The ITO-1, Khandwa V. M/s. R S P Real Estate, Khandwa

ITA 714/Ind/2019

• Counselvise Citation: [2023] 100 COUNSELVISE.COM (IT) 5828 (ITAT-INDORE)
• Duration Of Justice: 4 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 24-10-2023
• Assessment Year: 2016-2017
• Appeal Filed On: 18-06-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Tax effect; TDS
• Section: 131; 68; 143(3); 142(1); 194C; 264; 44AB; 13

Judgement Text

Page 1 of 13 आयकर अपीलȣय अͬधकरण, इंदौर Ûयायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI B.M. BIYANI, ACCOUNTANT MEMBER ITA No. 714/Ind/2019 Assessment Year: 2016-17 ITO-1, Khandwa बनाम/ Vs. M/s. RSP Real Estate, Ramkrishnaganj, Khandwa (Revenue / Appellant) (Assessee / Respondent) PAN: AAPFR1699K Assessee by Shri S.N.Agrawal, AR Revenue by Shri Ashish Porwal, Sr. DR Date of Hearing 25.10.2023 Date of Pronouncement 31.10.2023 आदेश / O R D E R Per B.M. Biyani, A.M.: Feeling aggrieved by appeal-order dated 25.03.2019 passed by learned Commissioner of Income-Tax (Appeals)-II, Indore [“Ld. CIT(A)”], which in turn arises out of assessment-order dated 18.12.2018 passed by learned ITO, Ward-1, Khandwa, [“Ld. AO”] u/s 143(3) of Income-tax Act, 1961 [“the Act”] for Assessment-Year [“AY”] 2016-17, the revenue has filed this appeal on following effective grounds: 1) Whether on the facts and in the circumstances of the case, the Ld. CIT(A) was justified in deleting the addition of Rs. 64,65,800/- made on account of unexplained development expenses, after considering the submission made before him by the assessee and without calling remand report of the AO on such evidences/submissions. 2) Whether on the facts and in the circumstances of the case, the Ld. CIT(A) was justified in holding that the transactions for unsecured loan received ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 2 of 13 by the assessee from M/s. Vikask Udhyog for Rs. 1,25,00,000/- are genuine even though on inquiry it was found by the AO that the assessee has routed through funds by accommodative entries through M/s. SLA Commodities, Kolkata. 3) Whether on the facts and in the circumstances of the case, the Ld. CIT(A) was justified in holding that the transactions for unsecured loan received by the assessee from M/s. Gayatri Industries for Rs. 50,00,000/- is genuine even though on inquiry it was found by the AO that the assessee has routed through funds by accommodative entries through Mr. Narendra Bansal who is man of no means.” 2. This revenue’s appeal was originally dismissed by order dated 21.08.2019 of ITAT, Indore on account of low-tax effect. Subsequently, the revenue filed M/A No. 23/Ind/2020 seeking re-call of ITAT’s order on the footing that the tax effect was more than the stipulated limit of Rs. 50 lacs; therefore the Revenue’s appeal had been wrongly dismissed. The revenue’s prayer was accepted; the M/A was allowed; original ITAT order dated 21.08.2019 was re-called and this appeal being ITA No. 714/Ind/2019 was re-stored for hearing with same registration number. This way, the appeal has again come before us for hearing. 3. Brief facts leading to present appeal are such that the assessee, a partnership firm, filed its return of income of relevant assessment-year on 27.08.2016 declaring a total income of Rs. 8,60,310/-. The assessee is engaged in the business of real estate. The case was selected under scrutiny and notices u/s 143(2)/142(1) were issued. Ultimately, while completing assessment, the AO made these additions, namely (i) disallowance of Rs. 64,65,800/- out of development expenses and (ii) addition of Rs. 1,75,00,000/- u/s 68 in respect of unsecured loans taken by assessee from two lenders, M/s Vikash Udhyog and M/s Gayatri Industries. Aggrieved by additions so made, the assessee went in first-appeal wherein the CIT(A) ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 3 of 13 deleted all additions fully. Now, the revenue is aggrieved by relief given in first-appeal and has come in this appeal before us. Ground No. 1: 4. In this ground, the revenue claims that the CIT(A) has erred in deleting the disallowance of development expenses of Rs. 64,65,800/- made by AO. 5. Ld. DR for revenue referred to assessment-order and firstly submitted that the AO has made this disallowance by noting that the assessee has claimed this expenditure by making journal-entries on 31.03.2016 in the names of three parties. The AO further noted that the assessee did not file any detail to prove the genuineness of expenditure and did not file any reply to show-cause notice issued by him. Secondly, Ld. DR emphasized the plea raised by revenue in Ground No. 1 of appeal-memo that the CIT(A) has accepted claim of assessee without calling remand-report from AO. Therefore, Ld. DR contended, the order of AO must be upheld. 