GANGA INDUSTRIES,BHAVNAGAR V. THE DY. CIT, CENTRAL CIRCLE-1(1), AHMEDABAD

ITSSA 142/AHD/2023

AI Insights

The case involves Ganga Industries appealing against the additions made under Section 68 of the Income-tax Act, 1961, which were confirmed and enhanced by the Commissioner of Income-tax (Appeals). The additions pertained to unsecured loans taken by the assessee, which were treated as unexplained cash credits. The Tribunal examined whether the additions were justified based on the materials and evidence presented, including a notarized deed and excel sheets found during searches. The Tribunal concluded that the materials used for making the additions were not directly linked to the assessee and thus, the additions were not sustainable.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 102646 (ITAT-AHMEDABAD)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-04-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Other Referred Cases: Narmada Concast Pvt. Ltd. vs. DCIT, Jamuna Industries vs. DCIT, Shri Rajesh Sundardas Vaswani & others vs. DCIT, CIT vs. Kabul Chawla, DIT vs. Smt. Shivali Mahajan and others, Subhag Khattar vs. ACIT, Pr.CIT vs. Saumya Construction, CIT vs Ayachi Chandrasekhar Narsangji
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ADJOURNMENT APPLICATION FILED
• Assessee Lawyers: TUSHAR HEMANI; PARIMALSINH B. PARMAR; OBSERVING
• Keywords: Set aside; Opportunity of being heard; Question of law; Unexplained cash credit; Document seized; Documents seized; Principle of natural justice; Search and seizure; Accommodation entries; Bogus loan; Opportunity of cross examination; Bogus
• Section: 147; 148; 143(3); 250; 201; 153; 132; 153A; 139(1); 68; 131; 133(6); 13; 153C; 158BC; 20

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, AHMEDABAD BEFORE DR. B.R.R. KUMAR, VICE-PRESIDENT MS. SUCHITRA R. KAMBLE, JUDICIAL MEMBER IT(SS)A Nos. 141 & 142/Ahd/2023 (Assessment Year: 2014-15 & 2015-16) Ganga Industries, Survey No. 159/160, Vill- Malpar, Tal-Gogha, Bhavnagar, Gujarat-364006 PAN : AAFFG 5748 F Vs. Deputy Commissioner of Income-tax, Central Circle-1(1), Ahmedabad (Appellant) .. (Respondent) Appellant by : Shri Tushar Hemani, Sr Advocate & Shri Parimalsinh B. Parmar, AR Respondent by: Adjournment application filed Date of Hearing 12.03.2025 Date of Pronouncement 16.04.2025 O R D E R PER DR. B.R.R. KUMAR, VICE-PRESIDENT:- Delay Condoned These two appeals have been filed by the Assessee against the common order of the learned Commissioner of Income-tax (Appeals)-11, Ahmedabad (hereinafter referred to as \"CIT(A)\" for short) dated 25.10.2023, passed under Section 250 of the Income-tax Act, 1961 [hereinafter referred to as \"the Act\" for short], for Assessment Years 2014- 15 & 2015-16. 2. Both the appeals are having same nature of facts and a common issue. Therefore, both the appeals are taken together, heard together and disposed of by this common order. IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 2– IT(SS)A No. 141/Ahd/2023 for AY 2014-15 is taken as the lead case. 3. The assessee has raised following grounds of appeal:- “1. The learned CIT(A) has erred in law and on facts of the case in confirming the assessment order u/s 153A of the Act which is passed in violation of provisions of the Act and against the scheme of assessment related to search cases. 2. The learned CIT(A) has erred in law and on facts of the case in confirming the additions made by the learned AO without any incriminating material found during the search. 3. The learned CIT(A) has erred in law and on facts of the case in upholding the order of transfer u/s. 127 of the Act which was passed without providing any opportunity of being heard to appellant as required u/s. 127(1) and 127(2) of the Act. Even the order u/s. 127 of the Act was not served on the appellant. 4. The learned CIT(A) has erred in law and on facts of the case in confirming the addition of Rs. 50,00,000/-(AY 2014-15) & Rs.23,50,000/- (AY 2015-16) made by the Ld. AO u/s. 68 of the Act. 5. The learned CIT(A) has erred in law and on facts of the case in enhancing the addition by Rs. 21,50,000/-(AY 2015-16) u/s. 68 of the Act. 6. Both the lower authorities have erred in law and on facts of the case in making the addition by relying on the statement of third parties without providing the appellant with an opportunity to cross-examine such parties. 7. The learned CIT(A) has erred in law and on facts of the case in rejecting the alternate argument of the appellant proposing to make the addition in the hands of Gulwani family instead of appellant. 8. Both the lower authorities have passed the orders without properly appreciating the facts and they further erred in grossly ignoring various submissions, explanations and information submitted by the appellant from time to time which ought to have been considered IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 3– before passing the impugned order. The action of the lower authorities is in clear breach of law and principles of natural justice and therefore deserves to be quashed. 9. The learned CIT(A) has erred in law and on facts of the case in confirming action of the Ld. Assessing Officer in levying interest u/s 234A/B/C/D of the Act.” 4. The brief facts of the case are that a search action u/s.132 of the Act was carried out at the premises of Mr. Shripal Vora, CA, Bhavnagar on 16.12.2016. During the course of search, it was found that Mr. Shripal Vora was involved in providing accommodation entries of unsecured loan against cash through various Surat based entities to Globe-200 Sourcing Private Limited for Rs.29.67 crores. During the post search inquiries, the Assessing Officer found that Surat based entities have also provided unsecured loan to assessee company in A.Y. 2014-15 and 2015-16 and a list of such unsecured loan is provided at page No.3 and 4 of the Assessment Order. Thereafter, the Assessing Officer had referred to notarised deed dated 06.12.2016 that was found from assessee’s premises during the course of search which states that all the unsecured loan shown in Annexure is book entry and no actual payment is required to be made. Few names of unsecured loan appearing in Annexure to deed found during the course of search tellies with list prepared during post search inquiries in search of Mr. Shripal Vora referred supra. Thereafter, the Assessing Officer had referred to excel files found from seized hard disc which contain date of loan taken by the assessee, name of entity from whom loan is taken and amount. Based upon all these facts, Assessing Officer observed that unsecured loan taken by assessee for Rs. 1,20,00,000/- in A.Y.2014-15 and Rs.40,00,000/- in A.Y.2015-16 are bogus and the same were disallowed u/s 68 of the Act for the respective assessment years. IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 4– 5. Aggrieved by the order of the Assessing Officer, the assessee preferred appeal before the Ld. CIT(A) who granted partial relief of Rs. 70,00,000/- but enhanced the income by adding Rs. 21,50,000/- based on a registered deed executed by the Gulwani Family for AY 2014-15, resulting in a total addition of Rs. 71,50,000/-. For the sake of ready reference, the addition made by the Assessing Officer and confirmed/enhanced by the Ld. CIT(A) for both assessment years are as under:- AY Addition made by AO - (A) Relief on account of duplicate addition (B) Relief on account of repayment of loan prior to date of search and before executing registered deed (C) Relief on account of inter- group entries (D) Relief on account of opening balance (E) Enhancement of income being addition based upon registered deed executed by Gulwani Family (as per supra) (F) Total addition upheld u/s 68 of the Act (A)- (B)- (C)- (D)- (E)+(F) 2014-15 1,20,00,00 0 60,00,000 10.00,000 — — 21,50,000 71,50,000 2015-16 40,00,000 20,00,000 20,00,000 - — 23,50,000 23,50,000 IT(SS)A No. 141/Ahd/2023 – AY 2014-15 Addition u/s 68 - Rs.50,00,000/- Enhancement of addition u/s 68 - Rs.21,50,000 IT(SS)A No. 142/Ahd/2023 – AY 2015-16 Enhancement of addition u/s 68 - Rs.23,50,000 6. Aggrieved by the order of the Ld. CIT(A) confirming/enhancing the addition, the assessee is now in appeal before the Tribunal. 7. At the outset itself, the Ld. AR contended that the issue raised in these appeals is covered in favour of the assessee vide order dated 22.12.2023 IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 5– passed by the ITAT in connected group cases of “Narmada Concast Pvt. Ltd.” and “Jamuna Industries in IT(SS)A Nos. 60/Ahd/2022 and others. For the sake of ready reference, the relevant portion of the said order is reproduced hereunder:- “(c) Further, the Assessing Officer has relied upon the seized material in the form of deed signed by Gulwani which was found from premises namely, Swara Park Lane, Bhavnagar which is not the premises owned or possessed by the appellant and hence, such material cannot be an incriminating material found from the appellant and no action can be taken for addition in the appellant's case u / s 153A on the basis of such seized material. ……. ……. 