ACIT (Central)-1, Indore V. Global Metal & Energy Pvt. Ltd., Mumbai

ITSSA 82/Ind/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4610 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 25-04-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2014-2015
• Appeal Filed On: 18-03-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Bogus Share capital; Unexplained expenditure; Depreciation; Income from undisclosed sources; Search and seizure; Loose papers; Document seized; Principle of natural justice; Opportunity of cross examination; Additional evidence; Question of law; Tangible material; Corroborative evidences; Accommodation entries; Block assessment; Onus to prove; Retraction; Documents seized; TDS
• Section: 147; 131; 68; 263; 132; 69C; 143(3); 133A; 153A; 133(6); 69B; 143(2); 207; 64; 142(2A); 113; 43; 48; 2(A); 73; 72; 13; 153; 119; 22; 153C

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, इंदौर 瀈यायपीठ इंदौर 瀈यायपीठइंदौर 瀈यायपीठ इंदौर 瀈यायपीठ, इंदौर इंदौरइंदौर इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER VIRTUAL HEARING IT(SS)A No.161 to 165/Ind/2020 Assessment Years: 2013-14 to 2017-18 M/s. Global Metal & Energy Pvt. Ltd. Mumbai बनाम बनामबनाम बनाम/ Vs. ACIT(Central)-1 Indore (Appellant) (Respondent ) P.A. No.AAECG9590N IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 ACIT(Central)-1 Indore बनाम बनामबनाम बनाम/ Vs. M/s. Global Metal & Energy Pvt. Ltd. Mumbai (Appellant) (Respondent ) P.A. No.AAECG9590N Appellant by S/Shri Anil Kamal Garg & Arpit Gaur, CAs Respondent by Shri P.K. Mitra, CIT-DR Date of Hearing: 27.01.2022 Date of Pronouncement: 26.04.2022 आदेश / O R D E R PER BENCH: The above captioned appeals filed at the instance of the Assessee and Revenue are directed against the Common Order of the Ld. Commissioner of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 2 of 121 Income Tax (Appeals)-3, Bhopal (in short ‘CIT(A)’), dated 23.09.2020, which is arising out of the Common Assessment Order dated 16.08.2019 passed u/s. 143(3) r.w.s. 153A of the Income-Tax Act, 1961 (in short, ‘the Act’) for A.Y. 2013-14 to A.Y. 2016-17 and u/s. 143(3) of the Act for A.Y. 2017-18 by the ACIT (Central) -I, Indore. 2.1 Grounds of appeal raised by the Revenue for AY 2013-14 in IT(SS)A No.81/Ind/2021: “1. On the facts and in the circumstances of the case, the ld. CIT(A) has erred in law in deleting the addition of Rs. 3,99,10,000/- made by the Assessing Officer on account of share capital/share application money u/s 68 of the Income Tax Act, 1961 as unexplained cash credits. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 1,60,25,000/- made by the Assessing Officer on account of unexplained cash credits u/s 68 of the Income Tax Act, 1961 and corresponding interest expenses u/s 69C of Income Tax Act, 1961.” 2.2 Grounds of appeal raised by the Revenue for AY 2014-15 in IT(SS)A No.82/Ind/2021: “1. On the facts and in the circumstances of the case , the Ld. CIT(A) has erred in law in deleting the addition of Rs. 7,08,66,700 /- made by the Assessing Officer on account of share capital / share application money u/s 68 of the Income Tax Act, 1961 as unexplained cash credits. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 9,99,589/- made by the Assessing Officer on account of unexplained cash credits u/s 68 of the Income Tax Act, 1961 and corresponding interest expenses u/s 69C of Income Tax Act, 1961.” 2.3 Grounds of appeal raised by the Revenue for AY 2015-16 in IT(SS)A No.83/Ind/2021: “1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 27,91,300 /- made by the Assessing Officer on account of share capital / share application money u/s 68 of the Income Tax Act, 1961 as unexplained cash credits. 2. On the facts and in circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 4,27,52,925/- made by the Assessing Officer on account of unexplained cash credits u/s 68 of the Income Tax Act, 1961 and corresponding interest expenses u/s 69C of Income Tax Act, 1961.” 2.4 Grounds of appeal raised by the Revenue for AY 2016-17 in IT(SS)A No. 84/Ind/2021: “1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 12,81,42,000/- made by the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 3 of 121 Assessing Officer on account of share capital / share application money u/s 68 of the Income Tax Act, 1961 as unexplained cash credits. 2. On the facts and in circumstances of the case, the Ld. CIT(A) has erred in law in deleting the addition of Rs. 2,59,84,440/- made by the Assessing Officer on account of unexplained cash credits u/s 68 of the Income Tax Act, 1961 and corresponding interest expenses u/s 69C of Income Tax Act, 1961.” 2.5 Grounds of appeal raised by the Assessee for AY 2013-14 in IT(SS)A No.161/Ind/2020: “1. That, on the facts and in the circumstances of the case, the action of the learned CIT(A) in confirming the additions to the extent of Rs.52,25,000/- made by the AO in the appellant’s income, is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. 2. That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned additions in the appellant’s income for the relevant assessment year without considering the material fact that having already furnished original return of income under s.139(1) of the Act, on the date of initiation of the search under s. 132, no assessment proceeding was pending in respect of the assessment year under consideration and therefore, without having recourse to any seized incriminating document or material, no addition could have been made on any count in view of the settled legal position. 3a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition to the extent of Rs.52,25,000/- made by the AO in the appellant’s income on account of alleged unexplained unsecured loans by invoking the provisions of s.68 of the Act and payment of interest thereon, without considering the material fact that having already furnished original return of income under s.139(1) of the Act, on the date of initiation of the search under s. 132, no assessment proceeding was pending in respect of the assessment year under consideration and therefore, without having recourse to any seized incriminating document or material, merely on the basis of entries found recorded in the regular books of account, no addition could have been made. 3b). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition to the extent of Rs.52,25,000/- without confronting the appellant with any information as regard to the creditors allegedly gathered behind the back of the appellant either in the case of the appellant itself or in the cases of some other assessees and as also, without giving any opportunity of cross-examination to the appellant. 3c). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition to the extent of Rs.52,25,000/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts by producing all the necessary documentary evidences. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 4 of 121 3d). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned addition without adhering to the appellant’s prayer to issue either summons under s.131 or letters under s.133(6) of the Act to the loan creditors. 3e). That, without prejudice to the above, the learned CIT(A) grossly erred in confirming the addition to the extent of Rs.2,25,000/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that the interest expenditure so claimed by the appellant, were duly recorded in its regular books of account, and the same have been incurred out of the explained sources and therefore, the provisions of s. 69C could not have been invoked in the instant case. 3f). That, without prejudice to the above, the learned CIT(A) grossly erred in confirming the impugned addition of Rs.2,25,000/- on account of disallowance of interest on unsecured loans without considering the material fact that the interest expenditure so claimed by the appellant were genuinely incurred by it on the genuine borrowings of the loans made for the purpose of its business. 4. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary.” 2.6 Grounds of appeal raised by the Assessee for AY 2014-15 in IT(SS)A No.162/Ind/2020: “1. That, on the facts and in the circumstances of the case, the action of the learned CIT(A) in confirming the additions to the extent of Rs.4,47,975/- made by the AO in the appellant’s income, is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. 2. That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned additions in the appellant’s income for the relevant assessment year without considering the material fact that having already furnished original return of income under s.139(1) of the Act, on the date of initiation of the search under s. 132, no assessment proceeding was pending in respect of the assessment year under consideration and therefore, without having recourse to any seized incriminating document or material, no addition could have been made on any count in view of the settled legal position. 3a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition of Rs.4,47,975/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that having already furnished original return of income under s.139(1) of the Act, on the date of initiation of the search under s. 132, no assessment proceeding was pending in respect of the assessment year under consideration and therefore, without having recourse to any seized incriminating document or material, merely on the basis of entries found recorded in the regular books of account, no addition could have been made. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 5 of 121 3b). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition of Rs.4,47,975/- without confronting the appellant with any information as regard to the creditors allegedly gathered behind the back of the appellant either in the case of the appellant itself or in the cases of some other assessees and as also, without giving any opportunity of cross-examination to the appellant. 3c). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition of Rs.4,47,975/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts by producing all the necessary documentary evidences. 3d). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned addition without adhering to the appellant’s prayer to issue either summons under s.131 or letters under s.133(6) of the Act to the loan creditors. 3e). That, without prejudice to the above, the learned CIT(A) grossly erred in confirming the addition of Rs.4,47,975/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that the interest expenditure so claimed by the appellant, were duly recorded in its regular books of account, and the same have been incurred out of the explained sources and therefore, the provisions of s. 69C could not have been invoked in the instant case. 3f). That, without prejudice to the above, the learned CIT(A) grossly erred in confirming the impugned addition of Rs.4,47,975/- on account of disallowance of interest on unsecured loans without considering the material fact that the interest expenditure so claimed by the appellant were genuinely incurred by it on the genuine borrowings of the loans made for the purpose of its business. 4. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary.” 2.7 Grounds of appeal raised by the Assessee for AY 2015-16 in IT(SS)A No. 163/Ind/2020: “1. That, on the facts and in the circumstances of the case, the action of the learned CIT(A) in confirming the additions to the extent of Rs.3,27,12,970/- made by the AO in the appellant’s income, is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. 2a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition to the extent of Rs.2,18,12,970/- made by the AO in the appellant’s income on account of alleged unexplained unsecured loans by invoking the provisions of s.68 of the Act and payment of interest thereon, without confronting the appellant with any information as regard to the creditors allegedly gathered behind the back of the appellant either in the case of the appellant itself or in the cases of some other assessees and as also, without giving any opportunity of cross-examination to the appellant. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 6 of 121 2b). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition to the extent of Rs.2,18,12,970/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts by producing all the necessary documentary evidences. 2c). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned addition without adhering to the appellant’s prayer to issue either summons under s.131 or letters under s.133(6) of the Act to the loan creditors. 2d). That, the learned CIT(A) grossly erred in confirming the addition to the extent of Rs.8,12,970/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that the interest expenditure so claimed by the appellant, were duly recorded in its regular books of account, and the same have been incurred out of the explained sources and therefore, the provisions of s. 69C could not have been invoked in the instant case. 2e). That, the learned CIT(A) grossly erred in confirming the impugned addition of Rs.8,12,970/- on account of disallowance of interest on unsecured loans without considering the material fact that the interest expenditure so claimed by the appellant were genuinely incurred by it on the genuine borrowings of the loans made for the purpose of its business. 3a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition of Rs.1,09,00,000/- made by the AO in the appellant’s income by holding the receipt of unsecured loan amounting to Rs.1,09,00,000/- by the appellant from M/s. Sumeet and Sumeet Sales, as non-genuine, by invoking the provisions of s.68 of the Act, without giving the appellant an opportunity to cross-examine Mr. Sumeet Garg, Proprietor of M/s. Sumeet and Sumeet Sales, on whose statement the AO has placed reliance. 3b). That, without prejudice to the above, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition of Rs.1,09,00,000/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditor, the genuineness of the transaction and creditworthiness of loan creditor beyond all doubts by producing all the necessary documentary evidences. 4. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary.” 2.8 Grounds of appeal raised by the Assessee for AY 2016-17 in IT(SS)A No. 164/Ind/2020: “1. That, on the facts and in the circumstances of the case, the action of the learned CIT(A) in confirming the additions to the extent of Rs.98,09,558/- made by the AO in the appellant’s income, is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 7 of 121 2a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition to the extent of Rs.98,09,558/- made by the AO in the appellant’s income on account of alleged unexplained unsecured loans by invoking the provisions of s.68 of the Act and payment of interest thereon, without confronting the appellant with any information as regard to the creditors allegedly gathered behind the back of the appellant either in the case of the appellant itself or in the cases of some other assessees and as also, without giving any opportunity of cross-examination to the appellant. 2b). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition to the extent of Rs.98,09,558/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts by producing all the necessary documentary evidences. 2c). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned addition without adhering to the appellant’s prayer to issue either summons under s.131 or letters under s.133(6) of the Act to the loan creditors. 2d). That, the learned CIT(A) grossly erred in confirming the addition to the extent of Rs.24,09,558/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that the interest expenditure so claimed by the appellant, were duly recorded in its regular books of account, and the same have been incurred out of the explained sources and therefore, the provisions of s. 69C could not have been invoked in the instant case. 2e). That, the learned CIT(A) grossly erred in confirming the impugned addition of Rs.24,09,558/- on account of disallowance of interest on unsecured loans without considering the material fact that the interest expenditure so claimed by the appellant were genuinely incurred by it on the genuine borrowings of the loans made for the purpose of its business. 3. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary.” 2.9 Grounds of appeal raised by the Assessee for AY 2017-18 in IT(SS)A No. 165/Ind/2020: “1. That, on the facts and in the circumstances of the case, the action of the learned CIT(A) in confirming the additions to the extent of Rs.27,56,842/- made by the AO in the appellant’s income, is quite unjustified, unwarranted, excessive, arbitrary and bad-in-law. 2a). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the addition to the extent of Rs.27,56,842/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without confronting the appellant with any information as regard to the creditors allegedly gathered behind the back of the appellant either in the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 8 of 121 case of the appellant itself or in the cases of some other assessees and as also, without giving any opportunity of cross-examination to the appellant. 2b). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the impugned addition to the extent of Rs.27,56,842/- without considering the material fact that the appellant had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts by producing all the necessary documentary evidences and therefore, no disallowance of interest qua such loans was warranted. 2c). That, the learned CIT(A) grossly erred, both on facts and in law, in confirming the AO’s action of making the impugned addition without adhering to the appellant’s prayer to issue either summons under s.131 or letters under s.133(6) of the Act to the loan creditors. 2d). That, the learned CIT(A) grossly erred in confirming the addition to the extent of Rs.27,56,842/- made by the AO in the appellant’s income on account of disallowance of interest on unsecured loans, claimed by the appellant, by invoking the provisions of s. 69C r.w.s. 115BBE of the Act, without considering the material fact that the interest expenditure so claimed by the appellant, were duly recorded in its regular books of account, and the same have been incurred out of the explained sources and therefore, the provisions of s. 69C could not have been invoked in the instant case. 2e). That, the learned CIT(A) grossly erred in confirming the impugned addition of Rs.27,56,842/- on account of disallowance of interest on unsecured loans without considering the material fact that the interest expenditure so claimed by the appellant were genuinely incurred by it on the genuine borrowings of the loans made for the purpose of its business. 3. That, the learned CIT(A) grossly erred, in law, in confirming the action of the AO in invoking the provisions of section 115BBE of the Act in respect of disallowance of interest made without considering the material fact that in the appellant’s case, the nature of addition to the income was not falling in any of the deeming provisions of the Act and therefore, the provisions of section 115BBE of the Act could not have been invoked in the appellant’s case. 4. That, the appellant further craves leave to add, alter and/or amend any of the foregoing grounds of appeal as and when considered necessary.” 3.1 The brief facts of the case as culled out from the records are that the assessee is a private limited company and belongs to Dixit/Global Group. The assessee is mainly engaged in the business of power generation through wind mill and sale of REC (Renewable Energy Certificates). The assessee company was incorporated on 07/08/2012 and was not in existence during the previous years relevant to the A.Y. 2011-12 & A.Y. 2012-13. The assessee furnished its original returns of income for the various years u/s. 139 of the I.T. Act, 1961. Search and seizure operations u/s. 132 were carried out at various premises of Global group and the assessee on 12/07/2016. As the warrant of authorization u/s. 132 was issued in the name of the assessee also, notices u/s. 153A were issued to the assessee for IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 9 of 121 A.Y. 2013-14 to A.Y. 2016-17 on 01/11/2018. In response to the above notices, the assessee filed returns of income for A.Y. 2013-14 to A.Y. 2016- 17 on 15/11/2018. The assessee furnished its regular return of income for A.Y. 2017-18 on 06/11/2017. The details of returns of income for A.Y. 2013-14 to 2017-18 are as under: A.Y. Date of filing of Return u/s. 139 Returned income (in Rs.) Date of filing of Return in response to the notice u/s. 153A Income declared in Return u/s. 153A (In Rs.) Additional Income offered, if any (In Rs.) 2013-14 31/10/2013 Nil 15/11/2018 Nil Nil 2014-15 24/09/2014 (-)2,09,01,770 15/11/2018 (-)2,09,01,770 Nil 2015-16 27/09/2015 (-)1,77,08,436 15/11/2018 (-)1,77,08,436 Nil 2016-17 29/03/2017 (-)42,41,029 15/11/2018 (-)42,41,029 Nil 2017-18 06/11/2017 (-)2,75,09,864 NA NA Nil 3.2 In the case of the assessee, a reference was made for special audit u/s. 142(2A) of the Act and accordingly, the special auditors submitted their report on 20.06.2019. The report of the special auditors, as produced by the assessee, was duly perused and considered by the AO and as also, by the CIT(A). A copy of the Special Auditors Report was also filed by the assessee before this Bench which has been perused and placed on record. 3.3 Finally, the AO made additions of Rs.3,99,10,000/- in A.Y. 2013-14, Rs.7,08,66,700/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.12,81,42,000/- in A.Y. 2016-17 on account of unexplained cash credits u/s. 68 in respect of share capital issued by the assessee (Para 8);addition of Rs.2,12,50,000/- in A.Y. 2013-14, Rs.14,47,564/- in A.Y. 2014-15, Rs.6,45,65,895/- in A.Y. 2015-16, Rs.3,57,93,998/- in A.Y. 2016-17 and Rs.48,25,049/- in A.Y. 2017-18 on account of unexplained cash credits u/s. 68 and unexplained expenditure u/s. 69C respectively in context of unsecured loans obtained by the assessee and interest expenses thereon (Para 9); addition of Rs.1,09,00,000/- in A.Y. 2015-16 on account of receipt from bank account of M/s. Sumeet & Sumeet Sales treated as unexplained cash credit u/s. 68 (para 11); addition of Rs.32,68,250/- in A.Y. 2017-18 on account of disallowance of depreciation on Wind Mill (para 10). 4. Aggrieved assessee preferred separate appeals for all the assessment years under consideration before Ld. CIT(A). Before the ld. CIT(A), the assessee filed additional evidences for AY 2013-14 to AY 2016-17 in respect of two issues viz (i) unexplained cash credits u/s. 68 in the form of share capital; and (ii) unexplained cash credits u/s. 68 in the form of unsecured loans. The additional evidences furnished by the assessee were duly admitted by the ld. CIT(A) and the additional evidences were forwarded to the AO for his comments. The AO submitted the common remand report vide his letter dated 16/09/2020, which is placed at page no. 519 to 545 of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 10 of 121 the Paper Book of the assessee for A.Y. 2013-14. A copy of the Remand Report was provided to the assessee for making its counter comments and accordingly, the assessee vide its letter dated 22/09/2020, as placed at page no. 546 to 554 of the assessee’s Paper Book for A.Y. 2013-14, made its counter comments before the ld. CIT(A). The ld. CIT(A), after taking into consideration the AOs findings, report of the special auditors, assessee’s oral and written submissions made in the course of the hearing, remand report submitted by the AO and comments thereon by the assessee as well as the facts of the case, vide his common Order dated 23.09.2020 adjudicated the appeals of the assessee thereby giving substantial relief to the assessee and also confirming certain additions for the assessment years under consideration. 5. Now, aggrieved by the relief granted by the ld. CIT(A) to the assessee, the revenue is in appeal before this Tribunal, whereas, against the additions confirmed by the ld. CIT(A), the assessee has preferred cross appeals before us, for various assessment years. 6. As all the appeals relate to the same assessee and the issues raised are common, they were heard together and are being disposed off by this common order for sake of convenience and brevity. 7. Ground No. 1 of the Assessee common for all the assessment years under consideration 7.1 Through this ground of appeal, the assessee has challenged the additions confirmed by the ld. CIT(A). In the written submissions, the assessee itself has submitted that in the Appeal Memos, it has taken separate grounds of appeal in respect of each and every addition confirmed by the ld. CIT(A) and therefore, no separate adjudication on this Ground is warranted. Accordingly, this ground of appeal for A.Y. 2013-14 to A.Y. 2017- 18 is hereby Dismissed. 8. Ground No. 2 of the Assessee for A.Y. 2013-14 & A.Y. 2014-15 8.1 Through the Ground No. 2 taken for A.Y. 2013-14 & A.Y. 2014-15, the assessee has challenged the action of the ld. CIT(A) in upholding the additions made by the AO in completed assessment years without having recourse to any incriminating material found during the course of search. 8.2 Before the ld. CIT(A), the assessee furnished the detailed written submissions on the subject ground, which has been reproduced by the ld. CIT(A) at page no. 16 to 25 of his Order. While adjudicating the ground, the ld. CIT(A) held that for A.Y. 2013-14 and A.Y. 2014-15, the assessee had filed its return of income u/s. 139 of the Act much prior to the date of search and seizure operations in its case which were carried out on 12/07/2016. The ld. CIT(A) further held that as on the date of the search no assessment proceedings were pending for such assessment years and further, the time limit for issuance of any notice u/s. 143(2) had also got IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 11 of 121 expired on 30/09/2015 and no such notice was issued to the assessee prior to the date of the search. Thus, the ld. CIT(A) went on holding that for A.Y. 2013-14 and A.Y. 2014-15, the assessment proceedings had got completed and therefore, they did not get abated in accordance with the second proviso to section 153A(1) of the Act. However, having given these findings, the ld. CIT(A) further held that during the course of the search and seizure operations carried u/s. 132 of the Act, in the various premises of the Dixit/Global Group, various incriminating bills, vouchers, loose papers, documents etc. were found evidencing deriving of substantial amount of undisclosed income by the assessee and other group assessees. The ld. CIT(A) also held that the assessee had shown to have received some amount under the garb of unsecured loans from various companies operated by one defamed entry operator namely Shri Sharad Darak which could be revealed only during the course of the search proceedings. Thus, the ld. CIT(A) did not find any substance in the contention of the assessee that for the aforesaid assessment years, no incriminating documents or materials were found or seized. 8.3 Aggrieved with the Order of the ld. CIT(A), the assessee has preferred appeals before us. 8.4 Before us, the learned CIT(DR) vehemently argued supporting the observations of the AO and the ld. CIT(A) on this issue. However, during the course of the hearing before us, the ld. CIT(DR) failed to bring on record any incriminating material on the basis whereof the subject additions were made in the A.Y. 2013-14 & A.Y. 2014-15. 8.5 Per Contra, Learned Counsel for the assessee has filed written synopsis. The relevant part of the assessee's submission for this contention, treating A.Y. 2013-14 as Lead Year, is being reproduced as under: “D. Key Points of Assessee’s Submission and Relevant Pages of the Paper Books: 1.01 That, in the instant case, the impugned assessment order has been framed by the learned Assessing Officer in pursuance of the Search Operations carried out under the provisions of s.132 in the business premises of the assessee company as well as in the residential premises of its directors. 1.02 That, on the date of initiation of the search under s.132 of the Act, i.e. on 12-07-2016, no assessment proceedings were pending in respect of the assessment year under consideration. Further, during the course of search operations carried out in the business premises of the assessee and as also in the residential premises of its directors along with the group concerns, not even a single incriminating material or document or valuable article or thing, pertaining to the assessment year under consideration, was found on the basis of which addition has been made by the learned AO in the returned income of the assessee. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 12 of 121 1.03 The learned AO has made the total additions of Rs.6,11,60,000/- in the assessee’s income for the assessment year 2013-14. Out of the total additions of Rs.6,11,60,000/-, the learned AO has made an addition of Rs.3,99,10,000/- in the assessee’s income on account of alleged unexplained cash credits, by invoking the provisions of s.68 of the Act, in respect of share application money received by the assessee. Further, the ld. AO has made an addition of Rs.2,10,25,000/- on account of alleged unexplained unsecured loans by invoking the provisions of s.68 r.w.s. 115BBE of the Act. Furthermore, an addition of Rs.2,25,000/- has been made by the learned AO on account of disallowance of interest paid on aforesaid loans by treating the same as unexplained expenditure under s.69C r.w.s. 115BBE of the Act. It is submitted that all the aforesaid additions have been made by the ld. AO without having recourse to any seized incriminating document or material or valuable article found during the course of search proceedings. Such an act on the part of the learned AO is patently wrong, unjustified, unwarranted and bad in the eyes of law in view of the facts and circumstances of the case and as also in view of the settled legal position as discussed in the ensuing paras. 2.01 On a plain reading of the provisions of section 153A, one may note that these provisions can be set into motion only in the case of a person where a search is initiated under s. 132 or books of account, other documents or any assets are requisitioned under s. 132A. Even, the caption of the provision is read as ‘assessment in case of search or requisition’. Thus, there remains no doubt to the proposition that the section 153A cannot be invoked in each and any case but it can be invoked only for the purpose of making an assessment or reassessment in the case of a person in whose case either a search under s. 132 is initiated or a requisition under s. 132A is made. The sole purpose of the section 153A is to bring home the tax on the undisclosed income, unearthed during the course of action under s. 132/ 132A, to the kitty of the ex-chequer. It is submitted that the section 153A is not meant for assessing/ reassessing any income which in the opinion of revenue authorities has escaped to the assessment and for that there are other provisions such as section 147 and section 263 in the statute. Although, not explicitly stated, the provisions of section 153A are aimed for making the assessment/ reassessment, for six assessment years, of the persons searched/ requisitioned, only, on the basis of money, bullion, jewellery, other valuable articles or things or books of account or documents found and seized either under s. 132 or requisitioned under s. 132A. In other words, subject to certain exceptions, as discussed here-in-after, under the scheme of the law any assessment/ reassessment under the provisions of section 153A has to be made only on the basis of incriminating material or undisclosed assets found during the course of action under s. 132/ 132A and it cannot be made on those issues in respect of which no incriminating material/ undisclosed asset was found. 2.02 It is submitted that normally provisions of section 132 are invoked only when the authorizing officer being the Principal Director General or Principal Director or Principal Chief Commissioner or Chief IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 13 of 121 Commissioner or Principal Commissioner or Commissioner or Additional Director or Additional Commissioner or Joint Director or Joint Commissioner, in consequence of information in his possession, has reason to believe that any person is in possession of some money, bullion, jewellery or other valuable articles or things or books of account or documents which have not been or would not have been disclosed by such person for the purpose of the Income-Tax Act, 1961. The purpose of the provisions of section 132 is not to make any assessment or reassessment but to gather the material necessary for the purpose of making assessment or reassessment. It is submitted that the provisions of section 132 are not aimed for discovery of those assets, books or documents or transactions, which are already in the specific knowledge or domain of the revenue or if required may come in the specific knowledge or domain of the revenue. It shall thus be appreciated that the provisions of section 132 are not meant for verifying the transactions which are already recorded in the regular books of account of an assessee. For such verification, the powers of assessment or reassessment are duly vested with the AO under the provisions of section 143/ 147 of the Act. As a natural corollary it thus follows that very purpose of initiating action under s. 132 is to unearth or discover any undisclosed income or undisclosed asset of an assessee and its objective is not at all to verify the veracity of the transactions already recorded in the regular books of account or in respect of which assessments have already attained finality. Since, the provisions of section 153A have the sole objective of framing the assessment/ reassessment in the case of a person in whose case search under s. 132 is initiated or requisition under s. 132 is made, it has to be necessarily concluded that the scope of the assessment/ reassessment under the provisions of section 153A is limited and restricted only to the undisclosed income based upon the incriminating material/ undisclosed assets found during the course of search/ requisition. 2.03 It is submitted that the scheme of section 153A takes within its sweeps not only the assessment/ reassessment for those completed assessment years in respect of which either the assessments under s. 143(3) have already got completed previously or the time limit for issuance of notice under s. 143(2) have got expired but it also include those assessment years in respect of which either the assessment proceedings were pending or the statutory time limit for issuance of notice under s. 143(2) were alive, on the date of initiation of the search. The later situation has been contemplated under clause (b) of sub- section (1) to section 153A of the Act which prescribes that all the assessment proceedings which are pending on the date of search shall get abate. It is so because while legislating the law the legislature were not intending to carry out two parallel assessment/ reassessment proceedings for the same assessment years under two different sections which was the situation prevalent in the old block assessment scheme under Chapter XIV-B of the Act in respect of search initiated up till 31st day of May, 2003. It is therefore, it has been prescribed that no sooner any search under s. 132 takes place in case of any assessee, all the assessment proceedings which were either in the motion or which were pending shall come to a halt. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 14 of 121 2.04 It is submitted that under the provisions of section 153A of the Act, assessment or reassessment of total income of the person searched or requisitioned for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or requisition is made has to be made by the concerning Assessing Officer. Under the second proviso to section 153A, it has been enjoined that assessment or reassessment, if any, relating to any of the six assessment years which is pending on the date of initiation of the search or making the requisition shall abate. On a plain reading of the proviso, it becomes abundantly clear that only the assessment proceedings which were pending on the date of initiation of search or requisition shall get abate whereas the assessment proceedings for other assessment years, which have attained finality, shall not get abated. Thus, a clear cut distinction has been made in the section itself in respect of those assessment years in respect of which proceedings have attained finality at the AO stage and those assessment years where the assessment proceeding have not so attained the finality at AO stage. It is submitted that while making the assessment under s. 153A, an AO has to make a specific distinction for non-abated assessment years with that of the abated assessment years. 3.00 It is submitted that the issue relating to scope of assessment under s. 153A/153C is not res integra. The Hon’ble High Court of Delhi in the case of CIT vs. Kabul Chawla (2015) 9 TMI 80 (Del.), after considering all the available decisions on the issue has held that in respect of the completed assessment, additions can be made only on the basis of incriminating documents. 3.01 Your Honours, earlier the Hon’ble High Court of Rajasthan in the case of Jai Steel (India) vs. CIT (2013) 259 CTR 281 (Raj.) has also held that in respect of the assessment years which have got abated due to initiation of the search, an AO is free to make addition on any ground but in respect of the assessment years which have got completed before the date of the search, the assessment has to be made on the basis of the material seized during the course of search. 3.02 Your Honours, the decision of the Hon'ble Delhi High Court in the case of Kabul Chawla has been followed by the Hon'ble Gujarat High Court in the case of Pr. CIT vs. Saumya Construction Pvt. Ltd. (2016) 387 ITR 529 (Guj.) and again in the case of Pr. CIT vs. Deepak Jashwantlal Panchal (2017) 397 ITR 153 (Guj.). 3.03 Your Honours, it is submitted that following the above judgment of the Hon’ble Delhi High Court, the Hon’ble jurisdictional Indore Bench of ITAT in case of Kalani Brothers in IT(SS)A No. 71/Ind/2014 and again in the case of Anant Steel Pvt. Ltd. in IT(SS)A Nos. 31, 28, 29 & 30/Ind/2010 and in many other cases, has held that in respect of the completed assessment years, in absence of any incriminating documents found and seized during the course of search, no addition can be made. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 15 of 121 3.04 Reliance is also placed on the following judicial pronouncements: i) Pr. CIT vs. Smt. Kusum Gupta (2015) 9 TMI 1406 (DelHC) ii) CIT vs. RRJ Securities Ltd. (2016) 380 ITR 612 (DelHC) iii) Pr. CIT vs. Mrs. Lata Jain (2016) 384 ITR 543 (DelHC) iv) Pr. CIT vs. Jai Infrastructure & Properties Pvt. Ltd. (2016) 10 TMI 1022 (GujHC) v) CIT vs. Anil Kumar Bhatia 211 Taxman 453 (Del) vi) Amandeep Singh Bhatia vs. Addl. CIT (2016) 29 ITJ 1 (Indore-Trib) vii) Bhatia International Ltd. vs. Addl. CIT (2016) 29 ITJ 109 (Trib-Indore) viii) Pr. CIT vs. Dharampal Premchand Ltd. (2018) 408 ITR 0170 (Del. HC) ix) Pr. CIT & Ors. vs. Meeta Gutgutia & Ors. (2017) 295 CTR 0466 (Del.) x) Pr. CIT vs. Dipak J Panchal (2017) 397 ITR 0153 (Guj.) xi) Pr. CIT vs. Devangi Alias Rupa (2017) 98 CCH 0051 (Guj.) xii) Rakesh Kumar Jain vs. DCIT (2019) 57 CCH 0098 (Jaipur Trib.) xiii) DCIT vs. SMS SME Ltd. (2019) 57 CCH 0031 (Gau. Trib.) xiv) Rashmi Metaliks Ltd. and ANR vs. DCIT and ANR (2019) 72 ITR (Trib.) 0226 (Kolkata) xv) Amitbhai Manubhai Kachadiya and Ors. vs. DCIT (2019) 56 CCH 0189 (SuratTrib.) xvi) Smt. Sanjana Mittal vs. DCIT (2019) 55 CCH 0644 Asr Trib. xvii) SVM Buildcon Pvt. Ltd. vs. DCIT [IT(SS) A no. 71/Ind/2016 Order dated 26-10-2017] xviii) Chugh Real Estate Pvt. Ltd. vs. DCIT [IT(SS) A no. 60&61/Ind/2016 Order dated 26-10-2017] xix) Kamta Prasad Dwivedi vs. ACIT-1(1), Bhopal 2018 (9) TMI 1746 - ITAT Indore xx) Smt. Rashmi Mujumdar vs. DCIT(Central)-1, Bhopal 2018 (12) TMI 688 - ITAT Indore xxi) ACIT vs. Sudeep Maheshwari [ITA No. 524/Ind/2013, Order dated 13-02-2019] xxii) M/s. Ultimate Builders vs. ACIT [ITA No. 134/Ind/2019, Order dated 09-08-2019] xxiii) Sainath Builders vs. ACIT (2019) 35 ITJ 77 (Trib.-Indore) xxiv) DCIT-2(1), Indore vs. Shri Satish Neema [IT(SS) 149, 150 & 152/Ind/2016; Order dated 07-02-2020] 4.00 Your Honours, in the instant case, undisputedly, the assessee had voluntarily furnished its return of income under the provisions of s.139 of the Act for A.Y. 2013-14 on 31-10-2013 and further since, the time limit for issuance of notice under s.143(2) in response to the return so filed had also got expired much before the date of initiation of search, it has to be necessarily regarded that as on the date of search, i.e. on 12- 07-2016, the assessment of the assessee for the assessment year 2013-14 was not pending and the same had got completed. In view of such position, the assessment year under consideration cannot be IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 16 of 121 termed to be a year in respect of which assessment proceedings got abated in terms of second proviso to sub-section (1) of section 153A of the Act. It shall be worthwhile to mention here that in many of the judicial authorities, as cited above, it has been held that if in respect of any assessment year, an assessee had filed a return under s.139 and the time limit for issuance of notice under s.143(2) in respect of such return had got expired before the date of search, such assessment year would have to be regarded as a year in respect of which no proceeding was pending. 5.00 Your Honours, the similar legal ground was also raised by the assessee before the ld. CIT(A). However, The ld. CIT(A) at para (4.3.2) at page nos. 25 & 26 of the impugned Order dismissed the ground. The ld. CIT(A) held that during the course of the search under s. 132 in the various premises of the Dixit/Global Group, various incriminating bills, vouchers, loose papers, documents etc. were found evidencing deriving of substantial amount of undisclosed income by the assessee and other group assessee. The ld. CIT(A) further held that the assessee had shown receipt of amount under the garb of unsecured loans from various companies operated by one defamed entry operator namely Shri Sharad Darak and such fact could be revealed only during the course of the search proceedings. 5.01 Your Honours, it is humbly submitted that none of the findings given by the ld. CIT(A) is factually correct. It is submitted that during the course of the search proceedings, not even a single incriminating document was found relating to the assessee and even, the ld. AO while making the various additions in the income of the assessee for A.Y. 2013-14 & A.Y. 2014-15 has not made any reference of any seized document. Even further, while submitting his Remand Report, the ld. AO has not rebbuted the claim of the assessee made before the ld. CIT(A) that none of the additions is based upon any seized material. It is submitted that although in the opening lines of para (8) at page no. 4 of the assessment order, the ld. AO has mentioned that upon analysis of seized documents, he noticed that huge share capital was introduced by the assessee in various names but, in the entire body of the assessment order, there is not a whisper or mention of any such so called seized document. It is submitted that even in the Show Cause Notices issued to the assessee, as abstracted by the ld. AO himself at para (8) of his assessment order, there is no reference of any so called seized documents. It is submitted that the entire additions have been made by the ld. AO only based upon the regular books of account maintained by the assessee company in its normal course of business and no addition is based upon any incriminating seized material. 5.02 Your Honours, it is submitted that the second ground taken by the ld. CIT(A) for dismissing the legal plea of the assessee is that according to the ld. CIT(A), the assessee had obtained accommodation entries from some entry operator. It is submitted that first of all, such a finding is factually incorrect, as demonstrated in the subsequent paras and even if it is assumed to be correct, it would not meet the requirement of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 17 of 121 seized material as contemplated in the decision of Kabul Chawla supra and other judicial pronouncements. 6.00 Your Honours, in view of the facts and circumstances of the case of the assessee and various judicial pronouncements, it is submitted that since the assessment years 2013-14 & 2014-15 are the years in respect of which assessment proceedings had already got completed and the same were not pending on the date of the search, any addition which is not based on any incriminating material found during the course of search is not legally sustainable and the same deserves to be knocked down on the threshold itself.” 9.1 We have heard rival contentions, perused the records placed before us, duly considered the facts and circumstances, carefully gone through the orders of the authorities below, written and oral submissions made from both the sides and as also, various judicial authorities cited by both the sides. 