9911796707
TMI Blog2024 (5) TMI 1443X X X X Extracts X X X X X X X X Extracts X X X X ..... cessed under the provision of Section 143 (1) of the Act. Thereafter, the case of the respondent-assessee was selected for scrutiny assessment and a notice under Section 143 (2) of the Act was issued. 3. Subsequently, on 28.03.2016, the Assessing Officer ["AO"] passed an order under Section 143 (3) of the Act determining the total loss of Rs. 5,10,62,730/-. While framing the assessment order, the AO made the following additions: - i) Addition of Rs. 89,37,613/- under Section 68 of the Act on account of sundry creditors which included Transearch Consultants Pvt. Ltd. ["TCPL"] ii) Addition of Rs.5 crores under Section 68 of the Act on account of unsecured loans from M/s. Maple Technology Ltd. ["MTL"], and M/s. Mari Gold Overseas Limited. ["MOL"] 4. Being aggrieved by the order of the AO, the respondent-assessee preferred an appeal before the Commissioner of Income-Tax (Appeals) ["CIT (A)"], who vide order dated 22.09.2017, partly allowed the appeal of the respondent-assessee. The CIT(A), out of the total addition of Rs. 89,37,613/- made by the AO on account of sundry creditors, deleted the addition of Rs. 71,37,613/- holding that the balance due to the respective parties was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eipt of funds by MTL from Divine Infracon Pvt. Ltd., therefore, in the absence of any material, it cannot be said that the respondent-assessee introduced its own unaccounted income as loan from MTL. 12. We have heard the learned counsels appearing on behalf of the parties and perused the record. 13. With regard to the first contention relating to the proof of genuineness of the amount of Rs. 18,00,000/- on account of sundry creditor namely, TCPL, the ITAT has made a categorical finding that the respondent-assessee had a running account with TCPL having substantial movement in the account of the creditor. It has also been held that the copy of the ledger account of TCPL which was filed before the AO manifested that against credit balance of Rs. 33,00,000/-, there were four debit entries amounting to Rs. 15,00,000/- and as such, a sum of Rs. 18,00,000/- was outstanding as on 31.03.2013, which was written off on 31.03.2014. The ITAT held that the addition of the said sum would amount to double addition, for the amount had been written off and was offered to tax. 14. In this context, we may refer to the order of the ITAT, wherein, in paragraph no. 7, while deleting the additions on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company have not been disturbed by the A.O. The decision in the case of CIT vs. Ritu Anurag Aggarwal (supra) would support the case of the assessee-company. The assessee-company has also written back the amount in question in subsequent year which is also supported by the ledger account of this party. Since the assessee-company has offered the same amount for taxation in subsequent year, therefore, if the said addition is maintained in the assessment year under appeal, it would amount to double addition. Otherwise also, it is a case of loss, therefore, when amount is surrendered subsequently for taxation, at the best, it could be a tax neutral exercise. Considering the totality of the facts and circumstances of the case, we do not find any justification to sustain the addition. We, accordingly, set aside the orders of the authorities below and delete the addition of Rs.18 lakhs. This issue is decided in favour of the assessee-company." 15. With respect to the second contention relating to the unsecured loan amount of Rs.5 crores on account of MTL and MOL, the ITAT noted that the respondent-assessee cannot be asked to prove the source of the source since the entire case of the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditor was having capacity to give loan of Rs.3.70 crores to the assessee-company. The assessee-company paid interest on these loans to the creditor, on which, TDS have been deducted. The A.O. accepted the claim of assessee-company and did not disallow interest paid on such loans. Both the creditors are unrelated and independent parties. In the case of M/s. Marry Gold Overseas Limited the amount have been returned in subsequent year and in the case of other creditor M/s. Maple Technologies Ltd., the assessee-company written back the amount in subsequent year and shown its income. Therefore, it would amount to double addition in assessment year under appeal. It is well settled law that assessee-company cannot be asked to prove source of the source. Even then the Director of both the companies in his statement confirmed that source of giving loans to the assessee-company was advanced return by M/s. Divine Infracon Pvt. Ltd. However, the A.O. did not believe the explanation of the creditor because copy of the Rent Agreement was not filed. The A.O. has summoned both the creditors under section 131 of the I.T. Act in order to verify the genuineness of the transaction in the matter. The A ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