2. In law and in the facts and circumstances of the appellant's case, the learned CIT(A) has erred in confirming the addition u / s 68 to the extent of Rs. 2,01,00,000/-. 2.1 The Ld. CIT (A) ought to have appreciated that the appellant had provided before the Assessing Officer necessary details in respect of loans and the Assessing Officer has not given any finding regarding genuineness of such loans in the assessment order and accordingly the addition was not justified u/s 153A. 2.1 First, we take up ground No. 2 of the appeal. The issue raised by the assessee in ground No. 2 is that the learned CIT-A erred in confirming the addition of Rs. 2,01,00,000/- on account of unsecured loan under section 68 of the Act. 3. The necessary facts arising from the order of the authorities below are that the assessee in the present case, a private limited company, was subject to search and seizure operation along with its group companies under section 132 of the Act dated 19th November 2019. In consequence to the search, various documents of incriminating nature were found from the premises of the assessee which are classified as under: A. The present company being assessee along with its group associated was earlier controlled and managed by another family known as Gulwani Family Group. The erstwhile family transferred all the companies to Mehta Family Group. There was some understanding between the earlier management and the present management dated 6th December 2016 wherein it was agreed that there was certain amount of loan from various parties as per annexure-1 which are only book entry, no actual payment is required to be made by the present assessee. The list of such loans was attached in the agreement as annexure A-1. As such, it was the liability of the old management to pay them off in case such loan parties raise a demand to the assessee for the recovery of loan. B. Likewise, a hard disk was recovered from the premises of the assessee company containing the details on excel sheet of the loans taken by the group company including the assessee. Such excel sheet contains the information of the loan amount received from various parties along with the broker’s name who arranged such loan to the assessee. 4. In addition to the above documents found during search and seizure operation, it is important to note that there was a search and seizure operation conducted at the office premises IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 6– of Shri Shripal Vora dated 16th December 2016 under the provisions of section 132 of the Act wherein it was found that such person was engaged in providing the accommodation entries from Surat based companies to the companies based in Mumbai. Certain digital data were found containing the details of the loan provided by Shri Shiripal Vora. Such details include the name of the company which provided a loan to the Mumbai-based company through the broker. 4.1 The AO during the assessment proceedings analyzed the information contained in Annexure-1 attached with the agreement dated 6 December 2016 and the details found from the premises of Shri Shripal Vora with the excel sheet found from the hard disk. On analysis of such information/details, the AO found that the assessee has obtained loan from various parties through the brokers which is nothing but the unaccounted money of the assessee itself which has been routed through the web of different companies. As per the AO, the amount of loan taken by the assessee in different assessment years represents the unexplained cash credit under section 68 of the Act. According to the AO, the amount of loan representing unexplained cash credit has been taken by various companies of the assessee group in different assessment years, the details of the same for the AY 2014-15 stand as under: S.No. LENDER NAME DATE AMOUNT IN AY 2014-15 NAME APPEARS IN ANNEXURE - 1 WHETHER NAME APPEAR IN ANNXURE OF SHRIPAL VORA 1 BHAVESH P SHAH 23-04-2013 10,00,000/- NO NO 2 BHAVESH P SHAH HUF 30-04-2013 10,00,000/- NO NO 3 EXECUTIVE VINIMAY PVT LTD 02-04-2013 7,00,000/- YES NO 4 EXECUTIVE VINIMAY PVT LTD 07-05-2013 25,00,000/- YES NO 5 EXECUTIVE VINIMAY PVT LTD 02-04-2013 7,00,000/- YES NO 6 EXECUTIVE VINIMAY PVT LTD 07-05-2013 25,00,000/- YES NO 7 GEETABEN PHARAM/ OFFICE 3,00,000/- NO NO 8 GIRIRAJ COMMERCIAL PVT LTD 10,00,000/- NO NO 9 GIRIRAJ COMMERCIAL PVT LTD 03-05-2013 20,00,000/- NO NO 10 KOTIRARAN COMOSALES PVT LTD. 22-02-2013 50,00,000/- NO NO 11 MITESH P SHAH 22-05-2013 7,00,000/- NO NO 12 P.A SHAH HUF 30-04-2013 16,00,000/- NO NO 13 PRATIK H SANGHVI 17-02-2014 5,00,000/- NO NO 14 PARVEEN P SHAH HUF 17-02-2014 5,00,000/- YES NO 15 PUSHPANJALI TRADING PVT LTD 09-04-2013 30,00,000/- YES NO 16 PUSHPANJALI TRADING PVT LTD 12-08-2013 25,00,000/- YES NO 17 PUSHPANJALI TRADING PVT LTD 09-04-2013 30,00,000/- YES NO 18 PUSHPANJALI TRADING PVT LTD 12-08-2013 25,00,000/- YES NO 19 RAJESH KUMAR J SHAH HUF 17-02-2013 10,00,000/- YES NO 20 TARUNABEN P BHATT 25-03-2014 9,00,000/- NO NO TOTAL 3,29,00,000/- 4.2 The amount of loan taken in the AY 2015-16. S.No. LENDER NAME DATE AMOUNT IN AY 2015-16 NAME APPEARS IN ANNEXURE - 1 WHETHER NAME APPEAR IN ANNXURE OF SHRIPAL VORA 1 ABHAY COMMERCE PVT LTD 15,00,000/- NO NO 2 ADITI GEMS PVT LTD 29-05-2014 9,00,000/- YES YES 3 ADITI GEMS PVT LTD 29-05-2014 9,00,000/- YES YES 4 ADITI GEMS PVT LTD 29-05-2014 9,00,000/- YES YES IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 7– 5 ARROW COMMODITIES PVT LTD 18-02-2015 25,00,000/- NO NO 6 BALVANT RAI T SHAH 08-08-2014 5,00,000/- NO NO 7 JCC HOLDING PVT LTD. 30-01-2015 10,00,000/- NO NO 8 MEHUL P BHATT 08-08-2014 5,00,000/- NO NO 9 MITESH P SHAH HUF 08-08-2014 5,00,000/- NO NO 10 NIKHAR COMMODITIES PVT PLT 18-02-2015 25,00,000/- NO NO 11 RIGHTANGLE 28-05-2014 10,00,000/- NO YES 12 RIGHTANGLE 28-05-2014 10,00,000/- NO YES 13 RUSHABH SHAH 08-08-2014 5,00,000/- NO NO 14 SANGHAM DIAMOND 17-02-2014 15,00,000/- NO YES 15 SANGHAM DIAMOND 17-02-2014 15,00,000/- NO YES 16 SUBTANTIAL CONULTANCY PVT LTD 20-02-2015 25,00,000/- YES NO 17 SUBTANTIAL CONULTANCY PVT LTD 20-02-2015 25,00,000/- YES NO 18 VINOD CHAUHAN 29-05-2014 10,00,000/- NO YES 19 VINOD CHAUHAN 29-05-2014 10,00,000/- NO YES 20 VAIBHAV SHAH 02-06-2014 6,00,000/- NO YES 21 VAIBHAV SHAH 02-06-2014 6,00,000/- NO YES TOTAL 2,54,00,000/- 4.3 In view of the above, the AO proposed to treat the amount of loan taken by the assessee for Rs. 3,29,00,000/- in the year under consideration as unexplained cash credit under section 68 of the Act by issuing a notice dated 16-09-2021. 4.4 In response to such notice, the assessee submitted that most of the loan liabilities shown by the assessee as per the annexure 1 attached to agreement dated 6 December 2016, the same are payable to the group companies, meaning thereby, if the amount shown as loan in the hands of one company, then the same amount of loan has been shown as an advance in the financial statement of another group company. Thus, effectively there is no liability upon the assessee as per the list attached in annexure-1 to the agreement which is payable to the outside parties. Furthermore, such a loan was received by the assessee through the banking channel and the same was accepted as genuine in the assessment framed under section 143(3) of the Act. The assessee further submitted that the other companies are also assessed with the same office at present for the AY 2014-15 to AY 2020-21. Thus, how can an advance given by lender and assessed as genuine become bogus in the hand of receiver. 