9.2 We find that search and seizure operations u/s 132(1) were carried out in the case of assessee on 12/07/2016. We further find that, prior to the date of search, the assessee had already filed its returns of income, u/s. 139 of the Act, for A.Y. 2013-14 and A.Y. 2014-15, on 31/10/2013 and 24/09/2014 respectively. We noted that as on the date of search, i.e. 12/07/2016, no assessment proceedings were pending for AYs 2013-14 & 2014-15 and further, time limit for issuance of any notice under s.143(2) had also got expired on 30-09-2015 but, no such notice was issued to the assessee prior to the date of the search. In such circumstances, it can be concluded that for A.Y. 2013-14 & A.Y. 2014-15, the assessment proceedings had got completed and they did not get abated in accordance with the second proviso to the provisions of section 153A(1) of the Act, as also held by the ld. CIT(A). 9.3 We also find that the AO, while making the additions on account of non-genuine share capital and unsecured loans in the two assessment years viz. A.Y. 2013-14 & A.Y. 2014-15, has not made any single reference to any incriminating material found during the course of the search. We find that in the instant case, the AO has made the additions in the A.Y. 2013-14 & A.Y. 2014-15 on the sole basis of the audited financial statements furnished by the assessee during the course of the assessment proceedings and the entries found made in the tally data containing the regular books of account of the assessee, without making reference of any seized document or any other evidence gathered during the course of search. Before us, the ld. CIT (DR) also could not bring on record any single incriminating material on the basis whereof the additions have been made by the AO in the assessment order for the aforesaid two assessment years. In our considered view, even in respect of the loan transactions claimed to have been carried out by the assessee with various companies operated by Shri Sharad Darak, while making the additions, the AO has not made specific reference of any single seized document or material. Thus, in our considered view, the two IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 18 of 121 assessment years viz. A.Y. 2013-14 and A.Y. 2014-15 are non-abated assessment years and therefore, as per the settled position of the law, any addition in such non-abated assessment years could have been made only on the basis of some incriminating material or evidences gathered during the course of the search which is not a case here. 9.4 We find support from the decision of the Hon’ble Delhi High Court in the case of CIT vs. Kabul Chawla (2016) 380 ITR 53 (Del HC) wherein the Hon’ble Court after considering various judgments had dealt with this issue as under: “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. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 19 of 121 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.” 9.5 The above stated ratio laid down by the Hon’ble Delhi High Court has been applied by this Tribunal in the case of Kalani Bros. [IT(SS) No.71/Ind/2015 dated 6.11.15] observing as follows:- "We have heard both the sides. We have also gone through the case laws relied upon by both the sides. We have also considered various relevant facts of the case. It is a settled legal position that once a search and seizure action has taken place u/ s 132 of the Act or a requisition has been made u/ s 132A, the provisions of section 153A trigged and Assessing Officer is bound to issue notice u/ s 153A of the Act. Once notices are issued u/ s 153A of, the Act then assessee is legally obliged to file return of income for six years. The assessment and reassessment for six years shall be finalised by the Assessing Officer. It is also held by various Courts that once notice u/ s 153A of the Act issued, then assessment for six years shall be at large both for Assessing Officer and assessee have no warrant of law. It has been also held that in the assessment years where assessments have been abated in terms of second proviso to section 153A then Assessing Officer acts under original jurisdiction and one assessment is made for total income including the addition made on the basis of seized material. But where there is no abatement of assessments and assessments were completed on the date of search then addition can be made only on the basis of incriminating documents or undisclosed assets, etc. In these cases there was no incriminating document found and seized. No assessment proceedings were abated in these assessees. Thus assessments for these assessment years were completed on the date of search. The assessments were completed u/ s 143(3} of the Act read with section 153A/ 153C of the Act after the search. There was no abatement of any proceedings in these cases for these assessment years in terms of second proviso to section 153A of the Act. There is no seized material belonging to the assessee which was found and seized in relation to additions made. In. a recent decision, Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla (supra) has held that completed assessments can be interfered with by the Assessing Officer while making assessment u/ s 153A of the Act, 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 was not produced or not already disclosed or made known in the course of original assessment. In. all these cases no assessments were pending on the date of search for these assessment years. No assessments were abated in terms of second proviso to section 153A of the Act. Hon'ble Delhi High / Court in the case of CIT vs. Kabul Chawla (supra) has considered various High Court decisions relied upon by the learned DR. The Hon'ble Delhi High Court has considered the cases of Canara Housing Development Co. vs. DCfT; Madugula vs. DCIT; CIT vs. Chetandas Laxmandas and CIT vs. Anil Kumar Bhatia (supra). The only decision of the Hon'ble Allahabad High Court in the case of CIT vs. Raj Kumar Arora; 367 ITR 517 relied IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 20 of 121 on by the learned DR was not considered by Hon'ble Delhi High Court while deciding the issue in the case of Kabul Chawla. The Hon'ble Allahabad High Court has reversed the order of the Tribunal and remanded the issue to the Tribunal to consider the appeal of the department on merits. It is a settled legal position that when two views are possible on a particulars issue then the view favourable to the assessee should be followed as held by the Hon'ble Apex Court in the case of CIT vs. Vegetable Products; 88 ITR 192. Respectively following the decision of the Hon'ble Apex Court, we dismiss the ground of appeals of the Revenue. Departmental appeals are disposed accordingly." 9.6 Similar view also taken in the case of DCIT, Indore vs. Shri Satish Neema (2020) 37 ITJ 308 (Trib. Indore). Relevant extract of the decision is reproduced below: “19. We therefore respectfully following the decision referred above and also considering the latest judgement of Hon'ble High court of Delhi in the case of Pr. CIT & Ors. Vs. Meeta Gutgutia (supra) come to the conclusion that since the assessment orders in question were concluded and non-abated assessments no addition can be made in the assessment proceedings u/s 153A of the act unless there is any incriminating material found during the course of search. We find no inconsistency in the finding of Ld. CIT(A) quashing the assessment proceedings u/s 153A of the Act since the additions were not made on the basis of any incriminating material found during the course of search. Thus revenue's appeal for Assessment Years 2005-06, 2006- 07 and 2009-10 stands dismissed.” 9.7 This Tribunal in the case of Rajmohan Agrawal (Ind), Bhopal vs. ACIT- 2(1), Bhopal [IT(SS)A No.04/Ind/2019 Order dated 07-09-2021] has held as under: “9. We find that the year under appeal is A.Y. 2006-07. Time limit of issuance of notice u/s 143(2) of the Act for selecting assessee’s case for scrutiny expires on 30th September 2007. Search was conducted on 13.11.2007. Except registered sale deed no other incriminating material was found. Consideration mentioned in the registered sale deed is duly accounted for. Other evidences are gathered by the Ld. AO by issuing notice u/s 131 of the Act and statement of the sellers were recorded during the course of assessment proceedings. The year under appeal is a non-abated assessment year. Addition in such non- abated assessment years can be made only on the basis of incriminating material found during the course of search. 10. Our this proposition is supported by the judgment of Hon'ble Delhi High Court in the case of CIT vs. Kabul Chawla 280 ITR 570 and in the case of Pr. CIT vs. Meeta Gutgutia 395 ITR 526. We have also followed this ratio in the case of Satish Neema –IT(SS)A No.149/Ind/2016 dated 07.02.2020. Ld. DR failed to bring any other binding precedence in its favour. We, therefore, respectfully following the above referred decisions allow the legal ground raised by the assessee and delete the impugned addition.” IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 21 of 121 9.8 Thus, respectfully following the settled judicial precedence which are squarely applicable on the instant issue, we are of the view that while making an assessment under s.153A of the Act in pursuance of a search under s.132, no addition could have been made by the AO in the assessee’s income in a completed year of assessment without having recourse to any incriminating material. Accordingly, in our considered view, the action of the ld. CIT(A) in confirming the AO’s action of making additions in completed years of assessment i.e. A.Y. 2013-14 and A.Y. 2014-15, without having any recourse to any incriminating material was unjustified and unwarranted. Thus the finding of Ld.CIT(A) is reversed and the common Ground No. 2 of the assessee for A.Y. 2013-14 & A.Y. 2014-15 areAllowed. 10. Ground Nos. 3(a) to 3(f) of the Assessee for A.Y. 2013-14& A.Y. 2014- 15; Ground Nos. 2(a) to2(e) of the Assessee for A.Y. 2015-16, A.Y. 2016- 17&A.Y. 2017-18; Ground Nos. 3(a) & 3(b) of the Assessee for A.Y. 2015-16 and Ground No. 2 of the Revenue for A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015- 16&A.Y. 2016-17 10.1 Through the ground nos. 3(a) to 3(f) for A.Y. 2013-14 & A.Y. 2014-15 and ground nos. 2(a) to 2(e) for A.Y. 2015-16 to A.Y. 2017-18, the assessee has challenged the action of the ld. CIT(A) in upholding the additions to the tune of Rs.50,00,000/- (A.Y. 2013-14), Rs.2,10,00,000/- (A.Y. 2015-16) &Rs.74,00,000/- (A.Y. 2016-17),made by the AO on account of unsecured loans obtained by the assessee company from various entities and additions to the extent of Rs.2,25,000/- (A.Y. 2013-14), Rs.4,47,975/- (A.Y. 2014-15), Rs.8,12,970/- (A.Y. 2015-16), Rs.24,09,558/- (A.Y. 2016-17) & Rs.27,56,842/- (A.Y. 2017-18) on account of interest payments thereon.Besides, through Ground Nos. 3(a) & 3(b) for A.Y. 2015-16, the assessee has challenged the action of the ld. CIT(A) in confirming the addition of Rs.1,09,00,000/- made by the AO on account of unsecured loan from M/s. Sumeet & Sumeet Sales. Further, through Ground No. 2 for A.Y. 2013-14 to A.Y. 2016-17, the Revenue has challenged the action of the ld. CIT(A) in deleting the various additions to the extent of Rs.1,60,25,000/- (A.Y. 2013-14), Rs.9,99,589/- (A.Y. 2014-15), Rs.4,07,75,000/- (A.Y. 2015- 16) & Rs.2,33,92,000/- (A.Y. 2016-17), made by the AO on account of unsecured loans and additions to the extent of Rs.19,77,925/- (A.Y. 2015- 16) & Rs.25,92,440/- (A.Y. 2016-17) on account of interest payments thereon. Since the issues in respect of the aforesaid grounds are inter- connected to each other, these grounds of appeals of the assessee and the revenue are adjudicated together. 10.2 Briefly stated facts of the issue, as culled out from the records, are that during the search and post search proceedings, it was found by the AO that the assessee had accepted unsecured loans from certain alleged dubious/ shell entities/ companies. According to the AO, some of such entities/ companies were found to be managed/ controlled directly/ indirectly by a well-known entry provider of Indore namely Shri Sharad Darak and some of the loan creditor companies were self-managed shell IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 22 of 121 companies of the group itself which were used for routing of unaccounted funds, while some of these loans were shown as accepted from employees/ others. Accordingly, the AO issued show-cause notices dated 19/11/2018 and 19/07/2019 to the assessee before as well as after the receipt of Special Audit Report. In reply, the assessee, vide its letters dated 07.12.2018 and 03.08.2019, furnished its detailed explanation along with documentary evidences in support of establishing the identity & creditworthiness of loan creditors and genuineness of loan transactions. The AO, while framing the assessment order, averted that the assessee had accepted unsecured loans from shell/ paper companies and employees. The AO has also held that interest claimed by the assessee on such loans be held as unexplained expenditure u/s. 69C r.w.s. 115BBE of the Act. Finally, the AO made an addition of Rs.2,12,50,000/- in A.Y. 2013-14, Rs.14,47,564/- in A.Y. 2014- 15, Rs.6,45,65,895/- in A.Y. 2015-16, Rs.3,57,93,998/- in A.Y. 2016-17 and Rs.48,25,049/- in A.Y. 2017-18 by holding the unsecured loans obtained by the assessee and interest paid thereon as unexplained cash credits u/s. 68 and unexplained expenditure u/s. 69C respectively. Further, the facts relating to the issue of unsecured loan of Rs.1,09,00,000/- in A.Y. 2015-16 from M/s. Sumeet & Sumeet Sales are that during the course of search/post search proceedings, it was found that the assessee had shown certain transactions with one concern called Sumeet & Sumeet Sales. As per the AO, this is a namesake proprietary concern of Shri Sumeet Garg who is an ordinary person who has no connection with the assessee’s business. Accordingly, the AO, vide show-cause notices dated 19/11/2018 and 19/07/2019, required the assessee to furnish its explanation on the said issue. In reply, the assessee, vide its letters dated 07.12.2018 and 03.08.2019, furnished its detailed explanation. The AO, while framing the assessment order, averted that cash was introduced in the bank account of M/s. Sumeet & Sumeet Sales which was then transferred to various companies of Global group including the assessee. Finally, the AO made an addition of Rs.1,09,00,000/- in A.Y. 2015-16 on account of receipts from bank account of M/s. Sumeet & Sumeet Sales by treating the same as unexplained cash credit u/s. 68 r.w.s. 115BBE of the Act. 10.3 Aggrieved with the Order of Assessment, the assessee preferred separate appeals for the subject assessment years before the ld. CIT(A). During the course of the first appellate proceedings, the assessee made detailed written submissions along with the documentary evidences which were also furnished by it before the AO. Before the ld. CIT(A), the assessee also furnished certain additional evidences, under Rule 46A, to substantiate the identity & creditworthiness of the lenders and genuineness of loan transactions which were forwarded to the Assessing Officer for comments. The copy of the Remand Report of the AO was provided by the ld. CIT(A) to the assessee and in response, the assessee filed its rejoinder. The Ld. CIT(A), after considering the remand report of the AO as well as the rejoinder of the assessee, deleted the substantial additions made by the AO in respect of the unsecured loans obtained from certain entities/ persons and the ld. CIT(A) also confirmed certain additions made in respect of the certain lender IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 23 of 121 entities. The ld. CIT(A) has given the relevant findings in respect of the unsecured loans obtained from various entities at paras (4.5.5) to (4.5.6) of his order. Further, the relevant findings in respect of unsecured loan obtained from M/s. Sumeet & Sumeet Sales are given by the ld. CIT(A) at para (4.6.2) of his Order. The relevant findings of the ld. CIT(A) are reproduced as under: “4.5.5 I have considered the facts of the case, the assessment order, the written as well as oral submissions of the appellant, the Special Audit Report of the Special Auditors, the remand report of the AO and the counter comments of the appellant. I find that for the assessment years under consideration, the AO has made additions u/s. 68 of the Act, in respect of the eighteen nos. of loan creditors. In order to analyse the facts of each of the loan creditors, I have considered it necessary to give my findings, separately, for all such creditors as under: A. Shri Ashok Choudhary [loan - Rs. 4,99,589/-] [Interest – Rs. Nil] – A.Y. 2014-15 I find that necessary finding regarding unsecured loan from Shri Ashok Choudhary, an employee of the appellant’s group, has been given by the AO from para (9.31) to (9.33) of the impugned order. I find that according to the AO, during the course of the assessment proceedings, the appellant could only furnish copies of the PAN card and letter of confirmation of the creditor, but, the bank statement of Shri Ashok Choudhary, the loan creditor, was not provided. The AO further noted that from the copy of the Income-Tax Return furnished by Shri Ashok Choudhary, that he has filed his return for A.Y. 2014- 15 showing returned income of only Rs. 1,88,400/-. According to the AO, the amount of loan of Rs.4,99,589/- given is disproportionate to the annual returned income of the loan creditor. Further, the AO also doubted providing of loan by Shri Ashok Choudhary as an employee to the appellant as his employer. Accordingly, the AO held such unsecured loan given by Shri Ashok Choudhary to the appellant at Rs.4,99,589/- as non-genuine. I find that the above named loan creditor is one of the employees of the Global Group. I find that during the course of the assessment proceedings, the appellant had duly furnished the copy of the PAN Card of the loan creditor, the copy of the loan confirmation letter, the copy of acknowledgement his Income- Tax return for A.Y. 2014-15 and copy of the relevant bank statement of the appellant. Further, as additional evidences, which have duly been admitted under Rule 46A of the Income-Tax Rules, 1962, the appellant has also furnished the copy of the relevant bank statement of the loan creditor Shri Ashok Choudhary, the copy of letter of confirmation of the sub-creditor namely, SRP Entertainment Pvt. Ltd., who, as per the appellant, provided funds to the loan creditor, and the copies of the audited financial statements of SRP Entertainment Pvt. Ltd. for the F.Y. 2013-14. The copies of all these documents have furnished by the appellant before me. From the copy of the PAN Card, I find that Shri Ashok Choudhary, aged 38 years, is regularly assessed to Income-Tax under PAN: AHIPC2687C. He has furnished a signed copy of the loan confirmation letter before me. Further, from the bank statement of Shri Ashok Choudhary, I find that in such bank statement, as on 08/04/2013, issuance of a cheque bearing no. 33870 for a sum of Rs.1,50,000/-, is getting IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 24 of 121 clearly reflected in the name of the appellant. Further, as on 06/05/2013, issuance of RTGS for a sum of Rs.3,49,589/- is also getting reflected. I also find that before issuance of the cheque of Rs.1,50,000/-, Shri Ashok Choudhary had received a sum of Rs.1,50,000/- through cheque from some SRP Entertainment Pvt. Ltd. on 05/04/2013. I also find that SRP Entertainment Pvt. Ltd. (AAQCS4202F) in his letter of confirmation dated 01/03/2020, has duly confirmed giving of the loan of a sum of Rs. 1,50,000/- to Shri Ashok Choudhary. Further, I find that before issuing RTGS of Rs.3,49,589/- to the appellant, Shri Ashok Choudhary had received a sum of Rs.5,00,000/- through cheque no. 586833 on 06/05/2013 from M/s. Global Marketing (Proprietorship Concern of Shri Awadhesh Dixit). Thus, in my considered view, it is a transfer of accounted funds, through banking channels, in the inter-group entities of the appellant and therefore, by no stretch of imagination, the sources of such loans in the hands of the appellant can be doubted. Thus, in my considered view, by furnishing all the aforesaid documents, the appellant could be able to discharge its onus of establishing the identity of the loan creditor, genuineness of the transaction and the creditworthiness of the loan creditors beyond all doubts. In such circumstances, in my considered view, the addition of Rs.4,99,589/- so made by the AO, in respect of the aforesaid loan, is not sustainable and is directed to be deleted. B. Shri Vijendra Sisodiya [loan - Rs. 5,00,000/-] [Interest – Rs. Nil] – A.Y. 2014-15 The necessary findings regarding loan claimed to have been taken by the appellant from its another employee namely, Shri Vijendra Sisodiya, have been given by the AO at para (9.34) & para (9.35) of the impugned order. From perusal of the para (9.34), I find that the AO has given finding that Shri Vijendra Sisodiya has furnished his return of income for A.Y. 2016-17 declaring an income of only Rs.1,91,880/-. According to the AO, the above named creditor had given loan of Rs.5,00,000/- to the appellant company and as also, substantial loans to other group assessees. At para (9.35), the AO has given a finding that the interest free loan taken by the assessee from Shri VijendraSisodiya is also regarded as unexplained cash credit since the credibility of the loan creditor is not established for giving an interest free loan, the total whereof is ten times his annual income. Accordingly, the AO held such unsecured loan given by Shri Vijendra Sisodiya to the appellant, during the F.Y. 2013-14 relevant to A.Y. 2014-15 at Rs. 5,00,000/- as non-genuine and added to the income of the appellant u/s. 68 of the Act. I find that the above named loan creditor is also one of the employees of the Global Group. On a perusal of the written submissions of the appellant made before the AO dated 07/12/2018, I found that during the course of the assessment proceedings, the appellant had duly furnished the copy of the PAN Card of the loan creditor, the copy of the loan confirmation letter, the copy of acknowledgement his Income-Tax return for A.Y. 2014-15, copy of the relevant bank statement of the loan creditor and as also, copy of the relevant bank statement of the appellant. I also find that the appellant has also furnished the copy of the relevant bank statement of the loan creditor Shri Vijendra Sisodiya, a copy of letter of confirmation of the sub-creditor namely, SRP Entertainment Pvt. Ltd., who, as per the appellant, provided funds to the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 25 of 121 loan creditor. The copies of all these documents have furnished by the appellant before me. From the copy of the PAN Card, I find that Shri VijendraSisodiya, the loan creditor, aged 42 years, is assessed to Income-Tax under PAN: BCLPS8668E. The appellant has also furnished a signed copy of the loan confirmation letter of the loan creditor before me. Further, from the bank statement of Shri Vijendra Sisodiya, I find that in such bank statement, as on 08/04/2013, issuance of RTGS for a sum of Rs.5,00,000/-, is getting clearly reflected in the name of the appellant. I also find that before issuance of the RTGS, Shri Vijendra Sisodiya had received a sum of Rs.5,00,000/- through cheque from some SRP Entertainment Pvt. Ltd. on 05/04/2013. I also find that SRP Entertainment Pvt. Ltd. (AAQCS4202F) in its letter of confirmation dated 01/03/2020, has duly confirmed giving of the loan of a sum of Rs. 5,00,000/- to Shri Vijendra Sisodiya. In my considered view, by furnishing all the aforesaid documents, the appellant could be able to discharge its onus of establishing the identity of the loan creditor, genuineness of the transaction and the creditworthiness of the loan creditors beyond all doubts. In such circumstances, in my considered view, the addition of Rs. 5,00,000/- so made by the AO, in respect of the aforesaid loan, is also not sustainable and is directed to be deleted. C. M/s. ACIL Cotton Industries Pvt. Ltd. (‘ACIPL’)[Loan - Rs.1,27,00,000/- in A.Y. 2015-16] [Interest – Rs.5,68,438/- in A.Y. 2015-16, Rs.4,53,404/- in A.Y. 2016-17 & Rs.3,16,769/- in A.Y. 2017-18] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from ACIPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. ACIL Cotton Industries Pvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that in respect of loan from the aforesaid lender company, the AO made an addition of Rs.1,27,00,000/- in the appellant’s income. During the course of the appellate proceedings, the appellant stated that during the A.Y. 2015- 16, it had obtained unsecured loan only to the tune of Rs. 26,00,000/- from ACIPL and the remaining amount of Rs. 1,01,00,000/- pertains to unsecured loan from M/s. Sumeet & Sumeet Sales. It was further submitted by the appellant that out of the total addition of Rs.5,68,438/- made by the AO on account of unexplained interest expenditure to ACIPL, only a sum of Rs.1,81,348/- pertains to ACIPL and remaining interest of Rs.3,87,090/- IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 26 of 121 pertains to interest paid on loan from M/s. Sumeet & Sumeet Sales. It was also submitted that due to an inadvertent clerical mistake, the entire loan amount of Rs.1,01,00,000/- pertaining to loan from M/s. Sumeet & Sumeet Sales got recorded in the regular books of account of the appellant in the name of ACIPL. I find that the AO, vide para (11.9) of the impugned Order, has also made a separate addition of Rs.1,09,00,000/- in the appellant’s income for the relevant assessment year in respect of unsecured loan obtained from M/s. Sumeet & Sumeet Sales which inter alia includes the aforesaid loan of Rs.1,01,00,000/- wrongly shown by the appellant in the name of ACIPL. I also find that in respect of the aforesaid addition of Rs.1,09,00,000/-, the appellant has raised its separate ground nos. 6(a) & 6(b) of the present appeal and has also made a detailed written submission in respect of such grounds infra. On a perusal of the entire facts, I find that out of the total addition of Rs.1,27,00,000/- made by the AO in the name of ACIPL, an addition to the extent of Rs.1,01,00,000/- in respect of the subject loan creditor has got made twice in the total income of the appellant. Now, in the above background, my findings in respect of unsecured loan of Rs.26,00,000/- from ACIPL and interest paid thereon at Rs.1,81,348/- are given as under: I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Gujarat, under the Companies Act, 1956, with Company Identification No. L99999GJ1994PTC022000 of 1994-95 on 06/05/1994. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘B-1, Sadguru Complex, Near Rupal Park, Gotri Road, Vadodara, Gujarat’. I also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.23,00,00,000/- and Rs.22,16,30,000/- respectively. Further, I found that in such company, there are three directors namely Shri Naresh Nagindas Shah, Shri Vimalkumar Sureshchandra Raval and Smt. Alkaben Ajay kumar Jadhav who have been shown to be holding such position since 24/05/2017, 21/06/2013 and 08/08/2017 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company. I find that the appellant has furnished a copy of certificate of incorporation of the ACIPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company and a copy of the relevant abstract of the bank account of the ACIPL. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the ACIPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the ACIPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the ACIPL and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 27 of 121 appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with ACIPL. Further, I find that by furnishing the copy of master data of ACIPL as downloaded from the official website of Ministry of Corporate Affairs, showing the sufficient net owned funds of ACIPL at Rs.22,16,30,000/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the ACIPL. I find that in the instant case, the appellant has duly established the sources of cash credits. Further, from the copy of the bank statement of the ACIPL with the Axis Bank Limited, I find that in such bank statement, making of payments of Rs.16,00,000/- and Rs.10,00,000/- on 27.08.2014 and 06.09.2014 respectively through RTGS are getting clearly reflected. From such bank statement, I find that before remitting the funds, the ACIPL had received funds not by way of any cash deposits but, through banking channels which according to the appellant were received by the ACIPL out of their business operations.I find that during the course of the search, no incriminating material in respect of the ACIPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from ACIPL could have been drawn. Accordingly, in my considered view and in terms of my findings given above, the entire addition of Rs.1,27,00,000/- made by the AO in the name of ACIPL for A.Y. 2015-16 is not sustainable. Further, the addition on account of interest amounting to Rs.5,68,438/- in A.Y. 2015-16, Rs.4,53,404/- in A.Y. 2016-17 & Rs.3,16,769/- in A.Y. 2017-18 paid by the appellant towards such loan are also not sustainable and is directed to be deleted. D. M/s. Alpha Graphic India Ltd. (‘AGIL’)[Loan - Rs.30,00,000/- in A.Y. 2015-16] [Interest – Rs.1,80,493/- in A.Y. 2015-16, Rs.2,84,620/- in A.Y. 2016-17 & Rs.3,07,674/- in A.Y. 2017-18] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from AGIL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Alpha Graphic India Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Gujarat, under the Companies Act, 1956, with Company Identification No. L29294GJ1993PLC019278 of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 28 of 121 1993-94 on 13/04/1993. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘B-1, Sadguru Complex, Near Rupal Park, Gotri Road, Vadodara, Gujarat’. I also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.21,00,00,000/- and Rs.19,91,74,000/- respectively. Further, I found that in such company, there are three directors namely Shri Sanjay Ambalal Patel, Smt. Alkaben Ajaykumar Jadhav and Shri Dhaval Ranjitbhai Jadhav, who have been shown to be holding such position since 07/04/2017, 09/08/2017 and 09/08/2017 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company. I find that the appellant has furnished a copy of certificate of incorporation of the AGIL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the appellant and a copy of the audited financial statements of AGIL. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the AGIL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the AGIL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the appellant and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with AGIL. Further, I find that by furnishing the copy of the audited financial statements of AGIL for the year ended 31/03/2015, showing the sufficient net owned funds of AGIL at Rs.19,91,74,000/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the AGIL. I find that in the instant case, the appellant has duly established the sources of cash credits. I find that during the course of the search, no incriminating material in respect of the AGIL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from AGIL could have been drawn. Accordingly, in my considered view, the addition of Rs.30,00,000/- made by the AO in the name of AGIL in A.Y. 2015-16 is not sustainable. Further, the addition on account of interest amounting to Rs.1,80,493/- in A.Y. 2015-16, Rs.2,84,620/- in A.Y. 2016-17 & Rs.3,07,674/- in A.Y. 2017-18 paid by the appellant towards such loan are also not sustainable and is directed to be deleted. E. M/s. Bonanza Industries Ltd. (‘BIL’)[Loan - Rs.70,00,000/- in A.Y. 2015-16] [Interest – Rs.5,40,822/- in A.Y. 2015-16, Rs.6,73,807/- in A.Y. 2016-17 & Rs.7,28,385/- in A.Y. 2017-18] IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 29 of 121 I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from BIL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Bonanza Industries Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Maharashtra, under the Companies Act, 1956, with Company Identification No. L17110MH1981PLC024265 of 1981-82 on 20/04/1981. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘Room No. 21, 2nd Floor, Old Shanti Nagar, Chamunda Circle, Mandpeshwar Road, Borivali (W), Mumbai’. I also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.5,00,00,000/- and Rs.1,21,36,960/- respectively. Further, I found that in such company, there are three directors namely Shri Sanjay Ambalal Patel, Smt. Alkaben Ajaykumar Jadhav and Shri Ajaykumar Shashikant Jadhav, who have been shown to be holding such position since 15/05/2017, 09/08/2017 and 09/08/2017 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company, which are placed on record. I find that the appellant has furnished a copy of certificate of incorporation of the BIL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the appellant and a copy of the audited financial statements of BIL. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the BIL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the BIL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the appellant and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 30 of 121 the appellant could be able to establish the genuineness of the loan transactions claimed by it with BIL. Further, I find that by furnishing the copy of the audited financial statements of BIL for the year ended 31/03/2015. showing the sufficient net owned funds of BIL at Rs.1,21,36,960/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the BIL. I find that in the instant case, the appellant has duly established the sources of cash credits. I find that during the course of the search, no incriminating material in respect of the BIL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from BIL could have been drawn. Accordingly, in my considered view, the addition of Rs.70,00,000/- made by the AO in the name of BIL in A.Y. 2015-16 is not sustainable. Further, the additions on account of interest of Rs.5,40,822/- in A.Y. 2015-16, Rs.6,73,807/- in A.Y. 2016-17 & Rs.7,28,385/- in A.Y. 2017-18 paid by the appellant towards such loan are also not sustainable and is directed to be deleted. F. M/s. Krishna Raj Diamond Pvt. Ltd. (‘KRDPL’)[Loan - Rs.83,75,000/- in A.Y. 2015-16] [Interest – Rs.3,46,945/- in A.Y. 2015-16] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from KRDPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Krishna Raj Diamond Pvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Gujarat, under the Companies Act, 1956, with Company Identification No. U36912GJ2010PTC061515 of 2010-11 on 11/07/2010. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘307, 3rd Floor, H.No. 5/1171,72,73,1090, New D.T.C. Hath Falia, Haripura, Surat (GJ.)’. Further, I found that in such company, there are two directors namely Shri Anil Kumar Pukhraj Jain and Shri Ritesh Kumar ParasmalRanka, who have been shown to be holding such position since 30/07/2013 and 13/03/2018 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 31 of 121 for establishing the genuineness of the loan transactions carried out by the appellant with such company, which are placed on record. I find that the appellant has furnished a copy of certificate of incorporation of the KRDPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the KRDPL and as also, a copy of the relevant bank statement of the appellant. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the KRDPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the KRDPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the KRDPL and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with KRDPL. I find that in the instant case, the appellant has duly established the sources of cash credits. From the copy of the bank statement of the KRDPL with the ING Vysya Bank Limited, I find that in such bank statement, making of payments of Rs.9,80,000/-, Rs.8,75,000/-, Rs.9,00,000/-, Rs.9,50,000/-, Rs.9,70,000/-, Rs.9,20,000/-, Rs.9,10,000/-, Rs.9,30,000/- and Rs.9,40,000/- on 22/11/2014, 22/11/2014, 22/11/2014, 22/11/2014, 24/11/2014, 28/11/2014, 28/11/2014, 28/11/2014 and 29/11/2014 respectively through RTGS are getting clearly reflected. From such bank statement, I find that before remitting the funds, the KRDPL had received funds not by way of any cash deposits but, through banking channels which according to the appellant were received by the KRDPL out of their business operations.I find that during the course of the search, no incriminating material in respect of the KRDPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from KRDPL could have been drawn. Accordingly, in my considered view, the addition of Rs.83,75,000/- made by the AO in the name of KRDPL for A.Y. 2015-16 is not sustainable. Further, the addition on account of interest of Rs.3,46,945/- paid by the appellant towards such loan for A.Y. 2015-16 is also not sustainable and is directed to be deleted. G. M/s. Omkar TradeximPvt. Ltd. (‘OTPL’) [Loan - Rs.46,00,000/- in A.Y. 2015-16] [Interest – Rs.1,86,279/- in A.Y. 2015-16] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from OTPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 32 of 121 Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Omkar TradeximPvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Madhya Pradesh, under the Companies Act, 1956, with Company Identification No. U51109MP2009PTC021640 of 2008-09 on 20/02/2009. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘B-240, Panchvati Colony, A.B. Road, Indore(M.P.)’. Further, I found that in such company, there are two directors namely Shri Sanjay Kashinath Nayak and Shri Ambalal who have been shown to be holding such position since 20/02/2009 and 27/08/2018 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company, which are placed on record. I find that the appellant has furnished a copy of certificate of incorporation of the OTPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the OTPL, a copy of the relevant bank statement of the appellant and a copy of the audited financial statements of OTPL as of 31/03/2015. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the OTPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the OTPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the OTPL and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with OTPL. Further, I find that by furnishing the copy of audited financial statements of OTPL for the year ended 31/03/2015 showing the sufficient net owned funds of OTPL at Rs.1,08,75,778/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the OTPL. I find that in the instant case, the appellant has duly established the sources of cash credits. Further, from the copy of the bank statement of the OTPL, I find that in such bank statement, making of payments of Rs.8,50,000/-, Rs.12,50,000/-, Rs.10,00,000/- and IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 33 of 121 Rs.15,00,000/- on 21.10.2014, 21.10.2014, 29.12.2014 and 30.12.2014 respectively through RTGS are getting clearly reflected. I find that during the course of the search, no incriminating material in respect of the OTPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from OTPL could have been drawn. Accordingly, in my considered view, the addition of Rs.46,00,000/- made by the AO in the name of OTPL for A.Y. 2015-16 is not sustainable. Further, the addition on account of interest of Rs.1,86,279/- paid by the appellant towards such loan for A.Y. 2015-16 is also not sustainable and is directed to be deleted. H. M/s. Prudent TradexPvt. Ltd. (‘PTPL’)[Loan - Rs.51,00,000/- in A.Y. 2015-16] [Interest – Rs.1,54,948/- in A.Y. 2015-16, Rs.4,71,551/- in A.Y. 2016-17 & Rs.5,09,747/- in A.Y. 2017-18] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from PTPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Prudent TradexPvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Madhya Pradesh, under the Companies Act, 1956, with Company Identification No. U52590MP2014PTC032632 of 2013-14 on 31/03/2014. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, as filed before me, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘35 - D, E. W. S., Stadium Ground, Janta Quarter, Nanda Nagar, Indore’. Further, I found that in such company, there are two directors namely Shri Sukhdev Visvakarma and Shri Ambalal who have been shown to be holding such position since 15/07/2017. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company, which are placed on record. I find that the appellant has furnished a copy of certificate of incorporation of the PTPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015- 16, copy of the master data downloaded from the official website of the MCA, IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 34 of 121 copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the PTPL, a copy of the relevant bank statement of the appellant and a copy of the audited financial statements of PTPL as of 31/03/2015. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the PTPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2015-16, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the PTPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the PTPL and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with PTPL. Further, I find that by furnishing the copy of audited financial statements of PTPL for the year ended 31/03/2015 showing the long-term liabilities of PTPL at Rs.6,94,50,000/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the PTPL. I find that in the instant case, the appellant has duly established the sources of cash credits. Further, from the copy of the bank statement of the PTPL, I find that in such bank statement, making of payments of Rs.30,00,000/- and Rs.21,00,000/- on 22.12.2014 and 07.01.2015 respectively through RTGS are getting clearly reflected. From such bank statement, I find that before remitting the funds, the PTPL had received funds not by way of any cash deposits but, through banking channels which according to the appellant were received by the PTPL out of their business operations. I find that during the course of the search, no incriminating material in respect of the PTPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from PTPL could have been drawn. Accordingly, in my considered view, the addition of Rs.51,00,000/- made by the AO in the name of PTPL for A.Y. 2015- 16 is not sustainable. Further, the addition on account of interest of Rs.1,54,948/- in A.Y. 2015-16, Rs.4,71,551/- in A.Y. 2016-17 & Rs.5,09,747/- in A.Y. 2017-18 paid by the appellant towards such loan is also not sustainable and is directed to be deleted. I. M/s. Brain Masters Classes Pvt. Ltd. (‘BMCPL’)[Loan - Rs.1,00,00,000/- in A.Y. 2016-17] [Interest – Rs.6,43,731/- in A.Y. 2016-17 & Rs.1,10,344/- in A.Y. 2017-18] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from BMCPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 35 of 121 at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Brain Masters Classes Pvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Gujarat, under the Companies Act, 1956, with Company Identification No. U80903MP2011PTC025907 on 03/05/2011. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘Victory Chamber, 4A Ratlam Kothi, Geeta Bhavan Square, Indore (M.P.)’. Further, I found that in such company, there are two directors namely Shri Parag Kumar Gupta and Pankaj Gupta, who have been shown to be holding such position since 03/05/2011. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company. I find that the appellant has furnished a copy of certificate of incorporation of the BMCPL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the appellant and a copy of the audited financial statements of BMCPL. