TMI Blog2024 (4) TMI 593X X X X Extracts X X X X X X X X Extracts X X X X ..... no. 1 of the appeal is dismissed. Addition u/s 68 - onus to prove the identity, creditworthiness of the lender and genuineness of the transaction - Assessee produces material to discharge onus cast up on it in reassessment proceedings showing identity and creditworthiness of the lender as well as genuineness of the Transaction. If we hold that such material is enough, it will result in to blurring distinction between reopening of an assessment and reassessment of income. Reopening is door to make a reassessment. Assessee has accepted a loan from Sarwaria Investments Consultants Pvt. Ltd. To prove the identity of the above company, assessee has submitted the PAN No. of the lender as well as the fact that it is assessed with ITO, ward 2(1), Kolkata. With respect to the credit worthiness of the above loan, assessee has submitted the copy of the bank account of the lender with IndusInd bank. In the bank account when the loans were given to the assessee company, lender had received the sum from other entities. With respect to the genuineness of the transaction, assessee has submitted the copy of account of the lender from the books of the assessee and the confirmation of the lender fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e basis of borrowed satisfaction and without having reason to believe of escapement of income; 2. ON facts and circumstance of the case and in law, Learned. CIT(A), on ignoring the direct evidences, erred in confirming the addition under Section. 68 of ₹1,00,00,000/-, though the appellant had proved the identity and credit worthiness of the lender and genuineness of short term loan received from M/s. Sanwaria Investment Consultants Pvt. Ltd; 3. The Learned. CIT(A) erred in confirming the addition of ₹ 1,00,00,000/- under a serious mistaken belief that the appellant had agreed with the addition proposed under Section 68, irrespective of the fact that the appellant had never admitted of any such addition; 4. The Learned. CIT(A), before sustaining the addition under Section 68 of loan received of ₹ 1,00,00,000/-, erred seriously in brushing aside the understated vital facts, being; a) The exhaustive documentary evidences, being Ledger, Confirmation, PAN, CIN, Own bank statement, TDS certificate, I.T return, bank statement and balance sheet of lender and TDS certificate for interest payment to prove the identity, genuineness and credit-worthiness of the lender had not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w the receipt of loan and Bank A/c to show the repayment of the above sum. f. The assessee repaid Rs. 50,00,000 on 25th May 2015, and further ₹50,00,000/- on 1st September 2015. g. Form No. 26AS of the lender to show that assessee has paid interest to the lender of Rs. 3,40,274 on which tax of Rs. 34,028 was deducted at source. h. Bank A/c of the lender with IndusInd bank to show that the amount of investment made by the lender in the assessee company was available. i. Source of loan of Rs. 50,00,000 on 29th September, 2014 was received from Gujarpur Marcomm Pvt. Ltd. of the same amount and Rs. 50,00,000 given on 4th October, 2014, as the source of ₹2 Crore received from Paul Tree Deal makers Pvt. Ltd. j. Bank account of the lender for repayment of loan by the assessee. k. Copy of income tax return filed by the lender on 30th March 2016 wherein total income of Rs. 5,02,950/- was disclosed. l. The annual accounts of the lender was also shown where the total of assets were shown to be ₹7,86,00,000/-. In the Profit and loss account the revenue of the lender was shown at Rs. 33,14,000/-. ix. Thus, the assessee submitted that it has discharged initial onus under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modation entry provider. He also named the beneficiaries of such accommodation entries. The assessee was also found as beneficiary having received ₹1,00,00,000/- in two trenches from one of the group company of Mr. Dilip Kumar Gupta namely Sarwaria Investments Consultants Pvt. Ltd. of ₹50,00,000/- each. Based on this information received from investigation wing, while recording the reasons, the learned AO categorically mentions that escapement of income has arisen on account of failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment. However, assessee has already assessed under Section 143(3) of the Act on 29th December 2017. However, the search on Mr. Dilip Kumar Gupta, his statement and information about accommodation entries received by the assessee from Sarwaria Investments Consultants Pvt. Ltd. as a result into formation of belief that income of the assessee has escaped assessment cannot be found fault with. The learned Assessing Officer has received a tangible material and therefore, found if the assessment under Section 143(3) of the Act has been made, the reopening of the assessment on receipt of new inform ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted the copy of account of the lender from the books of the assessee and the confirmation of the lender from the books of lender providing copy of account of the assessee. The bank account of the lender and bank account of the assessee is also shown at the time of taking of the loan and on repayment of the loan. Form no. 26 AS, which is the annual tax statement of the lender, also shows that assessee has paid interest to the lender of ₹3,40,274/- on which tax of ₹37,028/- is deducted. In view of the above information provided before the lower authorities it is clear that assessee has discharged its initial onus to prove the identity, creditworthiness of the lender and genuineness of the transaction as per provision of Section 68 of the Act. 012. On receipt of such information, the learned Assessing Officer did not conduct any enquiry but has merely relied upon the information contained in the reasons for the reopening of the assessment. Such information is valid as far as giving gateway to the Revenue for the reopening of the assessment. For making reassessment, the learned Assessing Officer should have made a fresh inquiry on the same. Failure of the learned Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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