4.5 However, the AO rejected the contention of the assessee by observing as under: (iii) The assessee has submitted that \"major amounts involved in the list are loans from family members of the old promoters, i,e, Gulwani family and inter company loans of the group concerns, i.e. Ganga Ind, Jamuna Ind Saraswati Enterprise and Narmada Concast Pvt Ltd, Therefore, the intention behind mentioning such statement in the agreement was that these being intera group and intra family loans does not actually create any financiallibility on new promoters\". On perusal of excel sheet files namely \"SV All Cos\", \"BPS_ALL COS\" & \"TR\" found in seized hard disk, the name of lenders are different as claimed by the assessee [also refer the table placed in above para (i)]. (iv) Details of the bogus unsecured loan was recorded in the excel sheet files namely \"SV All Cos\", \"BPS_ALL COS\" & \"TR\". On perusal of the said excel file, the details of the bogus unsecured loan A.Ys. wise is as: A.Y 2014-15 2015-16 2018-19 Bogus Unsecured loan as per excel file namely “SV All Cos” “BPS_ALL CIS” & “TR” 3,29,00,000 2,54,00,000 1,13,30,000 Thus, in view of the above and after careful consideration of reply of the assessee and material available on record it is found that the argument of the assessee is not tenable, thus, it is clear that loan from the aforesaid parties taken by the assessee are nothing but accommodation entries of unsecured loan. Therefore, unsecured loan of Rs.3,29,00,000/- is disallowed and aggregated addition of Rs.3,29,00,000/- u/s.68 has been made in the case of the assessee of A.Y. 2014-15. IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 8– 5. Aggrieved assessee preferred an appeal before the ld. CIT-A. The assessee before the learned CIT-A raised certain contentions detailed as below: i. There was no document of incriminating nature found from the premises of the assessee for the assessment year 2014-15 suggesting that the assessee has received any loan through such party being Shri Shripal Vora. Thus, in the absence of any incriminating documents, there cannot be any addition to the total income of the assessee in the assessment framed under section 153-A of the Act. ii. iii. Without prejudice to the above, the AO has made the addition treating the entries appearing in the excel sheet bearing name as “SV All cos”, BPS_All cos”, & TR found during search operation as unexplained cash credit under section 68 of the Act but without taking the cognizance of the fact that there were multiple entries which were duplicate in nature. Thus, consequently there have been double addition made by the AO for loan with respect to certain parties in the assessment year 2014-15 and 2015 16. The list of duplicate entries stands as under: S.NO PARTY NAME DATE AMOUNT AY 2014-15 1 EXECUTIVE VINIMAY PVT LTD 02-04-2013 7,00,000/- 2 EXECUTIVE VINIMAY PVT LTD 07-05-2013 25,00,000/- 3 GIRIRAJ COMMERCIAL PVT LTD NA 10,00,000/- 4 PUSHPANJALI TRADING PVT LTD 09-04-2013 30,00,000/- PUSHPANJALI TRADING PVT LTD 12-08-2013 25,00,000/- TOTAL 97,00,000/- S.NO PARTY NAME DATE AMOUNT AY 2015-16 1 ADITI GEMS PVT LTD 29-05-2014 9,00,000/- 2 ADITI GEMS PVT LTD 29-05-2014 9,00,000/- 3 RIGHTANGLE 28-05-2014 10,00,000/- 4 SANGHAM DIAMOND 17-02-2014 15,00,000/- 5 SUBSTANTIAL CONSULATNCY PVT LTD 20-02-2015 25,00,000/- 6 VINOD CHAUHAN 29-05-2014 10,00,000/- 7 VIBHAV SHAH 02-06-2014 6,00,000/- TOTAL 84,00,000/- iv. There were certain loan parties appearing in the excel sheet bearing name “SV All cos”, BPS_All cos”, & TR which were repaid even before the date of search and the date of deed found during the search and seizure operation. As such, it was contended by the assessee that it has paid a sum of Rs. 85 lakhs and 1.36 crore for the assessment year 2014-15 and 2015-16 to the parties. The details of the same is available on page 25 of the CIT-A order. v. The assessee also contended that the amount of loan which was received in the year prior to the year in dispute, the same cannot be made subject to the addition in the year under consideration. The list of such loan stand as under: S.No Party name Date Amount 1 Kotiratan comoales Ltd 22-02-2013 50,00,000/- TOTAL 50,00,000/- vi. Most of the entries of loan appearing in the Annexure-1 attached with the signed deed dated 06-12-2016 were representing the intercorporate loan transactions of the group. As such, the loan shown by the assessee in its books of accounts, the same was shown as an advance in the books of the other group concern. In other words, the amount of loan shown by the assessee did not effectively represent any loan to the outside parties. The list of such cases stands as under: S.No Party name Amount 1 Jamuna Industries 1,89,30,415/- Maheshbhai T gulwani 14,65,000/- TOTAL 2,03,95,415/- IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 9– vii. The assessee further contended that it has discharged the onus imposed under section 68 of the Act with respect to the identity/creditworthiness of the parties and genuineness of the transaction by furnishing the details such as name, address, PAN and the ledger account of the loan parties along with the confirmation. All these loans were received through the banking channel and the same were accepted in the assessment framed under section 143(3) of the Act for the AY 2014-15 and 2015-16. viii. The AO has not brought any clinching evidence suggesting that the amount of loan received by the assessee were bogus. The AO has not brought any information about the cash trail by making independent enquiries suggesting the exchange of cash in lieu of unsecured loan. As such, the AO has gone to make the addition based on the information gathered from the office of Shri Shripal Vora but without making any independent enquiries from the loan parties. The statement of Shri Shripal Vora was used against the assessee without providing the opportunity of cross-examination which is against the principles of natural justice. 6. The learned CIT-A after considering the submission of the assessee agreed to the fact that some of the amount appearing in the excel sheet bearing name “SV All cos”, BPS_All cos”, & TR have been added twice by the AO. Therefore, the ld. CIT-A was pleased to delete the addition representing duplicate entries. The details of the same are reproduced on pages 30 to 31 in the order of the ld. CIT-A. The amount of such a loan representing duplicate entries stands at Rs. 97,00,000.00 and Rs. 84,00,000.00 for the respective assessment years 2014-15 and 2015-16. Thus, the ld. CIT-A reduced the addition made by the AO by ₹97 Lacs and 84 lacs respectively and accordingly the balance amount was calculated at ₹2.32 crores 1.70 crores for the AY in dispute and for the AY 2015-16. 6.1 The learned CIT-A further found that the amount of Rs. 201 lakhs and Rs. 2,84,70,415.00 appearing in the annexure-1 attached to the deed dated 6 December 2016, representing the book entry, pertains to the year in dispute. Out of such loan amount, a sum of ₹1.47 crores and Rs. 34 lacs were added to the income of the assessee by the AO treating the same as unexplained cash credit as the amount was also reflected in the excel sheet recovered from the premises of the assessee. But the balance amount of ₹54 lakhs (201 lakhs -147 Lacs) and Rs. 2,50,70,415.00 (Rs. 2,84,70,415 minus 34,00,000.00) was not made subject to the addition by the AO in the respective assessment orders. Thus, the learned CIT-A enhanced the income of the assessee by the sum of ₹54 lakhs and Rs. 2,50,70,415.00 treating the same as unexplained cash credit under section 68 of the Act. 6.2 The learned CIT-A in view of the above calculated the correct amount of addition which is in dispute as reproduced below: 6.5 In view of above discussion, the correct amount of addition (as per AO) based upon actual receipt of loan is worked out as under: Particulars A.Y. 2014-15 A.Y 2015-16 Addition made by AO 3,29,00,000 2,54,00,000 Correct amount after removing duplicate balances as discussed in preceding para Unsecured loan as per search of Shripal Vora and excel sheet-para 6.3 2,32,00,000 1,70,00,000 Unsecured loan as per deed of Gulwani Family (Para 6.4) 54,00,000 2,50,70,415 Total 2,86,00,000 4,20,70,415 7. Likewise, the learned CIT-A found that there was certain amount of loan, appearing in the excel sheet bearing name “SV All cos”, BPS_All cos”, & TR pertaining to the assessment year IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 10– 2014-15 and 2015-16 but they were repaid before the date of search and before the date of the agreement dated 6 December 2016. As per the learned CIT-A, the AO has not disputed the repayment of such loan. Accordingly, the learned CIT-A deleted the addition made by the AO of the unsecured loan which was repaid before the date discussed above. The amount of such loan entries stands at Rs. 85,00,000.00 and 136 lacs as evident from the order of the ld. CIT-A on pages 37 and 38 of the order. Thus the ld. CIT-A was pleased to delete the addition made by the AO representing the loan repaid by the assessee. 