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the BMCPL, its copy of Memorandum and Articles of Association, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the BMCPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the appellant and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with BMCPL. Further, I find that by furnishing the copy of the audited financial statements of BMCPL for the year ended 31/03/2016, showing the sufficient net owned funds of BMCPL at Rs.4,73,16,557/-, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the BMCPL. I also find that the BMCPL is one of the most renowned coaching classes of Central India. From the copy of the statement of Profit & Loss Account of BMCPL, I find that it had shown revenue from coaching operations for the F.Y. 2015-16 at Rs.11.35 crores. Thus, I find that in the instant case, the appellant has duly established the sources of cash credits. I find that during the course of the search, no incriminating material in respect of the BMCPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 36 of 121 the appellant from BMCPL could have been drawn. Accordingly, in my considered view, the addition of Rs.1,00,00,000/- made by the AO in the name of BMCPL for A.Y. 2016-17 is not sustainable. Further, the addition on account of interest of Rs.6,43,771/- in A.Y. 2016-17 and Rs.1,10,344/- in A.Y. 2017-18 paid by the appellant towards such loan are also not sustainable and is directed to be deleted. J. M/s. Premier Clearing Agency Pvt. Ltd. (‘PCAPL’)[Loan - Rs.10,00,000/- in A.Y. 2016-17] [Interest – Rs.65,287/- in A.Y. 2016-17 & Rs.95,288/- in A.Y. 2017-18] I find that for the assessment year under consideration, the AO has made addition u/s. 68 of the Act, in respect of the loan creditor without giving any specific finding. I find that the subject addition in respect of the unsecured loan from PCAPL has got made by the AO by presuming the same to be a company controlled by Mr. Sharad Darak. I find that during the course of the appellate proceedings, the appellant has stated that the lender company was not belonging or in any way having any direct or indirect connection with Mr. Sharad Darak. I find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the impugned assessment order. Thus, I find that in both the paras, the AO himself has not shown the above named M/s. Premier Clearing Agency Pvt. Ltd. as belonging to Shri Sharad Darak. Thus, I find merit in this contention of the appellant. I find that the findings given by the AO in the body of the assessment order do not apply to the above named company. Accordingly, I find that there is no specific charge against such company that alike other companies of Shri Sharad Darak, it was also a paper company or bogus company. I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, Maharashtra, under the Companies Act, 1956, with Company Identification No. U63090MH2003PTC139758 of 2002-03 on 27/03/2003. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘Room No 001, Anand Bhavan, 290 Shahid Bhagat Singh Road, Mumbai (MH.)’. Further, I found that in such company, there are three directors namely Shri Manoj Doshi, Smt. Sujata Manoj Doshi and Shri Neel Manoj Doshi, who have been shown to be holding such position since 27/03/2003, 27/03/2003 and 17/05/2011 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company. I find that the appellant has furnished a copy of certificate of incorporation of the PCAPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the director of the company, a copy of the relevant abstract of the bank account of the PCAPL, a copy of the relevant abstract of the bank statement of the appellant and a copy of the audited financial statements of PCAPL as of 31/03/2016. Thus, in my considered view, by furnishing all the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 37 of 121 necessary documents, such as the certificate of incorporation of the PCAPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, the appellant could be able to establish the statutory as well as the physical identity and existence of the PCAPL. I further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the PCAPL and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by it with PCAPL. Further, I find that by furnishing the copy of audited financial statements of PCAPL for the year ended 31/03/2016 showing the net owned funds of PCAPL at Rs.2.83 crores, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the PCAPL. I find that in the instant case, the appellant has duly established the sources of cash credits. Further, from the copy of the bank statement of the PCAPL maintained with Kotak Mahindra Bank, I find that in such bank statement, making of payments of Rs.7,50,000/- and Rs.2,50,000/- on 09.07.2015 and 11.07.2015 respectively through RTGS are getting clearly reflected. From such bank statement, I find that before remitting the funds, the PCAPL had received fundsnot by way of any cash deposits but, through banking channels which according to the appellant were received by the PCAPL out of their business operations. I find that during the course of the search, no incriminating material in respect of the PCAPL was found or seized. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from PCAPL could have been drawn. Accordingly, in my considered view, the addition of Rs.10,00,000/- made by the AO in the name of PCAPL for A.Y. 2016-17 is not sustainable. Further, the additions on account of interest of Rs.65,287/- in A.Y. 2016-17 and Rs.95,288/- in A.Y. 2017-18 paid by the appellant towards such loan are also not sustainable and is directed to be deleted. K. M/s. Saviour CommotradePvt. Ltd.(SCPL)[Loan - Rs.1,60,25,000/- in A.Y. 2013-14 and Rs.1,23,92,000/- in A.Y. 2016-17] [Interest – Rs. Nil for A.Y. 2013-14 and Rs.Nil for A.Y. 2016-17] In respect of the loans taken by the appellant company in two assessment years, as mentioned above, from the loan creditor namely, Saviour CommotradePvt. Ltd (in short ‘SCPL’), the AO has only given a short finding at para (9.30) of the impugned Order. At such para, the AO has stated that the discussion made in respect of companies controlled by Shri Sharad Darak also squarely applies to the unsecured loan from SCPL. The AO has further stated that citing of an assessment order for A.Y 2009-10, by identifying the shareholders, in the case of SCPL, is of no relevance at this point of time in light of the findings about SCPL already discussed in paras in the matter of bogus share capital. The AO further stated that the Affidavit filed by a director of SCPL and loan transactions through banking channels also do not prove the genuineness of the loan transaction as discussed by him in earlier paras. I find that the AO, while discussing the issue of bogus share capital at para (8) IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 38 of 121 of the impugned Order, has given his findings in respect of the transactions entered into by the appellant with SCPL at para (8.3) to para (8.21) of the impugned order. At para (8.3), the AO has stated that the SCPL is a dummy concern of the appellant’s group itself, which is based at Kolkata, having Shri Shantanu Dixit and Shri Rajeev Dubey as its directors. At the same para, the AO has drawn a chart showing the returned income of the SCPL. At the same para, the AO has also made reference of one excel sheet which was also seized from a hard disk from the premises situated at 178, BhaktPrahlad Nagar, Indore. The AO also reproduced such excel sheets in the body of the assessment order. Such excel sheets are in the nature of register of members at the time of incorporation of the company, at the time of first and second allotment of new shares by such company and as also on the transfer of shares in such company from time to time of the name of shareholders and certificate nos. issued to them have also been given. At para (8.3), the AO has analyzed the transfer of shares of SCPL from time to time. At para (8.5) of the Order, the AO has stated that the companies referred to in the excel sheets reproduced at para (8.4) are involved in giving bogus entries. The group has used such companies, registered with ROC Kolkata, in routing their unaccounted funds. At para (8.6), the AO has made reference of some Statement of Shri Rajeev Kumar Dubey, one of the directors of the SCPL and has also reproduced abstract of his statement in the said para. At para (8.7), the AO has averted that from the statement of Shri Rajeev Dubey, it is clear that the SCPL is not carrying out any business activity. At para (8.7), the AO has pointed out that Rajeev Kumar Dubey, director of SCPL stated in his statement that books of account of SCPL are maintained at 178, Bhakt Prahalad Nagar, Indore but according to the AO, during the course of the search, no single bill voucher regarding this company was found at the given address. Instead, during the course of the search, only tally data related to SCPL was found. At paras (8.8) to (8.13), the AO has given the screenshots of the balance sheets of the SCPL for the F.Y. 2008-09 to F.Y. 2013-14 as were found in the tally books of the SCPL during the course of the search, in the appellant’s premises. The AO has also made an analysis of such Balance Sheets. At paras (8.13) to (8.16), the AO has made an analysis of Bank accounts of SCPL. At para (8.17), the AO after reproducing the scanned copy of bank statement of the SCPL for the whole financial year 01/04/2012 to 31/03/2013, at para (8.18), commented that the total amount of Rs.5,94,91,886/- were credited in the account of SCPL during the F.Y. 2012- 13 relevant to A.Y. 2013-14, and out of the credits so received, the SCPL had given loans of Rs.1,60,25,000/- to the appellant and the other sum of Rs.4,33,33,000/- to other three entities of the appellant’s group, during the year under consideration. At para (8.20) the AO has reproduced the entire findings of Special auditors, given by the auditors in their report u/s. 142(2A) of the Act, commenting upon the transaction of appellant’s group with SCPL. At para (8.21), the AO has commented that the SCPL is a paper company and therefore, all the amounts received through this company is unaccounted and undisclosed money of Global Group entities. Finally, at such para, the AO has alleged that the unaccounted funds of the group have been ploughed back in the books of account of the SCPL and accordingly, the loan received from the SCPL have been treated as unexplained cash credits of the appellant u/s. 68 of the Act. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 39 of 121 I find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, West Bengal, under the Companies Act, 1956, with Company Identification No. U51909WB2008PTC129469 2008-2009 on 19/09/2008. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, I find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘408, 4th Floor, Landmark Building, Opp. Raheja Classic Complex, Link Road, Andheri, Mumbai’, which is a premises belonging to the appellant’s group itself and in respect of such premises too, a simultaneous search operation u/s. 132 was carried out. I also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.15,00,000/- and Rs. 14,74,000/- respectively. Further, I found that in such company, there are two directors, belonging to the appellant’s group namely Shri Shantanu Dixit and Shri Rajeev Kumar Dubey who have been shown to be holding such position since 04/03/2013 and 14/05/2012 respectively. I find that during the course of the assessment proceedings, the appellant has furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the appellant with such company. I find that the appellant has furnished a copy of certificate of incorporation of the SCPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2013-14 & A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, copy of statement showing the details of the directors of the company, copy of the assessment order for A.Y. 2009-10 passed in the case of SCPL, on 23/08/2011, u/s. 143(3)/147 of the Act, copy of the form no. INC-22A along with the relevant annexures filed before the concerning Registrar of Companies for establishing the actual existence and active status of the company along with photographs of the offices of the company, copy of letter of confirmation duly signed by one of the director of the company, copy of the relevant abstract of the bank account of the SCPL, copy of an Affidavit duly sworn-in before Notary Public by Shri Rajeev Kumar Dubey on 19/11/2018 affirming the loan transactions of the SCPL with the appellant, copy of the audited financial statements of the SCPL showing the net owned funds of the SCPL as on 31/03/2012 at Rs. 6,87,86,335/-. From the copy of the assessment order passed for A.Y. 2009- 10 in the case of the SCPL, u/s. 143(3)/147 of the Act, on 23/08/2011, I find that in the body of the assessment order of SCPL, the AO framing the assessment, at para (2) of the assessment order, has clearly stated that as per the Balance Sheet of the SCPL as on 31/03/2009, the Authorized Share Capital and Paid-up Capital of the SCPL was of Rs. 15 Lakhs and Rs. 14.74 Lakhs respectively with a Share Premium of Rs. 6.73 Crores. I also find that in the same para, the AO has stated that in support of receipt of such share capital and share premium, the SCPL had furnished relevant papers and notices u/s. 133(6) were issued for verification of the share applicant. Eventually, the AO accepted the genuineness of receipt of share capital and share premium by the SCPL and did not form any adverse opinion. I find that in the body of the assessment order, the AO has made a reference of the income returned by the SCPL but, in my considered view, merely on the basis of the returned income of an entity, his creditworthiness cannot be examined and the creditworthiness is necessarily required to be tested on the touchstone of the availability of funds in the hands of the loan creditors at the time of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 40 of 121 providing loan to any other person. I find that for the reasons that (i) a simultaneous search u/s. 132 was carried out at the registered office of the company situated at Mumbai and during the course of the search, one of the representatives of the group was duly found; (ii)on the date of the search itself, the SCPL has been found to be one of the companies of the appellant group itself under the control and management of the family members and associates; (iii) during the course of the search, according to the AO, certain tally books of accounts were found; (iv) as per the findings given by the AO himself at para (8.32) of the impugned order, one of the directors of the company namely Shri Rajeev Kumar Dubey had duly given his statement u/s. 131(1A) of the Act on 05.08.2016; (v) as per the ROC records, the SCPL has been shown to be an active company; (vi) the SCPL is duly assessed to Income-Tax under PAN: AAMCS3660D; (vii) the SCPL is maintaining bank accounts with various banks and (viii) the SCPL has drawn its financial statements and have also got the same duly audited, the levelingof charge of a dummy company or a paper company against the SCPL cannot be accepted under any cannon of law. Thus, in my considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the SCPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2013-14& A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, copy of statement showing the details of the directors of the company, copy of the form no. INC-22A along with the relevant annexures filed before the concerning Registrar of Companies, the appellant could be able to establish the statutory as well as the physical identity and existence of the SCPL. I further find that from the copies of letters of confirmation duly signed by one of the directors of the company, copy of the relevant abstracts of the bank account of the SCPL, copy of an Affidavit duly sworn-in before Notary Public by Shri Rajeev Kumar Dubey on 19/11/2018 affirming the loan transactions of the SCPL with the appellant and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the appellant as well as the lender company, in my view, the appellant could be able to establish the genuineness of the loan transactions claimed by him with SCPL. Further, I find that by furnishing the copies of audited financial statements of the SCPL, showing the net owned funds of SCPL as on 31/03/2012 at Rs. 687.86 Lakhs, copy of the assessment order for A.Y. 2009-10 passed in the case of SCPL, on 23/08/2011, u/s. 143(3)/147 of the Act affirming the sources of the aforesaid funds, in my view, the appellant company could be able to discharge its onus of even proving the creditworthiness of the SCPL. I find that in the instant case, the appellant has not only established the sources of cash credits, but, going one step further, it has also established sources of the sources i.e. the sources of availability of funds in the hands of SCPL and the sources of funds in the hands of the sub- creditors can also not be disbelieved. Further, from the copy of the bank statement of the SCPL with the Axis Bank Limited, I find that in such bank statement, for A.Y. 2013-14, making of payments of Rs.20,25,000/-, Rs.22,00,000/-, Rs.25,00,000/-, Rs.50,00,000/-, Rs.25,00,000/-, Rs.8,00,000/- and Rs.10,00,000/- respectively on 27.09.2012, 27.09.2012, 03.10.2012, 06.10.2012, 08.10.2012, 11.10.2012 & 29.11.2012 through various cheques by clearing mentioning the name of the appellant company are getting clearly reflected. Likewise, for A.Y. 2016-17, from the copy of the bank statement of SCPL maintained with Axis Bank Ltd. as placed at page no. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 41 of 121 1028 of paper book for A.Y. 2016-17, I find that making of payments of Rs.1,00,00,000/-, Rs.23,00,000/- and Rs.92,000/- respectively on 08/07/2015, 22/07/2015 & 25/07/2015 with the specific mention of the name of the appellant, through various cheques, are also getting clearly reflected.From such bank statement, I find that before remitting the funds, , the SCPL had received funds not by way of any cash deposits but, through banking channels which according to the appellant were received by the SCPL out of the disinvestments/ recovery of the loans already given by it on earlier occasions. I find that during the course of the search, no incriminating material in respect of the SCPL was found or seized. In my considered view, the seized document referred to by the AO at para (8.3) of the Order, is a statutory document containing the details of register of members and register of transfer of shares which are mandatorily required to be maintained by every company in accordance with the Companies Enactments. Thus, on the basis of such documents, no adverse inference can be drawn. I find that one of the directors of the SCPL, namely Shri Rajeev Dubey, had got himself appeared before the Investigation Wing in response to a summons issued u/s. 131(1A) of the Act and his statements were duly recorded on 05/08/2016 and from the relevant abstracts of the statement of Shri Rajeev Dubey, as reproduced by the AO himself at para (8.6) of the Order, no adverse view can be drawn on the subject issue. I have carefully taken into consideration that the availability of the funds was by way of its share capital and share premium money aggregating to a sum of Rs.6.98 crores and the sources of such receipts have already got verified and assessed by the AO who passed an assessment order for A.Y. 2009-10, dated 23/08/2011, u/s. 143(3)/ 147 of the Act of SCPL, a copy whereof has been filed before me. In my considered view, having assessed the SCPL u/s. 143(3)/147 and having verified the sources of availability of funds, as per the settled law, no adverse view can be drawn in respect of giving of funds by the SCPL out of the aforesaid assessed funds. I further find that various case laws relied upon by the AO are not applicable to the appellant’s case. In such circumstances, in my considered view, no adverse view in respect of the loan shown to have been received by the appellant from SCPL could have been drawn. Accordingly, in my considered view, the additions of Rs.1,60,25,000/- in A.Y. 2013-14 and Rs.1,23,92,000/- in A.Y. 2016-17 made by the AO in the name of SCPL are not sustainable and is directed to be deleted. L. (i) M/s. Jay Jyoti India Pvt. Ltd.[loan - Rs.50,00,000/- in A.Y. 2013-14] [Interest – Rs. 2,25,000/- in A.Y. 2013-14, Rs.4,47,975/- in A.Y. 2014-15, Rs.4,61,451/- in A.Y. 2015-16 & Rs.48,070/- in A.Y. 2016-17]; (ii) M/s. Octagon Media Matrix Pvt. Ltd.[loan - Rs.1,25,00,000/- in A.Y. 2015-16] [Interest – Rs. 2,37,369/- in A.Y. 2015-16, Rs.11,44,227/- in A.Y. 2016-17 & Rs.12,36,910/- in A.Y. 2017-18]; (iii) M/s. Suzlon Securities Pvt. Ltd.[loan - Rs.70,00,000/- in A.Y. 2015-16& Rs.24,00,000/- in A.Y. 2016-17] [Interest – Rs.60,594/- in A.Y. 2015-16, Rs.8,18,842/- in A.Y. 2016-17 & Rs.9,17,234/- in A.Y. 2017-18];(iv) M/s. Rajwadi Retail Trade Systems Pvt. Ltd.[loan - Rs.35,00,000/- in A.Y. 2016-17] [Interest – Rs.2,77,992/- in A.Y. 2016-17 & Rs.3,37,517/- in A.Y. 2017-18]; IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 42 of 121 I find that as per the details given by the AO, at para (9.12) of the impugned Order, all the aforesaid companies are controlled/ managed companies and associated concerns of Shri Sharad Darak, a well known accommodation entry provider. Since the findings in respect of all the aforesaid companies have been commonly given by the AO at para (9.3) to para (9.20)& (9.27) to (9.29) of the impugned Order, the cash credits in respect of all such cash creditor companies are being dealt with together. I find that in respect of all these companies, the written as well as oral submissions made by the appellant before me are also on the similar lines. I find that the main grounds of contention of the appellant are that (i) during the course of the assessment proceedings, it had furnished all the necessary documents to establish the identity of the loan creditors, the genuineness of the loan transactions and the creditworthiness of the loan creditors, as contemplated under the provisions of s.68 of the Act; (ii) after having discharged its initial onus of proving during the course of the assessment proceedings, the appellant had specifically requested the AO to issue the summons u/s. 131 / notices u/s. 133(6) to the loan creditors but despite making such specific request, the AO did not do the same and made the addition; (iii) the entire additions have been made by the AO only on the basis of findings given by the Special Auditors which were not factually correct without applying his own mind; (iv) the AO except relying upon some information gathered behind the back of the appellant by some other authorities in some other proceedings did not bring on record any adverse material against the appellant; (v) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions recorded in the regular books of account of the appellant were not genuine; (vi) in respect of some of the lender companies, allegedly controlled by Shri Sharad Darak, the Income Tax Department has duly framed assessments u/s. 143(3) of the Act which fact establishes the actual existence and identity of such companies; (vii) in respect of some of the lender companies allegedly belonging to Shri Sharad Darak, even during the course of the income tax appeals, before the Hon’ble Income Tax Appellate Tribunal, genuineness of the transactions have been approved by the Hon’ble ITAT; (viii) the AO has relied upon only hearsays and some information without confronting the same to the appellant and without giving the opportunity of any cross examination; (ix) the transactions carried out by the appellant were of the nature of loan and not of the nature of share capital or share premium and therefore, it was not required to prove the source of the source as contemplated under the proviso to section 68 of the Act; and (x) since the interest expenditure were fully recorded in the books, the provisions of section 69C could not have been invoked. I have carefully considered the findings of the AO, written as well as oral submissions made by the appellant, Special Audit Report, remand report of the AO and the rejoinder of the appellant thereon. I find that during the course of the appellate proceedings, the appellant has furnished numerous documents for establishing its claim regarding the identity of the loan creditors, genuineness of the transactions and creditworthiness of the loan creditors. I find that the appellant has furnished the documents relating to each of the above named lender companies such as copies of certificates of incorporation, memorandum & articles of association, copies of income-tax IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 43 of 121 returns, copies of master data downloaded from website of MCA, copies of loan confirmation letters duly given by the lender companies, copies of relevant bank statements of the lender companies, copies of the relevant bank statements of the appellant, copies of the audited financial statements of the lender companies, copies of the Affidavits duly sworn by Shri Sharad Darak confirming the loan transactions and in some cases, copies of the assessment orders passed u/s. 143(3) of the Act. However, in my considered opinion, the furnishing of all these documents by themselves cannot establish the genuineness of the loan transactions which goes to the root of section 68 of the Act. I find that from the various enquiries conducted by the Investigation Wing and various income-tax authorities, now it has got established beyond all doubts that Sharad Darak is a defamous entry provider of Indore. I find that in many of the cases, the genuineness of the loans provided by the companies of Shri Sharad Darak have not been accepted. Once it is proved that the assessee has taken any loan from any entry provider company then, furnishing of any documentary evidences cannot establish the loan transactions as contemplated u/s 68 of the Act. I find that the AO has rightly placed his reliance on the various judicial pronouncements mentioned in the body of the assessment order. In view of above, I find no infirmity in the action of the AO in making the additions u/s. 68 as well as u/s. 69C in respect of the unsecured loans shown to have been taken by the appellant from the above named four companies. Accordingly, the additions of Rs.50,00,000/- for A.Y. 2013-14, Rs.1,95,00,000/- for A.Y. 2015-16 and Rs.59,00,000/- for A.Y. 2016-17 made by the AO u/s. 68 of the Act on account of unsecured loans taken from aforesaid four companies are confirmed. Correspondingly, the additions of Rs.2,25,000/- for A.Y. 2013-14, Rs.4,47,975/- for A.Y. 2014-15, Rs.7,59,414/- for A.Y. 2015-16, Rs.22,89,131/- for A.Y. 2016-17 and Rs.24,91,661/- for A.Y. 2017-18 made by the AO u/s. 69C of the Act on account of disallowance of interest claimed to have been paid by the appellant on aforesaid loans from four companies are also hereby confirmed. M. (i) M/s. Excellent InfrabuildPvt. Ltd. (‘EIPL’) [Loan - Rs.13,00,000/- in A. Y. 2015-16 & Rs.15,00,000/- in A.Y. 2016-17] [Interest – Rs.42,312/- in A.Y. 2015-16, Rs.1,20,427/- in A.Y. 2016-17 & Rs.2,65,181/- in A.Y. 2017-18]; (ii) M/s. VRR Financial Services Pvt. Ltd. (‘VFSPL’) [Loan - Rs.2,00,000/- in A.Y. 2015-16] [Interest – Rs.11,244/- in A.Y. 2015-16] I find that the necessary findings in respect of the above two loan creditors have been given by the AO at para (9.21) & (9.22) of the impugned Order. According to the AO, these companies were being operated by another entry operator namely Shri Rajesh Vyas who was a director of both the above said companies. At para (9.22), the AO has reproduced the statement of Shri Rajesh Vyas recorded on 31.03.2017 u/s. 131(1A) of the Act during the post search investigation. In reply to Q. No. 11, Shri Rajesh Vyas has denied the genuineness of the transactions carried out by him with the appellant company. I find that in respect of both these companies, the written as well as oral submissions made by the appellant before me are also on the similar lines. I find that the main grounds of contention of the appellant are that (i) during the course of the assessment proceedings, it had furnished all the necessary documents to establish the identity of the loan creditors, the genuineness of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 44 of 121 the loan transactions and the creditworthiness of the loan creditors, as contemplated under the provisions of s.68 of the Act; (ii) the entire additions have been made by the AO only on the basis of some statement recorded behind the back of the appellant without giving any opportunity of cross examination to the appellant; (iii) the AO except relying upon some statement recorded behind the back of the appellant by some other authorities in some other proceedings did not bring on record any adverse material against the appellant; (iv) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions recorded in the regular books of account of the appellant were not genuine; (v) the transactions carried out by the appellant were of the nature of loan and not of the nature of share capital or share premium and therefore, it was not required to prove the source of the source as contemplated under the proviso to section 68 of the Act; and (vi) since the interest expenditure were fully recorded in the books, the provisions of section 69C could not have been invoked. I have carefully considered the findings of the AO, written as well as oral submissions made by the appellant, Special Audit Report, remand report of the AO and the rejoinder of the appellant thereon. I find that during the course of the appellate proceedings, the appellant has furnished numerous documents for establishing its claim regarding the identity of the loan creditors, genuineness of the transactions and creditworthiness of the loan creditors. I find that the appellant has furnished the documents relating to each of the two above named lender companies such as copies of certificates of incorporation, memorandum & articles of association, copies of income-tax returns, copies of master data downloaded from website of MCA, copies of loan confirmation letters duly given by the lender companies, copies of relevant bank statements of the lender companies, copies of the relevant bank statements of the appellant, copies of the audited financial statements of the lender companies. However, in my considered opinion, the furnishing of all these documents by themselves cannot establish the genuineness of the loan transactions which goes to the root of section 68 of the Act. I find that Shri Rajesh Vyas, one of the directors of the above named two companies in his statement given under s.131(1A) of the Act, has clearly accepted that the loan transactions carried out by his companies with the appellant company were not genuine. Once it is proved that the assessee has taken any loan from any entry provider company then, furnishing of any documentary evidences cannot establish the loan transactions as contemplated u/s 68 of the Act. I find that the AO has rightly placed his reliance on the various judicial pronouncements mentioned in the body of the assessment order. In view of above, I find no infirmity in the action of the AO in making the additions u/s. 68 as well as u/s. 69C in respect of the unsecured loans shown to have been taken by the appellant from the above named two companies. Accordingly, the additions of Rs.15,00,000/- for A.Y. 2015-16 and Rs.15,00,000/- for A.Y. 2016-17 made by the AO u/s. 68 of the Act on account of unsecured loans taken from aforesaid two companies are confirmed. Correspondingly, the additions of Rs.53,556/- for A.Y. 2015-16, Rs.1,20,427/- for A.Y. 2016-17 & Rs.2,65,181/- for A.Y. 2017-18 made by the AO u/s. 69C of the Act on account of disallowance of interest claimed to have been paid by the appellant on aforesaid loans from two companies are also hereby confirmed. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 45 of 121 4.5.6 Accordingly, out of the various additions made by the AO vide para (9.37) of the Order, for A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015-16, A.Y. 2016- 17 and A.Y. 2017-18, on account of unsecured loans u/s. 68 and interest expenditure u/s. 69C, respectively at Rs.2,12,50,000/- in A.Y. 2013-14, Rs.14,47,564/- in A.Y. 2014-15, Rs.6,45,65,895/- in A.Y. 2015-16, Rs.3,57,93,998/- in A.Y. 2016-17 and Rs.48,25,049/- in A.Y. 2017-18, the appellant would get relief of Rs.1,60,25,000/- in A.Y. 2013-14, Rs.9,99,589/- in A.Y. 2014-15, Rs.4,27,52,925/- in A.Y. 2015-16, Rs.2,59,84,440/- in A.Y. 2016-17 and Rs.20,68,207/- in A.Y. 2017-18. Accordingly, such additions are hereby Deleted. Consequently, the additions to the extent of Rs.52,25,000/- in A.Y. 2013-14, Rs.4,47,975/- in A.Y. 2014-15, Rs.2,18,12,970/- in A.Y. 2015- 16, Rs.98,09,558/- in A.Y. 2016-17 and Rs.27,56,842/- in A.Y. 2017-18 are hereby Confirmed. Therefore, appeal on these grounds is Partly Allowed. 4.6.2 I have considered the facts of the case, the assessment order, the written submissions of the appellant and the Special Audit Report of the Special Auditors. I find that the main grounds of contention of the appellant are that (i) during the course of the assessment proceedings, it had furnished all the necessary documents to establish the identity of the loan creditor, the genuineness of the loan transactions and the creditworthiness of the loan creditor, as contemplated under the provisions of s.68 of the Act; (ii) after having discharged its initial onus of proving during the course of the assessment proceedings, the appellant had specifically requested the AO to issue the summons u/s. 131 / notices u/s. 133(6) to the loan creditor but despite making such specific request, the AO did not do the same and made the addition; (iii) the entire additions have been made by the AO only on the basis of statement of Shri Sumeet Garg recorded u/s. 131(1A) of the Act before the Investigation Wing; (iv) the AO has not given any credence and even made a reference of an Affidavit of retraction duly given by Shri Sumeet Garg before him, (v) during the course of the assessment proceedings, it was duly explained that cash were deposited by Shri Sumeet Garg, Proprietor of M/s. Sumeet & Sumeet Sales from his own sources claimed to have been out of sale of some property; (vi) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions carried out by the appellant with M/s. Sumeet & Sumeet Sales recorded in the regular books of account of the appellant were not genuine. I have carefully considered the findings of the AO, written as well as oral submissions made by the appellant and the Special Audit Report. I find that during the course of the appellate proceedings, the appellant has furnished numerous documents for establishing its claim regarding the identity of the loan creditor, genuineness of the transactions and creditworthiness of the loan creditor and as also, an Affidavit of Shri Sumeet Garg retracting his own statement given earlier. I find that although all these documents were also furnished by the appellant before the AO but, for the two reasons viz. (i) finding of huge cash deposits in the bank accounts of M/s. Sumeet & Sumeet Sales; and (ii) admission of non-genuineness of the transactions by the proprietor of the concern in the statement recorded u/s. 131(1A) of the Act, and in my view, for taking both the reasons, the AO was having evidences on his record. In such view of the facts, I find no infirmity in the addition of Rs.1,09,00,000/- made by the AO in the appellant’s income for A.Y. 2015-16 IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 46 of 121 u/s. 68 of the Act. Thus, addition made by the AO amounting to Rs. 1,09,00,000/- is Confirmed. Therefore, appealon this ground is Dismissed.” 10.4 Aggrieved with the Order of the ld. CIT(A), both the assessee as well as the Revenue are in appeal before us. 10.5 Before us, learned CIT(DR) vehemently argued supporting the observations of the AO as well as of the ld. CIT(A) on this issue. 10.6 Per Contra, Learned Counsel for the assessee has filed written submission before us. The relevant portion of such written submission is being reproduced as under: “Details of the Additions confirmed by the ld. CIT(A) for which the assessee is in Appeal : A.Y. Name of the Lender Principal Sum Interest Total Relevant Finding by the CIT(A) Remarks 2013-14 M/s. Jay Jyoti India Pvt. Ltd. 50,00,000 2,25,000 52,25,000 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company TOTAL 50,00,000 2,25,000 52,25,000 2014-15 M/s. Jay Jyoti India Pvt. Ltd. - 4,47,975 4,47,975 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company TOTAL - 4,47,975 4,47,975 2015-16 M/s. Jay Jyoti India Pvt. Ltd. - 4,61,451 4,61,451 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Octageon Media Matrix Pvt. Ltd. 1,25,00,00 0 2,37,369 1,27,37,369 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Suzlon Securities Pvt. Ltd. 70,00,000 60,594 70,60,594 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Excellent Infrabuild Pvt. Ltd. 13,00,000 42,312 13,42,312 Para (4.5.5)[M] at page no. 287 to 290 Rajesh Vyas Company M/s. VRR Financial Services Pvt. Ltd. 2,00,000 11,244 2,11,244 Para (4.5.5)[M] at page no. 287 Rajesh Vyas Company IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 47 of 121 to 290 TOTAL 2,10,00,00 0 8,12,970 2,18,12,970 2016-17 M/s. Jay Jyoti India Pvt. Ltd. - 48,070 48,070 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Octageon Media Matrix Pvt. Ltd. - 11,44,227 11,44,227 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Suzlon Securities Pvt. Ltd. 24,00,000 8,18,842 32,18,842 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Rajwadi Retail Trade Systems Pvt. Ltd. 35,00,000 2,77,992 37,77,992 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Excellent Infrabuild Pvt. Ltd. 15,00,000 1,20,427 16,20,427 Para (4.5.5)[M] at page no. 287 to 290 Rajesh Vyas Company TOTAL 74,00,000 24,09,558 98,09,558 2017-18 M/s. Octageon Media Matrix Pvt. Ltd. - 12,36,910 12,36,910 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Suzlon Securities Pvt. Ltd. - 9,17,234 9,17,234 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Rajwadi Retail Trade Systems Pvt. Ltd. - 3,37,517 3,37,517 Para (4.5.5)[L] at page no. 283 to 287 Sharad Darak Company M/s. Excellent Infrabuild Pvt. Ltd. - 2,65,181 2,65,181 Para (4.5.5)[M] at page no. 287 to 290 Rajesh Vyas Company TOTAL - 27,56,842 27,56,842 LEAD YEAR : A.Y. 2013-14 A. Relevant Para and Page Nos. of the AO’s Common Order : IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 48 of 121 Para (9) at page no. 55 to Para (9.37) at page no. 85. (Operative Para (9.37) at page no. 83 to 85) B. Relevant Paras and Page Nos. of the CIT(A)’s Common Order : Para (4.5) at page no. 137 to Para (4.5.6) at page no. 290. (Operative Para [4.5.6] at page no. 289 & 290) C. Our Detailed Submissions, on the subject issue, as made before the ld. CIT(A): Page No. 65 to 109 of Paper Book for A.Y. 2013-14 D. Key Points of Assessee’s Submission and Relevant Pages of the Paper Books: 1.00 At the outset, it is submitted that the impugned addition of Rs.2,12,50,000/- so made by the learned AO suffers from legal infirmity inasmuch such addition has been made by the learned AO merely on the basis of some entries found in the regular books of account of the assessee without having recourse to any incriminating material found or seized during the course of the search. 1.01 As has already been discussed elaborately in respect of legal ground No. 2 for A.Y. 2013-14 & A.Y. 2014-15, it is reiterated that on the date of initiation of the search under s. 132, no assessment proceeding was pending in respect of the assessment years 2013-14 & 2014-15 and therefore, without having recourse to any seized incriminating document or material, no addition could have been made in the total income of the assessee. 1.02 Your Honours, at para (9.5) at page no. 60 of the assessment order, the learned AO has made an attempt to justify his action of making the addition on the pretext that during the course of the search proceedings, details of unsecured loanswerefound mentioned in some documents and tally datas seized during the course of search. According to the AO, such details and tally datas meet the requirement of existence of incriminating material for making the additions. In this regard, it is submitted that such a premise taken by the ld. AO is patently wrong and against the established canon of law. It is submitted that the details and tally datas, as referred to by the ld. AO in the body of the assessment order, were maintained by the assessee in its ordinary course of business and based upon such datas only the assessee had furnished its returns of income under s.139 of the Act, from year to year, much prior to the date of the search and therefore, by no stretch of imagination, it can be inferred that such datas were either not disclosed by the assessee or were not purported to be disclosed by the assessee before the Income Tax Authorities, as contemplated under s.132 of the Act. In such circumstances, the nature of documents and tally datas so seized cannot be held to be of the incriminating nature. Consequently, such details and datas would not meet out the requirement of seized material as contemplated under the various judicial pronouncements in which it has been held that in respect of the completed assessment years, no addition can be made without having any recourse to seized material. In other words, the details of unsecured loans and tally data, as referred to by the ld. AO in the assessment order cannot be said to be incriminating material so as to give rise to making of addition on the basis of such materials. For such proposition, reliance is placed on the following judicial pronouncements: IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 49 of 121 i) ACIT vs. M/s. Jackson Ltd. (2020) (1) TMI 1054 – ITAT Del. ii) Lord Krishna Dwellers (P)Ltd. vs. DCIT (2019) 197 TTJ 0502 (Del.) 2.00 Your Honours, without prejudice to the above, it is submitted that the impugned addition of Rs.2,12,50,000/- was not called for, even on merits, in view of the facts and circumstances, as discussed in the ensuing paras. 3.00 Your Honours, the relevant findings on the subject issue have been given by the learned AO, from para (9.0) at page no. 55 to para (9.37), at page no. 85 of the impugned order. 3.01 Your Honours, during the course of the assessment proceedings, the learned AO, vide his show-cause notice dated 19-07-2019 [kindly refer Page No. 204 to 209 of oru Paper Book for A.Y. 2013-14], had required the assessee to furnish its explanation on the subject issue. In response to the aforesaid query, the assessee vide its letter dated 03-08-2019 [kindly refer Page No. 210 to 281 of our Paper Book for A.Y. 2013-14], made its very elaborative explanation on the subject issue along with ample of documentary evidences, filed by way of furnishing a separate Volume marked as ‘Volume –UL’. By tendering the explanations which were duly supported by all the necessary documentary evidences, the assessee had discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts and in accordance with the provisions of s.68 of the Act. Consequently, no addition in the hands of the assessee was warranted under s. 68 of the Act, in respect of the subject loan amounts. 3.02 Your Honours, despite making the explanation as aforesaid, the learned AO made the impugned addition of Rs.2,12,50,000/- merely on his whims, surmises, presumptions, assumptions and extraneous considerations and also without bringing any positive material on record to substantiate his allegation that the assessee was engaged in routing its own unaccounted funds into its books of account in form of cash credits, by making its employees and other persons/ concerns as conduit for the same. 3.03 Your Honours, the learned AO, at page no. 84 & 85 of the assessment order, has given the break-up of the sum of Rs.2,12,50,000/- in respect of which the subject addition has been made for the assessment year 2013-14. For the sake of convenience, the break-up so given is summarized, in a tabular form, as under: S. No. Name of the loan creditor Loan Amount U/s. 68 Interest Amount u/s. 69C 1. M/s. Jay Jyoti India Pvt. Ltd. 50,00,000 2,25,000 2. M/s. Saviour Commotrade Pvt. Ltd. 1,60,25,000 - TOTAL 2,10,25,000 2,25,000 4.00 Your Honours, during the course of assessment proceedings, the assessee vide its letter dated 03-08-2019 [kindly refer PB Page No 146 to 199 of our Paper Book for A.Y. 2013-14], had furnished the necessary documentary evidences to establish the identity of the loan creditors, the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 50 of 121 genuineness of the loan transactions and the creditworthiness of the loan creditors, as contemplated under the provisions of s.68 of the Act. 5.00 Your Honours, it is submitted that the assessee by furnishing the necessary documents had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts and in accordance with the provisions of s.68 of the Act. It is further submitted that during the course of assessment proceedings, the assessee, vide para (9.00) of its letter dated 03-08-2019 [kindly refer PB Page No 146 to 199 for A.Y. 2013-14], had specifically requested the learned AO that if he wish to make further verification or investigation in the matter, then summons under s.131 or letters under s.133(6) of the Act to the loan creditors may be issued in order to further substantiate the claim of the assessee. However, despite making such specific request, the learned AO did not carry out any enquiry by himself and proceeded further in regarding the impugned unsecured loan as unexplained credits of the assessee. Such a failure on the part of the learned AO was not permissible and is bad-in-law. For such proposition, reliance is placed on the following judicial pronouncements : i) CIT vs. Shri Sai Vihar (2016) 28 ITJ 158 (Trib. - Raipur) ii) CIT V Ramesh Chander Shukla 10 ITJ 286 (Madhya Pradesh HC) iii) Manna Lal Murlidhar79 ITR 540 iv) Radhe Sham Jagdish Prashad 117 ITR 186 v) G. Shubha Devi vs. ITO (2019) 307 CTR 0536 (Kar.) vi) Anil Kumar Midha (HUF) vs. ITO (2006) 100 TTJ 0644 vii) ITO vs. Sanjay Kumar Goel (2007) 108 TTJ 0823 (Del.) viii) Mass Con (India) Pvt. Ltd. vs. ITO (2013) 37 CCH 0143 (Del.) ix) CIT vs. Rajeev Shukla (2007) 207 CTR 0253 (MP HC) 6.00 Your Honours, it is submitted that once the initial onus has been discharged by the assessee, the burden to prove the credits as unexplained shifts from the shoulder of the assessee to the taxing authorities. It is submitted that, in the instant case, the learned AO has failed to discharge his onus by failing to substantiate his assertion with the aid of corroborative evidences and thus, there was absolutely no justification for the learned AO to make the impugned addition merely on the basis of some hearsay allegations against the loan creditors and information gathered behind the back of the assessee. 