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TMI Blog2019 (2) TMI 718X X X X Extracts X X X X X X X X Extracts X X X X ..... 68 of the I.T. Act on account of unexplained cash credit as the assessee failed to prove the identity, creditworthiness and genuineness of the said loan." 2. "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition u/s. 68 of the I.T. Act on account of unexplained cash credit despite the fact that the party from whom the alleged loan was received by the assessee was listed as hawala entry provider who indulged in providing accommodation entry of unsecured loans and related to Rajendra Jain and his group." 3. "On the facts and in the circumstances of the case the finding of Ld. CIT(A| that the AO has only discussed the facts of Rajendra Jain group and the AO has not appreciated the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee to show cause as to why loan taken from M/s Arihant Exports should not be disallowed and added to the total income. As per the assessment order the assessee filed his reply along with the bank statement, copy of ledger, affidavit of M/s Arihant Exports and confirmation of the loan provider. The AO however, discussed in detail the modus operandi of giving accommodation entries employed by the Rajendra Jain Group of cases. The AO thereafter mentioned that it has been conclusively established that the assessee had taken accommodation entry of unsecured loan. The AO added the amount of loan as well as interest paid on such loan to the total income of the assessee u/s 68 of the Act. In this way, addition of Rs. 1,18,49,567/- was made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opy of his bank statement reflecting loan given to the appellant. In order to make addition u/s 68 AO had to establish that either the transaction was not genuine or the lender did not have credit worthiness or his identity was not established. As mentioned in para 4.5 above, the genuineness of transaction and the identity as well as the creditworthiness of the lender have been established. It can be seen from the assessment order that the entire focus of the AO was on the modus operands adopted by Rajendra Jain Group of cases to provide bogus accommodation entry of loan. The main reason for making addition u/s 68 was on the basis of information provided by the Investigation Wing. (While the information provided by the Investigation Wing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the payments were made by a/c payee cheques which were encashed in the bank account of the petitioner in the regular course of business. We find that the petitioner has also paid interest on this loans after deduction of tax at source and TDS returns are also accordingly filed. There is no dispute in regard to the above. We find nothing to support the said contentions of the revenue. The revenue 's contention in the affidavit in reply has no merit. On the other hand, the loans appear to be taken in the regular course of business..........." 4.8 After considering the totality of facts, the rival submissions, applicable law and on the basis of discussions mentioned above I have come to a conclusion that nature and source of credit in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modus operandi of accommodation entries by Rajendra Jain Group. It is further noted that the A.O. has not made any independent enquiry of his own to prove that the impugned transaction is bogus. The ld. CIT(A) has given a finding that during the assessment proceedings following details were submitted: 1. Loan Confirmation from the lender. 2. PAN No. of the lender. 3. Copy of the Return of Income of the Lender which advanced the loan. 4. Copy of Bank account of (he Lender. 5. Copy of Bank A/c of the Assessee. 6. Affidavit of the lender. These have not been disputed by the Revenue. 9. From the above, it is clear that the assessee has discharged its onus. From the balance sheet of the lender, it is noted that it has substantial s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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