Case Law Details
Manibhadra Securities Services P.Ltd Vs ITO (ITAT Ahmedabad)
he assessee in the present case is a private limited company and engaged in the business of trading of Shares and Securities. The assessee in the year under consideration has received the Loan to the tune of Rs. 4,08,01,000/-from M/s Ken Securities Limited. The assessee has repay the loan to the tune of Rs.3,02,96,000/- and in the books of account has shown the outstanding loans amounting to Rs. 1,05,05,000/- under the head unsecured loans. The assessee has adjusted the repayment of loan by earlier advance amounting to Rs.1,93,50,000/-given to M/s Ken Securities Limited and made payment amounting to Rs. 50,00,000/- on 17-04-2005, Rs. 55,00,000/- on 22-05-2012 and Rs. 4,46,000/- on 04-03-2013 respectively.
However, the AO observed that the assessee has not furnished the requisite details to substantiate the loan amount as Identity, Creditworthiness, ITR, confirmation of the lender. The AO also noted that the notice u/s 133(6) of the Act was issued to M/s Ken Securities Limited was returned back with the remark as “left”. The AO thus in the absence relevant details and documents made the addition of closing balance of Rs. 1,05,05,000/- u/s 68 of the Act to the total income of the assessee.
Aggrieved assessee preferred the appeal before the Ld. CIT-A. The assessee before the Ld. CIT-A submits the confirmation of ledger in the books of M/s Ken Securities Limited, accounts M/s Ken Securities Limited in the books of assessee, ITR. The assessee also stated that the reply of the notice issued to M/s Ken Securities Limited was forwarded by post to the AO.
On perusal of the aforesaid documents the Ld. CIT-A observed that M/s Ken Securities Limited had shown the loss in the return of income therefore credit worthiness of M/s Ken Securities Limited is not proved. Likewise, the notice issued under section 133(6) of the Act to M/s Ken Securities Limited was returned as unserved. The Ld. CIT-A thus confirmed the addition of Rs. 1,05,05,000/- made by the AO u/s 68 of the Act.
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