Case Law Details
DCIT Vs Aarti Catalyst Solutions P. Ltd. (ITAT Ahmedabad)
In the present case on hand, the assessee has discharged his onus by providing details relating to the loan amount availed from the three creditors by producing their bank accounts, Income-Tax Returns, confirmation letters, etc. The AO has doubted source of the creditors thereby the AO is inquiring source of source which is not permitted as held in various judgments cited (supra). Wherever explanation has been provided by the assessee, the ld.CIT(A) has deleted such credits, and also confirmed the amount of loans which were not explained by the assessee. Therefore, this findings of the Ld.CIT(A) does not require any interference.
Another limb of arguments of the ld.DR is that as per the new proviso to section 68 of the Act introduced w.e.f. 1-4-2003 is related to the investment made on share application money, share capital, share premium or any such amount by whatever name called. Here in this case, the AO has doubted about the loans received by the assessee from three creditors who are not the ‘investors’. When the assessee has established with necessary documents, bank statements, IT return, confirmation letters, bank entries, etc. the AO ought not to have invoked proviso to section 68 which is not applicable to loan transactions. Thus, the grounds raised by the Revenue is rejected.
FULL TEXT OF THE ORDER OF ITAT AHMEDABAD
This appeal is preferred by the Revenue against the order dated 18.01.2018 of the LD.Commissioner of Income-tax (Appeals)-3, Vadodara passed in appeal no.CIT(A)-Vadodara-3/10076/2017-16 relating to the assessment year 2014-15.
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