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2022 (11) TMI 270 - AT - Income TaxAddition u/s 68 - Share application money from M/s. Talent Infoways Ltd. - Non discharge of onus with regards to identity of the party, creditworthiness of the party and genuineness of the transaction - HELD THAT:- In the case of Shir Mukesh Choksi [2011 (2) TMI 1399 - ITAT MUMBAI] and the companies run by him it has been established that they were engaged in providing accommodation entries to its beneficiaries, however, the statement recorded of Shri Mukesh Choksi, was not provided to the assessee despite various requests. It is the plea of the assessee that in absence of the aforesaid statement no cross examination could be done of Shri Mukesh Choksi. Since the additional evidence now filed before us was not examined by the AO and statement on the basis of which the reassessment proceedings were initiated was also not furnished to the assessee despite its requests, we deem it appropriate to remand this issue to the file of the AO for de novo adjudication. We direct the AO to provide the copy of statement of Shri Mukesh Choksi or any other person, which has been relied upon by the AO and also to examine the audited financials of M/s Talent Infoways Ltd. to determine the creditworthiness of the said entity. Since this issue is remanded for adjudication afresh, the assessee shall be at liberty to adduce any other evidence to support its case. AO shall also have the liberty to call for or examine any other documents/detail as may be necessary for complete adjudication of this issue. We order accordingly. As a result, ground No. 1 raised in assessee‟s appeal is allowed for statistical purpose. Addition towards interest on long-term loan with Shamrao Bank - HELD THAT:- As per the assessee, the amount towards interest on term loan with Shamrao Bank, which is pertaining to financial year 2003–04, was debited to its profit and loss account under the head prior period adjustments. Since, it forms of adjustments below the line of profit/loss before tax, therefore, the assessee has not claimed the said expenses while calculating the taxable income as the assessee has started the computation of business income/loss by considering profit/loss before tax and before the said prior period adjustment. In this regard, reference was made to the income tax return, computation of total income and profit and loss account of the assessee by the learned AR. After perusal of the aforesaid details, we agree with the submissions of the assessee and accordingly, direct the AO to delete the disallowance towards interest on long-term loan with Shamrao Bank. As a result, ground No. 2, raised in assessee's appeal is allowed.
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