7.2 Similarly, the learned CIT-A was pleased to observe that the amount of loan reflected in the annexure-1 to the deed dated 6th of December 16 represents the unexplained cash credit as evident from the contents of the deed discussed above. Thus, the ld. CIT-A confirmed the addition made by the AO in part and further enhanced the income of the assessee by observing as under: 8.13 During the course of appellate proceedings, Appellant has stated that entire addition has been made by considering declaration made by Gulwani Family and found during the course of search. The Appellant has stated that as loans were taken by Appellant when Gulwani family was running the concern, hence addition can be made in the case of Gulwani Family. However, this contention of Appellant cannot be accepted for the reason that loan is taken by Assessee and there is nothing on record to prove that benefit of alleged accommodative entry was taken by Gulwani Family in their individual capacity. Once the loan is taken by Assessee, funds have been received in the books of Assessee provision of Section 68 are applicable only in the case of Assessee. as it was not able to explain sources of such loan during the course of Assessment proceedings or appellate proceedings. Merely because liability to repay such loan is of Gulwani Family as mentioned in registered deed, addition cannot be made in their individual hands, as provisions of Section 68 are applicable qua Assessee and not based upon who are the owners of such firm or company. Considering this fact, alternate legal plea raised by Appellant is rejected. 8.14 It is observed that appellant firm has received loan of Rs. 1,89,30,415/- from Jamuna Industries in A.Y.2015-16 (part of aggregate receipt of Rs 2,84,70,415). Rs. 14,65,000 from Maheshbhai T. Gulwani in A.Y.2015-16 and such loan is reflected as part of annexure of registered deed duly signed by Gulwani family and found during the course of search. It is found that such loan is taken only from group concern being Jamuna Industries and Mr. Mahesh Gulwani, owner of erstwhile firm and party to registered deed. As observed earlier, all the concerns being Ganga Industries, Saraswati Enterprises, Jamuna Industries and Narmada Concast Pvt Limited are owned by Gulwani family prior to take over of such loan by Priya Blue Group and once loan is intra group transactions, such loan cannot be held to be bogus solely based upon contents in registered deed supra. As such loan is only from group entries, Gulwani family might have stated that such loan is book entry and same is not required to be paid by Priya Blue Group as repayment of such loan by appellant would be receipt in the hands of Jamuna Industries and funds would remain within the group only. Considering such facts, no addition is required to be made for aforesaid loan received in AY 2014-15 and 2015-16. Thus, addition of Rs.2,01,10,000 in AY 2014-15 and Rs.80,75,000 (2,84,70,415 less 1,89,30,415 less 14,65,000) is confirmed. 8.15 In view of detailed discussion made herein above, addition made by AO in all the three assessment years are upheld as below:- A.Y Additio made by AO -(A) Relief on account of duplicate addition (B) Relief on account of repayment of loan prior to date of search and before executing regsitered deed (C) Net Amount (A)-(B)-(C) Enhancement of income being addition based upon registered deed executed by Gulwani Family (as per supra) (F) Total addition upheld u/s. 68 of the Act (A)-(B)- (C)-(D)- (E)+(F) 2014-15 3,29,00,000 97,00,000 85,00,000 1,47,00,000 54,00,000 2,01,00,000 2015-16 2,54,00,000 84,00,000 1,36,00,000 34,00,000 46,75,000 80,75,000 8.16 In view of discussion made herein above and based upon tabular chart, income of appellant for A.Y.2014- 15 is enhanced by Rs.54,00,000/- and for A.Y.2015-16 by Rs.46,75,657/-. In nutshell, the AO is directed to confirm addition of Rs. 2,01,00000/- in AY 2014-15 and Rs. 80,75,000/- in AY 2015-16 and balance addition made by AO in both the years are deleted. Thus, the related grounds of appeal no. 2 and 3 in both assessment years i.e. for A.Y.2014-15 & 2015-16 are partly allowed. 8. Being aggrieved by the order of the learned CIT-A, both the assessee and the Revenue are in appeal before us. The assessee is in appeal against the confirmation of the addition for IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 11– Rs. 2,01,00,000/- whereas the Revenue is in appeal against the deletion of the addition made by the AO for Rs. 97, 00,000/- in respect of duplicate/ double entry and Rs. 85,00,000/- for the repayment of loan. 9. The Revenue is in ITA bearing No. 53/AHD/2022 for the AY 2014-15 on the following grounds of appeal: 1. In the facts and on the circumstances of the case and in law, Ld. CIT(A) erred in deleting the addition u/s 68 of Rs.85,00,000/- made on account of unexplained unsecured loans despite the fact that in notarized deed dated 06.12.2016 it was clearly mentioned that all the unsecured loans shown in the attached annexure are only book entry and no actual payment was required to be made. 2. In the facts and on the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition u/s 68 of Rs.97,00,000/- made on account of unexplained unsecured loans, being duplicate addition, without appreciating the fact that in fact there was no duplicate entry but some similar entries reflected in the different part of the excel sheet are different entries wherein only amount and date of entry are same but these similar entries are different which are reflected in the different part of excel sheet. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) ought to have upheld the order of the A.O. 4. It is, therefore, prayed that the order of the Ld. CIT(A) be set aside and that of the A.O. be restored to the above extent. 10. The learned AR before us filed a paper book running from pages 1 to 281 and the written submission by contending that the materials gathered from the premises of the third- party i.e. Shri Shripal Vora during search cannot be used against the assessee without following the procedure laid down under the provisions of section 153C of the Act. Similarly, the statement recorded of Shri Shripal Vora cannot be treated as material of incriminating nature and therefore the same cannot be used against the assessee. Furthermore, the opportunity of cross- examination was not furnished of the statement of Shri Shripal Vora which is against the principles of natural justice. 10.1 The Ld. AR further contended that the MOU found from the premises of the assessee containing the information of various loans cannot be treated as a document of incriminating nature. As per the ld. AR, all the loans shown in annexure 1 attached to such MOU are appearing in the regular books of accounts. Thus, the same cannot be treated as incriminating in nature. 10.2 All the details about the loan parties such as name, PAN, Ledger and confirmation letters of the lenders were furnished during the assessment proceedings with the details that all the transactions were carried out through the banking channel. But the AO without carrying out any verification under section 131/133(6) of the Act, but based on the MOU, has treated the impugned amount as unsecured unexplained cash credit under section 68 of the Act despite the fact that no detail about the cash trail was found during the search proceedings. 10.3 The AR further submitted that there was change of management in the assessee company and therefore such agreement was entered between the assessee and Gulwani family wherein it was ascertained that all the loan liability is the responsibility of the old management. But the AO has wrongly interpreted the content of the agreement and drawn the wrong conclusion that the entries in the agreement represent the bogus loan. Furthermore, most of the loan transactions were among the group companies which cannot be treated as cash credit under section 68 of the act. In view of the above, the ld. AR submitted that no addition is warranted. 10.4 On the other hand, the learned DR before us reiterated the findings contained in the assessment and appellate order by placing reliance therein. 10.5 Both the ld. AR and the DR before us were vehemently supported the order of the lower authorities to the extent favourable to them. IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 12– 11. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion, we note that the addition in the hands of the assessee has been sustained treating the loan shown by the assessee to the extent of Rs. 2.01 crores as unexplained cash credit under section 68 of the Act. The basis of the addition made by the AO was based on the facts as detailed under: i. The notarized deed signed by Gulwani family stating that the loan shown by the assessee represents book entry and the amount is not actually payable by the assessee to the outside parties. ii. There were excel sheets found during a search detailing the loan taken by the assessee from various parties along with the name of the broker which was held by the AO as unexplained cash credit under section 68 of the Act. iii. The loan was taken by the assessee from certain parties engaged in providing accommodation entry which is evident from the details unearthed during the search proceedings at the premises of the 3rd party namely Shri Shripal Vora dated 16 December 2016. 