7.00 Your Honours, the ld. AO, for making the impugned addition, relied on the reports submitted by the Special Auditors u/s. 142(2A) of the Act. However, during the course of assessment proceedings, the assessee had got its preliminary objection registered against the observation made by the ld. AO as well as by the Special Auditors appointed under s.142(2A) of the Act, that the scope of the Special Auditors had to be restricted to the examination, verification and audit of books of account and other documents, pertaining to the assessee or as found and seized during the course of the search. The scope would not include an investigation into the affairs of the auditee or for that matter, to occupy the judgment seat of an Assessing Officer. The scheme of the Special Audit nowhere contemplates satisfaction of the Special Auditors IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 51 of 121 as regard to the genuineness of the loan transactions which have duly been recorded in the books of account. The Assessing Officer who is competent to examine the ingredients of the cash credits such as identity of the loan creditor, genuineness of the transactions and creditworthiness of the loan creditor as contemplated under the provisions of s.68 of the Act and it is his satisfaction only, which matters for invocation of provisions of s.68 of the Act. It is submitted that in the instant case, the ld. AO is heavily harping on the comments given by the Special Auditors in their Report without even going through the various documentary evidences already placed by the assessee company on his record for establishing the genuineness of the loan transactions as claimed by the assessee. 8.01 Your Honours, it has been averted by the ld. AO in para (9) of the impugned Order that during search and post search proceedings, it was found that the assessee has accepted unsecured loans from certain dubious/ shell entities/ companies. Some of such entities/ companies were found to be managed/ controlled by Shri Sharad Darak, a well known accommodation entry provider. Your Honours, it is submitted that the assessee or any of its functionaries do not know any entry provider and have never made any transaction with any entry provider. 8.02 Your Honours, the ld. Assessing Officer, at paras (9.12) to (9.20) of the Assessment Order, has given a finding related to entities/ companies allegedly managed/ controlled by Shri Sharad Darak. In the aforesaid paras, the ld. AO has alleged that Shri Sharad Darak through his companies had been involved in providing the accommodation entries to the assessee and to its group companies. It is submitted that the assessee had genuinely borrowed unsecured loans from certain companies and had never got indulged in routing of its unaccounted money, as alleged by the learned AO. It is submitted that during the course of the assessment proceedings, the assessee had duly furnished all the necessary documents for establishing the identity and creditworthiness of the lender companies and as also, the genuineness of the loan transactions carried out by it during the periods under assessment. 8.03 In nutshell, during the course of the assessment proceedings, the assessee had duly discharged its onus of proving the credit entries found recorded in its books of account, as contemplated under the provisions of s.68 of the Act, by furnishing all the necessary documentary evidences. Further, the learned AO could not find any specific discrepancy or defect in the documentary evidences so furnished by the assessee. Instead, the learned AO, merely on his own surmises and conjectures, without bringing any cogent material on record, disbelieved the loan transactions genuinely carried out by the assessee with various companies and made the addition under s.68 of the Act which was not so warranted. 9.00 Your Honours, without prejudice to the above, now, on the merits of the case, we will be dealing with each and every ingredients of s. 68 of the Income-Tax Act, 1961 in respect of the aforesaid loan creditors in the ensuing paras. 10.00 LOAN FROM M/s. JAY JYOTI INDIA PVT. LTD. [‘JJIPL’]– Rs.52,25,000/- IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 52 of 121 [Presently known as M/s. Jayganga Exim India Pvt. Ltd.] – [A.Y. 2013-14] - ASSESSEE’S APPEAL [AO’s Findings at para (9.37) at page no. 84] [CIT’s Findings at para (4.5.5[L]) at page no. 283 to 287] (A) IDENTITY: (i) The JJIPL was incorporated in the name of “Jay Jyoti India Pvt. Ltd.”, as a private company, duly registered under the erstwhile Companies Act, 1956, under the Certificate of Incorporation granted by the Registrar of Companies, Maharastra, on 06-12-1999 vide registration No.11-122929 of 1999. Presently, the company has changed its name to Jayganga Exim India Pvt. Ltd. having Unique Corporate Identification Number i.e. CIN as U51900WB1999PTC231394. A copy of certificate of incorporation of the company is placed at Page No. 381 of our Paper Book for A.Y. 2013-14. (ii) The JJIPL was incorporated with the objects of carrying out the business of trading in various commodities, financing and investment as per the objects contained in its Memorandum of Association, under which it has got incorporated. A copy of the Memorandum and Articles of Association of the company is placed at Page No. 382 to 409 of our Paper Book for A.Y. 2013-14. (iii) The registered office of the JJIPL, at the relevant time, was situated at 26, Col Biswas Road, Ground Floor, West Side Flat, Kolkata (W.B.). (iv) The JJIPL, since its inception, is regularly assessed to income-tax under PAN-AAACJ8822E. The JJIPL had also furnished its return of income for the relevant assessment year. In evidence of such fact, a copy of acknowledgement of return of JJIPL, for A.Y. 2013-14, is placed in our Paper Book for A.Y. 2013-14 at Page No. 410. (v) The JJIPL is an active and functionary company as per the records and data of the Ministry of Corporate Affairs (MCA), Government of India. In evidence of such fact, a copy of the Master Data downloaded from the official website of the MCA is placed at Page No. 411 of our Paper Book for A.Y. 2013- 14. (vi) The JJIPL has been maintaining its bank accounts with various banks. During the relevant previous year, the JJIPL was maintaining its current account with Indusind Bank at its Branch at Indore vide account No. 200001124518. (B) GENUINENESS OF THE TRANSACTIONS: (i) As regard the genuineness of the transactions, it is submitted that all the transactions entered into by the assessee with JJIPL had taken place through account payee cheques/ banking channels only and none of the transactions had taken place in the form of cash. In evidence of such fact, a copy of loan confirmation letter duly signed by the authorized signatory of the lender company, confirming the transactions of loan given by the JJIPL to the assessee, is placed at Page No. 412 of our Paper Book for A.Y. 2013-14. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 53 of 121 (ii) The assessee’s claim to the effect that all the loan transactions had taken place through banking channels can be verified from the copies of the relevant statements of accounts maintained with the banks in which the transactions relating to receipt of loan by the assessee from JJIPL are clearly getting reflected. Copies of abstracts of the relevant bank statements of the assessee are placed at Page No. 413 of our Paper Book for A.Y. 2013-14. (iii) Further, to establish the fact that unsecured loan was genuinely given by JJIPL through their bank accounts, a copy of relevant bank statement of JJIPL for the relevant period, is placed at Page No. 414 & 415 of our Paper Book for A.Y. 2013-14. (iv) Furthermore, it is also submitted that the assessee has paid interest on such loans after making necessary TDS which has duly been incorporated by the loan creditor JJIPL in its return of income for the relevant assessment year. (v) It shall be pertinent to note that the assessee company has repaid the entire loan of Rs.50,00,000/- to JJIPL through banking channel in the succeeding previous year relevant to A.Y. 2016-17. In support of such assertion, a copy of relevant bank statement of the assessee company, is placed at Page No. 416 of our Paper Book for A.Y. 2013-14. The repayment of loan by the assessee in the succeeding year itself proves the genuineness of the loan transaction from JJIPL. (vi) The genuineness of the loan transaction also gets fortified from a very vital fact that the director of the JJIPL namely Shri Sharad Darak, through his Affidavit, duly sworn before Notary Public, has duly affirmed the transaction of loan of Rs.50,00,000/- given by his company JJIPL to the assessee company. Shri Sharad Darak, at paras (4) & (7) of the Affidavit, has stated that the subject loan was given by JJIPL out of its own funds only. A copy of the Affidavit of Shri Sharad Darak is placed at Page No. 417 to 419 of our Paper Book for A.Y. 2013-14. The Affidavit so furnished by a director of the lender company also establishes the genuineness of the borrowing made by the assessee from JSFL. For such proposition, reliance is placed on the decision of the Hon’ble High Court of Karnataka in the case of Tam Tam Pedda Guruva Reddy vs. JCIT (2007) 291 ITR 44 (Kar.). (C) CREDITWORTHINESS OF JJIPL: (i) For establishing capacity and creditworthiness of JJIPL to provide loan to the assessee, during the course of the assessment proceedings, the assessee had duly furnished a copy of the audited financial statements of JJIPL along with Auditors’ Report, in respect of the financial year ended 31 st March 2013. A copy of such audited financial statementsis placed at Page No. 420 to 437 of our Paper Book for A.Y. 2013-14. (ii) On a perusal of the audited financial statements of JJIPL, it shall be observed by Your Honours that as on 31-03-2013 [kindly refer PB Page No 420 to 437 for A.Y. 2013-14], the JJIPL was having its net owned funds to the extent of Rs. 114.96 Crores by way of share capital and reserves & surplus. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 54 of 121 (iii) Your Honours, on a perusal of the copy of the bank statement in respect of the bank account maintained by the JJIPL with Indusind Bank [kindly refer PB Page no. 414 & 415 for A.Y. 2013-14], it shall be observed by Your Honours that, in such bank statement, entries regarding issuance of cheques for the purpose of providing the subject unsecured loan to the assessee are getting clearly reflected. Such entries by themselves, speak in volume, regarding the identity of the loan creditor, genuineness of the loan transaction and as also, creditworthiness of the loan creditor. (iv) Your Honours, on a further perusal of the bank statement of the JJIPL, it would be observed by Your Honours that JJIPL was having sufficient balance in its bank statement before providing the subject loan to the assessee. It shall further be observed by Your Honours that such bank balance in its turn had not got accumulated with JJIPL by making cash deposits in bank account. Thus, in such circumstances, the sources of providing loan by JJIPL cannot be doubted. It is submitted that JJIPL before providing loan to the assessee company, had procured funds from its sister company namely M/s. Jayant Security and Finance Ltd. [kindly refer PB Page No. 414 for A.Y. 2013-14] and such Jayant Security and Finance Ltd. has been held to be a genuine company by this Hon’ble Bench in the case of M/s. Tirupati Construction vs. DCIT in ITA No. 522/Ind/2014. (v) Your Honours, the creditworthiness of the also gets substantiated from the Affidavit of Shri Sharad Darak, director of JJIPL, wherein he has stated on oath that the unsecured loan of Rs.50,00,000/- has been given by JJIPL out of its own funds only [kindly refer PB Page No. 417 to 419 for A.Y. 2013-14]. (vi) Your Honours, during the course of the assessment proceedings, the assessee had furnished ample of documents for establishing the genuinnenss of the loan transactions. During the course of the appellate proceedings, in addition to the documents furnished before the AO, some additional documents were also furnished by the assessee and the same were duly admitted by the ld. CIT(A) as additional evidences under Rule 46A of the Income-Tax Rules, 1962 after giving due opportunity of comments to the concerning AO. Such documentary evidences are placed at page nos. 381 to 517 of our Paper Book for A.Y. 2013-14. (D) GENUINENESS OF THE LOAN TRANSACTIONS FROM JJIPL ACCEPTED BY THE HON’BLE ITAT ‘G’ BENCH – ORDER DATED 01-06-2021 Your Honours, the Hon’ble Coordinate ‘G’ Bench of Mumbai, in the case of JCIT vs.Shalimar Housing and Finance Limited vide its recent pronouncement on 1-06-2021 in Appeal No. ITA 4079/Mum/2019 for A.Y. 2013-14 was pleased to hold the genuineness of the loan transactions carried out by the assessee with JJIPL. Finally, in respect of the loan transactions with JJIPL, it is submitted that the assessee has fully established the credibility of the loan creditor and as also the genuineness of the transactions, and therefore, the findings given by the learned AO in the impugned assessment order, deserve to be set-aside. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 55 of 121 11.00 LOAN FROM M/S. SAVIOUR COMMOTRADE PVT. LTD. [‘SCPL’]– Rs.1,60,25,000/- [A.Y. 2013-14] - DEPARTMENTAL APPEAL [AO’s Findings at para (9.37) at page no. 84] [CIT’s Findings at para (4.5.5[K]) at page no. 276 to 283] 11.01 Your Honours, the ld. AO has made an addition of Rs.1,60,25,000/-, in the returned income of the assessee, under s. 68 of the Act in respect of loan taken by the assessee from a company, named and titled, as M/s. Saviour Commotrade Pvt. Ltd. having its registered office at 6, Judges Court Road, Kolkata and PAN: AAMCS3660D . The learned Assessing Officer, in respect of the aforesaid loan creditor, has given his findings from para (9.12) at page no.65 to para (9.30) at page no.82 of the assessment order. 11.02 Your Honours, for making the impugned addition, in respect of SCPL, the ld. AO has made various findings such as (i) the assessee had taken loans from various entities/companies which were managed/controlled directly/indirectly by an entry provider of Indore, namely, Shri Sharad Darak; (ii) some of the loan creditor companies were self managed shell companies of the group itself, which were used for routing of unaccounted funds; (iii) SCPL is a dummy concern of the assessee with no business activity; (iv) SCPL is involved only in providing bogus entries for routing/layering unaccounted money; (v) filing of statutory documents before various authorities does not establish the genuineness of business transactions of such entities; (vi) the transactions through banking channels also is not a benchmark of genuineness; (vi) no bill or voucher regarding the SCPL was found during the course of the search and only some tally data related to SCPL was seized; (vii) during the course of the search, the details of the companies in which SCPL had made investments were not found; and finally (viii) the SCPL is a paper company with no actual business activity and all amounts received through this company is unaccounted and undisclosed income of Global Group entities. 11.03 Your Honours, before delving with the issue, it is submitted that the learned AO has made the impugned addition merely on the basis of some information available with him as regard to the loan creditor allegedly gathered behind the back of the assessee either in the case of the assessee itself or in the cases of some other assesses. The learned AO in the Assessment Order has referred to the statements of Shri Shantanu Dixit and Shri Rajeev Dubey recorded in capacity of the directors of the SCPL. Besides relying on such statements, the learned AO also made reference of various Balance sheets of SCPL in Tally accounts, bank statements, excel sheets etc.. But while doing so, the learned AO committed gross violation of principles of natural law and justice, firstly, by not confronting the assessee with the copies of all statements, documents and materials which he was intending to use against the assessee and secondly, by not affording any opportunity of cross examination to the assessee of the persons on whose statements the learned AO placed the reliance. In such circumstances, in view of the settled judicial position, the learned AO was not justified in drawing any adverse inference against the assessee merely on the basis of evidences collected behind his back. 11.03.1Your Honours, on the issue of cross-examination, the Hon’ble Supreme Court in the case of M/s. Kishinchand Chellaram vs. CIT (1980) 125 ITR 713 IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 56 of 121 (SC) was pleased to hold that the assessing officer is duty bound to confront the material collected by him to the assessee. The Hon’ble Supreme Court again in the case of M/s. Andaman Timber Industries V/s. Commissioner of Central Excise, Kolkatta-II 2016 (15) SCC 785 (SC) was pleased to hold as under: “5. According to us, not allowing the Assessee to cross examine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural justice because of which the Assessee was adversely affected. It is to be borne in mind that the order of the Commissioner was based upon the statements given by the aforesaid two witnesses. Even when the Assessee disputed the correctness of the statements and wanted to cross examine, the Adjudicating Authority did not grant this opportunity to the Assessee. It would be pertinent to note that in the impugned order passed by the Adjudicating Authority he has specifically mentioned that such an opportunity was sought by the Assessee. However, no such opportunity was granted and the aforesaid plea is not even dealt with by the Adjudicating Authority. As far as the Tribunal is concerned, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that cross examination of the said dealers could not have brought out any material which would not be in possession of the Assessee themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the Assessee wanted to cross-examine those dealers and what extraction the Assessee wanted from them. 6. As mentioned above, the Assessee had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of cross- examination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of cross-examination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the cross examination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17-3-2005 [2005 (187) E.L.T. A33 (S.C.)] was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. 7. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the show cause notice.” 12.04 Your Honours, without prejudice to the above, it is submitted that none of the allegations made by the ld. AO against the assessee, in respect of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 57 of 121 existence of SCPL, genuineness of the transactions carried out by the assessee with SCPL and creditworthiness of the SCPL is factually correct. It is submitted that the entire findings of the ld. AO are based on conjectures and surmises, and not on any documentary evidences placed on record. It is submitted that during the course of the assessment proceedings, the assessee had established the identity of the SCPL and as also genuineness of the loan transactions carried out by the assessee with such SCPL with plenty of documentary evidences. The assessee had also established the capacity and creditworthiness of the SCPL to provide loans to the assessee. The assessee had furnished various documentary evidences, in support of its explanation and the ld. AO has not found any single discrepancy or defect in the documentary evidences so furnished. 12.05 Your Honours, the learned AO has disbelieved the genuineness of the loan transaction on the basis of the income pattern of the SCPL. It is submitted that the creditworthiness of any person cannot be determined merely on the basis of its income pattern rather for establishing the creditworthiness of a person what is to be seen is the availability of funds in the hands of such and the sources of such funds. It is submitted that, during the course of assessment proceedings, the assessee vide its letter dated 07-12-2018 [kindly refer Page No 146 to 199], had strongly registered its objection against the allegation made by the learned AO to the effect that SCPL is merely a paper company or a dummy concern. For a ready reference, the relevant abstract of the submission of the assessee is being reproduced as under : “I.EXPLANATION ON THE ISSUE OF RECEIPT OF A SUM OF Rs.1,60,25,000/- FROM SAVIOR COMMOTRADE PRIVATE LIMITED [SCPL] DURING THE FINANCIAL YEAR RELEVANT TO THE A.Y. 2013-14 On this issue, we wish to submit as under: (i) At the outset, we wish to strongly object the allegations made by your good self in the captioned notice to the effect that the SCPL is a dummy or a paper concern of our group which is not carrying out any business activity and is engaged in providing bogus entries for routing/layering unaccounted money of our group. The fact remained that the Savior Commotrade Pvt. Ltd. is a genuine company duly registered under the erstwhile Companies Act, 1956. The company has been incorporated in the State of West Bengal under Company Identification No. U51909WB2008PTC129469, vide the Certificate of Registration dated 19-09-2008 issued by the Assistant Registrar of Companies, Kolkata. A copy of Certificate of Registration evidencing such fact is being submitted herewith as Annexure B-1.01. It is submitted that the aforesaid company, SCPL, has been incorporated with the main objects of carrying out the business of dealing in various commodities, making of investments, consultancy and providing of loans. The SCPL is duly assessed to Income tax since its inception under PAN – AAMCS3660D. The activities of the SCPL have already undergone depth scrutiny by one of the authorities of your own esteemed department i.e. by the Income Tax Officer, 11(1), Kolkata for A.Y. 2009-10 under the provisions of s. 143(3)/147 of the Income-tax Act, 1961. The assessing officer passed necessary order on 23-08-2011 by determining the total income of the company at Rs.24,850/- and creating a demand of Rs.9,910/-. A copy of the order of assessment passed under s. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 58 of 121 143(3)/147 of the Act along with the copy of the demand notice is being submitted herewith as Annexure B-1.02. It is submitted that during the course of such scrutiny, not only the financial statements, but the activities of the company had also been thoroughly examined by the then assessing officer. The assessing officer framing the assessment in the case of SCPL had also gone through capital structure and noted that the company was having paid- up capital and share premium money of Rs.14.74 lacs and Rs.6.73 crores, as is evident from the para (2) of the body of the assessment order. The AO, in his assessment order, has further confirmed that such company had filed all relevant papers in connection with share capital. The AO also stated that notices under s. 133(6) were issued by him to the share applicants and the necessary verification from the share applicants were made by him. In such circumstances, merely on guess work and presumption, it was not correct on your part to take a different view in respect of the existence and genuineness of the company, in the captioned notice. It is submitted that to the best of our knowledge, at the time of initiation of search under section 132 in our Dixit Group on 12-07-2016, the registered as well as administrative of the company was situated at 6, Judge Courts Road, Kolkata. It is submitted that all the books of account and the relevant records, pertaining to such company, were lying at their office at Kolkata only and therefore the question of finding those records at our premises at Indore or Bhopal or Mumbai does not arise. Consequently, merely on the premises of non-finding of records of such company at our premises, no adverse inference deserves to be drawn against any of the assessee of the Dixit Group. (ii) Sir, as regard to the transactions of receipts of a sum of Rs.1,60,25,000/- by us from the above named SCPL during the financial year 2012-13, relevant to A.Y. 2013-14, it is submitted that the aforesaid sum was genuinely received by us as unsecured loans only. It is submitted that the SCPL was holding investments, by way of equity shares, in certain closely held companies and during the financial year relevant to A.Y. 2013-14, it had sold some of equity shares to some companies. Out of sale proceeds of such shares which was received through banking channels only, it provided unsecured loan, of an aggregate sum of Rs.1,60,25,000/- to us, through RTGS, in seven trenches of Rs. 20,25,000/- on 27-09-2012 , Rs.22,00,000/- on 27-09-2012, Rs. 25,00,000/- on 03-10-2012, Rs.50,00,000/- on 06-10- 2012, Rs.25,00,000/- on 08-10-2012, Rs.8,00,000/- on 11-10-2012 and Rs.10,00,000/- on 29-11-2012. It shall be worthwhile to note that the entire unsecured loans aggregating a sum of Rs.1,60,25,000/- taken by our company from SCPL have been repaid through banking channels in the same financial year i.e. the financial year 2012-13 relevant to A.Y. 2013-14. (iii) Sir, the identity of the lender company i.e. SCPL is evident from the various documentary evidences such as, copy of certificate of incorporation, copy of income-tax assessment order, etc., as mentioned in the sub-para (i) above. (iv) Sir, as regard to the genuineness of the transaction, it is reiterated that the transactions of providing loans by SCPL to us had taken place through banking channels only and such transactions are getting clearly reflected in the statements of bank accounts maintained by SCPL as well as by our IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 59 of 121 company. In evidence of such fact, we are submitting herewith copy of abstract of relevant bank statements of SCPL and as also, of our company, as Annexure B-2.01 & B-2.02. Sir, for the purpose of establishing the genuineness of the transactions, we are also submitting herewith the copy of the loan confirmation letter duly signed by one of the directors of the SCPL as Annexure B-2.03. Further, for dispelling any doubt on the genuineness of the loan, as an abundant precaution, we are also submitting herewith an affidavit, duly sworn-in before the Notary Public, by Shri Rajeev Kumar Dubey, one of the Directors of the SCPL as Annexure B- 2.04. It is further submitted that we are also prepared to produce the deponent Shri Rajeev Kumar Dubey, the Director of SCPL before your good self, for the purpose of cross verification of contents of the affidavit given by him and as also for recording his statements on the issue, on anyday, as may be directed by your good self. (v) Sir, as regard the creditworthiness of the SCPL, it is reiterated that the SCPL is regularly assessed to income tax since its inception under PAN – AAMCS3660D. Presently, it is assessed to income tax with Ward-11(1), Kolkata. It is further submitted that before giving loans to us of a sum of Rs.1,60,25,000/- in the of September 2012 to November’2012, as per the immediate preceding audited financial statements of the SCPL as of 31-03- 2012, it was having net own funds by way of share capital and reserves and surplus of an aggregate sum of Rs.6,87,86,335/-. Thus, there cannot be any doubt as regard to the creditworthiness of the subject company. It shall be worthwhile to note that the availability of such funds with the aforesaid company was also confirmed by one of the authorities of your own department who passed the assessment order under s. 143(3)/147 of the company for the A.Y.2009-10. As regard to the availability of the funds with the SCPL, immediately before issuance of cheques in our favour, it has already been stated above that the SCPL had received certain sum from another company towards the consideration for sale of shares by the SCPL. In evidence of our above assertions, we are also submitting herewith copies of income-tax returns of SCPL for A.Y. 2012-13, and A.Y. 2013-14 as Annexure B-2.05 and B-2.06. Further, we are also submitting herewith a copy of audited financial statements of the company for the financial year 2012-13 as Annexure B-2.07. (vi) Sir, it shall be appreciated that by giving our explanation as aforesaid, along with necessary documentary evidences, we could be able to discharge our onus of proving the identity of the lender, the genuineness of the transaction and as also the creditworthiness of the lender beyond all doubts. Thus, we have fully met-out with the requirement of the provisions of section 68 of the Act. In such circumstances, in view of the judicial pronouncements made by the various judicial authorities, including that of the Hon’ble High Court of Madhya Pradesh, no addition is called-for in our hands under the provisions of section 68 of the Act. Reliance is placed on the following judicial pronouncements: i) Addl. CIT vs. Bahri Brothers (P) Ltd. (1985) 154 ITR 0244 (Pat) IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 60 of 121 ii) Ashok Pal Daga vs. CIT (1996) 220 ITR 0452 (MP) iii) Orient Trading Co. Ltd. vs. CIT (1963) 49 ITR 0723 (Bom) iv) CIT vs. Orissa Corporation P. Ltd. (1986) 159 ITR 0078 (SC) v) CIT vs. Hanuman Agarwal (1985) 151 ITR 150 (Pat) vi) Jalan Timbers vs. CIT (1997) 223 ITR 11 (Gau) vii) DCIT vs. Rohini Builders (2002) 256 ITR 360 (Guj) viii) CIT vs. Dalmia Resorts International (2007) 290 ITR 508 (Del) ix) CIT vs. Mehrotra Brothers (2004) 270 ITR 0157 (MP) x) CIT vs. Metachem Industries (2000) 245 ITR 0160 (MP) xi) Lalitha Jewellery Mart P. Ltd. vs. DCIT (2017) 399 ITR 0425 (Mad) xii) CIT vs. Daulat Ram Rawatmull (1973) 87 ITR 349 (SC) xiii) CIT vs. Jai Kumar Bakliwal (2014) 366 ITR 217 (Raj) xiv) CIT vs. Shri E.S. Jose (2014) 220 Taxman 0032 (Ker) xv) CIT vs. Kamdhenu Steel & Alloys Ltd. & ors. (2014) 361 ITR 0220 (Del) xvi) Roshand Di Hatti vs. CIT (1977) 107 ITR 0938 (SC) (vii) Sir, without prejudice to the above, even on one more legal ground your proposal for making addition of Rs.1,60,25,000/- in our hands under the provisions of section 68 of the Act for the assessment year 2013-14 is not sustainable inasmuch during the course of the entire search and seizure operations, carried out under section 132 of the Act in the case of our company, its directors and family members of the directors and other group assessees, not even a single loose paper or document or any other evidence was found or seized from which it could have been inferred that the transaction of obtaining subject loan was not genuine or for that matter, we provided any cash to the lender company for remitting payment through cheques to our bank account. In other words, there is no tangible material available on the record of your good self which can raise even an iota of doubt against the genuineness of the transactions. In such circumstances, any addition, if made, by your good self would be against the settled position of law, not sustainable in the eyes of the law. Reliance is placed on the following judicial pronouncements: i) CIT vs. Kabul Chawla (2016) 380 ITR 573 (Del.) ii) Pr. CIT vs. Smt. Kusum Gupta (2015) 9 TMI 1406 (DelHC) iii) CIT vs. RRJ Securities Ltd. (2016) 380 ITR 612 (DelHC) iv) Jai Steel (India) vs. CIT (2013) 259 CTR 281 (Raj.) v) Commissioner of Income Tax v. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015] 58 Taxmann.Com 78 (Bom) vi) Pr. CIT vs. Mrs. Lata Jain (2016) 384 ITR 543 (DelHC) vii) Pr. CIT vs. Jai Infrastructure & Properties Pvt. Ltd. (2016) 10 TMI 1022 (GujHC) viii) Pr. CIT vs. Saumya Construction Pvt. Ltd. (2016) 387 ITR 529 (Guj.) ix) Pr. CIT vs. Deepak Jashwantlal Panchal (2017) 397 ITR 153 (Guj.) x) Pr. CIT vs. Devangi alias Rupa 2017 (2) TMI 724 (Guj.) xi) Pr. CIT vs. Meeta Gugutia 2017 (5) TMI 1224 (Del.) IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 61 of 121 xii) Pr. CIT vs. Best Infrastructure India (P) Ltd. (2017) 10 TMI 1006 (Del.) xiii) CIT vs. Shri Deepak Kumar Agrawal, Nikki Agrawal, Govind Agrawal, Manidevi Agrawal (2017) 9 TMI 850 (Bom.) xiv) Pr. CIT, Vadodara vs. RSA Digi Prints (2017) 9 TMI 530 (Guj) xv) Pr. CIT vs. Sunrise Finlease Pvt. Ltd. (2017) 12 TMI 674 (Guj) xvi) Pr. CIT vs. M/s. Global Reality Creations Ltd., M/s. Global Heritage Venture Ltd., M/s. Global Televenture Ltd. (2017) 12 TMI 752 (DelHC) xvii) CIT vs. Anil Kumar Bhatia 211 Taxman 453 (Del) xviii) Amandeep Singh Bhatia vs. Addl. CIT (2016) 29 ITJ 1 (Indore- Trib) Finally, it is submitted that in view of the facts and circumstances of our case, documentary evidences and as also under the law, no addition deserves to be made in our hands.” 12.06 Your Honours, on a perusal of the written submission made by the assessee before the learned AO during the course of the assessment proceedings, as extracted hereinabove, it shall be appreciated that the assessee could be able to discharge its initial onus of proving the genuineness of the loan transaction carried out by him with SCPL, beyond all doubts, by furnishing necessary documentary evidences. For the sake of further clarity, the explanation of the assessee on the subject loan transactions, in respect of each and every limb of s.68 of the Act, is discussed in the ensuing paras. (A) IDENTITY: (i) The SCPL has duly been incorporated and registered under the erstwhile Companies Act, 1956, under the Certificate of Incorporation granted by the Registrar of Companies, Kolkata, on 19-09-2008 vide Corporate Identification Number – U51909WB2008PTC129469. A copy of certificate of incorporation of the company is placed at Page No. 438 of our Paper Book, for A.Y. 2013-14. (ii) The SCPL has been incorporated with the main object of carrying out the business of dealing in various commodities, making of investments, consultancy and providing of loans as per the objects contained in its Memorandum of Association, under which it has got incorporated. A copy of the Memorandum and Articles of Association of the company is being submitted by the assessee are placed at Page No. 439 to 474 of our Paper Book. (iii) The SCPL, since its inception, is regularly assessed to income-tax under PAN-AAMCS3660D. The SCPL furnished its return of income for the relevant assessment year i.e. A.Y. 2013-14 with the ITO Ward-11(1), Kolkata, vide acknowledgement No.133860021210314 on 21-03-2014. In evidence of such fact, the assessee has submitted a copy of acknowledgement of return of SCPL, for A.Y. 2013-14, is placed at Page No. 475 of our Paper Book. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 62 of 121 (iv) The SCPL is an active and functionary company as per the records and data of the Ministry of Corporate Affairs (MCA), Government of India. In evidence of such fact, the assessee has submitted a copy of the Master Data downloaded from the official website of the MCA, is placed at Page No. 476 of our Paper Book. (v) The SCPL has been functioning through its directors duly appointed from time to time under the provisions of the Companies Acts in force. On the date of search, the directors of the company were Shri Shantanu Dixit and Shri Rajeev Dubey. Both the directors of the company are regularly assessed to income tax and they are having separate Director Identification Number (DIN) under the regulations of the Companies Act. The necessary particulars as regard to the name, father’s name, address, Aadhar Card details, PAN details, DIN details, email ids, phone numbers, etc. of the directors of the company are given in a separate statement marked is placed at Page No. 477 of our Paper Book. (vi) The existence of the SCPL and its directors is also evident from the facts that (a) as per the AO’s own finding given at para (8.7) of the assessment order, books of account of the SCPL were duly found during the course of the search from the business premises of the group situated at 178, Bhakt Prahlad Nagar, Indore and; (b) the directors of SCPL were actually found in existence by the Investigation Wing itself and there statements under s.131(1A) were also duly recorded. Such fact is evident from the abstracts of the statements of the directors reproduced by the learned AO at para (8.6) of the impugned assessment order. (vii) The identity of the SCPL also gets fortified from a very vital fact that in its case one assessment under the provisions of s.143(3)/147 of the Income-Tax Act, 1961 had duly been framed for A.Y. 2009-10 by the Income-Tax Officer, 11(1), Kolkata, on 23-08-2009 by determining the total income of the SCPL at Rs.24,850/-. A copy of the order of assessment passed, in the case of the SCPL, under s. 143(3)/147 of the Act are placed at Page No. 478 to 480 of our Paper Book. It is submitted that during the course of such scrutiny, not only the financial statements, but the activities of the company had also been thoroughly examined by the then assessing officer. The assessing officer framing the assessment in the case of SCPL had also gone through capital structure and noted that the company was having paid-up capital and share premium money of Rs.14.74 lacs and Rs.6.73 crores, as is evident from the para (2) of the body of the assessment order, referred to hereinabove. The AO, in his assessment order, has further confirmed that such company had filed all relevant papers in connection with share capital. The AO also stated that notices under s. 133(6) were issued by him to the share applicants and the necessary verification from the share applicants were made by him. In such circumstances, merely on guess work, surmises, assumptions, presumptions and extraneous considerations, the learned AO was not justified in taking a different view in respect of the existence of the SCPL. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 63 of 121 (viii) Your Honours, the Ministry of Corporate Affairs, Government of India, vide its Notification No. GSR 144(E) dated 21-02-2019, has inserted a new Rule 25A in the Companies (Incorporation) Rules, 2014. As per such Rule, every company incorporated on or before 31 st December, 2017 shall be required to file the particulars of the company and its registered office in e-Form ACTIVE (Active Company Tagging Identities and Verification). It shall be pertinent to note that the SCPL has duly filed the e-Form ACTIVE in prescribed Form No. INC-22A. In such form, the SCPL has given the particulars of its registered address along with the geographical position in longitude and latitude. The SCPL has also filed the photographs of its registered office showing external building and inside office and also showing therein one director. A copy of such Form No. INC-22A along with the relevant enclosures thereof, filed by the SCPL, are placed at Page No. 481 to 488 of our Paper Book. All such evidences prove the actual existence of the SCPL and therefore, by no stretch of imagination, the ld.AO can be said to be justified to hold the SCPL as a mere paper company. (B) GENUINENESS OF THE TRANSACTIONS: (i) As regard the genuineness of the transactions, it is submitted that during the course of the assessment proceedings, it was brought to the knowledge of the learned AO that the loan transactions entered into by the assessee with SCPL had taken place through account payee cheques/ banking channels only and none of the transactions had taken place in the form of cash. (ii) Further, for establishing the genuineness, a copy of loan confirmation letter duly signed by the authorized signatory of the lender company, confirming the transactions of loan, as claimed by the assessee, was furnished before the learned AO. A copy of the same is being submitted by the assessed is placed at Page No. 489 of our Paper Book. (iii) The claim of the assessee that all the loan transactions had taken place through banking channels can be verified from the copies of the relevant bank statements of the assessee, in which the transactions regarding receipts of loan by the assessee with SCPL are clearly getting reflected. A copy of such abstract of bank statement of the assessee is being submitted by the assessee are placed at Page No 490 & 491 of our Paper Book. (iv) Further, to establish the fact that loans were genuinely given by SCPL through their bank accounts, we are also submitting herewith a copy of relevant bank statement of SCPL for the relevant period, is placed at Page No. 492 of our Paper Book. (v) The assessee in order to further substantiate the genuineness of the loan transaction has also submitted an affidavit, in original, duly sworn-in before the Notary Public, by Shri Rajeev Kumar Dubey, one of the Directors of the SCPL to this effect. A copy of the affidavit are placed at Page No. 493 to 495 of our Paper Book. The Affidavit so furnished by IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 64 of 121 a director of the lender company also establishes the genuineness of the borrowing made by the assessee from JSFL. For such proposition, reliance is placed on the decision of the Hon’ble High Court of Karnataka in the case of Tam Tam Pedda Guruva Reddy vs. JCIT (2007) 291 ITR 44 (Kar.). (C) CREDITWORTHINESS OF SCPL: (i) For establishing capacity and creditworthiness of SCPL to advance loan to the assessee, during the course of the assessment proceedings, the assessee had duly furnished a copy of the audited financial statements of SCPL along with Auditors’ Report, in respect of the financial year ended 31 st March 2013. A copy of such audited financial statements are placed Page No. 496 to 509 of our Paper Book. (ii) On a perusal of the audited financial statements of SCPL, it shall be observed by Your Honours that as on 31-03-2012, the SCPL was having its net owned funds to the extent of Rs.6.87 crores by way of share capital and reserves & surplus. Likewise, as on 31-03-2013, it was having net owned funds to the tune of Rs.6.88 crores [kindly refer PB page no. 496 to 509]. It is reiterated that the share capital of the company cannot be doubted as the same has undergone in-depth scrutiny in the assessment framed for the A.Y. 2009-10 in its case [kindly refer PB page no. 478 to 480]. (iii) Your Honours, it is submitted that the SCPL was holding investments, by way of equity shares, in certain closely held companies and during the financial year relevant to A.Y. 2013-14, it had sold some of equity shares to some companies. Out of sale proceeds of such shares which were received through banking channels only, the SCPL has given loan, aggregating amount to Rs.1,60,25,000/- to the assessee in seven trenches of Rs.20,25,000/- on 27-09-2012, Rs.22,00,000/- on 27-09- 2012, Rs.25,00,000/- on 03-10-2012, Rs.50,00,000/- on 06-10-2012, Rs.25,00,000/- on 08-10-2012, Rs.8,00,000/- on 11-10-2012 and Rs.10,00,000 on 29-11-2012. It is therefore submitted that since the very source of receipt of loan by the assessee from SCPL was receipt from the sale proceeds only no adverse inference is called in view and the addition so made deserves to be deleted on this count. (iv) Your Honours, as submitted in the preceding para, the immediate sources of funds in the hands of the SCPL before providing loan of Rs.1,60,25,000/- to the assessee, during the relevant previous year, was sale proceeds of shares from M/s. Cheer Infrastructure Pvt. Ltd. [‘CHIPL’], M/s. Cosmos Infraproperties Pvt. Ltd. [‘COIPL’], M/s. Galaxy Infraproperties Pvt. Ltd. [‘GIPL’], M/s. Glory Infraprojects Pvt. Ltd. [‘GLIPL’], M/s. Harmony Infraprojects Pvt. Ltd. [‘HIPL’], M/s. Colour Realtors Pvt. Ltd. [‘CRPL’], M/s. Allied Global Infrastructure Ltd. [‘AGIL’], M/s. Blue Print Securities Ltd. [‘BPSL’] and M/s. Capricorn Infraprojects Pvt. Ltd. [‘CAIPL’]. In evidence of such fact, we are submitting herewith the copies of account of CHIPL, COIPL, GIPL, GLIPL, HIPL, CRPL, AGIL, BPSL and CAIPL in the books of SCPL, for the relevant previous year, are placed at Page No. 510 to 517 of our Paper IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 65 of 121 Book. Further, in order to establish the fact that the sale proceeds were through banking channels, which eventually became the source of providing loan by SCPL to the assessee, we had already submited a copy of relevant bank statement of SCPL [kindly refer PB Page No. 492]. 13.00 Your Honours, during the course of the search proceedings carried out under s.132(1) of the Act in the various business premises of the assessee company and as also, in the residential premises of the directors of the assessee company, no incriminating document or data was found or recovered from the assessee company which could have given an iota of indulgement of the assessee in procuring any accommodation entries from anyone. It is submitted that in the body of the assessment order, at para (9.10) on page no. 63, the learned AO has made reference of some excel sheets which were allegedly found from the computer system of some Mr. Anuj Agrawal, Company Secretary. It is submitted that first of all, such datas were not recovered from any of the authorized persons of the assessee company and secondly, from the subject excel sheets, no adverse inference against the assessee company can be drawn. 