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2018 (11) TMI 590 - ITAT INDOREUnexplained cash credit - establishment of identity of creditors - Held that:- It is also evident from the perusal of the record that all the four companies are regularly assessed to tax and their assessment u/s 143(3) have been framed for AY 2006-07 and copies of the same are placed. They carry regular business activities and have sufficient funds for giving on credit towards interest. Identity of four companies are well established. Genuineness is duly proved by the transactions which are made through account payee cheque. All necessary details including bank statement/ financial statements, confirmation of account, PAN detail have been filed with these four companies and are placed on record at all proceedings are sufficient to prove the creditworthiness. The alleged unsecured loan of ₹ 1,02,00,000/- and ₹ 1,25,00,000/- were accepted during the year and were repaid also during the year which supports the contention of the assessee that the alleged loans were taken for business needs and were repaid back when the funds were available. Respectfully following the decision of ACIT V/s Girish Kumar Sharda (2014 (10) TMI 352 - ITAT INDORE) as well as detailed finding of fact by CIT(A) which is unconverted by the Ld. Departmental Representative as no material evidence has been placed to prove anything contrary. Therefore we find no infirmity in the finding of CIT(A) deleting the addition of ₹ 1,02,00,000/- and ₹ 1,25,00,000/- for alleged unsecured loans and also deletion of disallowance of interest on such loans at ₹ 6,14,855/- and ₹ 5,55,815/- and also deleting the addition for undisclosed expenditure of ₹ 5,25,000/- and ₹ 6,25,000/-. We accordingly dismiss Revenue’s Ground No.1, 2 &3 for Assessment Year 2006-07 and 2007-08 respectively. Nature of income - Rental income earned - house property or busniss income - Held that:- The alleged receipts of ₹ 26,87,635/- are purely rental income from renting out unsold property and manner of earning such income is purely taxable under the head income from house property and by no canon can be treated as business income and therefore the assessee is eligible for deduction u/s 24 of the Act @30% of the rental income which in this case is ₹ 7,92,350/-. The plea of the assessee further finds support that in the subsequent years this claim of the assessee of showing rental income of house property and claim of deduction u/s 24 has been consistently allowed by the revenue authorities. We therefore set aside the finding of CIT(A) for Assessment Year 2006-07 and allow the sole ground No.1 raised by the assessee.
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