6. Per contra, Ld. AR for assessee carried us to order of first-appeal wherein the CIT(A) has deleted addition by observing and holding thus: “Ground No. 1 to 3: 4. These grounds of appeal are with regard to making addition of Rs. 64,65,800/- by disallowing development expenses. I have carefully gone through the assessment order as well as submission of the appellant in this regard. 4.1 The AO has given reason in its order for disallowing the said expenses that “No details have been furnished”. The appellant has submitted in its submission that all the details of such expenses along with Copy of Account, complete Bill Vouchers were properly uploaded on e-filing Portal during the assessment proceedings before passing the assessment order. The copies of the same were also submitted by the appellant during the appellate proceedings. The AO has also mentioned in its order that the expenses were debited by the Journal Entry only on the last day of year without making any TDS. The appellant has submitted that the said expenses were incurred in the due course of business. It has been further argued that proper development of the colony was an essential condition for getting permission to sale the plot. ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 4 of 13 The appellant has also submitted the copy of accounts of such expenses and bill. It is clear from the said documents that the appellant had deducted the due tax under work contract u/s 194C of the Income-tax Act, 1961 and had also submitted the TDS Return well within time limit and payments were also made periodically only through proper banking channels. The appellant had maintained proper books of accounts which got audited u/s 44AB and the case of the appellant was completed u/s 143(3) of the Income-tax Act, 1961. In support of its case, the appellant has relied on the decision of Hon'ble High Court of M.P. in the case of CIT vs. Pure Pharma (P) Ltd. (2005) 270 ITR 382 (MP). 4.2 After going through the assessment order, it is clear that the AO had disallowed the said development expenses due to non-production of any document in respect of development expenses. But the appellant had submitted all the relevant documents i.e. bills, vouchers on e-filing portal before completion of assessment proceedings. The same were also submitted by the appellant at the appellate stage. Further, the appellant has also deducted the TDS on the same. The said expenses were incurred by the appellant wholly and exclusively for the business purposes. Hence, in view of the above facts, the disallowance made by the AO is hereby deleted and accordingly, these grounds are allowed.” 7. Ld. AR strongly supported the order of CIT(A). He submitted that the AO has incorrectly mentioned that no detail/document was filed before him; the correct fact is such that the assessee filed complete details and documentary evidences before AO on the designated web-portal of Income- tax Department. This fact is rightly examined and acknowledged by CIT(A) also in his order. Still to demonstrate this, Ld. AR showed that vide Query No. (ii) of notice dated 29.11.2018 u/s 142(1) (Page 40-41 of Paper-Book), the AO asked assessee to furnish details of development expenses of Rs. 69,55,071/- with supporting vouchers. In reply, vide Para No. 1 of letter dated 17.12.2018 (Page 50-56 of Paper-Book), the assessee e-filed complete details as called for. Ld. AR has filed a copy of e-filing acknowledgement dated 18.12.2018 downloaded from departmental database at Page No. 50 of Paper-Book. Referring to the reply furnished by assessee, Ld. AR submitted that the assessee filed to AO a complete Ledger A/c of the expenditure of Rs. 69,55,071/- (Page 57-58 of Paper-Book) and from such details only, the AO picked three entries of Rs. 50,00,000/-, Rs. 11,65,800/- and Rs. 3,00,000/- paid by assessee to M/s Earth Associates, M/s Subhash Kumar Darwai and M/s Luckey Construction respectively aggregating to Rs. 64,65,800/- for ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 5 of 13 making disallowance. He submitted that the assessee filed copies of invoices raised by those three parties to AO (Page No. 63-65 of Paper-Book). He submitted that the assessee also deducted TDS and reported in TDS returns (Page No. 66-80 of Paper-Book). Then, the Ld. AR also drew our attention to Paper-Book Page No. 59-62 where the Ledger A/cs of all three parties, extracted from books of account of assessee, are filed. Referring to same, Ld. AR explained that advance-payments to all three parties were made in preceding year through banking channel. Thereafter, when these parties completed work and submitted their bills during current year, the assessee passed necessary accounting entries in its books of account and claimed deduction. Ld. AR submitted that all accounting entries of payments, invoices raised and TDS deducted, are clearly mentioned in these Ledger A/cs and the entries are corroborated by supporting documents filed to AO and copies in Paper-Book. Ld. AR submitted that