11.1 Admittedly, the amount shown in the excel sheet found from the premises of the assessee was shown by the assessee in the regular books of accounts. Such a loan was also accepted as genuine in the assessment proceedings under section 143(3) of the Act. Accordingly, we are of the view that the amount of loan shown by the assessee in the excel sheet cannot be treated as unexplained cash credit under 68 of the Act on a stand-alone basis. Undeniably, if such excel sheet is seen in conjunction with details found because of search at the premises of Shri Shripal Vora, the suspicion arises about the genuineness of the loan shown by the assessee. In other words, the information gathered from the 3rd party premises during the search has been used in the assessment framed in the name of the assessee. The controversy arises whether the document found from the 3rd party premise as result of search can be used against the assessee. 11.2 Coming to the utilization of material found during the search proceeding at third party premises, the law is fairly settled that in case any material pertaining to or belonging to the assessee found during the search proceedings at the third party then such material can be used against the assessee by initiating proceeding under section 153C of the Act. As such, the proceedings under section 153C of the Act can be initiated in a situation where the documents/materials belonging to the assessee were recovered from the premises of the 3rd party during search proceedings under section 132 of the Act. Then, the AO of the search party has to record the satisfaction by observing that the documents found in the course of search from the premises of the 3rd party belongs to the person other than searched person and he/she (AO of search assessee) will hand over such satisfaction note along with the necessary documents to the AO of such other person (present assessee) who was not subject to search. The AO of the other person (present assessee) will again record his satisfaction that the documents found from the premises of the 3rd party during search has bearing on the income of the assessee. The question arises what the fate of the case would be where there was search in the case of the assessee as well as in the case of the other party under the provisions of section 132 of the Act and the document was found from the premises of the 3rd party. This issue has been answered by the order of this Tribunal in the case of Shri Rajesh Sundardas Vaswani & others in IT(SS)A No. 95/Ahd/2019 & others where the coordinate bench vide order dated 12-11-2020 quashed the assessment order passed under section 143(3) r.w.s. 153A of the Act by observing as under: 29. We have duly considered rival contentions and gone through the record carefully. Before adverting to the facts and alleged seized material considered by the ld.AO for making the addition in the hands of the present three assessees, we deem it appropriate to bear in mind the position of law propounded in various authoritative judgments recording scope of section 153A of the Act. We are of the view that in this regard, there were large numbers of decisions. First we refer to the decision of Hon’ble Delhi High Court in the case of IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 13– CIT Vs. Kabul Chawla, 380 ITR 573 (Del). Hon’ble Delhi High Court after detailed analysis has summarized the following legal position: 37. On a conspectus of Section 153A(1) of the Act, read with the provisos thereto, and in the light of the law explained in the aforementioned decisions, the legal position that emerges is as under: i. Once a search takes place under Section 132 of the Act, notice under Section 153 A(1) will have to be mandatorily issued to the person searched requiring him to file returns for six AYs immediately preceding the previous year relevant to the AY in which the search takes place. ii. Assessments and reassessments pending on the date of the search shall abate. The total income for such AYs will have to be computed by the AOs as a fresh exercise. iii. The AO will exercise normal assessment powers in respect of the six years previous to the relevant AY in which the search takes place. The AO has the power to assess and reassess the 'total income' of the aforementioned six years in separate assessment orders for each of the six years. In other words there will be only one assessment order in respect of each of the six AYs \"in which both the disclosed and the undisclosed income would be brought to tax\". iv. Although Section 153 A does not say that additions should be strictly made on the basis of evidence found in the course of the search, or other post-search material or information available with the AO which can be related to the evidence found, it does not mean that the assessment \"can be arbitrary or made without any relevance or nexus with the seized material. Obviously an assessment has to be made under this Section only on the basis of seized material.\" v. In absence of any incriminating material, the completed assessment can be reiterated and the abated assessment or reassessment can be made. The word 'assess' in Section 153 A is relatable to abated proceedings (i.e. those pending on the date of search) and the word 'reassess' to completed assessment proceedings. vi. Insofar as pending assessments are concerned, the jurisdiction to make the original assessment and the assessment under Section 153A merges into one. Only one assessment shall be made separately for each AY on the basis of the findings of the search and any other material existing or brought on the record of the AO. vii. Completed assessments can be interfered with by the AO while making the assessment under Section 153 A only on the basis of some incriminating material unearthed during the course of search or requisition of documents or undisclosed income or property discovered in the course of search which were not produced or not already disclosed or made known in the course of original assessment.” 30. ITAT, Delhi Bench in the case of DIT Vs. Smt. Shivali Mahajan and others, rendered in ITA No.5585/Del/2015 (copy of the decision placed on record) has considered this aspect in its decision. Thereafter, the Tribunal has specifically held that serial no.(iv) of the above proposition, the Hon’ble Delhi High Court has specifically held that assessment under section 153A of the Act has to be specifically made on the basis of seized material. ITAT Delhi Bench was considering an aspect whether the evidence in the shape of books of accounts, money, bullion, jewellery found during the course of search relates to other person than the searched person, can that be considered while making assessment under section 153A of the Act. Like in the present appeals, simultaneous search was carried out at the premises of the Venus Infrastructure and Ashok Sunderdas Vaswani, and the material found during the search of Venus Infrastructure Developers or Ashok Sunderdas Vaswani could be used while framing the assessment of Rajesh Sunderdas Vaswani and Deepak Budharmal Vaswani under section 153A of the Act. ITAT Delhi Bench has specifically held that material recovered from the premises of other person cannot be used in the hands of the searched person. For that purpose an assessment under section 153C or 147 is to be made. At this stage, in order to fortify ourselves, we would like to make reference to the following paragraphs of the ITAT Delhi Bench’s order. It reads as under: “15. Thus, when during the course of search of an assessee any books, document or money, bullion, jewellery etc. is found which relates to a person other than the person searched, then the Assessing Officer of the person searched shall hand over such books of account, documents, or valuables to the Assessing Officer of such other person and thereafter, the Assessing Officer of such other person can proceed against such other person. However, in the case under appeal before us, admittedly, Section 153C is not invoked in the case of the assessee and the assessment is framed under Section 153A. We, respectfully following the above decisions of Hon'ble Jurisdictional High Court, hold that during the course of IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 14– assessment under Section 153A, the incriminating material, if any, found during the course of search of the assessee only can be utilized and not the material found in the search of any other person.” 