H & F Games Pvt. Ltd. Vs DCIT (ITAT Bangalore)
Assessee company challenged CIT(A) order dated 20.06.2024 sustaining additions on cash deposits & disallowance of interest. Appeals were delayed; delay condoned by Tribunal applying the Supreme Court ruling in Collector, Land Acquisition v. Katiji.
Facts emerged from survey on 03.05.2017 & search on 28.08.2017 in the case of Shri D.S. Nandish. As recorded in statements u/s 131 & reaffirmed u/s 132(4), Nandish admitted that cash deposits in several entities’ bank accounts—including Assessee’s accounts—were made by him from his unaccounted money. Cash deposits totalled Rs.51,09,000/- (AY 2013-14) & Rs.1,25,30,000/- (AY 2014-15). Reassessments were completed u/s 147 r.w.s. 144/144B treating entire deposits as unexplained u/s 68, & interest claimed on loans of Rs.77,14,000/- & Rs.1,46,07,000/- was disallowed for lack of TDS & proof.
Before Tribunal, Assessee relied on documents filed during assessment (bank statements, 26AS, loan details) & argued that s.68 was wrongly invoked since AO himself admitted that no books of account were maintained, making s.68 inapplicable. Tribunal agreed, reproducing & analysing s.68 & holding that absence of books is fatal to invoking s.68. Tribunal relied on DCIT v. GSNR Rice Industries (2021) & the co-ordinate bench ruling in N9 Sports & Leisure Holdings Pvt Ltd, cited by Assessee, which dealt with identical facts from the same group.
