Ekesh Gaurang Desai Vs ACIT (ITAT Mumbai)
Flat purchase addition deleted – Loan from creditor proved; wife’s contribution cannot be taxed in assessee’s hands – ITAT Mumbai
In Ekesh Gaurang Desai vs ACIT (A.Y. 2011-12), addition of ₹94.69 lakh was made on investment in purchase of a flat after search proceedings, alleging unexplained source of funds. The assessee explained that investment was partly from own funds, partly from spouse (co-owner), and balance through loan from Shri Anand P. Nair, supported by confirmations, ledger accounts and bank transactions.
The ITAT observed that the Revenue had no adverse findings regarding assessee’s own funds or wife’s contribution, and the loan creditor had disclosed substantial income before the Settlement Commission, establishing creditworthiness. Even in remand proceedings, no specific defect was pointed out in the loan transaction. Applying settled principles on identity, genuineness & creditworthiness, the Tribunal held that the assessee discharged the onus and the addition was arbitrary.
Accordingly, addition relating to investment in flat was deleted. However, claim of Chapter VI-A deduction was remanded to AO for verification, and consequential grounds were dismissed. The appeal was partly allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
The instant appeal of the assessee filed against the order of the Ld. Commissioner of Income Tax (Appeal)-47, Mumbai [for brevity ‘the Ld. CIT(A)’], order passed under section 250 of the Income Tax Act 1961 (for brevity ‘the Act’) for Assessment Year 2011-12, date of order 28.07.2025. The impugned order emanated from the order of the Ld. Income-tax Officer Ward-22(1)(2), Mumbai (for brevity the Ld. AO), order passed under section 143(3) r.w.s. 153A of the Act, date of order 28.03.2014.