the assessee is engaged in the business of real estate and the assessee had to incur the impugned expenses for developmental work; therefore the expenses are incurred for business purpose and allowable as deduction. Ld. AR further submitted that the assessee has been engaged in this activity year after year and the assessment-order of preceding AY 2015-16 finalised by way of scrutiny- assessment is also placed at Page No. 157-158 of Paper-Book wherein not only the same activity but also the returned-income declared by assessee after deduction of expenses, have been accepted without any objection. Moreover, the advance-payments to three parties were made in financial year 2014-15 relevant to AY 2015-16 for which the said scrutiny- assessment was done. Finally, Ld. AR closed arguments by submitting that the CIT(A) has carefully and rightly deleted the addition made by AO; there is no infirmity in his order, hence his order must be upheld. 8. We have considered rival submissions of both sides and perused the orders of lower-authorities as well as the documents filed in the Paper-Book to which our attention has been drawn. After a careful consideration, we find that the AO has noted that the assessee did not furnish any detail in ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 6 of 13 response to his show-cause notice but the documents filed in the Paper- Book demonstrate otherwise. The assessee has filed complete details and documents to AO and in support, filed the evidences of e-filing acknowledgements in Paper-Book. The CIT(A) has also noted in his order that the assessee filed complete details and documents before AO at assessment stage and also before him during appellate stage. The AO has also mentioned that the expenditure is claimed by making only journal entries on 31.03.2016. It is true that the assessee has passed journal entries on 31.03.2016 but those entries are backed by respective invoices dated 15.03.2016/17.03.2016/31.03.2016 issued by those three parties, copies of which are placed at Page No. 63-65 of Paper-Book and were also filed to AO & CIT(A) as per certificate given in Paper-Book. The TDS deduction and remittance to Govt. A/c is also proved by documents filed to AO & CIT(A) as well as placed in the Paper-Book before us. Thus, we find a strong merit in submission of Ld. AR that the assessee filed complete details and documents to AO and the AO has made a wrong finding that no details were furnished and contrary to that, the CIT(A) has made a correct finding qua the submission having been made by assessee to AO. During hearing, the Bench also raised a query to Ld. DR that in Ground No. 1, why the AO is claiming that the CIT(A) has not called remand-report from him instead of taking a plea that no detail/documents were filed by assessee before him? The Ld. DR was answerless to this query. That apart, even before us, Ld. DR could not point out any fallacy in the merit of deduction claimed by assessee with reference to documents in Paper-Book. Therefore, taking into consideration the documents produced before us and the pleadings made before us, we accept that the CIT(A) has passed a correct order granting relief to assessee. There is no infirmity in his order so as to warrant our interference. Consequently, we approve his order. This ground is dismissed. Ground No. 2 and 3: ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 7 of 13 9. In these grounds, the revenue claims that the CIT(A) has erred in deleting addition of Rs. 1,75,00,000/- made by AO u/s 68 on account of unexplained loans. 10. Ld. DR for revenue drew our attention to assessment-order and submitted that the AO has noted that the assessee took a loan of Rs. 1,25,00,000/- from M/s Vikash Udhyog, Khandwa through an accommodation entry arranged from a Kolkata-based company “SLA Commodities & Derivatives Pvt. Ltd”. Ld. AO issued a notice to that Kolkata- based company but it remained unserved. The assessee has taken another loan of Rs. 50,00,000/- from M/s Gayatri Industries, Nagpur through an accommodation entry arranged from one Shri Narendra Bansal. The AO issued a summon u/s 131 to Shri Narendra Bansal but he failed to attend. Further, as per his affidavit dated 23.11.2018, he is a man of no means. The AO has also mentioned that all these facts were confronted to assessee by way of show-cause notice but the assessee did not file any reply to show- cause notice issued by him. Therefore, the AO has treated the unsecured loans of Rs. 1,25,00,000/- (+) Rs. 50,00,000/- taken by assessee as unexplained in terms of section 68 and made addition. Ld. DR submitted that the AO has rightly made addition when the ingredients of section 68 were not satisfied by assessee. 