Anirudh Khemka Vs ITO (ITAT Kolkata)
Unsecured Loans Fully Supported by Evidence—Non-Appearance of Creditors Not Fatal; Double Addition of Interest Noticed—Section 68 Addition of ₹1.59 Cr Deleted
Assessee appealed against the NFAC order dated 27.11.2024 confirming addition of ₹1,59,90,557 u/s 68 on account of unsecured loans received from 14 creditors & interest thereon. Assessee had filed return declaring income of ₹11,64,510.
During scrutiny, the AO called for complete details—audited accounts, bank statements, confirmations, loan ledgers, & issued 133(6) notices. Fourteen creditors responded with full documentation. AO then issued 131 summons to 21 creditors; only two appeared. Treating non-appearance as adverse, AO added ₹1,39,96,169 as unexplained loans including interest, & again added ₹19,94,388 as interest—resulting in double addition, clearly showing non-application of mind.
CIT(A) upheld the addition without properly appreciating evidence.
Tribunal examined the loan summary showing:
- Opening balance – ₹1,46,24,250
- Fresh loans – ₹44,16,425
- Repayment – ₹58,39,453
- Closing balance incl. interest – ₹1,39,96,169
Tribunal held that non-appearance in response to summons cannot invalidate the credit when all material evidences—PAN, ITRs, financials, bank statements, confirmations—were filed & no defect was pointed out either by AO or CIT(A). Loan repayment during the year further strengthened genuineness.
Tribunal relied on Orissa Corporation (SC), Orchid Industries (Bom HC), Crystal Networks (Cal HC), & Cygnus Developers (ITAT Kol) which hold that once identity, creditworthiness & genuineness are on record, addition u/s 68 cannot be sustained merely because creditors did not attend in person.