13.01 Your Honours, in the case of the assessee, the learned AO has proceeded with his pre-conceived notions only and it was therefore, at various places in the body of the assessment order, he has leveled the charge of accommodation entry provider on Mr. Sharad Darak and has further alleged the assessee company to have procured accommodation entries and not the genuine loans from the companies controlled by the above named Shri Sharad Darak. However, for leveling such a serious charge, the learned AO has relied solely on the hearsays without bringing any single evidence on record. 13.02 Your Honours, at para (9.13) of the Order, the learned AO has alleged that during the assessment proceedings, search and survey actions of the Income Tax Department, it has come to the light that Shri Sharad Darak is a full time entry provider. However, the learned AO has not given the basis of such assumption. 13.03 Your Honours, the learned AO, at paras (9.14) & (9.15) of the assessment order, has made a reference of some survey proceedings u/s. 133A carried out in the business premises of some of the companies namely M/s. East West Finvest Pvt. Ltd., M/s. Purvi Finvest Ltd. and M/s. Trimurti Finvest Ltd., having a common address at Kamla Hari Villa, Besides Apollo Pharmacy, Main Road, Vidhya Nagar, Bilaspur, allegedly controlled by Shri Sharad Darak. At para (9.15), the learned AO has made a reference of some statement given by some Mr. Dinesh Agrawal, Auditor of the companies controlled by Shri Sharad Darak, who was found the occupant of the premises where the survey proceedings were carried out. The learned AO has also given the gist of the statement given by such Mr. Dinesh Agrawal. In this regard, at the outset, it is submitted that during the previous year under consideration, the assessee had not carried out any loan transaction with any of the companies in respect of which the above said survey proceedings were allegedly carried out. Secondly, it shall be appreciated that Mr. Dinesh Agrawal whose statements have been referred to by the learned AO had not admitted that the companies run by Mr. Sharad Darak were accommodation entry provider companies. In any case, during the course of the survey IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 66 of 121 proceedings referred to by the learned AO, not a single evidence was found which could have put the slightest doubt on the various financial transactions carried out by the assessee with the so-called Sharad Darak’s controlled companies. 13.04 Your Honours, at para (9.16), the learned AO has made a reference of some statement, allegedly given by Shri Sharad Darak, on 21-02-2014, under s.131 of the Act, in some other proceedings not related to the assessee or any of its associates. In this regard, at the outset, it is submitted that such statement of Shri Sharad Darak, given way back in the year 2014 and that too, in some other proceedings not related to the assessee, has no evidentiary value. Even otherwise, the copy of the statement of Shri Sharad Darak so referred to by the learned AO was never provided to the assessee. Further, even from the gist of the statement of Shri Sharad Darak, as mentioned by the learned AO in the aforesaid para, it cannot be inferred that the loans genuinely borrowed by the assessee company were not the genuine loans. It is submitted that Mr. Sharad Darak has given an Affidavit to the effect that his companies had genuinely given loans to the assessee company. It is further submitted that the affidavit so given, in the case of the assessee company, would supercede the alleged statement of Shri Sharad Darak given at some different point of time and in some different proceedings, the outcome whereof have not been disclosed to the assessee. 13.05 Your Honours, at the cost of the repetition, it is submitted that in the instant case, neither the learned AO himself nor even the officios of the Investigation Wing has conducted any independent enquiry from Shri Sharad Darak, to unearth the truthfulness of the loan transactions claimed to have been carried out by the assessee, in various assessment years, with the various companies controlled by such Sharad Darak. The learned AO has completely harped upon the non-credible borrowed information and that too, without confronting the basis of such information to the assessee. 13.06 Your Honours, without prejudice to the above, it is submitted that if the claim of the learned AO is accepted that some survey in the business premises of the lender companies were carried out under s.133A of the Act and further, the statements of auditors/ directors were recorded either during the course of such survey or under s.131 of the Act, then, the identity of the lender companies cannot be doubted for the reason that without there being existence of any such company or directors thereof, there could not have been any occasion for the Department to conduct the survey and to record the statements. 14.00 Your Honours, without prejudice to the above, it is submitted that learned AO has made the impugned addition merely on the basis of some information available with him as regard to the loan creditors allegedly gathered behind the back of the assessee in the cases of some other assesses. The learned AO in the Assessment Order has referred to the statements of Shri Dinesh Agrawal and Shri Sharad Darak. But while doing so, the learned AO committed gross violation of principles of natural law and justice, firstly, by not confronting the assessee with the copies of all statements, documents and materials which he was intending to use against the assessee and secondly, by not affording any IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 67 of 121 opportunity of cross examination to the assessee of the persons on whose statements the learned AO placed the reliance. In such circumstances, in view of the settled judicial position, the learned AO was not justified in drawing any adverse inference against the assessee merely on the basis of evidences collected behind his back. For such proposition, we rely on the judicial pronouncements of various authorities as referred to in the earlier paras. 15.00 Your Honours, merely on the presumption that since one of the directors of a lender company is an entry provider, all the transactions carried out by all the companies in which such director was a common director, with all the persons cannot be regarded to be bogus transactions. For such proposition, reliance is placed on the decision of the Hon’ble Apex Court in the case of ITO vs. Lakhmani Mewal Das (1976) 103 ITR 437 (SC). 16.00 Your Honours, a similar case for adjudication arose before the Hon’ble ITAT Mumbai in the case of ITO vs. Smt. Pratima Ashar 2019 (7) TMI 1313 (ITAT Mumbai). In such case, the AO made addition on the allegation that some Mr. Praveen Jain was an accommodation entry provider and the assessee had claimed to have taken loans controlled by such Mr. Praveen Jain. The addition was entirely deleted by the CIT(A) and against the Order of the CIT(A), the Department preferred appeal before the ITAT. The ITAT confirmed the action of the CIT(A) in deleting the addition and held that merely on the basis of a statement given by some person, all the transactions carried out by various companies controlled by such person cannot be held to be non- genuine in a circumstance when the assessee had furnished ample of documentary evidences. The Hon’ble Bench was pleased to hold as under: “8. We have heard the authorized representatives for both the parties, perused the orders of the lower authorities and the material available on record. Admittedly, the assessee had raised loans aggregating to 1,05,00,000/- from six companies which are allegedly stated to be controlled by Shri Praveen Kumar Jain. On a perusal of the orders of the lower authorities, we find, that the assessee on being called upon to substantiate the genuineness and veracity of the loan transactions that was entered into by him with the aforementioned companies, had placed on record substantial documentary evidence in support of the same viz. (i) confirmations of the lender companies; (ii) copies of the financial statements of the lender companies; and (iii) copies of the bank statements evidencing the advancing of loans by the lender companies to the assessee through normal banking channel. Apart there from, the assessee had submitted before the A.O that the interest paid on the loans advanced by the lender companies was subjected to deduction of tax at source as per the mandate of law. We further find that the assessee in order to buttress his claim as regards the genuineness of the loan transactions had also drawn support from the fact that the respective loans were repaid by him to the aforementioned companies. Further, the notices issued by the A.O under Sec. 133(6) to the principal officers of the aforesaid companies, therein calling upon them to furnish the requisite information as regards the exact nature of the activity carried out by the respective companies, along with the source from which the loans were advanced to the assessee, was also complied with and the required details viz. details IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 68 of 121 of the loan transactions, copy of ledger accounts, copies of the bank statements etc were furnished by the abovementioned parties with the A.O. In sum and substance, the assessee had placed on record substantial supporting ‘material’ to drive home his contention that genuine loans were raised by him from the aforementioned companies. 9. We have perused the observations of the A.O and find that he had in support of his claim that the assessee had obtained accommodation entries from the aforementioned companies, primarily focused on the fact that the said companies as per the information received by him from the office of the DDIT(Inv)-II, Mumbai, were controlled by Shri Praveen Kumar Jain, who as per the information shared by the DDIT (Inv.)-II, Mumbai, was found to be involved in providing accommodation entries of bogus unsecured loans to various parties through companies managed and controlled by him. In fact, a perusal of the assessment order reveals that the A.O had not even attempted to dislodge the documentary evidence which was placed on record by the assessee to substantiate the authenticity of the loan transactions and had rejected the explanation of the assessee and characterised the said loans as accommodation entries, observing as under: “1. A perusal of the information reveals that the search action resulted into collection of evidences and other findings which conclusively proved that the Shri Praveen Kumar Jain Group through a web of concerns run and operated by him, is engaged in providing accommodation entries of various nature like bogus unsecured loans, bogus share application and bogus sales (purchases for the beneficiaries), etc. 2. During the course of the search at various premises which were shown by the assessee group to be the place of operation and registered addresses as per the Income tax Returns, MCA website and bank documents, it was found that the entities at these and no genuine business was being carried out at any of these premises. 3. In many concerns formed by Shri Praveen Kumar Jain Group, various persons shown to be the directors/proprietors were nonexistent on the given addresses. In certain cases, in the statements recorded u/s.132(4)/131 of the I.T Act these directors/proprietors admitted that they were merely dummy directors and used to sign different papers for nominal consideration given by Shri Jain. 4. In view of the above, it is seen that through various dummy directors/proprietor, he controls, operates and manages a large number of concerns. All such concerns are not carrying out any genuine business. They do not have any physical stock of goods, which they claimed to be dealing in, all such concerns have no employed persons except the few common accountants who mange accounts and banking transactions of all such concerns. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 69 of 121 All such concerns are indulged in the activity of providing accommodation entries only. 5. Further it is seen that Mr. Jain basically gives accommodation entries which are routed through the companies under his control. All the companies are either owned by him or directly/indirectly under his control are paper companies with no real business transactions. In most of the cases various, brokers who operate in the field of providing accommodation entry like bogus unsecured loan, bogus LTCG, etc. however, in very few cases the end beneficiaries also approach him when they what an accommodation entry. Based on the specific type of accommodation entry required, Mr. Jain either provides the same through the companies under his control or contact other brokers and facilitate the accommodation entries providers. 6. The payment through account payee cheque, if any, does not substantiates the assessee's claim as it is already accepted by the persons. Perusal of information is enough to show that the assessee has taken only accommodation entry in the name of unsecured loan. These entities were not carrying out any business. After going through the facts, information gathered and the above elaborate discussion it is concluded that the assessee has taken accommodation entry of unsecured loan of 1,05,00,000/- from the above said parties.” 10. We have given a thoughtful consideration to the facts of the case, and are unable to persuade ourselves to subscribe to the view taken by the A.O. As per Sec. 68 of the I-T Act, the assessee remains under a statutory obligation to substantiate both the “Nature” and “Source” of a ‘sum’ found credited in his books of accounts maintained for any previous year. In case, the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the A.O, satisfactory, then the sum so credited may be charged to income tax as the income of the assessee for that previous year. Accordingly, as per the mandate of the aforesaid statutory provision, the assessee is obligated to substantiate on the basis of a plausible explanation the nature and source of a sum found credited in his books of accounts. In the case before us, we find, that as is discernible from the records, the assessee in discharge of the ‘onus’ that was cast upon him as regards proving the “Nature” and “Source” of the amount aggregating to 1,05,00,000/- which was claimed by him to have been raised as loans from the aforementioned six companies, had therein placed on record supporting documentary evidence viz. (i) copies of the returns of the lender companies; (ii) copies of their audited financial statements; (iii) copies of the bank accounts of the lender companies; and (iv) the ‘affidavits’ of the principle officers of the lender companies, wherein they had confirmed the loan transactions. Further, on a perusal of the bank accounts of the aforementioned lender companies, all of which we IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 70 of 121 find were being assessed to income tax, therein revealed that there was no immediate cash deposits in their respective bank accounts in order to facilitate advancing of the loans to the assessee. In nutshell it is neither the case of the revenue, nor a fact borne from the records, that the assessee had routed his own money in the garb of the unsecured loans raised from the aforementioned parties. As observed by the CIT(A), the assessee had also deducted tax at source at the time of payment/crediting of the interest on the loans raised from the aforementioned companies. Accordingly, in the backdrop of the aforesaid facts, we are of a strong conviction that the assessee had sufficiently discharged the ‘onus’ that was cast upon him as regards proving the authenticity of the loan transactions under consideration. As per the settled position of law, once the assessee had proved the genuineness of the transactions, identity of the creditors and the creditworthiness, the ‘onus’ was thereafter shifted on the A.O to prove otherwise. In fact, in the case before us, as the loans had been raised by the assessee from certain companies which on the basis of information received by the A.O from the office of the DDIT(Inv)-II, Mumbai, were stated by the A.O to be the companies which were controlled by Shri. Praveen Kumar Jain, an infamous accommodation entry provider, therefore, it was all the more onerous on the part of the A.O to have demonstrated on the basis of supporting ‘material’ that accommodation entries in the garb of loans was provided by the said six companies by adopting the modus operandi of Sh. Praveen Kumar Jain and his group entities. However, we find, that as observed by us hereinabove, the A.O except for harping on the fact that the assessee had raised the loans from the companies which were controlled by Shri Praveen Kumar Jain, had absolutely done nothing which would conclusively prove that no genuine loans were raised by the assessee from the aforesaid companies. On the contrary, the notices which were issued by the A.O under Sec.133(6) to the aforementioned companies, wherein they were called to share certain information viz. nature of activities of the lender companies, source for giving the loans etc., were duly complied with by the said concerns and the requisite documents were placed on the record of the A.O by the aforementioned companies. We find that the A.O who ought to have made necessary verifications as regards the authenticity of the loan transactions by summoning the principal officers of the aforementioned companies under Sec.131 of the I-T Act, and also carrying out field inquiries/investigations as regards the identity and creditworthiness of the investor companies, and also the genuineness of the transactions, had however, not even done the bare minimum. Rather, only on the basis of his observations that the search proceedings conducted on Shri Praveen Kumar Jain group revealed that he was engaged in the business of providing accommodation entries, that the A.O had hushed to the view that the loan raised by the assessee from the aforementioned companies were to be dubbed as accommodation entries. We are unable to persuade ourselves to subscribe to the aforesaid view so arrived at by the A.O. In fact, a IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 71 of 121 perusal of the assessment order reveals as if the A.O was framing the assessment in the case of Shri Praveen Kumar Jain, and not in the case of the assessee. It is in the backdrop of the aforesaid factual position, we find, that the CIT(A) observing that as the assessee had duly discharged the ‘onus’ that was cast upon him under Sec. 68 for proving the authenticity of the loan transactions, therefore, in the absence of any ‘material’ placed on record by the A.O to dislodge the said duly substantiated claim of the assessee, there was no occasion for him to have to re-characterised the loans raised by the assessee as accommodation entries. The CIT(A) while so concluding had observed as under: “4.1.2 I have considered the submissions of the assessee and perused the material available on record including the judicial decisions relied upon by him. The point for adjudication is whether the AO was justified in treating the unsecured loans of 1,0,500,000/- shown to have been taken by the assessee from aforesaid six parties owned, controlled and managed by Mr. Praveen Kumar Jain as bogus or non-genuine u/s 68 of the Act adding the same to the total income of the assessee. In this connection, it is well-established that the onus lies on the assessee to adduce necessary documentary evidence so as to prove all the three ingredients of section 68 viz. identity of the creditor, creditworthiness of the creditor and the genuineness of the transaction as the relevant facts are within the exclusive knowledge of the assessee. It has also been held that the evidences adduced by the assessee has to be examined not superficially but in depth and having regards to the test of the human probabilities and normal course of human conduct. The Hon’ble ITAT, Mumbai Bench, Mumbai in case of ITO v. Anant Shelters Pvt. Ltd 51 SOT 234 (Mum) has enumerated certain legal principles regarding cash credits u/s 68 as under: “I. Section 68 can be invoked when there is a credit of sum of money in the books maintained by the assessee during the previous year and either the assessee offers no explanation about the nature and source of such credits or the explanation furnished by the assessee in the opinion of the AO is not satisfactory. II. The opinion of the AO for no accepting the explanation offered by the assessee as not satisfactory is required to be formed objectively with reference to the material on record. III. Courts are of the firm view that that the evidence produced by assessee cannot be brushed aside in a casual manner. IV. The onus of proof is not static. The initial burden lies on the assessee to establish the identity and the creditworthiness of the creditor as well as the genuineness of transaction. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 72 of 121 V. The identity of creditors can he established by either furnishing their PANs or assessment orders. The genuineness of the transaction can be proved if it was shown that the money was received by a/c payee cheque. Creditworthiness of the tender can be established by attending circumstances. 4.1.3 It is now to examine whether the assessee has been able to discharge the onus placed on him u/s 68 of the Act in light of the aforesaid legal principals or propositions. As stated above, the assessee has furnished copies of returns of lender companies accompanied by their audited financial statements, bank accounts of the lender companies and sworn affidavits of the lender companies confirming the loan transactions. All the lender companies had duly filed their returns for A.Y. under consideration. A perusal of bank accounts of the lender companies clearly reveals that there were no immediate cash deposits therein prior to the issuance of cheques towards unsecured loans to the assessee. It is noticed that the unsecured loans were received vide account payee cheques through normal banking channels. It is also noticed that interest was duly paid/credited lender companies and TDS thereon was deducted in accordance with law. In these circumstances, it can by no means be said that the assessee had not discharged the initial onus cast upon him to establish the identity and creditworthiness of the creditors as well as genuineness of the transactions. Therefore, the onus shifted to the AO. If the AO was not satisfied, she had the option of making inquiries from the lenders by summoning them. However, it is noticed that no independent verification was carried out by the AO with the lender companies. No summons u/s 131 was issued to the lender companies and no statements were recorded in regards to the genuineness of specific transactions with the assessee. No evidence was brought on record in order to controvert the claims of the assessee. There is no finding by the AO that the evidences produced by the assessee were untrustworthy or lacked credibility. In other words, the AO did not make any attempt to discharged his burden of proof to rebut the evidences produced 'by the assessee or to bring any contrary material on record. Thus, is found that the assessee had discharged onus of establishing- the identity and creditworthiness of the lender companies and genuineness of the transactions with help of relevant supporting evidences which could not be disproved by the AO. Therefore, the said addition of 1,05,00,000/- made by the AO u/s 68 is directed to be deleted. Ground No. 4 taken up by the assessee is accordingly allowed.” We have perused the aforesaid order of the CIT(A), and finding ourselves to be in agreement with the view taken by him, that the ‘onus’ discharged by the assessee as regards the authenticity of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 73 of 121 loan transactions had not been disproved or dislodged by the A.O by placing on record any supporting material, therefore, uphold his order.” 17.00 Your Honours, in the body of the assessment order, the learned AO has made reference of various judicial pronouncements but, none of the pronouncements so referred by the learned AO are applicable in the case of the assessee for the reason that the facts of the assessee’s case are quite distinguishable from those referred in the aforesaid pronouncements. 17.00 Your Honours, the Hon’ble Coordinate ‘G’ Bench of Mumbai, in the case of JCIT vs.Shalimar Housing and Finance Limited vide its recent pronouncement on 1-06-2021 in Appeal No. ITA 4079/Mum/2019 for A.Y. 2013-14 was pleased to hold the genuineness of the loan transactions carried out by the assessee with East West Finvest India Ltd., Jayant Security and Finance Ltd., Jay Jyoti India Pvt. Ltd., Purvi Finvest Ltd. etc. It is submitted that on the same grounds, the unsecured loans taken by the assessee from such companies deserves to be held as genuine. 18.00 Your Honours, the submissions set out in the preceding paras pertain to the additions made by the AO for A.Y. 2013-14 only. However, our submissions and arguments, on the issue for the other assessment years involve are also on the similar line. It is submitted that in respect of those loan creditors for which the ld. CIT(A) has granted relief to the assessee, we, wish to place reliance on the findings given by the ld. CIT(A) and for those additions which have been confirmed by the ld. CIT(A), we wish to place reliance upon our written submissions made before the ld. CIT(A). 18.01 Your Honours, the ld. CIT(A) has confirmed the additions on account of unsecured loans and interest thereon basically in respect of two types of lenders. First type of the lenders namely M/s. Jay Jyoti India Pvt. Ltd, M/s. Octageon Media Matrix Pvt. Ltd. & M/s. Suzlon Securities Pvt. Ltd. are those companies which are allegedly controlled by Shri Sharad Darak. Second type of lenders , namely, M/s. Excellent Infra Build Pvt. Ltd. and M/s. VRR Financial Services Pvt. Ltd., which are allegedly controlled by some Shri Rajesh Vyas. The discussions regarding to companies belonging to Sharad Darak has been discussed by the ld. AO at para (9.1) to para (9.20) whereas in respect of the companies belonging to Shri Rajesh Vyas, the findings have been given by the ld. AO at para (9.21) & (9.22) of the assessment order. The ld. CIT(A) has dealt with the companies belonging to Shri Sharad Darak at para (4.5.5)[L] from page no. 283 to 287 whereas in respect of the companies controlled by Shri Rajesh Vyas, the ld. CIT(A) has given his finding at para (4.5.5)[M] from page no. 287 to 289. 18.02 Your Honours, in respect of the companies allegedly belonging to Shri Sharad Darak, we have already given our detailed submission while dealing with the issue of cash credit in respect of M/s. Jay Jyoti India Pvt. Ltd. for A.Y. 2013-14. Now, as regard the unsecured loans taken by the assessee from two companies allegedly controlled by Shri Rajesh Vyas viz. M/s. Excellent Infra Build Pvt. Ltd. and M/s. VRR Financial Services Pvt. Ltd., it is submitted that in respect of these two companies too, before the authorities below, the assessee had furnished all the necessary documentary evidences to establish the identitiy of the creditor companies, the genuineness of the transactions IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 74 of 121 and as also, the creditworthiness of the lender companies. All these documents have also been placed by the assesssee in its Paper Book for A.Y. 2015-16. It is submitted that neither the AO, nor the ld. CIT(A) could find any specific discrepancy in respect of the documentary evidences furnished by the assessee. The ld. CIT(A) merely on the basis of some alleged statement given by Shri Rajesh Vyas has confirmed the additions. The ld. CIT(A) grossly erred in not appreciating the material fact that the statement of Shri Rajesh Vyas was recorded behind the back of the assessee and the assessee was not given any opportunity to cross-examine Shri Rajesh Vyas. It is submitted that in view of the ratio laid down by the Apex Court in the various judicial pronouncements, third parties statements cannot be relied upon without giving an opportunity of cross-examination to the person against whom such statements are purported to be used as evidences. 19.00 Your Honours, there are plethora of judgments including those of the Hon’ble Jurisdictional High Court in favour of the assessee which have held that once the identity & creditworthiness of the loan creditors and genuineness of loan transactions are established, no addition can be made in the hands of the loan recipient. The brief notes of all such judgments have been given in our Paper Book for A.Y. 2013-14 at Page No. 97 to 108 on which we wish to place our reliance. 20.00 Your Honours, now, in respect of the alleged unexplained expenditure of the assessee towards payment of interest to various lenders, it is submitted that the learned AO was not justified in invoking the provisions of section 69C of the Income-Tax Act, 1961. Before delving with the issue in hand, it shall be appropriate to have a look at the provisions of section 69C of the Income-Tax Act, 1961, which, for a ready reference, is reproduced as under: "Unexplained expenditure, etc. 69C. Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the Assessing Officer, satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year: Provided that, notwithstanding anything contained in any other provision of this Act, such unexplained expenditure which is deemed to be the income of the assessee shall not be allowed as a deduction under any head of income." 20.01 Your Honours, it is submitted that the provisions of section 69C can be invoked if an assessee is found to have incurred any expenditure and the sources of such expenditure are not explained by the assessee. However, in the instant case, the assessee has not only explained the interest payments made by it but has also explained the sources of the funds in respect of which such interest payments have been made. It is therefore, most humbly submitted that the entire interest payment to various lender companies be held as genuine and allowable under s. 36(1)(iii) of the Act.” IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 75 of 121 “FOR A.Y. 2015-16– UNSECURED LOANS FROM M/S. SUMEET & SUMEET SALES D. Key Points of Assessee’s Submission and Relevant Pages of the Paper Books: 1.00 At the outset, it is submitted that out of the total impugned addition of Rs.1,09,00,000/- so made by the learned AO in the assessee’s income on account of unsecured loan from M/s. Sumeet & Sumeet Sales, whereas in facts during the year under consideration, the assessee company has obtained unsecured loan aggregating to a sum of Rs. 1,01,00,000/- only instead of Rs.1,09,00,000/- as stated by the ld. AO. The ld. AO had arrived on such figure on the basis of bank account of M/s. Sumeet & Sumeet Sales maintained with Bank of Baroda, RNT Marg, Indore. Such bank account has been reproduced by the ld. AO in the assessment order at para (11.6). The ld. AO on making the impugned addition of Rs. 1,09,00,000/- on the basis of bank statement of the loan creditor had also considered an entry of RTGS of Rs.8,00,000/- dated 09-02-2014 which has been returned back on the same day. Such fact may be verified by Your Honours on bank statement of M/s. Sumeet & Sumeet Sales reproduced by the ld. AO in the impugned assessment order. Further such loan amount of Rs. 1,01,00,000/- has also been taken into consideration by the ld. AO while making a separate addition of Rs.1,27,00,000/- on account of unsecured loan from M/s. ACIL Cotton Industries Pvt. Ltd. [‘ACIPL’] at para (9) of the assessment order. It is submitted that due to an inadvertent mistake, the amount of loan from M/s. Sumeet & Sumeet Sales to the extent of Rs.1,01,00,000/- had got recorded in the name of ACIPL. Thus, in the impugned order, a double addition to the tune Rs.1,01,00,000/- has got made in the assessee’s income which may kindly be taken into consideration by Your Honours while adjudicating the appeal of the assessee. 2.00 Your Honours, it is submitted that the impugned addition of Rs.1,09,00,000/- so made by the learned AO in the assessee’s income on account of unsecured loan from M/s. Sumeet & Sumeet Sales during the previous year relevant to A.Y. 2015-16 was not called for, in view of the facts and circumstances, as discussed in the ensuing paras. 3.00 Your Honours, the relevant findings on the subject issue have been given by the learned AO, from para (11) at page no. 94 to para (11.09), at page no. 109 of the assessment order. 4.00 Your Honours, before delving with the issue, it is submitted that learned AO has made the impugned addition merely on the basis of some information available with him as regard to the loan creditor allegedly gathered behind the back of the assessee. The learned AO in the Assessment Order has referred to the statement of Shri Sumeet Garg Prop. of M/s. Sumeet & Sumeet Sales recorded allegedly recorded under s.131(1A) of the Act by the Investigation Wing. Besides relying on such statement, the learned AO also made a reference of the bank statement of Shri Sumeet Garg. But while doing so, the learned AO committed gross violation of principles of natural law and justice, firstly, by not confronting the assessee with the copies of statement, documents and materials which he was intending to use against the assessee IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 76 of 121 and secondly, by not affording any opportunity of cross examination to the assessee of the person on whose statement the learned AO placed his sole reliance. In such circumstances, in view of the settled judicial position, the learned AO was not justified in drawing any adverse inference against the assessee merely on the basis of evidences collected behind his back. For such proposition, we rely on the judicial pronouncements of various authorities as referred to in the earlier paras. 5.01 Your Honours, on merits of the case, during the financial year 2014-15 relevant to A.Y. 2015-16, the assessee had genuinely taken unsecured loans aggregating to a sum of Rs.1,01,00,000/- through banking channels, in multiple trenches, from M/s. Sumeet & Sumeet Sales Corporation. On such unsecured loans, the assessee company had credited the account of M/s. Sumeet & Sumeet Sales Corporation with a sum of Rs.3,87,090/- on account of interest after debiting the account with the amount of TDS at Rs.38,709/-. Thus, as on 31-03-2015, the assessee was having deposit of Rs.1,04,48,381/- from the aforesaid concern. It is submitted that the entire deposits had been repaid by the assessee, again in multiple trenches, through banking channel during the financial year 2015-16 relevant to A.Y. 2016-17, thereby squaring-off its account completely in the books of account. For a better understanding of the financial transactions entered with M/s. Sumeet & Sumeet Sales, we are submitting an abstract of ledger account of M/s. Sumeet & Sumeet Sales for the financial year 2014-15 & financial year 2015-16, as under : Date Particulars Debit Amount Date Particular Credit Amount Financial Year 2014-15 31-03-2015 To TDS 38,709 05-11-2014 By Bank 6,00,000 31-03-2015 To Bal c/d. 1,04,48,381 05-11-2014 By Bank 9,00,000 09-12-2014 By Bank 8,00,000 09-12-2014 By Bank 8,00,000 09-12-2014 By Bank 8,00,000 09-12-2014 By Bank 6,00,000 09-12-2014 By Bank 8,00,000 10-12-2014 By Bank 7,00,000 10-12-2014 By Bank 6,00,000 10-12-2014 By Bank 6,00,000 10-12-2014 By Bank 5,00,000 10-12-2014 By Bank 7,00,000 10-12-2014 By Bank 5,00,000 10-12-2014 By Bank 8,00,000 10-12-2014 By Bank 4,00,000 31-03-2015 By Interest 3,87,090 TOTAL 1,04,87,090 TOTAL 1,04,87,090 Financial Year 2015-16 22-05-2015 To Bank 9,00,000 01-04-2015 By Bal b/d. 1,04,48,381 27-05-2015 To Bank 27,00,000 16-06-2015 To Bank 27,00,000 17-06-2015 To Bank 18,00,000 17-06-2015 To Bank 20,00,000 31-03-2016 To Bal c/d. 3,48,381 TOTAL 1,04,48,381 TOTAL 1,04,48,381 IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 77 of 121 Further, in evidence of the aforesaid assertion, a copy of account of M/s. Sumeet & Sumeet Sales in the assessee’s books of account is placed at Page No. 834 of the Paper Boook for A.Y. 2015-16. 5.02 Your Honours, it is submitted that the entire loan of Rs.1,01,00,000/- had been obtained by the assessee company through banking channels only, which can very well be verified from the copies of the relevant bank statements of M/s. Sumeet & Sumeet Sales which are also being reproduced by the ld. AO at para (11.6) on page no. 101 to 106 of the assessment Order. 5.02.1Your Honours, the fact of repayment of loan by the assessee to the lender Shri Sumeet Garg in itself speaks about the genuineness of the loan transactions as claimed by the assessee. It is submitted that had the assessee not taken any genuine loan, the question of repayment thereof and that too, through the banking channel would not have arisen. It is submitted that it is not the case of the learned AO that the sum of repayment routed back to the assessee by the lender. In such circumstances, by any stretch of imagination, the genuineness of the loan transaction ought not to have been disbelieved by the learned AO. For such proposition, reliance is placed on the following judicial pronouncements: i) Gujarat Television Pvt. Ltd. vs. ACIT (2018) 101 CCH 451 (GujHC) ii) ITO vs. Satyanarayan Agrawal (2007) 112 TTJ 717 (JodhTrib.) iii) ITO vs. Gouri Shankar Singhal (2013) 38 CCH 24 (JodhTrib.) iv) Kundles Loh Udyog vs. ITO (2016) 45 ITR (Trib.) 11 (Chd.) v) ACIT vs. H.K. Pujara Builders (2019) 198 TTJ 981 (MumTrib.) 5.03 Your Honours, the learned AO, while making the impugned addition, has alleged that before the subject loan transaction, cash was deposited by the Global group itself in the bank account of Shri Sumeet Garg. In this regard, it is submitted that undisputedly, the immediate source of the loan given by the loan creditor is the deposition of cash in his bank account. However, it is strongly objected that such cash was not deposited by the assessee company or any of its employee/associates but the cash was actually deposited by Shri Sumeet Garg himself out of the receipt of certain cash amount against sale of a property, in which he had vested interest under an agreement to purchase, from some farmer. It is submitted that merely because cash was found deposited in the bank account of the creditor before providing loan to an assessee, a transaction of loan, otherwise found genuine, cannot be disbelieved. 6.00 Your Honours, it is submitted that the assessee by furnishing the necessary documents had duly discharged its initial onus of proving the identity of the loan creditors, the genuineness of the transactions and creditworthiness of loan creditors beyond all doubts and in accordance with the provisions of s.68 of the Act. It is further submitted that during the course of assessment proceedings, the assessee had specifically requested the learned AO that if he wish to make further verification or investigation in the matter, then a summons under s.131 or letters under s.133(6) of the Act to the loan creditors may be issued in order to further substantiate the claim of the assessee. However, despite making such specific request, the learned AO did IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 78 of 121 not carry out any independent enquiry by himself and proceeded further by solely relying upon the statement of the loan creditor recorded by the Investigation Wing. Such a failure on the part of the learned AO was not permissible and is bad-in-law. For such proposition, reliance is placed on the following judicial pronouncements : i) CIT vs. Shri Sai Vihar (2016) 28 ITJ 158 (Trib. - Raipur) ii) CIT V Ramesh Chander Shukla 10 ITJ 286 (Madhya Pradesh HC) iii) Manna Lal Murlidhar79 ITR 540 iv) Radhe Sham Jagdish Prashad 117 ITR 186 v) G. Shubha Devi vs. ITO (2019) 307 CTR 0536 (Kar.) vi) Anil Kumar Midha (HUF) vs. ITO (2006) 100 TTJ 0644 vii) ITO vs. Sanjay Kumar Goel (2007) 108 TTJ 0823 (Del.) viii) Mass Con (India) Pvt. Ltd. vs. ITO (2013) 37 CCH 0143 (Del.) ix) CIT vs. Rajeev Shukla (2007) 207 CTR 0253 (MP HC) 7.00 Your Honours, in the assessment order at para (11.4) the ld. AO has made reference of a statement given by Shri Sumeet Garg (Proprietor, Sumeet & Sumeet Sales). On a perusal of such statement, it would be observed that the statement of Shri Sumeet Garg is not hand written but it is in a computerized form. Upon enquiry from Shri Sumeet Garg by the assessee, Shri Sumeet Garg intimated the assessee that the contents of this computerized statement are not factually correct. It has been apprised to the assessee that originally his statement was recorded by one of the inspectors of the Investigation Wing in hand written form and such statement was duly shown to him. It has been further averted by Shri Sumeet Garg that in the originally recorded hand written statement, those contents were not there as he found in the computerized statement. Shri Sumeet Garg affirmed that he had never stated that any cash in any of his bank accounts was deposited by any of the persons of Global group. On the contrary, he asserted that before the officer recording the statement he had categorically stated that he was in receipt of certain cash amount against sale of a property, in which he had vested interest under an agreement to purchase, from some farmer. It was stated that out of cash so received, from time to time, he had, voluntarily, deposited cash in his bank account. Shri Sumeet Garg also confirmed that he had apprised before the officer recording the statement that the funds to various entities of the Global group were genuinely given by him and also confirmed that within a short span of time, the entire funds so given have got refunded to him. He categorically denied to have stated that cash for making deposits in his bank accounts were provided either by Shri Ashok Choudhary or anyone else of the Global group. Shri Sumeet Garg, firmly confirmed that he was detained in the office of the Investigation Officer till 8 PM and after taking the print out of computerized statement he was compelled, rather pressurized to put his signatures on the statement without even allowing him to read the same. In such circumstances, Shri Sumeet Garg completely denied the contents of the computerized statement referred to by the ld. AO. In support of his retraction of the computerized statement, Shri Sumeet Garg had given an affidavit duly sworn before the Notary Public and a copy of such Affidavit was duly furnished by the assessee along with its written submission dated 22-11- 2018 made before the learned AO during the course of the assessment IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 79 of 121 proceedings. A copy of such Affidavit is placed at Page No. 835 to 840 of our Paper Book for A.Y. 2015-16. 7.01 Your Honours, in the present case, it is reiterated that the learned AO himself neither conducted any independent enquiry nor recorded statement of the lender Shri Sumeet Garg. Despite making specific request, the learned AO stucked to the statement of the lender, allegedly recorded by the Investigation Wing. The learned AO did not give any attention to the subsequent Affidavit furnished by the lender in which he had unequivocally, confirmed the loan transactions and had also denied the veracity of the typed statement purported to be given by him before the Investigation Wing. It is submitted that it is a settled law that a statement taken under influence and coercion has no evidentiary value if subsequently the person giving the statement denies the same and also show the circumstances under which such statement came to be prepared. It is submitted that in the light of the denial of the contents of the purported statement by Shri Sumeet Garg, it was incumbent upon the learned AO to record the fresh statement of Shri Sumeet Garg to unearth the truth, which he miserably failed to do so. 8.00 Your Honours, on the facts and circumstances of the case, it shall be appreciated that the assessee had fully discharged its onus of proving the genuineness of the loan transactions by furnishing all the necessary documentary evidences. It shall also be appreciated that the learned AO neither could find any defect or discrepancy in the documentary evidences so furnished by the assessee nor could conduct any independent enquiry on his own to rebut the documentary evidences so furnished. The learned AO also failed to appreciate that the subject loan was subsequently repaid by the assessee through banking channels. The learned AO also could not rebut or controvert or make any adverse comment on the Affidavit given by the lender despite assessee’s furnishing a copy of the same before him during the course of the assessment proceedings. 