11. Per contra, Ld. AR for assessee carried us to the order of first-appeal wherein the CIT(A) has deleted addition by observing and holding thus: “Ground No. 5 to 8: 5.0 These grounds of appeal are with regard to making addition of Rs. 50,00,000/- on account of unsecured loan so taken by the appellant from M/s. Gayatri Udyog and addition of Rs. 1,25,00,000/- so taken by the appellant from Vikas Udyog. I have carefully gone through the assessment order as well as submission of the appellant in this regard. 5.1 The appellant has submitted that the opening credit balance of both the creditors was about of Rs. 1,42,92,700 and Rs. 57,78,398/- in the name of Gayatri Udhyog, Nagpur and Vikas Udhyog, Khandwa respectively. It has been further argued that the appellant had proved their identity and creditworthiness in the assessment proceedings u/s 143(3) of the Income-tax ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 8 of 13 Act, 1961 in the immediate preceding assessment year i.e. A.Y. 2015-16 and no addition was made by the AO u/s 68 of the Act. With regard to credit entry of 50,00,000/- at Gayatri Udhyog, Nagpur: 5.2 During the course of assessment proceedings, the appellant had filed confirmations, PAN, copy of bank statements of creditors to prove the genuineness of unsecured loans. Further, the identity & creditworthiness of the creditors has already been accepted by the AO in the immediate preceding assessment year i.e. 2015-16. The copy of the assessment-order for assessment year 2015-16 was also submitted by the appellant during the appellate proceedings. On perusal of the said bank statements, it is clear that the creditor – Gayatri Udhyog, Nagpur was having sufficient balance in its Cash Credit Accounts with a limit of Rs. Ten crores so held with Union Bank of India, Nagpur. Further, the appellant has submitted that the appellant had also repaid the old loan of the creditor to the tune of Rs. 1,41,00,000/- through Banking Channels. Further, the appellant had also made proper entry of interest and due tax was also deducted and paid by the appellant. The copy of the same was also submitted by the appellant. With regard to credit entry of Rs. 1,25,00,000/- of Vikas Udhyog, Khandwa: 5.3 The AO had issued summon u/s 131 of the Act to the partner of M/s. Vikas Udhyog, Khandwa to verify the identity and creditworthiness. In response to summon, Shri Naresh Kumar Mittal, partner of that firm, had appeared personally before the AO and had categorically stated on oath that the said firm had made advances to the appellant through banking channel and had also submitted its PAN, Bank statements, Acknowledgement of I.T. Return, Copy of the Audit Report. On asking by the AO about the source of advances, he had replied that one of the old sundry debtors namely SLA Commodity Ltd. had repaid the old outstanding loan through demand drafts and after getting credit of the same, he had made advances to the appellant. In support of his contention, he had filed the copy of PAN of SLA Commodity Ltd. alongwith the copy of Audit Report. Thus, the appellant as well as the partner of Vikas Udhyog, Khandwa had duly discharged the onus so lied upon them. 5.4 In the show cause notice, the AO had asked about the source of source of the unsecured loans. The appellant has submitted in its submission that the appellant firm or none of its partner was ever associated with the alleged providers of accommodation entry. The appellant firm had received the unsecured loans only from the creditworthy firms through proper Banking Channels and the repayments of said credit entries were also made through Banking Channels after paying interest. The AO on mere suspicion had treated the SLA Commodities & Derivatives Pvt. Ltd. as shell company without calling report from Registrar of the Companies & without checking its PAN and bank accounts. The appellant has further pleaded that the AO had not considered this fact that SLA commodities was the sundry debtor of the creditor firm i.e. Vikas Udhyog and having its closing balance in the audit report of creditor so submitted during the assessment proceedings by the said creditor. ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 9 of 13 5.5 It is a settled law that the appellant is not mandated to explain SOURCE OF SOURCE or ORIGIN OF ORIGIN of the fund, gets buttressed by the amendment made in section 68 with effect from 01/04/2013, which empowers the AO to examine source of source ONLY in cases of share- application money of limited companies. This amendment further does not give power to the AO to examine source of source, in case of loan creditors, in the light of various judgments of APEX COURT including decision of jurisdictional High Court of M.P. Reliance is placed on – 1. ITA No. 1542/Del/2012 Assessment year 2008-09, Banwari Lal vs. ITO, dated of order – 15.01.2016, wherein Hon'ble ITAT Delhi stating that appellant was not obliged to prove source of source of the credits. 2. Life Insurance Corporation of India Vs. CIT (1996) 219 ITR 410 (SC), wherein it is held that the law does not expect the impossible on the part of the Tax Payer. 