31. Order of the ITAT Delhi Bench in other cases viz. Asha Rani Lakhotia vs. ACIT and Subhag Khattar Vs. ACIT are on the same line. 32. Hon’ble Delhi High Court in the case of Subhag Khattar in Tax Appeal No.60 of 2017 has considered the following question of law: \"Did the Income Tax Appellate Tribunal (ITAT) fall into error in holding that the additions made under Section 153A read with Section 143(3) of the Income Tax Act, 1961 in the circumstances of the case, were not justified and supportable in law? \" 33. After putting reliance upon its decision in the case of CIT Vs. Kabul Chawla (supra) has replied this question as under: “6. The Assessee went in appeal before the Commissioner of Income Tax (Appeals) who dismissed it by an order dated 27th November, 2014. A further appeal was filed by the Assessee before the ITAT. The ITAT, inter alia, found substance in the contention of the Assessee that the assessment under Section 153(A) of the Act, in the absence of any incriminating material found during the search on the premises of the Assessee was not sustainable in law. Reliance was placed on the decision of this Court in Commissioner of Income Tax v. Kabul Chawla, [2016] 380 ITR 573. 7. A question was posed to the learned counsel for the Revenue whether in the present case anything incriminating has been found when the premises of the Assessee was searched. The answer was in the negative. The entire case against the Assessee was based on what was found during the search of the premises of the AEZ Group. It is thus apparent on the face of it, that the notice to the Assessee under Section 153A of the Act was misconceived since the so-called incriminating material was not found during the search of the Assessee's premises. The Revenue could have proceeded against the Assessee on the basis of the documents discovered under any other provision of law, but certainly, not under Section 153A. This goes to the root of the matter.” 34. Hon’ble Court has specifically observed for the purpose of section 153A that only seized material is required. However, if there is any other incriminating material belong to the assessee found at the premises of the some other person, then the assessment has to be made under other provisions and not under section 153A of the Act. Hon’ble jurisdictional high Court has also considered the decision of Hon’ble Delhi High Court in the case of CIT Vs. Kabul Chawla (supra). Hon’ble Gujarat High Court framed the following question of law in the case of Pr.CIT Vs. Saumya Construction (supra): \"[A] Whether the order of Tribunal is right in law and on facts in deleting the addition made in assessment made u/s 153A of the Act? [B] Whether the Tribunal is right in law in holding that the addition should be based on the incriminating material found during the course of search under new procedure of assessment u/s 153A which is different from earlier procedure u/s 158BC r.w.s. 158BB of the Act and by reading into the section, the words 'the incriminating material found during the course of search' which are not there in section 153A? [C] Whether the Tribunal erred in relying on the ITAT order in Sanjay Aggarwal v. DCIT (2014) 47 Taxmann.Com 210 (Del) which has interpreted undisclosed income unearthed during the search to imply incriminating material, as against the finding of the Delhi High Court in Filatex India Ltd. v. CIT-IV (2015) 229 Taxman 555 wherein it is held that during the assessment u/s 153A additions need not be restricted or limited to incriminating material found during the course of search?\" 35. Hon’ble Court concurred with the decision of Hon’ble Delhi High Court. We deem it appropriate to take note of relevant part of the decision, which reads as under: “16. Section 153A bears the heading \"Assessment in case of search or requisition\". It is well settled as held by the Supreme Court in a catena of decisions that the heading of the section can be regarded as a key to the interpretation of the operative portion of the section and if there is no ambiguity in the language or if it is plain and clear, then the heading used in the section strengthens that meaning. From the heading of section 153, the intention of the legislature is clear viz., to provide for assessment in case of search and requisition. When the very purpose of the provision is to make assessment in case of search or requisition, it goes without saying that the assessment has to have relation to the search or requisition. In other words, the assessment IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 15– should be connected with something found during the search or requisition, viz., incriminating material which reveals undisclosed income. Thus, while in view of the mandate of sub-section (1) of section 153A of the Act, in every case where there is a search or requisition, the Assessing Officer is obliged to issue notice to such person to furnish returns of income for the six years preceding the assessment year relevant to the previous year in which the search is conducted or requisition is made, any addition or disallowance can be made only on the basis of material collected during the search or requisition. In case no incriminating material is found, as held by the Rajasthan High Court in the case of Jai Steel (India) (supra), the earlier assessment would have to be reiterated. In case where pending assessments have abated, the Assessing Officer can pass assessment orders for each of the six years determining the total income of the assessee which would include income declared in the returns, if any, furnished by the assessee as well as undisclosed income, if any, unearthed during the search or requisition. In case where a pending reassessment under section 147 of the Act has abated, needless to state that the scope and ambit of the assessment would include any order which the Assessing Officer could have passed under section 147 of the Act as well as under section 153A of the Act. 17. In the facts of the present case, a search came to be conducted on 07.10.2009 and the notice was issued to the assessee under section 153A of the Act for assessment year 2006-07 on 04.08.2010. In response to the notice, the assessee filed return of income on 18.11.2010. In terms of section 153B, the assessment was required to be completed within a period of two years from the end of the financial year in which the search came to be carried out, namely, on or before 31st March, 2012. Here, insofar as the impugned addition is concerned, the notice in respect thereof came to be issued on 19.12.2011 seeking an explanation from the assessee. The assessee gave its response by reply dated 21.12.2011 calling upon the Assessing Officer to provide copies of statements recorded on oath of Shri Rohit P. Modi and Smt. Pareshaben K. Modi during the search as well as the copies of the documents upon which the department placed reliance for the purpose of making the proposed addition as well as the copy of the explanation given by Shri Rohit P. Modi and Smt. Pareshaben K. Modi regarding the on-money received, copies of the assessment orders in case of said persons and also requested the Assessing Officer to permit him to cross-examine the said persons. The Assessing Officer issued summons to the said persons, however, they were out of station and it was not known as to when they would return. In this backdrop, without affording any opportunity to the assessee to cross-examine the said persons, the Assessing Officer made the addition in question. 18. In this case, it is not the case of the appellant that any incriminating material in respect of the assessment year under consideration was found during the course of search. At the relevant time when the notice came to be issued under section 153A of the Act, the assessee filed its return of income. Much later, at the fag end of the period within which the order under section 153A of the Act was to be made, in other words, when the limit for framing the assessment as provided under section 153 was about to expire, the notice has been issued in the present case seeking to make the proposed addition of Rs.11,05,51,000/- on the basis of the material which was not found during the course of search, but on the basis of a statement of another person. In the opinion of this court, in a case like the present one, where an assessment has been framed earlier and no assessment or reassessment was pending on the date of initiation of search under section 132 or making of requisition under section 132A, while computing the total income of the assessee under section 153A of the Act, additions or disallowances can be made only on the basis of the incriminating material found during the search or requisition. In the present case, it is an admitted position that no incriminating material was found during the course of search, however, it is on the basis of some material collected by the Assessing Officer much subsequent to the search, that the impugned additions came to be made. 19. On behalf of the appellant, it has been contended that if any incriminating material is