DCIT-17(1) Vs Parth Constructions (ITAT Mumbai)
Summary: The appeal was filed by the Revenue against the NFAC order dated 11.12.2023 for AY 2013-14, challenging deletion of Rs.1,62,00,000 added under section 68 in respect of unsecured loans from four private companies: Atharv Business Private Limited, Casper Enterprises Private Limited, Duke Business Private Limited and Olive Overseas Pvt Ltd. The Assessing Officer treated the loans as accommodation entries on the basis of an investigation report concerning the Praveen Kumar Jain group.
The assessee furnished loan confirmations, PAN and address details, income-tax return acknowledgements, audited accounts, bank statements, ledger accounts, affidavits of directors, replies to notices under section 133(6), and a retraction statement of Praveen Kumar Jain. The Tribunal examined the lender-wise material and found the entities active with the MCA and financially capable of advancing the loans. It noted that payments were made through account-payee cheques, interest was paid with TDS, and the loans had been repaid with interest. The Tribunal held that the Assessing Officer had not carried out effective verification, had not identified defects or discrepancies in the documentary evidence, and had not established any connection between the lender companies and Praveen Kumar Jain.
It concluded that the assessee had discharged its onus by proving identity, creditworthiness and genuineness through documentary evidence. The Tribunal also considered the Revenue’s reliance on J.K. Global, dated 05.09.2024 and reported in 167 Taxmann.com 15, but held that its facts were materially different and therefore it was not applicable. As no new facts, circumstances or documents were placed by the Revenue to rebut the CIT(A)’s findings, the Tribunal upheld deletion of the Section 68 addition and dismissed the Revenue’s appeal.
