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TMI Blog2024 (12) TMI 1326X X X X Extracts X X X X X X X X Extracts X X X X ..... n the facts and circumstances of the instant case. 3. We have heard the rival submissions and perused the materials available on record. The assessee company is engaged in the business of real estate. The return of income was filed by the assessee company on 14.3.2022 declaring total income of Rs Nil. A search and seizure action u/s 132 of the Act was carried out on 14.10.2020 in the case of Shri Manoj Kumar Singh, his associates and various transacting parties. During the course of search proceedings, it was established that Shri Manoj Kumar Singh entered into unaccounted cash transactions with the various persons / entities. Search operation u/s 132 of the Act was also carried out on 14.10.2020 at the office premises of the assessee. During the course of search proceedings, incriminating documents were found and seized. The ld AO observed during the course of assessment proceedings that assessee has shown unsecured loans received from M/s Dreamland Buildshoppe Pvt Ltd as under:- Opening Balance - 35,66,77,042 Less: Repaid - 42,06,02,042 Add: Fresh loans recd - 31,22,50,000 Closing Balance - 24,83,25,000 4. Notice u/s 133(6) of the Act stood issued to this lender on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the lender company is still exploring business opportunities and meanwhile conveniently providing unsecured loan entries through bank to the assessee company and its related entities. Shri Sunil Srivastava however confirmed that the lender company had provided unsecured loan of Rs 31,22,50,000/- during the year to the assessee company. The ld AO observed that Shri Sunil Srivastava in his statement had stated that administrative decisions of lender company are being taken by Shri Manish Uppal (Director of assessee company). Shri Sunil Srivastava also stated in his statement that there was no loan agreement, no internal discussion papers before deciding to granting loan, no workings done for the same etc . Hence the ld AO observed that the nature and purpose of granting loan to the assessee company could not be proved by Shri Sunil Srivastava. 6. The assessee in response to the show cause notice issued by the ld AO replied by stating that the unsecured loans were received from the lender company through regular banking channels. Further the lender company received a sum of Rs 25 crores from Uppal Hotels Pvt Ltd on 1.1.2021 and the said sum was given by lender company to the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were made by the AO through Inspector during the impugned assessment proceedings for the as well and it was found that the company was not available at the given address. The Inspector's report has been reproduced by the Assessing Officer in para-5.4 The AO further observed that the said company has also not shown any income in its Income Tax Return and has no credible assets available in the books to justify the quantum of loans given by it. The Assessing Officer has further noted that the appellant has shown only interest income in its Income Tax Return in A.Y. 2019-20(Rs.69,16.187/-), 2020-21 (Rs. 10,26,370/-) and has shown loss of Rs. 33,807/ in the A.Y. 2021-22. The statement of Director of the creditor company Shri Sunil Srivastava who is also General Manager (Co-ordination) in the assessee company was recorded during the assessment proceedings and it was noted that the creditor company M/s. Dreamland was incorporated in the year 2008 with an objective to carry out real estate business but no such activity has been carried out by it so far. The company is controlled by Mr Manish Uppal and it is being used for routing of funds. It has no business activity of its own. Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee company to substantiate the finding of the Assessing Officer that the amount received by it from M/s. Dreamland Buildshoppe Pvt. Ltd. is not genuine, further there is no statement or evidence to allege that the unsecured loan received is any form of accommodation entry, routed through cash deposit or the layering of unaccounted income. The Director of the creditor company M/s. Dreamland Buildshoppe Pvt. Ltd. attended the assessment proceedings and has recorded his statement in which he had confirmed unsecured loan given by M/s. Dreamland Buildshoppe Pvt. Ltd. to the assessee company. Accordingly, the appellant submitted that the test of Section 68 viz identity creditworthiness of the creditor and the genuineness of transaction has been fully satisfied. 8..3 The observations of the Assessing Officer and the written submission of the appellant have been carefully perused. It is observed that the appellant has regular transactions receipt and repayment loans) with M/s Dreamland Buildshoppe Pvt. Ltd. The appellant has also submitted the bank statement of M/s. Dreamland Buildshoppe Pvt. Ltd. for the relevant period to explain the immediate source of funds in the books of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO u/s 68 of the Act amounting to Rs31,22,50,000/ is deleted." 9. Admittedly, the assessee is having running account with the lender company. The ledger account of the lender for the period 1.4.2015 to 31.3.2021 is part of the record. No adverse inferences were drawn with regard to unsecured loans received from the very same lender company in the scrutiny assessments completed u/s 153A or 143(3) of the Act except in Asst Year 2017-18, where an addition was made u/s 68 of the Act which stood deleted by ld CIT(A). On further appeal by the revenue to this Tribunal for Asst Year 2017-18, the same was dismissed by the Tribunal in ITA No. 1703/Del/2022 dated 4.1.2024 on merits of the addition u/s 68 of the Act. From the documents placed on record by the assessee before the lower authorities and also before us, it is evident that the assessee company in the instant case had duly proved the source of source of lender company by stating that the funds had been received by the lender company from the group companies of assessee (i.e Uppal Projects Pvt Ltd and Uppal Hotels Pvt Ltd) . These details are given in tabular form in Page 34 of the order of ld CIT(A) which is part of reproductio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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