Case Number: ITA 985/DEL/2021
Appellant: P.R. Constructions, Muzaffarnagar
Respondent: ACIT, Circle-3(2)1, Muzaffarnagar
Assessment Year: 2014-15
Result: 2014-15
Case Filed on: 2021-08-17
Order Type: Final Tribunal Order
Date of Order: 2022-10-18
Pronounced on: 2022-10-18
This case involves an appeal filed by P.R. Constructions (hereinafter referred to as ‘the Appellant’) against the order dated 31.07.2021 passed by the National Faceless Appeal Centre (NFAC), Delhi. The appeal concerns the disallowance of loans received by the Appellant for the assessment year 2014-15.
The pertinent facts for the adjudication of this case are as follows:
The additions were made on account of loan parties, namely:
The Appellant provided details such as PAN, amount, mobile number, complete address, confirmation, ITR, computation of income, bank statements, copies of query letters issued by the department, and replies to notices issued u/s 133(6) to prove identity, genuineness, and creditworthiness. It was also submitted that the source of the cash received as repayment was from various individuals, namely Gaurav Goyal, Richa Agarwal, and Ajay Kumar Agarwal. The Appellant paid 12% interest in the year under consideration and in the subsequent year, after duly deducting TDS.
The addition was solely made on the basis of low returned income, disregarding the sufficiency of sources and their genuineness. The CIT(A) held that the bank statements of the loan parties were not furnished by the Appellant. Additionally, the analysis of the bank accounts of S.C. Agarwal and Sons showed credits of Rs. 52,61,000/-, which was not in consonance with the returned income of the lender. However, the amount received by the Appellant from S.C. Agarwal was only Rs. 5,00,000/-. The total credit in the lender’s account being more than the amount received by the Appellant cannot be a reason to construe the loan as bogus or ungenuine.
The Tribunal, led by Dr. B.R.R. Kumar, Accountant Member, and Sh. Yogesh Kumar US, Judicial Member, noted that the Appellant had submitted all necessary evidence to prove the identity, genuineness, and creditworthiness of the loans received. The Tribunal found no contra findings brought by the Revenue and held that no addition on account of the loans received by the Appellant was called for.
The Tribunal directed the deletion of the addition made by the Assessing Officer and allowed the grounds raised by the Appellant. The appeal was decided in favor of the Appellant, and the disallowance of Rs. 15,00,000/- was deleted.
Order: The appeal of the Appellant is allowed.
Order Pronounced in the Open Court on 18th October, 2022.
-Sd/- (Yogesh Kumar US, Judicial Member)
-Sd/- (Dr. B.R.R. Kumar, Accountant Member)
Date:- 18.10.2022
Copy forwarded to:
Assistant Registrar
ITAT, New Delhi
P.R. Constructions vs. ACIT: Case Filed for Disallowance of Loans for Assessment Year 2014-15
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