022 (10) TMI 787 - AT - Income TaxValidity of reopening of assessment u/s 147 - assessee availed the loan is an accommodation entry provider - HELD THAT:- Assessee did whatever it could do to comply with the query raised by the Assessing Officer. However, the Assessing Officer has simply brushed aside all the evidences filed by the assessee by stating that the entities from whom the assessee availed the loan is an accommodation entry provider. AO has not made any independent inquiry or brought any contrary material on record to disprove the evidences brought on record by assessee. Even, the assessment order does not reveal that the AO made any preliminary inquiry u/s 133(6) of the Act either with the lender or with the concerned bank to ascertain the genuineness of the loan transaction or to unearth the money trail. Without making any inquiry the AO cannot treat the loan transaction as non-genuine on mere conjuncture and surmises. More so, when the lender is an income-tax assessee. The least the AO could have done is to obtain necessary information from the Assessing Officer having jurisdiction over the lender. In any case of the matter, when the lender is an income-tax assessee, he can be hauled up in case he is unable to explain the source of fund from which he advanced the loan to assessee. The bona fide of the assessee is further proved from the fact that not only the assessee paid interest on the loan availed and deducted tax at source, but, the entire loan amount was repaid to the lender in the financial year 2013-14, even, prior to the completion of the original assessment and much before initiation of proceedings u/s 147 of the Act. Thus, addition made in the given facts and circumstances of the present case is unsustainable. Assessee appeal is allowed.
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