9.00 Your Honours, the ld. CIT(A) has confirmed the subject addition made by the ld. AO under s. 68 of the Act by way of giving his findings at para (4.6.2) at page no. 296 & 297 of the impugned appellate order. It is submitted that the ld. CIT(A) has although acknowledged furnishing all the necessary documents by the assessee for establishing the genuiness of the loans. However, the ld. CIT(A) without assigning any cogent reason, chose to brush aside all these documentary evidences. The ld. CIT(A) has confirmed the impugned addition merely for two reasons viz. (i) the cash deposits were found made in the bank accounts of the lender and (ii) the lender in his statement given under s. 131(1A) of the Act, before the investigation wing, had admitted the non-genuinness of transactions. In this regard, it is submitted that the genuineness of the loan transactions, cannot be disbelieved merely for the reason that the lender had advanced the money by way of making the deposit in his bank account. It is submitted that in the instant case, the assessee had established that the lender was in receipt of some cash proceeds against sale of some of his properties to some farmers and out of such cash proceeds, he had advanced loan to the assessee company. The assessee had also furnished an Affidavit of the proprietor of M/s. Sumeet & Sumeet to this effect which remained uncontroverted or unrebuted. As regard the placing of the reliance on the statement of Shri Sumeet Garg, by the Investigation Wing, it is IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 80 of 121 reiterated that subsequently, by way of an Affidavit, Shri Sumeet Garg has retracted his earlier statement by way of an Affidavit sworn before Notary public which was duly furnished before the AO as well as the ld. CIT(A). In the Affidavit, Shri Sumeet Garg has clearly denied to have given any adverse statement accepting non genuineness of the loan transactions with the assessee. Shri Sumeet Garg further stated that under what circumstances his signatures were obtained forcefully on the statement recorded by the Investigation Wing. It is submitted that after having the Affidavit of Shri Sumeet Garg on record, it was incumbent upon the ld. AO to record a fresh statement of Shri Sumeet Garg to unearth the truth for which he miserably failed to. In such circumstances, it is submitted that the ld. CIT(A) was not justified in upholding the addition of Rs. 1,09,00,000/- so confirmed by the ld. AO under s. 68 of the Act in respect of loan from M/s. Sumeet & Sumeet Sales.” 11.1 We have heard rival contentions and perused the records placed before us and duly considered decisions referred to and relied upon by both the sides. 11.2 We find that the ld. CIT(A) at para (4.5.5) of his Order from page no. 247 to 289 and again at (4.6.2) from page no. 296 to 297 has elaborately dealt with each and every unsecured loan in respect of which the AO has made addition in various assessment years. In order to analyse the facts of each of the loan creditors, we have also considered it necessary to give our findings, for all such creditors in the paras set out below. 11.3 Before embarking upon the genuineness of all the loan creditors in respect of whom the ld. AO has made the additions by invoking the provisions of section 68 and 69C of the Act, for various assessment years, it would be apt to note that for A.Y. 2013-14, the AO has made additions amounting to Rs. 50,00,000/- and Rs. 1,60,25,000/- on account of loan claimed to have been received by the assessee respectively from Jay Jyoti India Private Limited and Saviour Commotrade Private Limited. For such assessment year 2013-14, the AO has also made addition u/s. 69C in respect of interest payment amounting to Rs. 2,25,000/- to Jay Jyoti India Private Limited. Thus, in totality, for A.Y. 2013-14, the AO vide para (9) of his Order, has made an addition of Rs. 2,12,50,000/- in the income of the assessee. Likewise, for A.Y. 2014-15, the AO has made additions amounting to Rs. 4,99,589/- and Rs. 5,00,000/- on account of loan claimed to have been received by the assessee respectively from Shri Ashok Choudhary and Shri Virendra Singh Sisodiya. For such assessment year 2014-15, the AO has also made addition u/s. 69C in respect of interest payment amounting to Rs. 4,49,775/- to Jay Jyoti India Private Limited. Thus, in aggregate, for A.Y. 2014-15, the AO vide para (9) of his Order, has made an addition of Rs. 14,47,564/- in the income of the assessee. We find that the aforesaid additions for both A.Y. 2013-14 and A.Y. 2014-15 have been made by the AO (i) on the basis of some information available with him regarding procurement of loans by the assessee from some dubious/shell companies (ii) the report of the Special Auditors obtained during the course of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 81 of 121 assessment proceedings; (iii) one excel sheet containing the details of loans obtained by the assessee from some lenders, which were found duly recorded in its books of accounts; (iv) statement of Shri Sharad Darak recorded u/s. 131 on 21/02/2014 in relation to the search conducted in the case of some other assessee and (v) statement of some Shri Rajesh Vyas. However, we find that none of the basis taken by the AO during the course of the assessment proceedings has any nexus with any incriminating document or material found during the course of the search operations carried out under s. 132 of the Act in the premises of the assessee and its directors. In our considered view, the report of the Special Auditors obtained during the course of the assessment proceedings or the statements of third parties recorded either prior to or after the search or for that matter, finding of one excel sheet containing the detail of loans already recorded in the books of accounts cannot be said to be incriminating evidence or material against the assessee recovered during the course of search. Since, while adjudicating the ground no. 2 of the assessee for A.Y. 2013-14 and A.Y. 2014-15, supra, we have already held that in respect of the completed assessment years, no addition in an assessment made u/s. 153A of the Act can be made without having recourse to any incriminating material, the aforesaid additions so made by the AO vide para (9) of his Order on account of unsecured loans and unexplained interest are not sustainable on this legal ground itself. 11.4 Loan from Shri Ashok Choudhary and Shri Vijendra Sisodiya 11.4.1 We find that in respect of Shri Ashok Choudhary and Shir Vijendra Singh Sisodiya, the AO has made addition u/s. 68 of the Act respectively at Rs. 4,99,589/- and Rs. 5,00,000/- for A.Y. 2014-15. 11.4.2 We find that the AO has made addition u/s. 68 of the Act, in respect of the above named two lenders who happens to be employees of the assessee’s group by giving necessary findings at paras (9.31) to (9.36) of his Order. We find that the necessary finding regarding unsecured loan from Shri Ashok Choudhary, an employee of the assessee’s group, has been given by the AO from para (9.31) to (9.33) of the order. We find that according to the AO, during the course of the assessment proceedings, the assessee could only furnish copies of the PAN card and letter of confirmation of the Shri Ashok Choudhary, but, the bank statement of Shri Ashok Choudhary, the loan creditor, was not provided. The AO further noted that from the copy of the Income-Tax Return furnished by Shri Ashok Choudhary, that he has filed his return for A.Y. 2014-15 showing returned income of only Rs. 1,88,400/- and the amount of loan of Rs.4,99,589/- given is disproportionate to the annual returned income of Shri Ashok Choudhary. Further, the AO also doubted providing of loan by Shri Ashok Choudhary as an employee to the assessee as his employer. Accordingly, the AO held such unsecured loan given by Shri Ashok Choudhary to the assessee at Rs.4,99,589/- as non-genuine. Likewise, the necessary findings regarding IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 82 of 121 loan claimed to have been taken by the assessee from its another employee namely, Shri Vijendra Sisodiya, have been given by the AO at para (9.34) & para (9.35) of the order. From perusal of the para (9.34), we find that the AO has given finding that Shri Vijendra Sisodiya has furnished his return of income for A.Y. 2016-17 declaring an income of only Rs.1,91,880/- and according to the AO, the above named creditor had given loan of Rs.5,00,000/- to the assessee company and as also, substantial loans to other group assessees. We find that at para (9.35), the AO has given a finding that the interest free loan taken by the assessee from Shri VijendraSisodiya is also regarded as unexplained cash credit since the credibility of the loan creditor is not established for giving an interest free loan, the total whereof is ten times his annual income. Accordingly, the AO held such unsecured loan given by Shri Vijendra Sisodiya to the assessee, during the F.Y. 2013-14 relevant to A.Y. 2014-15 at Rs. 5,00,000/- as non- genuine and added to the income of the assessee u/s. 68 of the Act. 11.4.3 We find that the above named loan creditorsare the employees of the Global Group. We find that during the course of the assessment proceedings, the assessee had duly furnished the copies of the PAN Cards of the loan creditors, the copies of the loan confirmation letters, the copy of acknowledgement of Income-Tax return of Shri Ashok Choudhary, copies of the relevant bank statements of the assessee, copies of the relevant bank statements of the loan creditors and the copies of letters of confirmation of the sub-creditor namely, SRP Entertainment Pvt. Ltd., who, as per the assessee, provided funds to the aforesaid two lenders. The copies of all such documents are placed at page no. 529 to 543 of the assessee’s Paper Book for A.Y. 2014-15 filed before us. On perusal of the aforesaid documents, we find that Shri Ashok Choudhary [PAN: AHIPC2687C] & Shri Vijendra Sisodiya [PAN : BCLPS8668E] are regularly assessed to Income-Tax. Thus, in our considered view, the assessee could be able to establish the identity and existence of both the aforesaid loan creditors. We further find from the copies of duly signed letters of confirmation, copy of the relevant abstracts of the bank accounts of the loan creditors that all the loan transactions have been carried out through banking channels which were found duly reflected in the bank statements of the assessee as well as the loan creditors. Further, from a perusal of the copies of the lender’s bank statements placed in the assesse’s Paper Book for A.Y. 2014-15, we find that in none of the cases, before making remittance to the assessee towards loan transactions, any cash was deposited by the lenders. On a perusal of the bank account statement of Shri Ashok Choudhary, as placed at page no. 534 Of the assesse’s Paper Book for A.Y. 2014-15, we find that before issuance of the cheque of Rs.1,50,000/-, Shri Ashok Choudhary had received a sum of Rs.1,50,000/- through cheque from some SRP Entertainment Pvt. Ltd. on 05/04/2013 and before issuing RTGS of Rs.3,49,589/- to the assessee, Shri Ashok Choudhary had further received a sum of Rs.5,00,000/- through cheque no. 586833 on 06/05/2013 from one of the associate concerns of the assesse company namely M/s. Global Marketing (Proprietorship Concern of Shri Awadhesh Dixit). Likewise, on careful examination of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 83 of 121 bank account statement of Shri Vijendra Sisodiya, as placed at page no. 541of the assesse’s Paper Book for A.Y. 2014-15, we find that before issuance of the RTGS to the assessee, Shri Vijendra Sisodiya had received a sum of Rs.5,00,000/- through cheque from some SRP Entertainment Pvt. Ltd. on 05/04/2013. We find that that the sub-creditor namely SRP Entertainment Pvt. Ltd. (AAQCS4202F) in its two letters of confirmation,both dated 01/03/2020, placed at page nos. 537 & 543 of assessee’s Paper Book for A.Y. 2014-15, has duly confirmed giving of the loans of a sum of Rs. 1,50,000/- to Shri Ashok Choudhary and of Rs. 5,00,000/- to Shri Vijendra Sisodiya. We find that before us, the ld. CIT(DR) could not point out any single defect or discrepancy in any of the documentary evidences referred hereinabove. 11.4.4 Thus, in our considered view, in respect of the aforesaid two loan creditors, by furnishing the documentary evidences as discussed hereinabove, the assessee could be able to fully discharge its onus of proving all the three ingredients as contemplated u/s. 68 of the Act viz. (i) identity of the creditors; (ii) genuineness of the loan transactions; and (iii) creditworthiness of the loan creditors beyond all doubts. We further find that during the course of the assessment proceedings, despite making a specific request to this effect by the assessee, the AO did not make any independent inquiry either by way of issuance of summons u/s. 131 or by way of issuance of letters u/s. 133(6) of the Act to the aforesaid lenders. We also find that the various case laws relied upon by the AO are not applicable to the assessee’s case. Thus, relying upon the decisions of the Hon’ble Jurisdictional High Court in the cases of CIT vs. Metachem Industries (2000) 245 ITR 0160 (MP), CIT vs. STL Extrusions Pvt. Ltd. (2011) 333 ITR 269 (MP), PCIT vs. Chain House Internationatioal (P) Ltd. & Ors. (2018) 408 ITR 0561 (MP), Ashok Pal Daga vs. CIT (1996) 220 ITR 0452 (MP), CIT vs. Mehrotra Brothers (2004) 270 ITR 0157 (MP), and the judgement of the Hon’ble Apex Court in the case of CIT vs. Orissa Corporation P. Ltd. (1986) 159 ITR 0078 (SC) we find absolutely no justification in the AO’s making the addition in respect of the aforesaid two loan creditors, namely Shri Ashok Choudhary and Shri Vijendra Sisodiya, in the income of the assessee u/s. 68 of the Act for A.Y. 2014-15. Accordingly, in our considered view, all the additions in respect of the loans made by the AO in the assessee’s income have rightly been deleted by the ld. CIT(A). 11.5 M/s. ACIL Cotton Industries Pvt. Ltd. (‘ACIPL’); M/s. Alpha Graphic India Ltd. (‘AGIL’); M/s. Bonanza Industries Ltd. (‘BIL’); M/s. Krishna Raj Diamond Pvt. Ltd. (‘KRDPL’); M/s. Omkar Tradexim Pvt. Ltd. (‘OTPL’); M/s. Prudent Tradex Pvt. Ltd. (‘PTPL’); M/s. Brain Masters Classes Pvt. Ltd. (‘BMCPL’) and M/s. Premier Clearing Agency Pvt. Ltd. (‘PCAPL’) 11.5.1 We find that the AO has made addition u/s. 68 of the Act, in respect of the all the aforesaid eight loan creditors without giving any specific finding. We find that the subject additions in respect of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 84 of 121 unsecured loans from ACIPL, AGIL, BIL, KRDPL,OTPL PTPL, BMCPL & PCAPL have got made by the AO by presuming the same to be the companies controlled by Mr. Sharad Darak. We find that during the course of the appellate proceedings before the ld. CIT(A), the assessee had contended that the lender companies were not belonging to or in any way having any direct or indirect connection with Mr. Sharad Darak. We find that the AO has given the names of the companies directly or indirectly controlled by Shri Sharad Darak at para (9.12) and again at para (9.13) of the assessment order and from such paras, we noted that the AO himself has not shown the above named eight companies as belonging to Shri Sharad Darak. 11.5.2 We further find that in order to establish the genuineness of the loans claimed to have been received by the assessee company from the above named loan creditors, the assessee company had furnished various documentary evidences before the ld. AO and as also, before the ld. CIT(A). We find that before us also, in its Paper Books for A.Y. 2015-16& A.Y. 2016- 17, the assessee has furnished various documentary evidences such as copies of certificates of incorporation of the creditors, copies of Memorandum and Articles of Associations of the creditors, copies of acknowledgements of income tax returns of the creditors, copies of the master datas downloaded from the official website of the MCA of the creditors, copies of duly signed letters of confirmations of the creditors, copies of the relevant abstracts of the bank account of the creditors and copies of the audited financial statements of the creditors. On a perusal of the aforesaid documents, we find that all the aforesaid lenders are private limited companies, duly incorporated under the Companies Act, 1956 by the concerning Registrar of Companies. From the abstracts of the master datas of the creditors, as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, we find that in the ROC records, all the lender companies have been shown as Active companies. Thus, in our considered view, by furnishing all the necessary documents, such as the certificates of incorporation, copies of Memorandum and Articles of Association, copies of acknowledgement of income tax returns, copies of the master datas downloaded from the official website of the MCA, copies of the PAN Cards, the assessee could be able to establish the statutory as well as the physical identity and existence of all the aforesaid three loan creditors. We further find from the copies of duly signed letters of confirmation, copy of the relevant abstracts of the bank accounts of the loan creditors that all the loan transactions have been carried out through banking channels which were found duly reflected in the bank statements of the assessee as well as the loan creditors. Further, from a perusal of the copies of the lender’s bank statements placed in the Paper Books for A.Y. 2015-16& A.Y. 2016-17, we find that in none of the cases, before making remmitance to the assessee towards loan transactions, any cash was deposited by the lenders. We have also perused the audited financial statemens of the lenders and from such financial statements, we found that such lenders were having IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 85 of 121 sufficient funds available for providing loans to the assessee company. We find that although all the documentary evidences for establishing the genuineness of the loans, as aforesaid, were also filed by the assessee before the AO, but the AO could not find any specific defect or discrepancy in any of such documentary evidences. We find that even before us, the ld. CIT(DR) could not point out any single defect or discrepancy in such documents. 11.5.3 Thus, in our considered view, in respect of all the aforesaid loan creditors, by furnishing the documentary evidences as discussed hereinabove, the assessee could be able to fully discharge its onus of proving all the three ingredients as contemplated u/s. 68 of the Act viz. (i) identity of the creditors; (ii) genuineness of the loan transactions; and (iii) creditworthiness of the loan creditors beyond all doubts. We also find that during the course of the search u/s. 132 of the Act, in the premises of the assessee company and its directors, no incriminating material or any evidence raising any doubt regarding the genuineness of the loan transactions was found or seized. We further find that during the course of the assessment proceedings, despite making a specific request to this effect by the assessee, the AO did not make any independent inquiry either by way of issuance of summons u/s. 131 or by way of issuance of letters u/s. 133(6) of the Act to the aforesaid lenders. We also find that the various case laws relied upon by the AO are not applicable to the assessee’s case. In the preceding paras, we have already cited various judicial authorities for the proposition that once the identity and creditworthiness of the loan creditors and genuineness of loan transactions are established, no addition can be made in the hands of the loan recipient and therefore, in respect of all the present lender companies, we refrain ourselves to make the same discussions again. Thus, in our considered view, there was absolutely no justification for the AO to make any addition in the income of the assessee, for any of the assessment years, under any of the provisions of the Act either u/s. 68 of the Act or u/s. 69C of the Act in respect of the aforesaid eight lender companies with whom in our considered view, the assessee had genuinely carried out the loan transactions. Accordingly, we find no infirmity in the action of the ld. CIT(A) in deleting the additions made by the AO in the various assessment years, on account of unsecured loans and unexplained interest payments relating to the above named eight lender companies. 11.6. Loan from M/s. Saviour CommotradePvt. Ltd.(‘SCPL’) 11.6.1 We find that in respect of the above named loan creditor, the AO has made addition u/s. 68 of the Act at Rs. 1,60,25,000/- and Rs. 1,23,92,000/- respectively for A.Y. 2013-14 and A.Y. 2016-17. Although, in respect of such addition for A.Y. 2013-14, on the legal ground as discussed in para (11.3) supra, we have already held that for such assessment year, no addition could have been made without having recourse to any incriminating material found during the course of the search. But, even on IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 86 of 121 merits, we find no substance in the addition so made by the AO in respect of the aforesaid loan creditor for both the assessment years. 11.6.2 We find that in respect of the aforesaid loan creditor the AO has only given a short finding at para (9.30) of the Order. At such para, the AO has stated that the discussion made in respect of companies controlled by Shri Sharad Darak also squarely applies to the unsecured loan from SCPL. The AO has further stated that citing of an assessment order for A.Y 2009- 10, by identifying the shareholders, in the case of SCPL, was of no relevance at that point of time in light of the findings about SCPL already discussed in paras in the matter of bogus share capital. The AO further stated that the Affidavit filed by a director of SCPL and loan transactions through banking channels also do not prove the genuineness of the loan transaction as discussed by him in earlier paras. We find that the AO, while discussing the issue of bogus share capital at para (8) of the Assessment Order, has given his findings in respect of the transactions entered into by the assessee with SCPL at para (8.3) to para (8.21). At para (8.3), the AO has stated that the SCPL is a dummy concern of the assessee’s group itself, which is based at Kolkata, having Shri Shantanu Dixit and Shri Rajeev Dubey as its directors. At the same para, the AO has drawn a chart showing the returned income of the SCPL. At the same para, the AO has also made reference of one excel sheet which was also seized from a hard disk from the premises situated at 178, BhaktPrahlad Nagar, Indore. The AO also reproduced such excel sheets in the body of the assessment order. Such excel sheets are in the nature of register of members at the time of incorporation of the company, at the time of first and second allotment of new shares by such company and as also on the transfer of shares in such company from time to time of the name of shareholders and certificate nos. issued to them have also been given. At para (8.3), the AO has analyzed the transfer of shares of SCPL from time to time. At para (8.5) of the Order, the AO has stated that the companies referred to in the excel sheets reproduced at para (8.4) are involved in giving bogus entries. The group has used such companies, registered with ROC Kolkata, in routing their unaccounted funds. At para (8.6), the AO has made reference of some Statement of Shri Rajeev Kumar Dubey, one of the directors of the SCPL and has also reproduced abstract of his statement in the said para. At para (8.7), the AO has averted that from the statement of Shri Rajeev Dubey, it is clear that the SCPL is not carrying out any business activity. At para (8.7), the AO has pointed out that Rajeev Kumar Dubey, director of SCPL stated in his statement that books of account of SCPL are maintained at 178, Bhakt Prahalad Nagar, Indore but according to the AO, during the course of the search, no single bill voucher regarding this company was found at the given address. Instead, during the course of the search, only tally data related to SCPL was found. At paras (8.8) to (8.13), the AO has given the screenshots of the balance sheets of the SCPL for the F.Y. 2008-09 to F.Y. 2013-14 as were found in the tally books of the SCPL during the course of the search, in the assessee’s premises. The AO has also made an analysis of such Balance Sheets. At paras (8.13) to (8.16), the AO IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 87 of 121 has made an analysis of Bank accounts of SCPL. At para (8.17), the AO after reproducing the scanned copy of bank statement of the SCPL for the whole financial year 01/04/2012 to 31/03/2013, at para (8.18), commented that the total amount of Rs.5,94,91,886/- were credited in the account of SCPL during the F.Y. 2012-13 relevant to A.Y. 2013-14, and out of the credits so received, the SCPL had given loans of Rs.1,60,25,000/- to the assessee and the other sum of Rs.4,33,33,000/- to other three entities of the assessee’s group, during the year under consideration. At para (8.20) the AO has reproduced the entire findings of Special auditors, given by the auditors in their report u/s. 142(2A) of the Act, commenting upon the transaction of assessee’s group with SCPL. At para (8.21), the AO has commented that the SCPL is a paper company and therefore, all the amounts received through this company is unaccounted and undisclosed money of Global Group entities. Finally, at such para, the AO has alleged that the unaccounted funds of the group have been ploughed back in the books of account of the SCPL and accordingly, the loan received from the SCPL have been treated as unexplained cash credits of the assessee u/s. 68 of the Act. We find that the ld. CIT(A) while giving his very detailed finding at para (4.5.5.K) from page no. 276 to 283 found no merit in the very observations and findings given by the AO and accordingly, deleted the additions for both the assessment years. 11.6.3 Upon overall consideration, we find that the above named loan creditor is a private limited company, duly incorporated by the Registrar of Companies, West Bengal, under the Companies Act, 1956, with Company Identification No. U51909WB2008PTC129469 2008-2009 on 19/09/2008. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, we find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘408, 4th Floor, Landmark Building, Opp. Raheja Classic Complex, Link Road, Andheri, Mumbai’, which is a premises belonging to the assessee’s group itself and in respect of such premises too, a simultaneous search operation u/s. 132 was carried out. We also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.15,00,000/- and Rs. 14,74,000/- respectively. Further, we found that in such company, there are two directors, belonging to the assessee’s group namely Shri Shantanu Dixit and Shri Rajeev Kumar Dubey who have been shown to be holding such position since 04/03/2013 and 14/05/2012 respectively. We find that during the course of the assessment proceedings, the assessee had furnished numerous documentary evidences for establishing the genuineness of the loan transactions carried out by the assessee with such company. We find that the assessee had furnished a copy of certificate of incorporation of the SCPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2013-14 & A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, copy of statement showing the details of the directors of the company, copy of the assessment order for A.Y. 2009-10 IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 88 of 121 passed in the case of SCPL, on 23/08/2011, u/s. 143(3)/147 of the Act, copy of the form no. INC-22A along with the relevant annexures filed before the concerning Registrar of Companies for establishing the actual existence and active status of the company along with photographs of the offices of the company, copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the SCPL, copy of an Affidavit duly sworn-in before Notary Public by Shri Rajeev Kumar Dubey on 19/11/2018 affirming the loan transactions of the SCPL with the assessee, copy of the audited financial statements of the SCPL showing the net owned funds of the SCPL as on 31/03/2012 at Rs. 6,87,86,335/-. We find that copies of all these documents have also been furnished by the assessee before us in its Paper Book for A.Y. 2013-14 from page no. 438 to 517 and again, at page no. 993 to 1043 of the Paper Book for A.Y. 2016-17. From the copy of the assessment order passed for A.Y. 2009-10 in the case of the SCPL, u/s. 143(3)/147 of the Act, on 23/08/2011, as placed at page no. 478 to 480 of the assessee’s Paper Book for A.Y. 2013-14,we find that in the body of the assessment order itself of SCPL, the AO framing the assessment, at para (2) of the assessment order, has clearly stated that as per the Balance Sheet of the SCPL as on 31/03/2009, the Authorized Share Capital and Paid-up Capital of the SCPL was of Rs. 15 Lakhs and Rs. 14.74 Lakhs respectively with a Share Premium of Rs. 6.73 Crores. We also find that in the same para, the AO has stated that in support of receipt of such share capital and share premium, the SCPL had furnished relevant papers and notices u/s. 133(6) were issued for verification of the share applicant. Eventually, the AO accepted the genuineness of receipt of share capital and share premium by the SCPL and did not form any adverse opinion. We find that in the body of the assessment order, the AO has made a reference of the income returned by the SCPL but, in our considered view, merely on the basis of the returned income of an entity, its creditworthiness could not have been examined and the creditworthiness was necessarily required to be tested on the touchstone of the availability of funds in the hands of the loan creditors at the time of providing loan to any other person. We find that for the reasons that (i) a simultaneous search u/s. 132 was carried out at the registered office of the company situated at Mumbai and during the course of the search, one of the representatives of the group was duly found; (ii)on the date of the search itself, the SCPL has been found to be one of the companies of the assessee group itself under the control and management of the family members and associates; (iii) during the course of the search, according to the AO, certain tally books of accounts were found; (iv) as per the findings given by the AO himself at para (8.32) of the impugned order, one of the directors of the company namely Shri Rajeev Kumar Dubey had duly given his statement u/s. 131(1A) of the Act on 05.08.2016; (v) as per the ROC records, the SCPL has been shown to be an active company; (vi) the SCPL is duly assessed to Income-Tax under PAN: AAMCS3660D; (vii) the SCPL is maintaining bank accounts with various banks and (viii) the SCPL has drawn its financial statements and have also got the same duly audited, the levelingof charge of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 89 of 121 a dummy company or a paper company against the SCPL cannot be accepted under any cannon of law. Thus, in our considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the SCPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2013-14& A.Y. 2016-17, copy of the master data downloaded from the official website of the MCA, copy of statement showing the details of the directors of the company, copy of the form no. INC-22A along with the relevant annexures filed before the concerning Registrar of Companies, the assessee could be able to establish the statutory as well as the physical identity and existence of the SCPL. We further find that from the copies of letters of confirmation duly signed by one of the directors of the company, copy of the relevant abstracts of the bank account of the SCPL, copy of an Affidavit duly sworn-in before Notary Public by Shri Rajeev Kumar Dubey on 19/11/2018 affirming the loan transactions of the SCPL with the assessee and further, considering that all the loan transactions have been carried out through banking channels which were duly found in the bank statements of the assessee as well as the lender company, in our view, the assessee could be able to establish the genuineness of the loan transactions. We find that the lender company i.e. SCPL, was holding own funds to the extent of Rs. 687.86 Lakhs as on 31/03/2012 as per the assessment order for A.Y. 2009-10 passed in the case of SCPL, on 23/08/2011, u/s. 143(3)/147 of the Act. Thus, in our considered view, the assessee company could also be able to discharge its onus of even proving the creditworthiness of the SCPL. We find that in the instant case, the assessee has not only established the sources of cash credits, but, going one step further, it has also established sources of the sources i.e. the sources of availability of funds in the hands of SCPL and the sources of funds in the hands of the sub-creditors can also not be disbelieved. Further, from the copy of the bank statement of the SCPL with the Axis Bank Limited, placed at page no. 492 of the assessee’s Paper Book for A.Y. 2013-14,we find that in such bank statement, for A.Y. 2013-14, making of payments of Rs.20,25,000/-, Rs.22,00,000/-, Rs.25,00,000/-, Rs.50,00,000/-, Rs.25,00,000/-, Rs.8,00,000/- and Rs.10,00,000/- respectively on 27.09.2012, 27.09.2012, 03.10.2012, 06.10.2012, 08.10.2012, 11.10.2012 & 29.11.2012 through various cheques by clearing mentioning the name of the assessee company are getting clearly reflected. Likewise, for A.Y. 2016-17, from the copy of the bank statement of SCPL maintained with Axis Bank Ltd. as placed at page no. 1028 of paper book for A.Y. 2016-17, we find that making of payments of Rs.1,00,00,000/-, Rs.23,00,000/- and Rs.92,000/- respectively on 08/07/2015, 22/07/2015 & 25/07/2015 with the specific mention of the name of the assessee, through various cheques, are also getting clearly reflected.From such bank statements, we find that before remitting the funds, the SCPL had received funds not by way of any cash deposits but, through banking channels which according to the assessee were received by the SCPL out of the disinvestments/ recovery of the loans already given by it on earlier occasions. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 90 of 121 11.6.4 In our considered view, the seized document referred to by the AO at para (8.3) of the Order, is a statutory document containing the details of register of members and register of transfer of shares which are mandatorily required to be maintained by every company in accordance with the Companies Enactments. Thus, on the basis of such documents, no adverse inference can be drawn. We find that one of the directors of the SCPL, namely Shri Rajeev Dubey, had appeared before the Investigation Wing in response to a summons issued u/s. 131(1A) of the Act and his statements were duly recorded on 05/08/2016 and from the relevant abstracts of the statement as reproduced by the AO himself at para (8.6) of the Order, no adverse view can be drawn on the subject issue. We have carefully taken into consideration that the availability of the funds was by way of its share capital and share premium money aggregating to a sum of Rs.6.98 crores and the sources of such receipts have already got verified and assessed by the AO who passed an assessment order for A.Y. 2009-10, dated 23/08/2011, u/s. 143(3)/ 147 of the Act of SCPL, a copy whereof has been filed before us. In our considered view, having assessed the SCPL u/s. 143(3)/147 and having verified the sources of availability of funds, as per the settled law, no adverse view can be drawn in respect of giving of funds by the SCPL out of the aforesaid assessed funds. We further find that various case laws relied upon by the AO are not applicable to the assessee’s case. In the preceding paras, we have already cited various judicial authorities for the proposition that once the identity and creditworthiness of the loan creditors and genuineness of loan transactions are established, no addition can be made in the hands of the loan recipient and therefore, in respect of the present lender company, we refrain ourselves to make the same discussions again. Thus, in our considered view, there was absolutely no justification for the AO to make any addition in the income of the assessee, for any of the assessment years, under s. 68 of the Act. Accordingly, we find no infirmity in the action of the ld. CIT(A) in deleting the additions made by the AO in the various assessment years, on account of unsecured loans relating to the above named lender company. 11.7 Loans from (i) M/s. Excellent InfrabuildPvt. Ltd. (‘EIPL’) and (ii) M/s. VRR Financial Services Pvt. Ltd. (‘VFSPL’) 11.7.1 We find that the AO has made additions amounting to Rs. 13,00,000/- and 15,00,000/- respectively for A.Y. 2015-16 and A.Y. 2016- 17, u/s. 68 of the Act, in respect of loan claimed to have been received by the assessee company from one company namely M/s. Excellent Infrabuild Priavte Limited. Besides, in respect of such loan transaction, the AO has also made an addition amounting to Rs. 42,312/-, Rs. 1,20,427/- and Rs. 2,65,181/- respectively for A.Y. 2015-16, A.Y. 2016-17 and A.Y. 2017-18 in the assessee’s income u/s. 69C of the Act by holding such loan transaction as well as payment of interest thereon as non-genuine. Likewise, the AO has made addition amounting to Rs. 2,00,000/- for A.Y. 2015-16, u/s. 68 of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 91 of 121 the Act, in respect of loan claimed to have been received by the assessee company from one company namely M/s. VRR Financial Services Private Limited. Besides, in respect of such loan transaction, the AO has also made an addition amounting to Rs. 11,244/-, for A.Y. 2015-16 in the assessee’s income u/s. 69C of the Act by holding such loan transaction as well as payment of interest thereon as non-genuine. 11.7.2 We find that the necessary findings in respect of the above loan creditors, EIPL and VFSPL, have been given by the AO at para (9.21) & (9.22) of his Order. According to the AO, the above named companies were being operated by another entry operator namely Shri Rajesh Vyas who was a director of the above said companies. At para (9.21), the AO has reproduced the statement of Shri Rajesh Vyas recorded on 03.01.2017 u/s. 131(1A) of the Act during the post search investigation. Before us, the ld. counsel of the assessee has placed reliance on his written submissions made before the ld. CIT(A), which are placed at page no. 1 to 116 of its Paper Book for A.Y. 2015-16 and more particularly, at page no. 64 to 66 and page no. 80 to 83 of the Paper Book. 11.7.3 We find that the main grounds of contention of the assessee are that (i) during the course of the assessment proceedings, it had furnished all the necessary documents to establish the identity of the loan creditors, the genuineness of the loan transactions and the creditworthiness of the loan creditors, as contemplated under the provisions of s.68 of the Act; (ii) the entire additions have been made by the AO only on the basis of some statement recorded behind the back of the assessee without providing the copy of such statement to the assessee and as also, without giving any opportunity of cross examination of Shri Rajesh Vyas to the assessee; (iii) the AO except relying upon some statement recorded behind the back of the assessee by some other authorities in some other proceedings did not bring on record any adverse material against the assessee; (iv) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions recorded in the regular books of account of the assessee were not genuine; (v) the transactions carried out by the assessee were of the nature of loan and not of the nature of share capital or share premium and therefore, it was not required to prove the source of the source as contemplated under the proviso to section 68 of the Act; and (vi) since the interest expenditure were fully recorded in the books, the provisions of section 69C could not have been invoked. 11.7.4 We find that, before both the authorities below, the assessee had furnished the various documents relating to the above named lender companies such as copies of certificates of incorporation, memorandum & articles of association, copies of income-tax returns, copies of master datas downloaded from website of MCA, copies of loan confirmation letters duly given by the respective lender companies, copies of relevant bank IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 92 of 121 statements of the lender companies, copies of the relevant bank statements of the assessee, copies of the audited financial statements of the lender companies and all these documents have also been furnished by the assessee before us in its Paper Book for A.Y. 2015-16 at page no. 541 to 573 and 793 to 832 and at page no. 725 to 758 of its Paper Book for A.Y. 2016- 17. 11.7.5 We find that the ld. CIT(A) has confirmed the addition made by the AO in the assessee’s income in respect of the loan transaction claimed to have been carried out by the assessee with the above named loan creditor. We find that the relevant findings have been given by the ld. CIT(A) at paras (4.5.5.M) of his Order. We find that the ld. CIT (A) has duly given a finding that before him, the assessee had furnished numerous documents for establishing its claim regarding the identity of the loan creditors, genuineness of the loan transactions and creditworthiness of the loan creditors. At the same breath, the ld. CIT(A) has also given the details and descriptions of the various documentary evidences furnished by the assessee before him. We find that despite acknowledging furnishing of all the documentary evidences by the assessee before him, the ld. CIT(A) has dislodged the claim of the assessee regarding the genuineness of the transactions merely on the basis of the statement of Shri Rajesh Vyas, one of the directors of the lender companies which were recorded before the Investigation Wing u/s. 131(1A) of the Act. On the sole basis of the statement of Shri Rajesh Vyas, the ld. CIT(A) went on to confirm the action of the AO in making the subject additions. 11.7.6 We find that in the instant case, by furnishing all the necessary documentary evidences, as discussed hereinabove, the assessee could be able to discharge its initial onus of proving the nature and sources of credit entries relating to the aforesaid loan creditors, as contemplated u/s. 68 of the Act. However, we find that in the instant case, both, the AO as well as the ld. CIT(A) have discarded and brushed aside such documentary evidences merely on the basis of some statement of Shri Rajesh Vyas, one of the directors of the lender companies, recorded by some authority on 03/01/2017 u/s. 131(1A) of the Act. We find that the full text of the statement has been reproduced by the AO at para (9.21) from page no. 70 to 76 of his Order. On a perusal of such statement, we find that, although the statement has been given on oath by Shri Rajesh Vyas, but, before which authority he administrated the Oath is not discernible. We find that from the entire statement name of the authority recording the statement is not given. We find that in the instant case, assessment proceedings u/s. 153A were initiated by the assessing officer by way of issuance of a notice dated 01/11/2018 which is placed at page no. 120 of the assessee’s Paper Book for A.Y. 2015-16. Thus, it is evident that the statement of Shri Rajesh Vyas was not recorded by the assessing officer during the course of the assessment proceedings. We further find that although at para (9.21) of the assessment order, the AO has made reference of such statement, but, IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 93 of 121 nowhere it is the claim of the AO that the assessee was provided a copy of such statement. Since, the copy of the statement itself of Shri Rajesh Vyas was not provided to the assessee, in our considered view, there could not have been any occasion for the assessee to have a cross-examination of such Shri Rajesh Vyas upon his statement claimed to have been recorded on 03/01/2017 by the Investigation Wing. 11.7.7 We also find full substance in the contention of the assessee that in the instant case, the AO was not only duty bound to provide a copy of the statement of Shri Rajesh Vyas, which was intended to be used against the assessee as an evidence, but, was also required to afford opportunity of cross examination of his witnesses to the assessee, which he miserably failed to do. In such circumstances, in our considered view, merely on the basis of one unconfronted statement, the AO was not legally justified in making the additions in respect of the aforesaid loan creditorsviz. EIPL and VFSPL. 