Dhaval Vinod Gada Vs DCIT (ITAT Pune)
ITAT Pune Deletes ₹1.62 Cr u/s 68 — “Source of Source” Not Required for Unsecured Loans Before 01.04.2023
The ITAT Pune deleted the addition of ₹1.62 crore u/s 68, holding that the assessee had fully proved the identity, creditworthiness and genuineness of the loan received from Shri Manilal M. Gada, who responded with confirmations and bank statements. Although the AO treated the loan chain—from lender to his wife to land vendors—as an accommodation arrangement, the Tribunal noted that the assessee had explained even the source of the source. Relying on Sheela Overseas (Del HC, 2025), it held that pre-amended Section 68 did not require tracing source of source for unsecured loans, and the 2022 amendment was prospective. The Bench also highlighted that the assessee’s brother received an identical loan for the same land without any addition, revealing inconsistency in the AO’s approach. Following Prem Grain Industries, and distinguishing NRA Iron & Steel, the Tribunal held that the statutory onus was fully discharged. Entire ₹1.62 crore addition was deleted; appeal allowed.
FULL TEXT OF THE ORDER OF ITAT PUNE
This appeal filed by the assessee is directed against the order dated 25.06.2025 of the Ld. CIT(A) / NFAC, Delhi relating to assessment year 2013-14.
