MALLESH PATEL YADAV RAJU THAGILLA,SAMALAPALLY V. ITO., WARD-1, SIDDIPET

ITA 702/HYD/2025

AI Insights

The case involves an appeal by Shri Mallesh Patel Yadav Raju Thagilla against the order of the CIT(A) - National Faceless Appeal Centre, which sustained the addition of Rs. 8,40,000 to the assessee's income for the assessment year 2020-2021 under section 68 of the Income Tax Act, 1961. The addition was initially made by the Assessing Officer due to the assessee's failure to provide evidence for loans claimed. The Tribunal examined the evidence presented, including bank statements and confirmations from creditors, and found that the assessee had satisfactorily proved the source of some loans, leading to a partial relief in the additions made.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 708357 (ITAT-HYDERABAD)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2025
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Assessment Year: 2020-2021
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PAVITRAN KUMAR J.
• Assessee Lawyers: T. RAJENDRA PRASAD
• Keywords: Additional evidence
• Section: 68; 6

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “SM-B” BENCH: HYDERABAD BEFORE SHRI VIJAY PAL RAO, VICE PRESIDENT AND SHRI MANJUNATHA G, ACCOUNTANT MEMBER ITA.No.702/Hyd./2025 Assessment Year 2020-2021 Shri Mallesh Patel Yadav Raju Thagilla, Samalapally, Nemtoor (v), Warangal (M) PAN AWZPT5206E vs. The Income Tax Officer, Ward-1, SIDDIPET – 502 334. (Appellant) (Respondent) For Assessee : CA, T. Rajendra Prasad For Revenue : Sri Pavitran Kumar J. Sr. AR Date of Hearing : 10.07.2025 Date of Pronouncement : 16.07.2025 ORDER PER MANJUNATHA G. : The above appeal has been filed by the Assessee against the Order dated 14.02.2025 of the learned CIT(A)- National Faceless Appeal Centre [in short the “NFAC”] Delhi, relating to the assessment year 2020-2021. 2. Briefly stated facts of the case are that, the assessee is an individual and has filed return of income for 2 ITA.No.702/Hyd./2025 the assessment year 2020-20 2021 on 06.01.2021 declaring Rs.NIL income. The case was selected for scrutiny. During the course of assessment proceedings, the Assessing Officer noticed that, the assessee has shown loan of Rs.8,40,000/-. The Assessing Officer called-upon the assessee to file relevant evidences in respect of loans availed during the financial year 2019-2020. Since the assessee could not file any evidence, the Assessing Officer made addition of Rs.8,40,000/- under section 68 of the Income Tax Act, 1961 [in short \"the Act\"]. 3. The assessee carried the matter in appeal before the learned CIT(A). Before the learned CIT(A), the assessee has filed certain additional evidences including confirmation from parties along with other evidences. The learned CIT(A) after considering relevant submissions of the assessee and also taking note of provisions of section 68 of the Act, sustained the addition made by the Assessing Officer on the ground that, the assessee was failed to prove the Identity of the creditors, capacity of the creditors two advance money and genuineness of the transaction. 3 ITA.No.702/Hyd./2025 4. Aggrieved by the order of the learned CIT(A) the assessee is now, in appeal before the Tribunal. 5. CA, T Rajendra Prasad, Learned Counsel for the Assessee submitted that, the learned CIT(A) erred in sustaining the addition towards loans u/sec.68 of the Act without appreciating the fact that, the assessee has filed relevant evidences, including confirmation from the parties. Learned Counsel for the Assessee submitted that, the assessee has taken loans from four parties. In respect of loan taken from M/s. Bhavani Ads and loan from Mr. Ramulu, the assessee has filed confirmations along with bank statements and also ITR filed by the relevant creditors. In respect of loan from Mr. Krishna, the assessee submitted that loan amount is very small in nature and received out of personal savings of the creditor. Similarly, the assessee has taken loan from MS. Swetha, for which, Aadhar card is furnished. Although, the assessee has furnished these documents before the learned CIT(A), but the learned CIT(A) without considering the relevant evidences, has simply sustained the addition made by the Assessing Officer. 4 ITA.No.702/Hyd./2025 Therefore, he submitted that, the addition made by the Assessing Officer should be deleted. 6. Shri Pavitran Kumar J. learned Sr. AR, on the other hand, supporting the order the learned CIT(A) submitted that, before the Assessing Officer, the assessee could not file any evidence. Before the CIT(A), the assessee has filed partial information. However, could not substantiate the creditworthiness of the creditors. Therefore, in absence of relevant details, the learned CIT(A) has rightly sustained the addition made by the Assessing Officer and, therefore, the order of the Assessing Officer should be upheld. 7. We have heard both the parties, perused the material on record and gone through the orders of the authorities below. We find that, the assessee had taken loan of Rs.8,40,000/- from 4 parties. The assessee received Rs.5 lakhs from M/s. Bhavani Ads and the same has been received through RTGS. For this purpose, the assessee has filed bank account of the assessee and the bank account of the creditor. The assessee had also filed confirmation from 5 ITA.No.702/Hyd./2025 M/s. Bhavani Ads along with their ITR filed for the relevant assessment year. On perusal of the relevant details filed by the assessee, we find that, the assessee has discharged his onus by filing all evidences and satisfied the ingredients of section 68 of the Act. Therefore, the addition made by the Assessing Officer towards loan received from M/s. Bhavani Ads to the extent of Rs.5 lakhs cannot be sustained. We direct the Assessing Officer to delete the addition of Rs.5 lakhs. 8. The assessee has received Rs.2,50,000/- from Mr. Ramulu, out of which, Rs.2 lakhs received through RTGS. For this purpose, the assessee has filed relevant bank account of the creditor and also the assessee. The assessee had also filed Pattadar Passbook for agriculture land holding. From the details filed by the assessee, we find that, assessee has discharged onus and satisfied the ingredients provided under section 68 of the Act in respect of loan of Rs.2 lakhs received from Mr. Ramulu. Therefore, we direct the Assessing Officer to delete the addition to the extent of Rs.2 lakhs received from Mr. Ramulu. In so far as the 6 ITA.No.702/Hyd./2025 balance amount of Rs.50,000/- received from Mr. Ramulu, the assessee could not file any evidence. Therefore, we direct the Assessing Officer to sustain the addition to the extent of Rs.50,000/- in the hands of the assessee towards loan received from Mr. Ramulu. 9. In respect of loan received from Mr. Krishna for Rs.50,000/- and loan received from MS. Swetha for Rs.40,000/-, the assessee could not file any evidences, be that, confirmations or bank statements. Therefore, in our considered view, the assessee could not satisfy the conditions provided under section 68 of the Act and, therefore, the Assessing Officer has rightly made the impugned additions towards loan received from Mr. Krishna and MS. Swetha. Thus, we uphold the additions made by the Assessing Officer towards loan received from Mr. Krishna Rs.50,000/- and for Rs.40,000/- from MS. Swetha. 10. To sum up, out of additions made by the Assessing Officer towards loan of Rs.8,40,000/- the assessee gets relief to the extent of Rs.7 lakhs and the balance amount of Rs.1,40,000/- is sustained. 7 ITA.No.702/Hyd./2025 11. In the result, appeal of the assessee is partly allowed. Order pronounced in the open Court on 16.07.2025. Sd/- Sd/- [VIJAY PAL RAO] [MANJUNATHA G] VICE PRESIDENT ACCOUNTANT MEMBER Hyderabad, Dated 16th July, 2025 VBP Copy to 1. