Case Law Details
Vachitra Builders Pvt Ltd Vs ITO ( ITAT Delhi)
ITAT Delhi held that addition towards unexplained credits under section 68 of the Income Tax Act unsustainable as genuineness, identity and creditworthiness of the creditors proved.
Facts- The assessee company engaged in the business of civil construction filed its return of income on 27.09.2015 for the assessment year 2015-16 declaring loss of Rs.46,247/-. The assessment was completed u/s. 143(3) of the Act on 12.12.2017 determining the income of the assessee at Rs.4,62,53,753/- by making an addition of Rs.4,63,00,000/- u/s. 68 of the Act.
Notably, AO treated unsecured loans amounting to Rs.4,63,00,000/- as unexplained credits u/s. 68 read with section 115BBE of the Act observing that the assessee was provided sufficient opportunity to provide confirmation from the party and to discharge its onus but the assessee completely failed to do so. Therefore, he concluded that the loan transactions by the assessee are not genuine transactions as the lenders did not respond to the notices and, therefore, the identity, creditworthiness and genuineness of the transactions could not be established.
CIT(A) sustained the addition. Being aggrieved, the present appeal is filed.
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