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Judgment
PER SUDHIR KUMAR, JUDICIAL MEMBER:
This appeal by the assessee is directed against the order of the Commissioner of Income Tax Appeals Addl/ JCIT Agra [hereinafter referred to as “Ld. CIT(A))”] vide order dated 25-08-2025 pertaining to A.Y. 2014-15 arising out the assessment order dated, 30-12-2016 u/s 143(3) of the Income-tax Act, 1961, (in short ‘the Act’).
The assessee has raised the following grounds in appeal as under:
1.Order passed by the Learned Commissioner of Income Tax (Appeals) (hereinafter referred to as “Ld. CIT(A) ) for the AY 2014-15 is bad in law and on the facts.
2.That on the facts and circumstances of the case the Ld. CIT(A) has erred in sustaining addition of Rs. 58,00,000/-u/s 68 of the Income-Tax Act,1961 despite providing all the necessary details of lenders i.e. Proof of identity, PAN acknowledgement of filing income tax returns, Jurisdiction, loan/balance confirmations affidavit and bank statement and totally ignoring the fact that all loans have been repaid in the next year itself i.e. A.Y.2015-16, before the receipt of any notice from the Income Tax department.
3.The appellant craves leave to amend delete or add any grounds of appeal before or during the course of hearing of the appeal.
The brief facts of the case are that the assessee is an individual and filed her return of income on 29-07-2014 declaring total income of Rs.5,81,520/-for the A.Y.2014-15. The case was selected for Scrutiny through CASS. Statuary notices u/s 143(2) of the Act were issued to the assessee on 18-09-2015 & 24-09-2015. Again, notice under section 142(1) of the Act along with questionnaire was issued to the assessee. According to AO the assessee had borrowed unsecured loan of Rs. 3,12,50,000/- as on 31-03-2013 and Rs.3,91,50,000/- as on 31-03-2014 from various parties. The Ld. AO directed the assessee to submit the complete address of the lenders. In the compliance of the notices the ld. AR furnished the details of the lenders. The Ld. AO found that the assessee has failed to establish the creditworthiness of the lenders and genuineness of loan. The Ld. AO completed the assessment after considering the submission furnished by the assessee, after making the additions of Rs.58,00,000/- treated undisclosed income of the assessee.
Aggrieved the order of the AO, the assessee preferred the appeal before the Ld. CIT(A) who vide his order dated 25-08-2025 dismissed the appeal of the assessee.
Being aggrieved the order of the Ld. CIT(A) the assessee is in appeal before the Tribunal.
6 Ld. AR of the assessee submitted that the assessee had discharged initial burden by providing identity of all creditors by giving their complete addresses, Permanent account number, confirmation of loan, photo copy of the Bank account statement, confirmation of repayment and copy of the acknowledgement of the ITR. He further submitted that the loan was received through banking channel and repayment also made through payee cheques. The assessee has established the genuineness of the transaction. Reliance is placed on the following decisions:
Deputy Commissioner of Income -Tax v. Rohini Builders [2003]127 taxman 523 (Gujarat)
Principal Commissioner of Income-tax v. KRBL Infrastructure Ltd. [2025]180 taxmann.com 502(Delhi)
ITO v. Habitat Infrastructure Ltd. ITA No. 6155/Del/2015
Principal Commissioner of Income -tax v. Bairagra Builders (P.) Ltd. [2024]164 taxmann.com 162 (Bombay)
In the case of Commissioner of Income-tax, Rajkot-I v. Ayachi Chandrashekhar Narsangji [2014]42 tasmann.com 251 (Gujarat) the Hon’ble High Court Held that
6.Having heard Shri Pranav Desai, learned Counsel appearing on behalf of the revenue and on perusal of the order passed by the CIT(A) confirmed by the ITAT, it appears that CIT(A) was satisfied with respect to the genuineness of the transaction and creditworthiness of Shri Iswar Adwani and, therefore deleted the addition of Rs.1,45,00,000,/- made by the Assessing Officer. It is required to be noted that as such an amount of Rs.1,00,00,000/- vide cheque no.102110 and an amount of Rs. 60 Lakh vide cheque no.196102111 was given to the assessee and out of the total loan of Rs.1.60 crore, Rs.15 lakh vide cheque no.197107 was repaid and therefore, an amount of Rs.1,45,00,000/- remained outstanding to be paid to Shri Ishwar Adwani in the immediate next financial year and the Departments has accepted the repayment of loan without probing into it. In the aforesaid facts and circumstances of the case, when the ITAT has held that the matter is not required to be remanded as no other view would be possible, we see no reason to interfere with the impugned order passed by the ITAT. No question of law, much less substantial question of law arises in the present Tax Appeal. Hence, the present Tax Appeal deserves to be dismissed and is accordingly dismissed.
The Ld. Sr. DR relied upon the order of the lower authorities. We have heard both the parties and perused the material available on record. Ld. CIT(A) has observed in his order as under:
“8. Conclusion
8.1After careful consideration of the assessment order the grounds raised in appeal, the submission and documents furnished by the appellant and the legal arguments advanced it is evident that the appellant has failed to discharge the primary onus cast upon her under section 68 of the Income Tax Act, 1961. The identity of the creditors may have been established through basic documentation but their creditworthiness and the genuineness the loan transactions have been proved.
8.2The material on record demonstrates a clear, anomaly sudden deposits in the lenders’ bank account followed by immediate transfer to the appellant, uniformity in affidavits and confirmations suggesting orchestrated paperwork, non-compliance with summons and adverse findings in the Inspector’s field inquiry. The appellant’s arguments regarding repayment in subsequent year and lack of coercive powers to compel lender’s attendance cannot override these substantive deficiencies. Judicial precedents relied upon by the appellant are distinguishable on facts, as in those cases identity creditworthiness, and genuineness stood independently demonstrated which is not the situation here.
8.3In view of the foregoing discussion, all grounds of appeal raised by the appellant fail. The addition of Rs. 58,00,000/-made by the Assessing Officer under section 68 of the Act is hereby confirmed. The assessment order passed u/s 143(3) dated 30-12-2016 is sustained to this extent.
9. Order
In the result, the appeal filed by the appellant is d dismissed.”
It is evident from the record that the loans were received through banking channels and fully repaid in the immediately succeeding years. The assessee has taken the loans from the nine lenders for amounting Rs.81,00,000. To prove the creditworthiness a of the lenders and the genuineness of the loans the assessee has filed the affidavits of the lenders, copy of the PAN, copy of the banks accounts, copy of the acknowledgements of the ITR, confirmation letter of the loans and the documents related to the repayments by which the loans were repaid. The assessee has discharged her burden by giving the details of the parties. The documents filed by the assessee cannot be doubted on the basis of the uniformity. The, AO has not brought any adverse material on record to establish that the confirmation letters filed by the assessee were not genuine. It is also observed that the AO inference that the two lenders namely Sh. Surender Kumar Jain and Sh. Sanjay Pradhan were not residing at the given addresses and rest of the lenders was housewife did not doubt the creditworthy and genuineness of the lenders, because the assessee provides all the details of the lenders (PB page no.59-68 & 23-31 related to Sh. Surender Kumar Jain & Sanjay Pradhan) and loans were paid by banking channel. The assessee has duly discharged the onus by filing the necessary relevant documentary evidences in support and of loans by proving the identity and creditworthiness of the creditors and also the genuineness of the transaction. Thus, in the light of the above facts, it is held that the CIT(A) was not justified to dismiss the appeal of the assessee. The appeal of the assessee is liable to be allowed and the additions made by the AO is liable to be deleted.
In the result, the appeal of the assessee is allowed.