11.7.8 We find that on the issue of cross-examination, the Hon’ble Supreme Court in the case of M/s. KishinchandChellaram vs. CIT (1980) 125 ITR 713 (SC) was pleased to hold that the assessing officer is duty bound to confront the material collected by him to the assessee. The Hon’ble Supreme Court again in the case of M/s. Andaman Timber Industries V/s. Commissioner of Central Excise, Kolkatta-II 2016 (15) SCC 785 (SC) was pleased to hold as under: “5. According to us, not allowing the Assessee to crossexamine the witnesses by the Adjudicating Authority though the statements of those witnesses were made the basis of the impugned order is a serious flaw which makes the order nullity inasmuch as it amounted to violation of principles of natural justice because of which the Assessee was adversely affected. It is to be borne in mind that the orderof the Commissioner was based upon the statements given by the aforesaid two witnesses. Even when the Assessee disputed the correctness of the statements and wanted to crossexamine, the Adjudicating Authority did not grant this opportunity to the Assessee. It would be pertinent to note that in the impugned order passed by the Adjudicating Authority he has specifically mentioned that such an opportunity was sought by the Assessee. However, no such opportunity was granted and the aforesaid plea is not even dealt with by the Adjudicating Authority. As far as the Tribunal is concerned, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that crossexamination of the said dealers could not have brought out any material which would not be in possession of the Assessee themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the Assessee wanted to cross-examine those dealers and what extraction the Assessee wanted from them. 6. As mentioned above, the Assessee had contested the truthfulness of the statements of these two witnesses and wanted to discredit their testimony for which purpose it wanted to avail the opportunity of cross-examination. That apart, the Adjudicating Authority simply relied upon the price list as maintained at the depot to determine the price for the purpose of levy of excise IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 94 of 121 duty. Whether the goods were, in fact, sold to the said dealers/witnesses at the price which is mentioned in the price list itself could be the subject matter of cross-examination. Therefore, it was not for the Adjudicating Authority to presuppose as to what could be the subject matter of the crossexamination and make the remarks as mentioned above. We may also point out that on an earlier occasion when the matter came before this Court in Civil Appeal No. 2216 of 2000, order dated 17-3-2005 [2005 (187) E.L.T. A33 (S.C.)] was passed remitting the case back to the Tribunal with the directions to decide the appeal on merits giving its reasons for accepting or rejecting the submissions. 7. In view the above, we are of the opinion that if the testimony of these two witnesses is discredited, there was no material with the Department on the basis of which it could justify its action, as the statement of the aforesaid two witnesses was the only basis of issuing the show cause notice.” 11.7.9 Their Lordships of the Hon’ble Supreme Court, again, in the case of AyaaubkhanNoorkhan Pathan vs. The State of Maharashtra and Ors., 2013 AIR 58 (SC) was pleased to hold as under: 28. The meaning of providing a reasonable opportunity to show cause against an action proposed to be taken by the government, is that the government servant is afforded a reasonable opportunity to defend himself against the charges, on the basis of which an inquiry is held. The government servant should be given an opportunity to deny his guilt and establish his innocence. He can do so only when he is told what the charges against him are. He can therefore, do so by cross-examining the witnesses produced against him. The object of supplying statements is that, the government servant will be able to refer to the previous statements of the witnesses proposed to be examined against him. Unless the said statements are provided to the government servant, he will not be able to conduct an effective and useful crossexamination. 29. In Rajiv Arora v. Union of India and Ors. AIR 2009 SC 1100, this Court held: 30. The aforesaid discussion makes it evident that, not only should the opportunity of cross-examination be made available, but it should be one of effective crossexamination, so as to meet the requirement of the principles of natural justice. In the absence of such an opportunity, it cannot be held that the matter has been decided in accordance with law, as cross-examination is an integral part and parcel of the principles of natural justice.” 11.7.10 The Hon’ble Gujarat High Court in the case of the Principal Commissioner of Income Tax Ahmedabad and Ors. vs. KanubhaiMaganlal Patel 2017 (3) TMI 271 (Guj.) has held as under: “12. We have heard Shri Varun K Patel, learned counsel appearing on behalf of the Revenue at length. It emerges from the impugned orders and even the order passed by the Assessing Officer that the Assessing Officer made additions under Section 69B of the Act, relying upon the statements of two farmers [i.e., two sellers of the land] in which, according to the Department, IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 95 of 121 they admitted of having received on-money in cash. However, it is required to be noted and it is an admitted position that the statements of those two farmers upon which reliance was placed by the Department were not furnished/given to the assessee to controvert the same. Not only that when a specific request was made before the Assessing Officer to permit them to cross examine the aforesaid two farmers, the same was rejected by the Assessing Officer. Under the circumstances, as rightly observed by the learned Tribunal, the Assessing Officer was not justified in making addition under Section 69B of the Act solely relying upon the statements of those two farmers. 13. We see no reason to interfere with the findings recorded by the learned Tribunal. We are in complete agreement with the view taken by the learned Tribunal while deleting the addition made by the Assessing Officer made under Section 69B of the Act. No substantial question of law arises.” 11.7.11 Similar view was taken by the Hon’ble Gujarat High Court, again, in the case of the Commissioner of Income Tax-V vs. Indrajit Singh Suri 2013 (8) TMI 111 (Guj.) 11.7.12 The Hon’ble Gujarat High Court, again, in the case of the CIT vs. Supertech Diamond Tools Pvt. Ltd. 2013 (12) TMI 1529 (Guj.) has held as under: “The reference to the statements made by some of the persons related with the said investing companies is of no effect because such statements could not have been utilized against the assessee Company when the assessee company had not been afforded an opportunity of confronting and cross- examining the persons concerned. There does not appear anything occurring in the statements of the persons relating with the assessee Company so as to provide a basis for the findings recorded by the AO.” 11.7.13 The Hon’ble Rajasthan High Court in the case of the CIT vs. Smt. Sunita Dhadda 2017 (7) TMI 1164 (Raj.), by taking into consideration the relevant case laws pronounced in various parts of the country, has also allowed the appeal of the assessee on the ground that the assessee was not given any opportunity of cross-examination of the persons whose statements were recorded and relied upon. Such an Order of the Hon’ble Rajasthan High Court has been upheld by the Hon’ble Supreme Court in CIT vs. Smt. Sunita Dhadda 2018 (3) TMI 1610 (SC) by dismissing the SLP of the Department. 11.7.14 Thus, in our considered view, in respect of both the above named loan creditors, by furnishing the documentary evidences as discussed hereinabove, the assessee could be able to fully discharge its onus of proving all the three ingredients as contemplated u/s. 68 of the Act viz. (i) identity of the creditor; (ii) genuineness of the loan transactions; and (iii) creditworthiness of the loan creditor beyond all doubts. We also find that during the course of the search u/s. 132 of the Act, in the premises of the assessee company and its directors, no incriminating material or any IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 96 of 121 evidence raising any doubt regarding the genuineness of the loan transactions with the above named creditors was found or seized. We further find that during the course of the assessment proceedings, despite making a specific request to this effect by the assessee, the AO did not make any independent inquiry either by way of issuance of summons u/s. 131 or by way of issuance of letters u/s. 133(6) of the Act to the aforesaid lenders. We find that the sole basis for making the addition by the AO was some statement of Shri Rajesh Vyas recorded but since, neither the copy of such statement was provided to the assessee nor the assessee was given an opportunity of cross examination of Shri Rajesh Vyas, in our considered view, such statement of Shri Rajesh Vyas has no evidentiary value in the eyes of law against the assessee. We also find that the various case laws relied upon by the AO are not applicable to the assessee’s case. Thus, relying upon the decisions of the various judicial authorities as cited in the preceding paras, we find absolutely no justification in the AO’s making the addition in respect of the aforesaid two loan creditors namely, Excellent Infrabuild Private Limited and VRR Financial Services Private Limited, in the income of the assessee u/s. 68 of the Act. Accordingly, in our considered view, the addition u/s. 68 as well as u/s. 69C of the Act, made by the AO in respect of loan transactions carried out by it with Excellent Infrabuild Private Limited and VRR Financial Services Private Limited are not justified and the AO is hereby directed to delete the same. 11.8 Loan From (i) M/s. Jay Jyoti India Pvt. Ltd. (ii) M/s. Octagon Media Matrix Pvt. Ltd. (iii) M/s. Suzlon Securities Pvt. Ltd. (iv) M/s. Rajwadi Retail Trade Systems Pvt. Ltd. 11.8.1 We find that out of the various additions made by the AO in respect of the loan transactions claimed to have been carried out by the assessee with the above named four creditors, in respect of loan taken by the assessee from M/s. Jay Jyoti India Pvt. Ltd. of a sum of Rs. 50,00,000/- during the A.Y. 2013-14, the AO has made an addition of Rs. 50,00,000/- u/s. 68 of the Act and has also made additions amounting to Rs. 2,25,000/- and Rs. 4,47,975/- respectively for A.Y. 2013-14 and A.Y. 2014-15 on account of unexplained interest payment u/s. 69C of the Act to such loan creditor. Although, in respect of such additions, on the legal ground as discussed in para (11.3) supra, that the assessment years 2013-14 & A.Y. 2014-15 were complete assessment years and therefore, for such assessment years, no addition could have been made without having recourse to any incriminating material found during the course of the search. But, even on merits, we find no substance in the additions so made by the AO in respect of all the above named four loan creditors. 11.8.2 We find that in respect of the above named four lender companies, the AO has given his findings at para (9.12) to para (9.20) of his Order. We find that at para (9.12), the AO has alleged that during the course of the search and post search proceedings, it was found that the assessee IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 97 of 121 had received huge unsecured loans from certain suspicious companies which were directly/indirectly controlled by a well known accommodation entry provider of Indore Shri Sharad Darak, who used to facilitate his clients by routing of unaccounted funds by providing accommodation entries through his companies. At the same para, the AO has given the list of the companies controlled by Shri Sharad Darak, which inter alia, includes the above named four lender companies. At para (9.13), without giving any specific details, the AO further made a finding that during the assessment proceedings and search & survey actions of the Income Tax Department in the case of Shri Sharad Darak, it was noted that Shri Sharad Darak is a full time entry provider. At para (9.14), the AO averted that a survey u/s. 133A of the Act was conducted by the Raipur Investigation Wing at the premises of East West Finvest Private Limited, Purvi Finvest Limited and Trimurthy Finvest Limited and during the course of such survey, it was found that the registered office of these companies were actually belonging to some Shri Dinesh Agrawal, Auditor of the Companies. According to the AO, during the course of the survey proceedings, no books of account of the above named three companies were found and further, in the premises of the companies surveyed, no staff was found working. The AO further at para (9.16) of his Order found that during the course of the assessment proceedings, in the case of some Krishna Oils and Proteins Private Limited for A.Y. 2011-12, the DCIT-5(1), Indore had conducted certain inquires and had also recorded the statement of Shri Sharad Darak. As per the AO, from the statement of Shri Sharad Darak recorded u/s. 131 on 21/02/2014, it was proved that the companies run by Sharad Darak such as Jayant Security and Finance Limited was a bogus company and used for providing of accommodation entries. The AO at para (9.19) also commented that two companies of Shri Sharad Darak namely Jayant Security and Finance Limited and East West Finvest India Limited were also featuring in the investigation report of the Directorate of Income-Tax (Inv.) Kolkata, as bogus loss/ exempted income providing paper companies. Finally, the AO reached to the conclusion that the subject four lender companies were bogus/paper companies controlled by the accommodation entry provider Shri Sharad Darak. Accordingly, he made the addition u/s. 68 of the Act in the income of the assessee for various assessment years in respect of the loans taken from the above named four lender companies and further made addition u/s. 69C of the Act for various assessment years, by holding the interest expenditure as unexplained expenditure. 11.8.3 We find that before the ld. CIT(A), the assessee had made a detailed explanation on the subject issue along with the various documentary evidences. We find that copies of the written submission made by the assessee before the ld. CIT(A) have also been furnished by the assessee before us in its Paper Books for various assessment years. 11.8.4 We find that the main grounds of contention of the assessee before the ld. CIT(A) was that (i) during the course of the assessment IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 98 of 121 proceedings, it had furnished all the necessary documents to establish the identity of the loan creditors, the genuineness of the loan transactions and the creditworthiness of the loan creditors, as contemplated under the provisions of s.68 of the Act; (ii) after having discharged its initial onus of proving during the course of the assessment proceedings, the assessee had specifically requested the AO to issue the summons u/s. 131 / notices u/s. 133(6) to the loan creditors but despite making such specific request, the AO did not do the same and made the addition; (iii) the entire additions have been made by the AO only on the basis of findings given by the Special Auditors which were not factually correct without applying his own mind; (iv) the AO except relying upon some information gathered behind the back of the assessee by some other authorities in some other proceedings did not bring on record any adverse material against the assessee; (v) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions recorded in the regular books of account of the assessee were not genuine; (vi) in respect of some of the lender companies, allegedly controlled by Shri Sharad Darak, the Income Tax Department has duly framed assessments u/s. 143(3) of the Act which fact establishes the actual existence and identity of such companies; (vii) in respect of some of the lender companies allegedly belonging to Shri Sharad Darak, even during the course of the income tax appeals, before the Hon’ble Income Tax Appellate Tribunal, genuineness of the transactions have been approved by the Hon’ble ITAT; (viii) the AO has relied upon only hearsays and some information without confronting the same to the assessee and without giving the opportunity of any cross examination; (ix) the transactions carried out by the assessee were of the nature of loan and not of the nature of share capital or share premium and therefore, it was not required to prove the source of the source as contemplated under the proviso to section 68 of the Act; and (x) since the interest expenditure were fully recorded in the books, the provisions of section 69C could not have been invoked. 11.8.5 We find that the ld. CIT(A) has dealt with the additions made by the AO in respect of the aforesaid loan creditors at para (4.5.5.L) of his Order. We find that the ld. CIT (A) has given a categorical finding that before him, the assessee had furnished numerous documents for establishing its claim regarding the identity of the loan creditors, genuineness of the loan transactions and creditworthiness of the loan creditors. However, we find that having given such categorical findings, the ld. CIT(A) held that from the various inquiries conducted by the Investigation Wing and the Income-Tax Authorities, it had got established that Shri Sharad Darak was a defamous entry provider of Indore. The ld. CIT(A) further held that in many of the cases, the genuineness of the loans provided by the companies of Sharad Darak have not been accepted. Finally, with the above findings, the ld. CIT(A) concluded that once it is proved that the assessee has taken any loan from any entry provider, then, furnishing of any documentary evidences could not establish the loan transactions as contemplated u/s. 68 of the Act IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 99 of 121 and accordingly, confirmed the various additions for various assessment years, made by the AO on this count. 11.8.6 We find that before us, in respect of the subject loan transactions, the assessee has placed his reliance on the written submissions made before the ld. CIT(A) which are duly placed in the Paper Books of the assessee filed before us for the concerning assessment years. The counsel of the assessee also placed reliance on the various documentary evidences furnished by it before both the authorities below which have also been furnished in the Paper Books for concerning assessment years filed before us. In addition to that, the assessee has also made a written synopsis which has already been reproduced by us in the preceding paras. In particular, the counsel of the assessee has invited our attention to the decision of the Coordinate ‘G’ Bench Mumbai, pronounced on 01/06/2021 in the case of JCIT vs. M/s. Shalimar Housing and Finance Limited in Appeal No. ITA- 4079/Mum/2019, in which the similar issue of cash credits accepted by the assessee from various companies of Shri Sharad Darak such as East West Finvest India Limited, Jayant Security and Finance Ltd., Jay Jyoti India Pvt. Ltd., Octagon Media Matrix Pvt. Ltd. and Purvi Finvest Ltd. was before the Hon’ble Bench. In this case, the Hon’ble Bench after considering all the aspects held that the lending companies were existing companies and were having capacity to grant the loan to the assessee. The counsel of the assessee further relied upon the decision of this Bench in the case of M/s. Tirupati Construction, Ujjain vs. DCIT, Ujjain in AppealNo. ITA/522/Ind/2014 pronounced on 14/07/2016 in which this Bench had held the loan transactions carried out by the assessee with East West Finvest India Limited, Jayant Securities and Finance Ltd. and KK Patel Finance Limited, companies controlled by Shri Sharad Darak as genuine. The counsel of the assessee also placed the reliance on the decision of this Bench in the case of ACIT vs. Pramod Kumar Sethi as reported in (2019) 34 ITJ 39 (Trib.Indore) in which case too, the loans taken by the assessee from various companies of Shri Sharad Darak were held to be genuine. 11.8.7 We find that in the instant case, the assessee has furnished all the necessary documents relating to each of the above named lender companies such as copies of certificates of incorporation, memorandum & articles of association, copies of income-tax returns, copies of master data downloaded from website of MCA, copies of loan confirmation letters duly given by the lender companies, copies of relevant bank statements of the lender companies, copies of the relevant bank statements of the assessee, copies of the audited financial statements of the lender companies, copies of the Affidavits duly sworn by Shri Sharad Darak confirming the loan transactions and in some cases, copies of the assessment orders passed u/s. 143(3) of the Act. We also find that in respect of the loan transactions, the assessee has made the payment of interest and has also made the necessary TDS thereon. Thus, in our considered view, by furnishing all the necessary documents, such as the certificates of incorporation, copies of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 100 of 121 Memorandum and Articles of Association, copies of acknowledgement of income tax returns, copies of the master datas downloaded from the official website of the MCA, copies of the PAN Cards, the assessee could be able to establish the statutory as well as the physical identity and existence of all the aforesaid four loan creditors. We further find from the copies of duly signed letters of confirmation, copy of the relevant abstracts of the bank accounts of the loan creditors that all the loan transactions have been carried out through banking channels which were found duly reflected in the bank statements of the assessee as well as the loan creditors and the copies of the Affidavits given by Shri Sharad Darak, the assessee could be able to establish the genuineness of the loan transactions. Further, from a perusal of the copies of the lender’s bank statements placed in the concerning Paper Books for A.Y. 2013-14, A.Y. 2015-16 & A.Y. 2016-17, we find that in none of the cases, before making remittance to the assessee towards loan transactions, any cash was deposited by the lenders. We have also perused the audited financial statements of the lenders and from such financial statements, we found that such lenders were having sufficient funds available for providing loans to the assessee company. From the copies of the audited financial statements of the lender companies, we further find that all the aforesaid four lender companies were having ample of funds which were available to them for providing loans to the assessee. We find that although all the documentary evidences for establishing the genuineness of the loans, as aforesaid, were also filed by the assessee before the AO, but the AO could not find any specific defect or discrepancy in any of such documentary evidences. We find that even before us, the ld. CIT(DR) could not point out any single defect or discrepancy in such documents.We find that by furnishing all the necessary documentary evidences, as discussed hereinabove, the assessee could be able to discharge its initial onus of proving the nature and sources of credit entries relating to the aforesaid loan creditors, as contemplated u/s. 68 of the Act. 11.8.8 However, we find that in the instant case, both, the AO as well as the ld. CIT(A) have discarded and brushed aside such documentary evidences merely on the hearsays and inquiries conducted by some other Income Tax Authorities in some other cases without confronting the assessee with such inquiries. We find that the AO has made the additions with preconceived notions about the lender companies without having any corroborative evidence or tangible material on his record. We find that the AO has made reference of some survey conducted in some of the concerns of Shri Sharad Darak and that too, in the year 2014. We further find that at para (9.15), the AO has made reference of some statement given by Shri Dinesh Agrawal who was found during the course of the survey conducted. We find that first of all, according to the AO himself, the survey was not conducted in any of the premises of the above named four lender companies, but, in some other companies of Shri Sharad Darak. Further, we find that the AO has not provided the assessee the copy of statement of Shri Dinesh Agrawal on whose statement, he has placed reliance for making the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 101 of 121 subject additions. Even from the abstracts of the statement of Shri Dinesh Agrawal, which was only an Auditor of some of the companies of Shri Sharad Darak, it cannot be inferred that the above named four lender companies were merely paper companies or for that matter, the transactions carried out by the assessee with such companies were not genuine. We find that the AO has also made a reference of some statement u/s. 131 of Shri Sharad Darak recorded by some other assessing officer in the case of some other assessee but again, the copy of such statement was not provided by the AO to the assessee. We find that before the ld. CIT(A), the assessee had duly furnished the copies of Affidavits duly sworn by Shri Sharad Darak before Notary Public. We also find that copies of such Affidavits were also provided by the ld. CIT(A) to the AO under Rule 46A of the Income Tax Rules, 1962, but the AO did not make any further examination or inquiry from Shri Sharad Darak. From the copy of the Remand Report dated 16/09/2020 submitted by the AO to the ld. CIT(A), as placed at page no. 519 to 545 of the assessee’s Paper Book for A.Y. 2013-14, we noted that the Affidavits filed by Shri Sharad Darak have been discarded by the AO on the extraneous grounds such as timing of the filing of the Affidavits, generic nature of the Affidavits, without taking any pain to cross-examine Shri Sharad Darak on the Affidavits so furnished. We find that a copy of such Affidavit of Shri Sharad Darak has duly been filed by the assessee before us in his Paper Book for A.Y. 2013-14 at page no. 417 to 419 and for A.Y. 2015-16 at page no.777 to 789, for A.Y. 2016-17 at page no. 911 & 912. We find that in all these Affidavits, Shri Sharad Darak has furnished the complete details of the identity of the concerning company and has also furnished the details of transactions carried out by his companies with the assessee company. In such Affidavits, Shri Sharad Darak in unequivocal terms has confirmed the loan transactions carried out by his various companies with the assessee company. 11.8.9 We find full substance in the contention of the assessee that in the instant case, the AO was not only duty bound to provide copies of the statements of Shri Dinesh Agrawal and Shri Sharad Darak which were recorded by some other authorities in some other proceedings, and which were intended to be used against the assessee as an evidence, but, was also required to afford opportunity of cross examination of such witnesses to the assessee, which he miserably failed to do. In such circumstances, in the light of the various judicial authorities, already cited in preceding paras, in our considered view, merely on the basis of one unconfronted statement, the AO was not legally justified in drawing any adverse inference against the assessee. 11.8.10 We also find that during the course of the search u/s. 132 of the Act, in the premises of the assessee company and its directors, no incriminating material or any evidence raising any doubt regarding the genuineness of the loan transactions with the above named creditors was found or seized. We further find that during the course of the assessment IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 102 of 121 proceedings, despite making a specific request to this effect by the assessee, the AO did not make any independent inquiry either by way of issuance of summons u/s. 131 or by way of issuance of letters u/s. 133(6) of the Act to the aforesaid lenders. We find that the sole basis for making the addition by the AO was some statements of Shri Dinesh Agrawal and Shri Sharad Darak recorded by some othe Income Tax Authorities in some other cases, but since, neither the copies of such statements were provided to the assessee nor the assessee was given an opportunity of cross examination of such persons making the statements, in our considered view, such statements have no evidentiary value in the eyes of law against the assessee. We also find that neither during the course of the search any evidence was found that the assessee company itself provided cash to the lender companies for procuring cheques under the garb of loans nor the AO could bring any single material to this effect on record. In our considered view, except leveling a bald charge against the lending companies, the AO by himself has not conducted any independent inquiry to substantiate his allegation that the lender companies were mere accommodation entry provider companies. We find that in the similar circumstances, the Hon’ble High Court of Delhi in the case of Pr. CIT vs. Oriental International Company Pvt. Ltd. (2018) 401 ITR 0083 (Delhi) has dismissed the appeal of the Revenue by holding that the AO did not conduct his task diligently and had not brought on record that whether the amounts were infused in the shareholders account in cash. We also find that the various case laws relied upon by the AO are not applicable to the assessee’s case. 11.8.11 We also find that in the similar circumstances, the additions made by some assessing officers in the case of the respective assesses, in respect of the loans taken by such assesses from various companies of Shri Sharad Darak, u/s. 68 of the Act, have been deleted by this Coordinate Bench itself and as also, by the Coordinate ‘G’ Bench of Mumbai. We find that Coordinate ‘G’ Bench Mumbai, in its Order pronounced on 01/06/2021 in the case of JCIT vs. M/s. Shalimar Housing and Finance Limited in Appeal No. ITA- 4079/Mum/2019, in which the similar issue of cash credits accepted by the assessee from various companies of Shri Sharad Darak such as East West Finvest India Limited, Jayant Security and Finance Ltd., Jay Jyoti India Pvt. Ltd., Octagon Media Matrix Pvt. Ltd. and Purvi Finvest Ltd. was before the Hon’ble Bench has held that all these lending companies were existing companies and were having capacity to grant the loan to the assessee. We also find that this Bench in the case of M/s. Tirupati Construction, Ujjain vs. DCIT, Ujjain in AppealNo. ITA/522/Ind/2014 vide is Order dated 14/07/2016 has held that the loan transactions carried out by the assessee with East West Finvest India Limited, Jayant Securities and Finance Ltd. and KK Patel Finance Limited, companies controlled by Shri Sharad Darak were genuine. Further, this Bench in the case of ACIT vs. Pramod Kumar Sethi as reported in (2019) 34 ITJ 39 (Trib.Indore) and again in the case of Shri Sanjay Shukla, Indore vs. ACIT, Central Circle-2, Indore as reported in 2022 (4) TMI 385-ITAT, Indore has also upheld the action of the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 103 of 121 CIT(A) in deleting the additions made by the AO in the assessee’s income on account of loans taken by the respective assessees from the various companies controlled by Shri Sharad Darak. In the case of Shri Pramod Kumar Sethi (supra) this Bench has held the loan transactions carried out by the assessee in that appeal with Trimurti Finvest Pvt. Ltd., Purvi Finvest Pvt. Ltd., KK Patel Finance Ltd. and East West Finvest India Ltd. as genuine loan transactions whereas, in the case of Shri Sanjay Shukla (supra), this Bench has held the loan transactions carried out by that assessee with M/s. Jayant Securities and Finance Limited and M/s. Jay Jyoti India Pvt. Ltd. as genuine. 11.8.12 Thus, in terms of the findings given above and as also, the legal authorities cited by us at para (11.4.4) and (11.8.11) supra, we are of the considered view that in respect of all the above named four loan creditors, by furnishing the documentary evidences as discussed hereinabove, the assessee could be able to fully discharge its onus of proving all the three ingredients as contemplated u/s. 68 of the Act viz. (i) identity of the creditor; (ii) genuineness of the loan transactions; and (iii) creditworthiness of the loan creditor beyond all doubts. Accordingly, in our considered view, the entire additions u/s. 68 as well as u/s. 69C of the Act, made by the AO, vide para (9) of his Order, in respect of all the loan transactions carried out by the assessee company with M/s. Jay Jyoti India Pvt. Ltd. (ii) M/s. Octagon Media Matrix Pvt. Ltd. (iii) M/s. Suzlon Securities Pvt. Ltd. (iv) M/s. Rajwadi Retail Trade Systems Pvt. Ltd. for A.Y. 2013-14, A.Y. 2015-16 and A.Y. 2016-17 are not justified and consequentlythe AO is hereby directed to delete the same. 11.9 Loan from M/s. Sumeet & Sumeet Sales 11.9.1 We find that the AO, vide para (11) of his Order has made an addition of Rs. 1,09,00,000/- in the assessee’s income for A.Y. 2015-16 u/s. 68 of the Act in respect of credit entries found in the books of account of the assessee, for the relevant previous year, in the name of some ‘M/s. Sumeet & Sumeet Sales’. The brief facts relating to the issue, as emerging out from the assessment order, are that during the course of search/post search proceedings, it was found that the assessee has shown certain transactions with one concern called Sumeet & Sumeet Sales. As per the AO, this is a namesake proprietary concern of Shri Sumeet Garg who is an ordinary person who has no connection with the assessee’s business. Accordingly, the AO, vide show-cause notice dated 19/11/2018, required the assessee to furnish its explanation on the said issue. The AO also made a reference of statement of Shri Sumeet Garg recorded by the Investigation Wing. In reply, the assessee, vide its letters dated 07.12.2018& 03.08.2019, furnished its detailed explanation. The AO, while framing the assessment order, averted that cash was introduced in the bank account of M/s. Sumeet & Sumeet Sales which was then transferred to various companies of Global group including the assessee. Finally, the AO, made an addition of IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 104 of 121 Rs.1,09,00,000/- in A.Y. 2015-16 in the assessee’s income on account of receipts from bank account of M/s. Sumeet & Sumeet Sales by treating the same as unexplained cash credit u/s. 68 r.w.s. 115BBE of the Act. 11.9.2 We find that the ld. CIT(A) while adjudicating the appeal of the assessee on this issue for A.Y. 2015-16, has confirmed the addition of Rs.1,09,00,000/- so made by the AO on account of receipts made by the assessee from the bank account of M/s. Sumeet & Sumeet Sales against which the assessee is in appeal before us. The ld. CIT(A) has given the necessary findings at para (4.6.2) from page no.296 to 297 of his Order. Before us, the assessee has placed reliance upon his written submissions made before the ld. CIT(A) which has been reproduced by the ld. CIT(A) at page no. 291 to 296 of his Order. 11.9.3 We find that the main grounds of contention of the assessee, on the subject addition of Rs. 1,09,00,000/-, are that(i) during the course of the assessment proceedings, it had furnished all the necessary documents to establish the identity of the loan creditor, the genuineness of the loan transactions and the creditworthiness of the loan creditor, as contemplated under the provisions of s.68 of the Act; (ii) the aggregate amount of loans taken was to the extent of Rs. 1,01,00,000/- only and not of Rs. 1,09,00,000/- as wrongly taken by the AO (iii) the entire loan so taken was repaid by it through banking channel during the financial year relevant to A.Y. 2016-17 along with the amount of interest. (iv) after having discharged its initial onus of proving during the course of the assessment proceedings, the assessee had specifically requested the AO to issue the summons u/s. 131 / notices u/s. 133(6) to the loan creditor but despite making such specific request, the AO did not do the same and made the addition; (v) the entire additions have been made by the AO only on the basis of statement of Shri Sumeet Garg recorded u/s. 131(1A) of the Act before the Investigation Wing; (vi) the AO has not given any credence and even made a reference of an Affidavit of retraction duly given by Shri Sumeet Garg before him, a copy whereof is placed on record; (vii) during the course of the assessment proceedings, it was duly explained that cash were deposited by Shri Sumeet Garg, Proprietor of M/s. Sumeet & Sumeet Sales from his own sources; (viii) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the unsecured loan transactions carried out by the assessee with M/s. Sumeet & Sumeet Sales recorded in the regular books of account of the assessee were not genuine and finally, (ix) the AO relied upon the statement of Shri Sumeet Garg, but, no opportunity of cross-examination was afforded to the assessee. 11.9.4 We have carefully considered the findings of the AO, written as well as oral submissions made by the assessee, Special Audit Report, remand report of the AO and the rejoinder of the assessee thereon. We find that, before both the authorities below, the assessee had furnished the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 105 of 121 various documents relating to the above named lender and furnishing of such documents by the assessee has also been noted by the ld. CIT(A) in the body of his Order itself. 11.9.5 We find that the ld. CIT(A) has confirmed the addition made by the AO in the assessee’s income in respect of the loan transaction claimed to have been carried out by tthe assessee with the above named M/s Sumeet and Sumeet Sales Corporation. We find that the relevant findings have been given by the ld. CIT(A) at para (4.6.2) of his Order. We find that the ld. CIT (A) has duly given a finding that before him, the assessee had furnished numerous documents for establishing its claim regarding the identity of the loan creditors, genuineness of the loan transactions and creditworthiness of the loan creditors and as also, a copy of an Affidavit of Shri Sumeet Garg retracting his own statemen given earlier. However, the ld. CIT(A) discarded the assessee’s claim only on two counts viz. (i) finding of huge cash deposits in the bank accounts of M/s. Summet & Sumeet Sales and (ii) admission of non-genuineness of the transactions by the proprietor of the concern in the statement recorded u/s. 131(1A) of the Act. 11.9.6 We find that in the instant case, undisputedly, the identity of the loan creditor cannot be doubted as according to the AO himself, in response to the summons issued by the Investigation Wing, the proprietor of the loan creditor concern i.e. Shri Sumeet Garg had got appeared before the Investigation Wing and had given his statements u/s. 131(1A) of the Act. We further find that undisputedly, the subject loan transaction was carried out through banking channels and the AO in the body of the assessment order itself at page nos. 102 to 106 has scanned the copies of bank statements of the loan creditors. From the copy of the bank statement of the loan creditor, we find that in such bank statement, clearance of various cheques aggregating to a sum of Rs. 1,01,00,000/- in the name of the assessee company are getting clearly reflected. However, we find that before clearance of the cheques, entries of deposition of cash are also getting reflected. We find that before the authorities below, the assessee had submitted that the very source of cash in the hands of the loan creditor was sales proceed from some of his agricultural lands. We find that the AO has not made any further enquiry on the explanation of the assessee. In our considered view, merely for the reason that immediately before issuance of the cheques, equivalent amount of cash was found deposited in the bank account of the lender, could not be the sole reason for disbelieving the genuineness of any loan transaction. 11.9.7 We further find that before the authorities below, the assessee had furnished a copy of Declaration duly signed by Shri Sumeet Garg Proprietor of M/s.Sumeet & Sumeet Sales dated 03/10/2018. A copy of such Declaration has also been furnished by the assessee before us in his Paper Book for A.Y. 2015-16 at page no. 835 to 840. From such declaration, we find that at para (4) of the Declaration, Shri Sumeet Garg has clearly IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 106 of 121 stated to have given loan aggregating to a sum of Rs. 1,01,00,000/- to the assessee company. At para (5) of the Declaration, Shri Sumeet Garg has stated to have given the loans out of his explained sources only. At para (8) of the Declaration, Shri Sumeet Garg has clearly denied to have made any statement before any authority admitting the non-genuineness of the transactions. At para (9), Shri Sumeet Garg has clearly stated that his statement was obtained under duress and pressure and finally, at para (10), Shri Sumeet Garg has retracted his statement recorded on 26/12/2016. In our considered view, a statement given by a third party, behind the back of an assessee, which is subsequently retracted by specifying the circumstances in which the original statement was given, has no evidentiary value by itself. We also find that Shri Sumeet Garg has clearly stated that cash deposits in his bank account were made by him only out of his own resources only. We find that during the course of the search proceedings in the various premises of the assessee company and its directors, no incriminating material or evidence was found or recovered which could have given a slightest idea regarding the non-genuineness of the loan transactions carried out by the assessee with M/s. Sumeet & Sumeet. We also find that in the instant case, the ld. AO himself has not conducted any independent enquiry either by way of issuance of summons u/s. 131 or letters u/s. 133(6) of the Act to the lender, despite the assessee’s making a specific request to this effect. We find that the ld. AO sticked only to the statement given by the lender before the Investigation Wing which got subsequently retracted. 11.9.8 We also find full substance in the contention of the assessee that in the instant case, the AO was not only duty bound to provide a copy of the statement of Shri Sumeet Garg, which was intended to be used against the assessee as an evidence, but, was also required to afford opportunity of cross examination of his witnesses to the assessee, which he miserably failed to do. In such circumstances, in our considered view, merely on the basis of one unconfronted statement, the AO was not legally justified in making the additions in respect of the aforesaid loan creditor i.e. M/s. Sumeet & Sumeet Sales. In the preceding paras, we have already cited various judicial authorities for the proposition that without giving an opportunity of cross examination of the person making the statement, merely on the basis of the statement of a third party, no adverse inference can be drawn against an assessee and therefore, in respect of the present lender, we refrain ourselves to make the same discussions again. 11.9.9 In the light of the aforesaid findings, we find no substance in the action of the AO in making the addition of Rs. 1,09,00,000/- in the assessee’s income for A.Y. 2015-16 on account of unexplained receipts from bank account of M/s. Sumeet & Sumeet Sales and accordingly, the same is hereby directed to be Deleted. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 107 of 121 12. In the result, we affirm the findings of the ld. CIT(A) to the extent he deleted the various additions made by the AO, vide his para (9) in the income of the assessee for various assessment years by invoking the provisions of section 68 and 69C of the Act in respect of various loans shown by the assessee in its books of accounts and as also, in respect of interest thereon. However, to the extent the ld. CIT(A) has confirmed the additions made by the AO vide para (9) and para (11) of his Order, we hereby set-aside the findings given by the ld. CIT(A). In our considered view, none of the additions made by the AO vide para (9) and (11) of his assessment order are sustainable. Consequently, the Assessee’s Ground Nos. 3(a) to 3(f) for A.Y. 2013-14 & A.Y. 2014-15; Ground Nos. 2(a) to 2(e) for A.Y. 2015-16, A.Y. 2016-17 & A.Y. 2017-18; Ground Nos. 3(a) & 3(b) for A.Y. 2015-16 are Allowed whereas the Revenue’s Ground No. 2 for A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015-16 & A.Y. 2016-17 are Dismissed. 13. Ground No. 1 of the Revenue for A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015-16and A.Y. 2016-17 13.1 Through the Ground No. 1 for A.Y. 2013-14 to A.Y. 2016-17, the Revenue has challenged the action of the ld. CIT(A) in deleting the various additions of Rs.3,99,10,000/- in A.Y. 2013-14, Rs.7,08,66,700/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.12,81,42,000/- in A.Y. 2016-17 made by the AO on account of acceptance of share capital/ share application money by the assessee company. 