found, notwithstanding that in relation to the year under consideration, no incriminating material is found, it would be permissible to make additions and disallowance in respect of all the six assessment years. In the opinion of this court, the said contention does not merit acceptance, inasmuch as, the assessment in respect of each of the six assessment years is a separate and distinct assessment. Under section 153A of the Act, an assessment has to be made in relation to the search or requisition, namely, in relation to material disclosed during the search or requisition. If in relation to any assessment year, no incriminating material is found, no addition or disallowance can be made in relation to that assessment year in exercise of powers under section 153A of the Act and the earlier assessment shall have to be reiterated. In this regard, this court is in complete agreement with the view adopted by the Rajasthan High Court in the case of Jai Steel (India), Jodhpur (supra). Besides, as rightly pointed out by the learned counsel for the respondent, the controversy involved in the present case stands concluded by the decision of this court in the case of Jayaben Ratilal Sorathia (supra) wherein it has been held that while it cannot be disputed that considering section 153A of the Act, the Assessing Officer can reopen and/or assess the return with respect to six preceding years; however, there must be some incriminating material available with the Assessing Officer with respect to the sale transactions in the particular assessment year. 20. For the foregoing reasons, it is not possible to state that the impugned order passed by the Tribunal suffers from any legal infirmity so as to give rise to a question of law, much less, a substantial question of law, warranting interference. The appeal, therefore, fails and is, accordingly, dismissed.” 36. As far as decisions relied upon by the ld.CIT-DR are concerned, we have already considered the decision in the case of E.N. Gopakumar (supra). Other decisions are also on the similar line, but they are not in coherence with the position of law propounded by the Hon’ble jurisdictional High Court. Therefore, Tribunal being subordinate to the Hon’ble Gujarat High Court, is required to first follow Hon’ble Supreme Court and thereafter Hon’ble jurisdictional High Court. If no ratio of the law is available from Hon’ble Supreme Court as well as Hon’ble jurisdictional high Court, then the decision of non- jurisdictional High Court is to be followed. Therefore, we do not deem it necessary to recapitulate the decisions of Hon’ble IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 16– Kerala High Court and make discussion on them. Ld.CIT-DR was unable to bring any authoritative decision from the Hon’ble Supreme Court or from the Hon’ble jurisdictional High Court to support the case of the Revenue. He made reference to para-18 of the Pr.CIT Vs. Saumya Construction (supra), which we have considered; but paragraph nowhere buttress the case of the ld.CIT-DR. On a detailed analysis of these case laws, it is pertinent to observe that scheme of the Income Tax Act would provide that a regular assessment of the income is to be made under section 143(3)/144. In the case of an escaped income, then a notice under section 148 should be issued and the assessment is to be made under section 147 r.w. section 143(3). In case a search is carried out on an assessee, then that search could give rise to a proceedings viz. under section 153A qua the person who has been searched. The income has to be assessed on the basis of material found during the course of search. The second category of the person is third-party and the assessment could be made under section 153C of the Act. The assessment under section 153C is to be made on a condition that during the course of search any money, bullion, jewellery, assets, documents belonged to the assessee prior to 1.6.2015, and information relates/pertains to assessee after 1.6.2015 was found qua to the person other than the searched person. In that situation, the AO of the searched person would record his satisfaction that such material belongs to third-person, and he would transmit that material along with his satisfaction to the AO having jurisdiction on such other person. The AO thereafter issue notice under section 153Cafter recording his satisfaction and the assessment proceedings under section 153C r.w. section 153A would commence. One more situation would arise, which we are going to discuss in this very group in the later part of the order that material was found during the course of search, but six years have expired, then the assessment could be reopened. In other words, the material belonged to some other person was found during the course of search. Prior to 1.6.2015, a possible angle could be that such material is to be construed, whether the income has escaped assessment or not. Broadly, these are basic parameters for making assessment under different sections. In the present group of three assessees in different assessment years, search was conducted, but the additions have been made on the basis of the material found during the search relating to some third person. In other words, the AO has not made the addition on the basis of material found during the course of search of these three assessees. We will discuss the material considered by the AO in the subsequent part of his order. Primarily, after looking the material considered by the AO and compiled in tabular form by the ld.counsel for the assessee, we have verified that these additions are not based on the material found during the course of search conducted at the premises of these three assessees. Let us take note of the material considered by the AO for making the addition. These details have been compiled in tabular form and they read as under: XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX 37. With the assistance of the ld.representatives, we have gone through the record carefully, and material available on record. For the sake of reference, let us take the assessment of Shri Deepak Budharmal Vaswani for the assessment year 2009-10. The assessee has filed his return of income under section 139(1) of the Act on 30.9.2009 declaring total income at Rs.2,57,82,210/-. His income has been determined under section 153A r.w. section 143(3) at R.69,53,93,838/- . One of the additions made is of Rs.5.10 crores which is discernible in the chart also. According to the ld.counsel for the assessee, this addition has been made on the basis of pages 374 to 376 of the Department’s paper book. The addition has been discussed in para-30 of the assessment order. A perusal of the paragraph-30.2 of the assessment order for the Asstt.Year 2009-10 in the case of Deepak Budharmal Vaswani would reveal that this addition has been made on the basis of the details of cash payments recorded in unaccounted cash book seized from “Terrace of Crystal Arcade”. The following observation of the AO would make it clear: “On the basis of the above incriminating material seized evidences, it is noticed that details of cash payment have been found recorded in unaccounted cash book seized from Terrace of Crystal Arcade, C.G.Road, Ahmedabad and upon correlation of seized documents, it has been established that the land at Nidhrad, Chekhla villages have been purchased by Vaswani family members/Venus group concerns/Thakor family members. The land was purchased in the name of Thakor family members but the funds were made available by Vaswani family members and Venus group concerns. The on-money has been paid over and above the registered value of the land.” 38. Thus, the AO is talking of on-money which has been unearthed, according to him, during the course of search, on the basis of alleged cash book. This cash book was not found from the premises of the assessee. It was found from the premises of Ashok Sunderdas Vaswani and Venus Infrastructure and Developers. Similarly, the ld.counsel for the assessee took us through various conclusions of the AO in other assessment orders, and the basis of the documents considered by the AO. None of the additions, except addition of jewellery in the assessment year 2015-16 in the case of Deepak Budharmal Vaswani was made on the basis of seized material. As far as the case of Sanjeet Motors and Finance Ltd. is concerned, these additions are based on the basis of certain information gathered during the various investigation carried out by Kolkatta Investigation Wing in the case of completely an unconnected third-person. So these materials could not be considered in the assessment proceedings under section 153A. They ought to be considered under some other provisions viz. Section 153C or some other sections; but not under this section. 