Loan Repayment Not Taxable U/s 68 & 14A Disallowance Restricted to Actual Expenditure

DCIT Vs Prudential Hotels Pvt. Ltd. (ITAT Delhi) The ITAT Delhi dismissed the Revenue’s appeal and upheld the CIT(A)’s order deleting addition of ₹7.70 crore made u/s 68 and restricting disallowance u/s 14A. The AO had treated repayment of “advance against equity” from certain parties as unexplained cash credits alleging lack of identity, genuineness and creditworthiness. However, the Tribunal noted that the amounts represented repayment of advances given in earlier years and not fresh credits during the year; therefore section 68 could not be invoked. The assessee had furnished supp...