Thar Stone Expo India Pvt. Ltd Vs ITO (ITAT Kolkata)
Addition U/s 68 Deleted — Advance Given Repaid through Banking Channel Cannot Be Treated as Cash Credit: ITAT Kolkata
The assessee challenged addition of ₹90 lakh made u/s 68 in reassessment proceedings u/s 147 r.w.s.144. AO treated advances as unexplained cash credit, which was upheld by CIT(A) mainly on ground of lack of evidences and Rule 46A issues. ITAT, however, allowed the appeal and deleted entire addition.
1770289987-dk2Q6B-1-TO
Tribunal noted that the assessee had advanced ₹50 lakh each to Navrang Vinimay Pvt. Ltd. and Jatadhari Sales Pvt. Ltd. through banking channels in earlier year and the same amounts were repaid during the relevant year. Bank statements, loan confirmations, audited financials and replies to notices u/s 133(6) clearly established genuineness of transactions.
ITAT observed that:
- Advances appeared as opening balances and were merely returned during the year.
- Both companies confirmed transactions in response to AO’s notices.
- Documentary evidences were already filed before AO; hence CIT(A)’s observation regarding non-submission was incorrect.
- Own funds advanced and subsequently repaid cannot be taxed as unexplained cash credit in assessee’s hands
FULL TEXT OF THE ORDER OF ITAT KOLKATA
This appeal filed by the assessee is directed against the order dated 09.09.2025 of the National Faceless Appeal Centre (hereinafter referred to as the “CIT(A)”) passed u/s 250 of the Income-tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2013–14.