3. S. Hastimal vs. CIT (1963) 49 ITR 273 (Mad), it was held that the assessee cannot be presumed to have special knowledge about the source of source or the origin of origin. 4. Jaiprakash Dadlani vs. ITO (2005) 4 SOT 138 (Mum. Trib.), it was held that while examining the applicability of section 68, source of source cannot be investigated. 5. Jurisdictional High Court of Madhya Pradesh in the case of – Ashok Pal Daga vs. CIT (1996) 220 ITR 452 (MP) – wherein it is held that assessee has proved the identity of the third party and also supplied the relevant evidence showing prima facie that the entries were not fictitious, the initial burden can be said to be discharged by the assessee. 5.6 There was no cash deposit in the bank accounts of the above named persons for advancing loan and their categorical admission regarding confirming the loan during the assessment proceedings itself proved the genuineness of transaction and thus, cannot be charged to tax in the appellant’s hands u/s 68 of the I.T. Act, 1961. The appellant has submitted that he had filed all the explanations with respect of proving identity, creditworthiness and genuineness of the transaction alongwith all supporting documents like the PAN, IT Return and bank account details of the creditors. The appellant has further relied on the following judicial decisions:- 1. CIT vs. Bedi & Co. P. Ltd. 230 ITR 580 (SC), wherein it was pointed out that Law does not expect the impossible on the part of the tax payer, if the explanation is prima facie reasonable, it cannot be rejected on mere surmises. 2. CIT vs. Metachem Industries (2000) 245 ITR 160 (MP), Jurisdictional High Court in the matter dealt that where the assessee had satisfactorily explained the credits standing in its name, the responsibility of the assessee stands discharged and ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 10 of 13 no further responsibility to show that it has come from the accounted source of the lender. 3. Orient Trading Co. Ltd. vs. CIT (1963) 49 ITR 723. 4. CIT vs. Real Time Marketing (P) Ltd. (2008) 306 ITR 35 (Del). 5. DCIT vs. Rohini Builders, (2002) 256 ITR 360 (Guj), wherein it is held that where the assessee satisfactorily explained the credits standing in its name, the responsibility of the assessee stands discharged and no further responsibility to show that it has come from the accounted source of the lender. 6. Nemi Chand Kothari vs. CIT (2003) 264 ITR 254 (Gauhati), wherein it was held that the appellant has not bothered to prove about source of source. 7. Sumerchand Jain vs. CIT (2007) 292 ITR 241 (MP) 5.7. After taking into account totality of facts, it is clear that the appellant had taken the loan from M/s. Gayatri Udhyog, Nagpur and Vikas Udhyog, Khandwa. As per section 68 of the Income-tax Act, 1961, it is required from the appellant to prove the identity, creditworthiness and genuineness of the said loan creditors. The appellant had submitted all the relevant documents before the AO to prove the identity, creditworthiness and genuineness of the said creditors. Further, the appellant has taken the plea that in the immediate preceding year i.e. 2015-16, he had proved the identity and creditworthiness of the said loan creditors and on this count, no adverse comment was made by the AO. Further, no addition was made by the AO u/s 68 of the IT Act,1961, in that year. In the statement, the partner of M/s. Vikas Udhyog, Khandwa, Shri Naresh Kumar Mittal had categorically accepted to have given loan to the appellant and he had also explained the source of the said loan amount. The AO had asked the appellant to explain source of source. Even after the amendment made in section 68 of Income-tax Act, 1961, the AO could not have asked the appellant to explain the source of source of the fund. The AO is free to examine and take relevant and appropriate action independently in the hands of the creditors. In fact, one of the creditors M/s. Vikas Udhyog is assessed in the same circle. The AO can and is free to take action, if any, in the case of the creditor Vikas Udhyog. Similarly, he can pass on the information to the AO of Nagpur where his counterpart can take action if so required. However, by no stretch of imagination, can these amounts be added in the hands of appellant as the appellant has not only discharged its onus with respect to identity, creditworthiness and genuineness but also provided the detail of source including the bank account where there is absolutely no cash transaction or deposit and have given all relevant documents like IT return etc. Further, the same creditors were already accepted in the previous 143(3) assessment. Hence, in light of the above facts and judicial decisions so discussed above, the addition so made by the AO is hereby deleted and accordingly, these grounds of appeal are allowed.” ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 11 of 13 12. Ld. AR strongly supported the order of CIT(A). For this issue also, Ld. AR submitted that the AO has incorrectly mentioned in assessment-ordre that no detail/document was filed before him; the correct fact is the assessee filed complete details and documentary evidences before him on the designated web-portal of Income-tax Department. This correct fact is also examined and acknowledged by CIT(A) in his order. Still to demonstrate this, Ld. AR showed that vide Para No. 2 of reply-letter dated 31.07.2018 (Page 35 of Paper-Book), the assessee furnished Ledger A/c, ITR, A/c confirmation and Bank statements of total 8 lenders including impugned 2 parties, M/s Vikash Udhyog and M/s Gayatri Industries, to AO. Copy of e- filing acknowledgement is placed at Page 34 of Paper-Book and copies of these documents are also filed in Paper-Book Page No. 86-155. Thereafter, vide Para No. 6 of letter dated 25.10.2018 (Page 39 of Paper-Book), the assessee again filed bank statement of M/s Gayatri Industries, copy of e- filing acknowledgement is placed at Page 38 of Paper-Book. Regarding loan taken from M/s Vikash Udhyog, Ld. AR referred to Bank statement and A/c Confirmation of party and demonstrated that there was opening balance of Rs. 57,78,398/-; thereafter a total loan of Rs. 1,25,00,000/- was taken the year in different tranches on various dates; there was repayment of Rs. 40,00,000/- made during the year; the lender charged interest of Rs. 22,73,488/- out of which the assessee deducted TDS of Rs. 2,27,349/-. Then, referring to audited accounts of lender, Ld. AR demonstrated that M/s Vikash Udhyog has not taken any loan from M/s SLA Commodities & Derivatives; in fact M/s Vikash recovered its outstanding-receivable from M/s SLA and out of such recovery, gave loan to assessee. Ld. AR further submitted that the AO also recorded statement of Shri Naresh Mittal, partner of M/s Vikash Udhyog on 24.10.2018, copy filed at Page 153-155 of Paper-Book. In reply to Q.No. 7, Shri Naresh Mittal clearly accepted the loan given by M/s Vikash Udhyog to assessee. Regarding loan taken from M/s Gayatri Industries, Ld. AR referred to Bank statement and A/c confirmation of party and demonstrated that there was opening balance of Rs. 1,42,92,700/-; thereafter a total loan of Rs. 50,00,000/- was taken during ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 12 of 13 the year; there was repayment of Rs. 1,41,00,000/- also during the year; the lender charged interest of Rs. 4,81,170/- out of which the assessee deducted TDS of Rs. 48,117/-. Referring to Bank statement of party, Ld. AR demonstrated that the loan of Rs. 50,00,000/- was given to assessee on 27.11.2015 out of available balance in Bank A/c; thereafter the party took loan from Shri Narendra Bansal. Thereafter, the observation made by AO that the loan was arranged from/through Shri Narendra Bansal is factually wrong. With these submissions, Ld. AR strongly contended that the assessee has sufficiently discharged onus cast upon it u/s 68 before the AO itself and again by re-filing those documents before CIT(A). Therefore, the CIT(A) has rightly deleted the addition made by AO, there is no infirmity in his action; his order must be upheld. 13. We have considered rival submissions of both sides and perused the orders of lower-authorities as well as the documents filed in the Paper-Book to which our attention has been drawn. After a careful consideration, we find that the AO has noted that the assessee did not furnish any detail in response to his show-cause notice but the documents filed in the Paper- Book demonstrate otherwise. The assessee has filed copies of e-filing acknowledgements as proof of making submission before AO. The CIT(A) has also noted in his order that the assessee filed complete details and documents before AO at assessment stage and as well as before him during appellate stage. We have also seen the papers and documents filed in Paper- Book, as explained by Ld. AR and discussed by us in preceding paragraph, and find that the assessee satisfies the ingredients of section 68, namely the identity and creditworthiness of the lenders as well as genuineness of loans taken. Therefore, there is no fallacy or infirmity in the action of CIT(A) in ITO-1, Khandwa, vs. M/s. RSP Real Estate, Khandwa ITA No.714/Ind/2019 Assessment year 2016-17 Page 13 of 13 deleting the addition made by AO. We agree with the order passed by CIT(A) in this regard. Consequently, his order is approved. These grounds of revenue are also dismissed. 14. Resultantly, this appeal of revenue is dismissed. Order pronounced in the open court on 31.10.2023. sd/- sd/- (VIJAY PAL RAO) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore Ǒदनांक /Dated : 31.10.2023 CPU/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order UE COPY Assistant Registrar Income Tax Appellate Tribunal Indore Bench, Indore