ITO Vs Saivi Finance Pvt Ltd (ITAT Delhi)
In the case of ITO Vs Saivi Finance Pvt Ltd, the Income Tax Appellate Tribunal (ITAT) Delhi has restored the matter back to the Assessing Officer (AO) due to the denial of natural justice. The assessees were not provided with an opportunity to cross-examine the persons whose statements were used against them, resulting in a violation of the principle of natural justice.
The appeal filed by the Revenue was directed against the order of the Commissioner of Income Tax (Appeals)-8, New Delhi, pertaining to Assessment Year 2015-16. The assessee, a Non-Banking Financial Company (NBFC), was engaged in providing loans to various clients. The case was selected for scrutiny under CASS in the limited category.
The crux of the matter revolved around the addition made by the AO under section 68 of the Income Tax Act, treating a sum of Rs. 4,00,00,000/- received as share capital/premium from M/s. I-Tech Insurance Brokers Pvt. Ltd. as an accommodation entry. The AO relied on the statement of Shri Nem Chand Gupta, one of the Directors of I-Tech Insurance Brokers Pvt. Ltd., recorded by the Investigation Wing. However, the assessee argued that they provided all necessary documents to prove the identity, creditworthiness, and genuineness of the transaction.