11.3 A question also arises whether the statement of Shri Shripal Vora represents incriminating material which can be used against the assessee. In this regard, we note that the Hon’ble Delhi High Court in the case of CIT versus Best Infrastructure India Private Ltd. reported in 397 ITR 82 has observed as under: IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 17– 36. Turning to the facts of the present case, it requires to be noted that the statements of Mr. Anu Aggarwal, portions of which have been extracted hereinbefore, make it plain that the surrender of the sum of Rs. 8 crores was only for the AY in question and not for each of the six AYs preceding the year of search. Secondly, when Mr. Anu Aggarwal was confronted with A- 1, A-4 and A-11 he explained that these documents did not pertain to any undisclosed income and had, in fact been accounted for. Even these, therefore, could not be said to be incriminating material qua each of the preceding AYs. 11.4 In view of the above, we hold that the statement of Shri Shripal Vora cannot be treated as an incriminating document and used against the assessee in the given facts and circumstances. Similarly, we also note that the assessee has not been given the opportunity of cross examination of the statement of Shri Shripal Vora relied upon by the AO for making the assessment in the hands of the assessee which is against the principal of natural justice. 11.5 Now moving further, undoubtedly the deed dated 6 December 2016 was found from the premises of the assessee duly signed by the families stating that the amount of loan appearing in the annexure 1 represents the book-entry and there is nothing payable by the assessee. Undeniably, the assessee has taken loans from the 3rd parties. The assessee has furnished the necessary details such as name, address, PAN ledger copies of lenders and confirmation of the lenders to the AO and no defect whatsoever was pointed out by the AO in such details. All the loan transactions were carried out through the proper banking channel and duly recorded in the books of accounts. There was no evidence found about the cash trail indicating the exchange of cash in the hands of the assessee and other parties despite extensive search operations being carried out under section 132 of the Act at the premises of the assessee. Furthermore, we are of the view that the AO grossly erred while putting the addition in the hands of the assessee based on the deed dated 6 December 2016 which is the secondary document and without verifying the primary document available on record. As such, the AO has not carried out any independent enquiries from the lenders by issuing notice under section 131 and 133(6) of the Act. Undeniably the deed dated 6 December 2016 creates suspicion about the genuineness of loan but the same cannot partake the character of the evidence until the verification of the primary documents is carried out by the AO. 11.6 On close analysis of deed dated 6 December 2016, we note that there is no concrete denial about the repayment of the loan. It was stated in the deed that such loans are on paper only to establish that the new management is not accountable for any payment toward such loan. At the same time, it was also reflected in the deed that in the event of any demand from the loan party, it is the sole responsibility of the old management and not the assessee. Therefore, the deed dated 6 December 16 cannot be treated as the gospel truth until the verification of the primary documents is carried out by the assessee revenue. In view of the above and after considering the facts in totality, we are of the view that the addition made by the AO and sustained by the learned CIT-A to the tune of Rs. 2.01 crore is not liable to be upheld. Accordingly, we set aside the finding of the learned CIT-A and direct the AO to delete the addition made by him. Hence, the ground of appeal of the assessee is allowed. 11.7 Coming to the ground of appeal of the revenue, we note that the AO while calculating the amount of unsecured loan which was treated as unexplained cash credit under section 68 of the Act has taken certain loan entries twice which is against the provisions of law. Accordingly, the learned CIT-A rightly deleted the addition made by the AO with respect to the addition made twice. Accordingly, we hold that the addition for ₹97 Lacs is not sustainable. 11.8 Likewise, the amount of loan which has been repaid by the assessee even much prior to the date of search conducted at the premises of the assessee, the same cannot be treated as unexplained cash credit under 68 of the Act in view of the judgement of Hon’ble Gujarat High Court in the case of CIT vs Ayachi Chandrasekhar Narsangji reported in 221 Taxman 146 (Guj) has held as under: It has also come on record that the said loan amount s been repaid by the assessee to Shri Ishwar Adwani in the immediate next financial year and the Department has accepted the repayment of loan without probing into it. In the aforesaid facts and circumstances of the case, when the ITAT has held that the matter is not required to be remanded as no other view would be possible, we see no reason to interfere with the impugned order IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 18– passed by the ITAT. No question of law, much less substantial question of law arises in the present Tax Appeal. Hence, the present Tax Appeal deserves to be dismissed and is accordingly dismissed. 11.9 At this juncture, it is also pertinent to point out that the loan among the group companies cannot be subject to the addition in the hands of assessee. It is for the reason that such loans are not actually repayable to the outside parties. Furthermore, one party has shown loan and corresponding party has shown as an advance which may be treated as only adjustment/ book entry which cannot be given the colour of unexplained cash credit under section 68 of the Act. Similarly, the loan taken by the assessee in the earlier cannot be disturbed in the year under consideration. 11.10 without prejudice to the above, it is pertinent to note that the issue about the additions made by the AO based on the documents discussed above is not sustainable as we have denied making any reference to the statement of Shri Shripal Vora as the procedure under section 153C of the Act was not adopted. Likewise, the statement of Shri Shripal Vora was not confronted to the assessee which is against the principles of natural justice. Similarly, the contents of the deed dated 6th December 2016 cannot be sole basis of making any addition under section 68 of the Act without making any cross verification from the loan parties particularly in the situation when all the necessary details were available on record. In view of the above and after considering the facts in totality, we hold that there is no infirmity in the order of learned CIT-A as discussed above. Accordingly, we decline to interfere in his order. Hence the ground of appeal of the revenue is hereby dismissed.” 8. We find that, based on the same reasoning and on materially similar facts, the Tribunal has deleted the impugned additions made by the Assessing Officer and sustained by the Ld. CIT(A) in the case of Narmada Concast Private Limited (supra). Respectfully following the same, we uphold the grievance of the assessee and direct the Assessing Officer to delete the impugned additions. 9. In the result, both the appeals of the assessee are allowed. The order is pronounced in the open Court on 16.04.2025 Sd/- Sd/- (SUCHITRA KAMBLE) (DR. B.R.R. KUMAR) JUDICIAL MEMBER VICE-PRESIDENT Ahmedabad; Dated /04/2025 btk IT(SS)A Nos.141 & 142/Ahd/2023 Ganga Industries Vs. DCIT Asst. Year : 2014-15 & 2015-16 - 19– आदेश की \bितिलिप अ\u000eेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u0007 / The Appellant 2. \b थ\u0007 / The Respondent. 3. संबंिधत आयकर आयु\u0015 / Concerned CIT 4. आयकर आयु\u0015(अपील) / The CIT(A)- 5. िवभागीय \bितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड फाईल / Guard file. आदेशानुसार/ BY ORDER, True Copy उप/ / / /सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, , , , अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation ….15.04.2025….. 2. Date on which the typed draft is placed before the Dictating Member ……15.04.2025……….. 3. Other Member……15.04.2025…………… 4. Date on which the approved draft comes to the Sr.P.S./P.S ………15.04.2025…. 5. Date on which the fair order is placed before the Dictating Member for pronouncement …16.04.2025……. 6. Date on which the fair order comes back to the Sr.P.S./P.S …16.04.2025……………. 7. Date on which the file goes to the Bench Clerk ……16.04.2025….…. 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order 10. Date of Dispatch of the Order…………………………………… "