13.2 Briefly stated facts of the issue, as emanating from the records, are that from the analysis of the seized documents, it was found by the AO that huge share capital has been introduced in the assessee company in various names after routing of unaccounted funds through assorted shell companies including Saviour Commotrade Pvt. Ltd. Accordingly, the AO issued show- cause notices dated 19/11/2018 and 19/07/2019 to the assessee. In reply, the assessee, vide its letters dated 07.12.2018 and 03.08.2019, furnished its detailed explanation along with documentary evidences in support of establishing the identity & creditworthiness of share applicants and genuineness of share transactions. The AO, while framing the assessment order, averted that the entire share capital introduced in the assessee company during various years are just accommodation entries to facilitate introduction of unaccounted funds directly or indirectly routed through various dummy/ shell/ jamakharchi companies. Finally, the AO made of addition of Rs.3,99,10,000/- in A.Y. 2013-14, Rs.7,08,66,700/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.12,81,42,000/- in A.Y. 2016-17 by holding the share capital raised by the assessee as unexplained cash credits u/s. 68 of the Act. 13.3 Aggrieved with the Order of Assessment, the assessee preferred separate appeals for the subject assessment years before the ld. CIT(A). During the course of the first appellate proceedings, the assessee made detailed written submissions along with the documentary evidences which were also furnished by it before the AO. Before the ld. CIT(A), the assessee IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 108 of 121 also furnished certain additional evidences, under Rule 46A, to substantiate the identity & creditworthiness of the shareholders and genuineness of share transactions which were forwarded to the Assessing Officer for comments. The copy of the Remand Report of the AO was provided by the ld. CIT(A) to the assessee and in response, the assessee filed its rejoinder. The Ld. CIT(A), after considering the remand report of the AO as well as the rejoinder of the assessee, deleted the entire additions made by the AO in respect of the share capital/ share application money obtained by the assessee from various entities/ persons. The ld. CIT(A) has given the relevant findings in respect of the share capital/ share application money at paras (4.4.5) to (4.4.17) of his order. 13.4 Aggrieved with the Order of the ld. CIT(A), the Revenue is in appeal before us. 13.5 Before us, learned CIT(DR) vehemently argued supporting the observations of the AO on this issue. 13.6 Per Contra, Learned Counsel for the assessee has placed reliance on the written submission made by him before the ld. CIT(A), on the subject issue, which has also been reproduced by the ld. CIT(A) at para (4.4.1) from page no. 27 to 118 of his Order. The copies of the written submissions made before the ld. CIT(A) have also been placed by the assessee in its Paper Books for various assessment years filed before us. 14.1 We have heard rival contentions and perused the records placed before us and duly considered the judgments and decisions referred to and relied upon by both the sides. 14.2 We find that in respect of certain share capital/share application money taken by the assessee, the AO has made additions amounting to Rs. 3,99,10,000/- and Rs. 7,08,66,700/- respectively for A.Y. 2013-14 and A.Y. 2014-15 u/s. 68 of the Act. We further find that such additions have been made by the AO, u/s. 68 of the Act, only on the basis of transactions recorded in the regular books of account without having recourse to any document or material found or seized during the course of the search u/s. 132 of the Act carried out in the premises of the assessee and its various directors. Although, in respect of such additions, on the legal ground as discussed in para (11.3) supra, that the assessment years 2013-14 and 2014-15 were complete assessment years and therefore, for such assessment years, no addition could have been made without having recourse to any incriminating material found during the course of the search. But, even on merits, we find no substance in the additions so made by the AO. 14.3 We find that the AO has made the additions for all the assessment years under appeal by way of giving a common finding and as also, by way of passing a common order. We find that the AO has made necessary findings from para (8.1) to para (8.41) of the common order and finally, at IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 109 of 121 para (8.42), by way of drawing one table giving the assessment year wise details of share capital, made the impugned additions. At the same para, the AO has given the finding that out of the additions made for A.Y. 2013-14, addition to the extent of Rs.99,79,000/- was required to be made in the hands of the assessee company on protective basis with substantive addition in the hands of Shri Awadhesh Dixit for A.Y. 2013-14. Likewise, for A.Y. 2014-15, the AO has given a finding that out of total additions of Rs.7,08,66,700/-, addition to the extent of Rs.1,50,00,000/- and Rs.10,00,000/-, aggregating to a sum of Rs.1,60,00,000/- be made in the hands of the assessee company on protective basis and the corresponding additions, respectively, be made in the hands of M/s. Global Realcon Pvt. Ltd. and Smt. Surekha Dixit. Since the findings of the AO are common, instead of dealing with the same assessment year wise, the same are dealt with together in the ensuing paras. 14.4 At para (8.1), the AO made reference of show-cause notices issued to the assessee. At such para, the AO has also reproduced the abstracts of the assessment year wise notices issued to the assessee. At para (8.2), in brief, the AO has discussed the submissions of the assessee made before him. At para (8.3) to para (8.21), the AO has given findings regarding some other group company of the assessee namely Saviour CommotradePvt. Ltd. At para (8.22), the AO has made a finding that during A.Y. 2013-14, the assessee company had accepted share capital amounting to Rs.3,99,10,000/- from Shri Rajeev Dubey, Shri Awadhesh Dixit and proprietorship concern of Shri Awadhesh Dixit. At para (8.23), the AO has given the details of share capital taken by the assessee company during A.Y. 2014-15, A.Y. 2015-16 and A.Y. 2016-17. At para (8.24), the AO has commented that Smt. Surekha Dixit has introduced share capital on 25.03.2014 by way of indirectly routing funds from the assessee’s group itself. At para (8.25), the AO has alleged that Saviour CommotradePvt. Ltd. from whom Smt. Surekha Dixit received the funds is a briefcase company. At para (8.26), the AO alleged that the assessee had also directly received share capital from Kolkata based dummy companies. At para (8.27), the AO commented that the assessee has taken entries from jamakharchi companies which do not have any work or business. At para (8.28), the AO commented that the assessee company had brought its unaccounted income to its books without paying any tax. At para (8.29), the AO produced one flow chart and through such chart, the AO made an attempt that the shareholder companies from whom the assessee company received the funds by way of share capital had in their turn taken the loans from one another group company namely M/s Global RealconPvt. Ltd. and again, such Global Realcon Pvt. Ltd. from Global Powernet Pvt. Ltd. At para (8.30), the AO discussed the modus operandi of bogus companies. At para (8.31), the AO commented that Saviour Commotrade Pvt. Ltd. and one more group company M/s. Global Tradeventures Pvt. Ltd. are paper companies. At para (8.32), the AO commented upon the working of M/s. Global Tradeventures Pvt. Ltd. At para (8.33), the AO furnished the details of share capital aggregating to Rs.20,18,00,000/- alleged to have been received by the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 110 of 121 assessee company from the dubious entities. At para (8.34), the AO reproduced some excel sheets demonstrating the provisional balance sheets of various companies. At para (8.35), the AO on the basis of the excel sheets, commented that Global Realcon Pvt. Ltd. is also carrying out money laundering. At para (8.36), the AO made reference of some jamakharchi companies. At para (8.37) to (8.39), the AO analysed the balance sheets of some of the share applicant companies. At para (8.40), the AO made the reference of various judicial pronouncements. At para (8.41), the AO reproduced the findings of the Special Auditors under s.142(2A) of the Act and while reproducing such findings, the AO himself has given the sources of availability of the funds in the hands of the shareholders for making the investments in the share capital of the assessee company. Finally, at para (8.42), the AO held that the entire share capital introduced in the assessee company during the various years are just accommodation entries to facilitate introduction of unaccounted funds directly or indirectly routed through various dummy/ shell/ jamakharchi companies and accordingly treated the same as unexplained cash credits u/s. 68 r.w.s. 115BBE of the Act which resulted into the impugned additions for four assessment years. 14.5 We find that in the instant case, the ld. CIT(A) has given very detailed and meticulous findings by making thread bear analysis of each and every share capital/share application transaction carried out by the assessee with various entities. We find that the ld. CIT(A) has given his relevant findings at para (4.5.5) from page no. 121 to para (4.4.17) at page no. 137 of his Order. We find that the main contention of the assessee before the ld. CIT(A) was that: (i) for A.Y. 2013-14 & A.Y. 2014-15, the assessee contended that these years being the completed assessment years, the additions made by the AO without having recourse to seized materials were not warranted; (ii) during the course of the assessment proceedings, the assessee had furnished all the necessary documentary evidences to establish the identity of the share applicants, genuineness of the transactions, the creditworthiness of the share applicants and even the sources of availability of funds in the hands of the shareholders by producing all the necessary documents which have also been furnished in the appellate proceedings; (iii) the assessee company had received substantial amount of share capital either from the directors of the company or their family members or from the group companies in which the directors and their family members were having full ownership; (iv) since simultaneous assessment proceedings u/s. 153A had been carried out in respect of many of the shareholders, there was absolutely no justification for making any addition by the AO in the hands of the assessee on account of share capital money received from such shareholders; (v) even the non- group shareholders, the immediate sources of funds for making investments in the assessee company were made only by the group assessees who were separately assessed by the AO himself; (vi) the AO by giving the flow charts and as also, by reproducing the findings of the Special Auditors had brought on record the sources of investment in the assessee company by the various group assessees; (vii) during the course of the assessment proceedings, the IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 111 of 121 assessee had made a specific request vide para (9) of its letter dated 03.08.2019 that if the AO wish to make further verification and investigation in the matter, then summons u/s. 131 or letters u/s. 133(6) be issued to the shareholders but despite making such specific request, the AO did not do the same and made the addition; (viii) the AO except relying upon some information gathered behind the back of the assessee by some other authorities in some other proceedings did not bring on record any adverse material against the assessee; (ix) during the course of the assessment proceedings, no incriminating material or document was found wherefrom it could have been inferred that the share capital transactions recorded in the regular books of account of the assessee were not genuine; (x) the AO has relied upon only hearsays and some information without confronting the same to the assessee and without giving the opportunity of any cross examination; (xi) the assessee had not only established the identity of the shareholders, genuineness of the transactions and creditworthiness of the shareholders but had also substantiated the sources in the hands of the shareholders for making investment in the assessee company as contemplated under the provisions of s.68 of the Act. 14.6 Before delving with the issue, we consider it necessary to comment that during the four assessment years under consideration, in respect whereof additions under s.68 of the Act have been made by the AO, the AO has made an aggregate addition of Rs.24,17,10,000/-. We find that the ld. CIT(A) has divided share capital claimed to have been taken by the assessee in various assessment years broadly into six categories viz. (i) share capital received from the directors and family members of the assessee group in respect whereof simultaneous search operations u/s. 132 were carried out and in pursuance to such search, simultaneous assessment proceedings u/s. 153A were also made and in such category, three share holders have fallen namely Shri Awadhesh Dixit, Shri Hradayesh Dixit and Smt. Surekha Dixit; (ii) share capital received from the associates of the assessee group namely Shri Rajeev Dubey; (iii) share capital directly received by the assessee company from its group companies such as M/s. Global RealconPvt. Ltd., M/s. Global TradeventuresPvt. Ltd., M/s. Global PowernetPvt. Ltd., in whose cases too, simultaneous search operations u/s. 132 were carried out and in pursuance to such search, simultaneous assessment proceedings u/s. 153A were also carried out by he same AO; (iv) share capital directly received from the group companies such as M/s. Madhya Pradesh Today Media Ltd. which is a widely held company separately assessed to tax but in respect whereof neither any search u/s. 132 nor any assessment proceedings were carried out; (v) share capital received from the companies other than the group companies where very sources of such share capital were funds provided by the group assessees and group companies only; and finally (vi) share capital received from other categories of companies. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 112 of 121 14.7 Before giving our findings separately in respect of each of the six categories of shareholders as enumerated above, we find that during the course of the assessment proceedings, the assessee had furnished numerous documents for establishing the identity of the shareholders, genuineness of the share capital transactions, creditworthiness of the shareholders and as also, for establishing immediate sources of funds in the hands of the shareholders for making investment in the assessee company. We find that before the ld. CIT(A), besides furnishing the documents furnished before the AO, the assessee had also furnished certain further documents for establishing the sources of sources as additional evidences under Rule 46A of the Income Tax Rules, 1962 which were duly admitted by the ld. CIT(A) as additional evidences after providing the copies of such additional documents to the AO and as also, after obtaining his remand report, a copy whereof is placed at page no. 518 to 545 of the assessee’s Paper Book for A.Y. 2013-14. We find that before the ld. CIT(A) as well as before us, for establishing the identity of the shareholders, the assessee has furnished various documentary evidences such as copies of the PAN card of the individual shareholders and copies of certificate of incorporation, copies of memorandum & articles of association and copies of the master datas of the respective companies as downloaded from the official website of the Ministry of Corporate Affairs, Government of India. Further, for establishing the genuineness of share capital transactions, in respect of each of the shareholders, the assessee has also furnished copies of letters of confirmation duly given by the concerning shareholders confirming the transactions of investment by them in the share capital of the assessee company. For establishing the creditworthiness of shareholders, the assessee has furnished copies of the statement of affairs/ copies of audited financial statements of the shareholders for the relevant years, copies of the abstracts of the bank statements of the assessee showing receipt of share capital money through banking channel and as also, copies of the relevant bank statements of the shareholders reflecting the remittance of funds from their respective bank accounts to the assessee through banking channels. Further, the assessee has also furnished necessary documentary evidences for establishing the sources of funds in the hands of the shareholders for making investment in the assessee company by way of share capital/share application. We find that all the documents are duly placed in the Paper Books of the assessee for various assessment years filed before us. 14.8 We find that the assessee is a private limited company which is engaged in the business of generation and transmission of power through wind mills. From the audited financial statements of the assessee for the assessment year 2016-17, we found that the assessee company has shown to have made substantial investment in Wind Turbine Generator and has also shown substantial power generation receipts. We also find that the total cost of the project of the assessee company, uptill 31.03.2016 was to the extent of Rs.69.91 crores and for meeting the cost of the project, the assessee had availed substantial secured loans from banks and Rural IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 113 of 121 Electrification Corporation. The remaining requirement of the funds were out of the share capital funds aggregating to a sum of Rs.24.18 crores arranged by the assessee from various sources in various years and further, by way of making borrowing of unsecured loans to the extent of Rs.7.68 crores. The very purpose of giving the above details is to examine as if the assessee company was a company in which any person of ordinary prudence would make any investment. So, in our view, the assessee company could have been a worth investing company at the relevant time. We also find that the entire share capital has been raised by the assessee company by issuing its shares on face value only without charging or receiving any security premiums, which is a unique feature prevailing with the companies accepting non-genuine share capital. In our considered view, when the shares are not issued at a premium, the probabilities of showing the allotment of shares in the name of strangers without actual receipt of any funds are minimized. 14.9 We find that in the instant case, the AO has made addition merely on the basis of entries found recorded in the regular books of account of the assessee company itself. We find that the findings of the AO are contradictory to each other. At one place, we find that the AO has mentioned that the sources of shareholders are not getting established and at other place, by making a reference of the report of the Special Auditors and various flow charts, the AO himself is not only giving the name of the shareholders but also the sources of availability of funds in the hands of such shareholders. 14.10 We find that in the entire body of the assessment order, the AO has not made reference of any material or document which can be said to be incriminating in nature and wherefrom an adverse inference could have been drawn in respect of the share capital transactions. We also find that despite the assessee’s furnishing the complete details about the whereabouts of the shareholders by furnishing the documentary evidences and thereupon making a specific request to the AO, the AO did not conduct any independent enquiry by himself from any of the shareholders. In the body of the assessment order, the AO has made detailed discussion on the funds procured by various group assessees from another group company namely Saviour CommotradePvt. Ltd. (SCPL). We find that in respect of such SCPL, the AO has also made separate additions under section 68 of the Act qua the unsecured loans taken by the assessee company from SCPL and while giving our finding in the preceding paras, we havealready held that such company, belonging to the assessee group itself, cannot be termed to be a paper company and it was having substantial explained sources of funds for making investment in the assessee company or for that matter, for providing loan to any person. Thus, in our view, the findings given by the AO in respect of SCPL are not relevant for the issue in hand. Likewise, we find that the findings given by the AO in respect of Global Trade VenturesPvt. Ltd. another group company of the assessee’s group, are also not germane IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 114 of 121 to the issue in hand. We find that so far as seven outsider Delhi based companies are concerned, all such companies have been found to have made investment in the assessee company only out of the equivalent funds received by them from the other group companies and therefore, for the purpose of examining the present issue, the analysis of financial status of such companies is also not much relevant. We find that in the body of the assessment order, the AO has made reference of one judgement of Hon’ble Supreme Court in the case of NRA Iron & Steel Pvt. Ltd. (supra) order dated 05/03/2019butwe find that the assessee by way of its written submissions at para (9) for A.Y. 2013-14 before the ld. CIT(A) has rightly made a distinction between the facts of case of NRA Iron & Steel Pvt. Ltd.(supra) from that of the assessee’s case. We find that the various distinguishing features between the case of the assessee company and the case of NRA Iron & Steel Pvt. Ltd.(supra) have been reproduced by the ld. CIT(A) in his Order at page no. 43 and 44. We have carefully considered the facts of the case of the assessee and found them to be clearly distibguishable with that of NRA Iron & Steel Pvt. Ltd.(supra) and therefore, in our considered view, the ld. AO was not correct in his approach in applying the ratio of NRA Iron & Steel (supra) in the assessee’s case. 14.11 Now, on merits, we would be dealing with all the transactions of share capital aggregating to a sum of Rs.24,17,10,000/- received by the assessee from various shareholders in A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015-16 & A.Y. 2016-17, in respect whereof the AO has invoked the provisions of section 68 of the Act and has made the impugned additions. Alike the ld. CIT(A), we would also be dealing with category-wise shareholders. In the first category, those shareholders fall which are the individual assessees of the assessee’s group itself. These assessees are either the directors of the assessee company or their family members who jointly reside under a common roof. We find that in respect of all such assessees, namely Shri Awadhesh Dixit, Shri Hradayesh Dixit and Smt. Surekha Dixit, the assessee had accepted share capital aggregating to a sum of Rs.3,45,30,000/- in A.Y. 2013-14, Rs.1,14,30,000/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.67,06,000/- in A.Y. 2016-17, thereby aggregating to a sum of Rs.5,55,47,300/- in all the four assessment years. The assessment year wise and the shareholder wise details have been furnished by the AO himself in the body of the assessment order. We find that in the case of all the above named shareholders, in pursuance of the search under s.132, simultaneous assessments u/s. 153A have been made by the same AO.We find that in respect of these shareholders, being the family members of the directors of the assessee company, the identity cannot be disputed. The transactions with such family members having taken place through banking channels, the genuineness of the transactions cannot be disputed and finally, while making the assessment in the hands of the shareholders u/s. 153A, the creditworthiness of the shareholders must have already been examined by the same AO. We find that wherever the AO found that such shareholders had procured some unsecured loans IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 115 of 121 for which according to the AO, no satisfactory explanation was given, the AO has made separate additions in respect of such shareholders. From the documents placed on record, we find that all the transactions had taken place through banking channels which are getting duly appeared in the bank statements of the shareholders as well as in the bank statements of the assessee. We also find that in none of the cases, before remitting the funds towards share capital in the assessee company, any cash deposit was made by any of the shareholdersin his/her bank account. We also find that even the Special Auditors in their Report, which has also been extracted by the AO at para (8.41) of the assessment Order, have not only mentioned the name of the shareholders but has also mentioned the sources of funds in the hands of the shareholders for making investment in share capital of the assessee company. In such situation, we find that the assessee company could be able to fully discharge its onus of proving the identity of the shareholders, the genuineness of the share capital transactions, the creditworthiness of the shareholders and as also, the sources of funds in the hands of the shareholders for making investment in the assessee company. In such circumstances, in our considered opinion, there was absolutely no justification for the AO to make any addition, amounting to Rs.3,45,30,000/- in A.Y. 2013-14, Rs.1,14,30,000/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.67,06,000/- in A.Y. 2016-17, thereby aggregating to a sum of Rs.5,55,47,300/- in all the four assessment years, in respect of the above category of the shareholders and accordingly, in respect of such shareholders, we uphold the action of the ld. CIT(A). 14.12 In the second category, only one shareholder falls who is Shri Rajeev Kumar Dubey S/o. Shri Purshottam Dubey R/o. C-158, Bakhtawar Ram Nagar, Indore [PAN – AEZPD9704P], who is one of the close associatesof the assessee’s group but in respect of such shareholder, neither any search u/s. 132 nor any assessments u/s. 153A have been framed. We find that the above named person is one of the directors in SCPL which is one of the group companies of the assessee’s group. The assessee has accepted the share capital amounting to Rs.53,80,000/- from the above named Shri Rajeev Dubey in only one assessment year viz. A.Y. 2013-14. We find that the necessary documents in relation to acceptance of share capital, as were undisputedly also filed before the authorities below, have also been filed by the assessee before us in its Paper Book for A.Y. 2013-14 at page no. 375 to 380-B. We find that the assessee has furnished a copy of PAN Card of the shareholder, copy of letter of confirmation duly given by the shareholder, copy of acknowledgment of income tax return of shareholder for A.Y. 2013- 14, copy of the relevant abstract of the bank statement of the shareholder and as also, copy of the relevant bank statement of the assessee. Further, We find that the assessee has claimed that the subject shareholder namely Shri Rajeev Dubey had taken loans from SCPL for making investment in the assessee company and in support of such assertion, the assessee has furnished a copy of account of Shri Rajeev Dubey, duly signed, given by the SCPL for the financial year 2012-13 in the books of account of such SCPL at IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 116 of 121 page no. 380-A and 380-B of its Paper Book for A.Y. 2013-14. Thus, in our considered view, by furnishing all the aforesaid documents, the assessee could be able to establish the identity of the shareholder. We further find that from the copy of letter of confirmation duly signed by the shareholder, copy of the relevant abstract of the bank account of the shareholder and further, considering that all the share capital transactions have been carried out through banking channels which were duly found in the bank statements of the assessee as well as the shareholder, in our view, the assessee could be able to establish the genuineness of the share capital transactions claimed by it with Shri Rajeev Dubey. Further, we find that by furnishing the copies of income tax return and further, by furnishing the copy of his statement of account in the books of SCPL wherefrom he had taken the funds through banking channels, in our view, the assessee company could be able to discharge its onus of even proving the creditworthiness of Shri Rajeev Dubey. We find that in the instant case, the assessee has not only established the sources of cash credits, but, going one step further, it has also established sources of the sources i.e. the sources of availability of funds in the hands of Shri Rajeev Dubey which can also not be disbelieved. Further, from the copy of the bank statement of the Shri Rajeev Dubey with the Axis Bank Ltd, we find that in such bank statement, making of investment of Rs.53,80,000/- by Shri Rajeev Dubey on various dates through RTGS is getting clearly reflected. From such bank statement, we find that before remitting the funds, Shri Rajeev Dubey had received funds not by way of any cash deposits but, through banking channels which according to the assessee were received by Shri Rajeev Dubey out of loans taken from SCPL. We find that during the course of the search, no incriminating material in respect of Shri Rajeev Dubey was found or seized. We find that neither at the stage of assessment or remand proceedings, nor before us, the various documentary evidences furnished by the assessee could be rebutted or any defect or discrepancy could be pointed out Accordingly, in our considered view, the addition of Rs.53,80,000/- made by the AO in the name of Shri Rajeev Dubey, is also not sustainable and accordingly, we find no infirmity in the action of the ld. CIT(A) in deleting the addition made by the AO in respect of the aforesaid shareholder. 14.13 In the third category, we find that only one shareholder falls which is a company named and titled as Madhya Pradesh Today Media Pvt. Ltd. (in short, ‘MPTMPL’), which again is one of the group companies of the assessee’s group but in respect of such company, as we have been given to understand, neither any search u/s. 132 nor any assessments u/s. 153A have been framed. We find that from the above named company, the assessee has accepted the share capital amounting to Rs.84,36,700/- in only one assessment year viz. A.Y. 2014-15. We find that the necessary documents in relation to acceptance of share capital have been filed by the assessee at page no. 431 to 507 of its Paper Book for A.Y. 2014-15. We find that the above named shareholder company was originally incorporated as a private limited company, by the Registrar of Companies, Madhya Pradesh, IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 117 of 121 under the Companies Act, 1956, with Company Identification No. U22120MP2010PTC024758 of 2010-11 on 18/11/2010. Subsequently, the company got itself converted into a public limited company vide the fresh Certificate of Incorporation granted by the ROC, MP on 05/07/2017. From the abstract of the master data of the company as abstracted from the official website of the Ministry of Corporate Affairs, Government of India, as filed before us at page no. 479of the assesse’s Paper Book for A.Y. 2014-15, we find that in the ROC records, such company has been shown as an Active company, having its registered office at ‘5, Press Complex, M.P. Nagar, Zone-1, Bhopal’. It was submitted before us by the assessee that such company is a media company which is engaged in publishing an accredited evening newspaper with several editions titled as ‘Pradesh Today’. We also find that as per the master data of the above named company, as per its audited balance sheet, it was having authorized capital and paid up capital of Rs.5,51,00,000/- and Rs.4,56,80,000/- respectively. Further, we found that in such company, there are seven directors out of which four directors belonged to the assessee’s group assessees. We find that the assessee has furnished a copy of certificate of incorporation of the MPTMPL, Certificate of conversion from private limited company to public limited company, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2014-15, copy of the master data downloaded from the official website of the MCA, copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the MPTMPL, copy of the audited financial statements of the MPTMPL showing the net owned funds of the MPTMPL as on 31/03/2014 at Rs.1,28,08,217/-, in its Paper Book for A.Y. 2014-15 from page nos. 431 to 507. On a perusal of the audited financial statements of MPTMPL, we find that such company has shown revenue from operations for the financial year 2013-14 at Rs.15,68,15,118/- from circulation sales and advertisement, placed at page no. 494 of the Paper Book for A.Y. 2014-15. Thus, in our considered view, by furnishing all the necessary documents, such as the certificate of incorporation of the MPTMPL, its copy of Memorandum and Articles of Association, copy of acknowledgement of its income tax return for A.Y. 2014-15, copy of the master data downloaded from the official website of the MCA, the assessee could be able to establish the statutory as well as the physical identity and existence of the MPTMPL. We further find that from the copy of letter of confirmation duly signed by one of the directors of the company, copy of the relevant abstract of the bank account of the MPTMPL and further, considering that all the share capital transactions have been carried out through banking channels which were duly found in the bank statements of the assessee as well as the shareholder company, in our view, the assessee could be able to establish the genuineness of the share capital transactions claimed by it with MPTMPL. Further, we find that by furnishing the copies of audited financial statements of the MPTMPL, showing the sufficient net owned funds of MPTMPL, in our view, the assessee company could be able to discharge its onus of even proving the creditworthiness of the MPTMPL. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 118 of 121 We find that in the instant case, the assessee has not only established the sources of cash credits, but, going one step further, it has also established sources of the sources i.e. the sources of availability of funds in the hands of MPTMPL can also not be disbelieved. Further, from the copy of the bank statement of the MPTMPL with the Bank of Maharashtra, as placed at page no. 484 to 486of the assesse’s Paper Book for A.Y. 2014-15, we find that in such bank statement, making of investment of Rs.84,36,700/- on various dates through RTGS is getting clearly reflected. From such bank statement, we find that before remitting the funds, the MPTMPL had received funds not by way of any cash deposits but, through banking channels which according to the assessee were received by the MPTMPL out of its business operations only.We find that during the course of the search, no incriminating material in respect of the MPTMPL was found or seized. Accordingly, in our considered view, the addition of Rs.84,36,700/- made by the AO in the name of MPTMPL is also not sustainable and accordingly, we find no infirmity in the action of the ld. CIT(A) in deleting the addition made by the AO, u/s. 68 of the Act, in respect of such shareholder. 14.14 We find thatin the fourth category, those shareholders fall which are the corporate assessees of the assessee’s group itself. We find that these assessees are the private limited companies duly registered under the Companies Act. We find that in this category, there fall two companies, namely M/s. Global Realcon Pvt. Ltd. and M/s. Global Tradeventures Pvt. Ltd. As per the AO, the assessee had accepted share capital aggregating to a sum of Rs.5,10,00,000/- in A.Y. 2014-15 and Rs.52,20,000/- in A.Y. 2016- 17 thereby aggregating to a sum of Rs.5,62,20,000/- in two assessment years. The assessment year wise and the shareholder wise details have been given by the AO in the body of the assessment order itself. We find that in the case of both the above named shareholders, in pursuance of the search under s.132, simultaneous assessments u/s. 153A have been made by the same AO. We find that in respect of these shareholders, being the group companies of the assessee company, the identity cannot be disputed. The transactions having taken place through banking channels, the genuineness of the transactions cannot be disputed and finally, while making the assessment in the hands of the shareholders u/s. 153A, the creditworthiness of the shareholders have already been examined by the same AO. We find that wherever the AO found that such shareholders had procured some unsecured loans for which according to the AO, no satisfactory explanation was given, the AO has already made separate additions in respect of such shareholders. From the documents placed on record, we find that all the transactions had taken place through banking channels which are getting duly appeared in the bank statements of the shareholders as well as in the bank statements of the assessee. We also find that in none of the cases, before remitting the funds towards share capital in the assessee company, any cash deposit was made by any of the shareholders in their respective bank accounts. We also find that even the Special Auditors in their Report, which has also been extracted by the AO at IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 119 of 121 para (8.41) of the assessment Order, have not only mentioned the name of the shareholders but has also mentioned the sources of funds in the hands of the shareholders for making investment in share capital of the assessee company. Furthermore, the Special Auditors in the Annexure-C annexed to and forming part of their Report, have also given the details of inter-group entities flow of funds and from such Report, the sources of funds from one group entity to another group entity can also be verified to some extent. In such situation, we find that the assessee company could be able to discharge its onus of proving the identity of the shareholders, the genuineness of the share capital transactions, the creditworthiness of the shareholders and as also, the sources of funds in the hands of the shareholders for making investment in the assessee company. We find that before us, the ld. CIT(DR) neither found any defect or discrepancy in the various documentary evidences furnished by the assessee, in respect of the subject shareholders nor, any of the factual findings given by the ld. CIT(A) could be rebutted by him. In such circumstances, in our considered opinion, there was absolutely no justification for the AO to make any addition, amounting to Rs.5,10,00,000/- in A.Y. 2014-15 and Rs.52,20,000/- in A.Y. 2016-17, thereby aggregating to a sum of Rs.5,62,20,000/- in the two assessment years, in respect of the above category of the shareholders and thus, we find no infirmity in the action of the ld. CIT(A) in deleting the addition made by the AO u/s. 68 of the Act in respect of the above named shareholders. 14.15 We find thatin the fifth category, those shareholders fall which are the corporate assesses not belonging to the assessee’s group and which have made investment in the share capital of the assessee company out of the funds procured by them from the group companies of the assessee themselves. We find that these assessees are the private limited companies duly registered under the Companies Act. We find that in this category, there fall seven companies, namely (i) M/s. Beatle Trading Pvt. Ltd., (ii) M/s. Kalyani Barter Pvt. Ltd., (iii) M/s. Marubhumi Dealer Pvt. Ltd., (iv) M/s. Plus Corporate Ventures Pvt. Ltd., (v) M/s. Parinidhi Commerce Pvt. Ltd., (vi) M/s. Tarun Tieup Pvt. Ltd. and (vii) M/s. Yuthika Commercial Pvt. Ltd. From such companies, the assessee had accepted share capital aggregating to a sum of Rs.11,62,16,000/- in A.Y. 2016-17. The shareholder wise details have been compiled by the AO in the body of the assessment order itself.We find that out of seven shareholder companies, in respect of four companies serialized above as (ii), (iii), (v) & (vi), the AO himself at para (8.29) of the assessment Order, by way of giving a trail of funds, has given the sources of availability of the funds in the hands of the shareholder companies being the funds transferred by M/s. Global Realcon Pvt. Ltd., one of the group companies of the assessee. Further, from the various documents placed on record, we find that the remaining three companies serialized at above as (i), (iv) & (vii), namely M/s. Beatle Trading Pvt. Ltd., M/s. Plus Corporate Ventures Pvt. Ltd. and M/s. Yuthika Commerical Pvt. Ltd. respectively had invested a sum of Rs.1,72,94,000/-, Rs.1,72,94,000/- and Rs.1,03,73,000/- IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 120 of 121 out of the equal funds received by them from M/s. Global Tradeventures Pvt. Ltd. which is another group company of the assessee. We find that during the course of the assessment proceedings as well as during the course of the appellant proceeding before the ld. CIT(A), the assessee had furnished all the necessary documents, separately in respect of each of the above said seven companies, such as copies of certificate of incorporation of the companies,copies of Memorandum and Articles of Association, copy of acknowledgement of its income tax returns for A.Y. 2016-17, copies of the master data downloaded from the official website of the MCA, copies of letter of confirmation duly signed by the respective directors of the companies, copies of the relevant abstract of the bank accounts of the shareholder companies showing the transactions of remittance of funds to the assessee company, copies of relevant bank statements of the assessee showing the receipts of the funds from the aforesaid companies, copies of the audited financial statements of the companies as of 31.03.2016. Copies of all these documents have also been furnished by the assessee before us in its Paper Book for A.Y. 2016-17 at page no. 312 to 724. Further, in order to establish the sources of availability of funds in the hands of each of the shareholder companies, the assessee has also furnished the bank statements of the group companies wherefrom the transfer of funds from such group companies to the shareholder companies are getting clearly reflected. The assessee has also furnished relevant documentary evidences of the group companies for establishing their identity and their creditworthiness for providing funds to the shareholder companies who in turn, provided funds to the assessee company. We find that in respect of these shareholders, the identity cannot be disputed. The transactions having taken place through banking channels, the genuineness of the transactions cannot be disputed. Further, the sources of availability of the funds in the hands of the shareholders, being the receipt of funds from group companies which were separately assessed by the same AO u/s. 153A of the Act, can also not be doubted by any stretch of imagination. In such situation, we find that the assessee company could be able to discharge its onus of proving the identity of the shareholders, the genuineness of the share capital transactions, the creditworthiness of the shareholders and as also, the sources of funds in the hands of the shareholders for making investment in the assessee company. We find that before us, the ld. CIT(DR) could not controvert or point out any defect or discrepancy in the various documentary evidences furnished by the assesses in its Paper Book. In such circumstances, in our considered opinion, there was absolutely no justification for the AO to make any addition, aggregating to a sum of Rs.11,62,16,000/- in A.Y. 2016-17, in respect of the above fifth category of the shareholders and accordingly, we do hereby affirm the action of the ld. CIT(A) in deleting the additions made by the AO u/s. 68 of the Act in respect of the above named shareholders. 14.16 We find that except the shareholders falling in any of the above said five categories, from no other shareholder, the assessee had received share capital in any of the assessment years under consideration. IT(SS)A No.161 to 165/Ind/2020 IT(SS)A No.81 to 84/Ind/2021 Assessment Years: 2013-14 to 2016-17 M/s. Global Metal & Energy Pvt. Ltd. Page 121 of 121 14.17 Thus, in our considered view, there was absolutely no justification for the ld. AO in making the addition under section 68 of the Act in the assessee’s income, on account of share capital, amounting to Rs. Rs.3,99,10,000/- in A.Y. 2013-14, Rs.7,08,66,700/- in A.Y. 2014-15, Rs.27,91,300/- in A.Y. 2015-16 and Rs.12,81,42,000/- in A.Y. 2016-17, vide para (8) of the assessment order. Accordingly, we find no infirmity in the action of the ld. CIT(A) in deleting the entire addition for various assessment years made by the AO vide para (8) of his Order in the assessee’s income by invoking the provisions of section 68 of the Act. Resultantly, Ground No. 1 of the Revenue for A.Y. 2013-14, A.Y. 2014-15, A.Y. 2015-16 and A.Y. 2016-17 is hereby Dismissed. 15. Ground No. 3 of the Assessee for A.Y. 2017-18 15.1 Through the Ground No.3 taken for A.Y. 2017-18, the assessee has challenged the action of the ld. CIT(A) in upholding the AO’s action for invoking the provisions of s.115BBE of the Act in respect of disallowance of interest on unsecured loans. 15.2 Before us, the counsel of the assessee has not pressed this Ground and therefore, the same is hereby dismissed. 16. In the result, the appeals of the Revenue are dismissed whereas the appeals of the assessee are partly allowed in terms of the findings indicated above . The order pronounced as per Rule 34 of ITAT Rules, 1963 on 26.04.2022. Sd/- Sd/- (MAHAVIR PRASAD) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER दनांक /Dated : 26.04.2022 Patel/Sr. PS Copy to: The Appellant/Respondent/CIT concerned/CIT(A) concerned/ DR, ITAT, Indore/Guard file. By Order, Asstt.Registrar, I.T.A.T., Indore