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2018 (10) TMI 878 - AT - Income TaxAddition on account of un-explained loan - allegation that invester is engaged in providing accommodation entries to several beneficiaries with the help of several bank accounts opened in the name of several proprietary concerns and companies - Held that:- It is clear that assessee produced sufficient documentary evidences before AO to prove the ingredients of Section 68 of the Act. The AO, however, did not make further enquiry on the documents filed by the assessee. The AO has thus, failed to conduct scrutiny of the documents at assessment stage and merely suspected the transaction between the investor company and the assessee because some materials found during the course of search in the case of Sh. Aseem Kumar Gupta or his statement recorded, but these would not prove anything against the assessee. It is not reported, if any, cash was found deposited in the account of the investor before making investment in assessee company. Therefore, clearly prove that assessee discharged its initial onus to prove the identity of the investor company, its creditworthiness and genuineness of the transaction in the matter. Addition on account of unexplained loan deleted - decided in favour of assessee. Addition on account of income from house property - Held that:- AO has been increasing the rent 10% every year which is not justified, which was even as per Rent Control Act, the rent could be enhanced after three years. In the absence of any justification or reasons, we are of the view that rent should not be enhanced every year by the AO particularly without there being any evidence with the AO. We may not note that in AY 2009-10, AO has made the addition of ₹ 3,77,520/- on account of income from house property for both these properties after allowing statutory deduction. It appears that assessee did not challenge the same computation before the appellate authorities. Therefore, considering the past history of the assessee and the annual rental value decided by the AO in preceding AY 2009-10 at ₹ 3,77,520/- for both the properties, we set aside the orders of the authorities below and direct the AO to adopt the same amount as income from house property in a sum of ₹ 3,77,520/- and make addition accordingly. The addition is, therefore, restricted to ₹ 3,77,520/- instead of ₹ 4,36,036/-. This ground of appeal of the assessee is partly allowed.
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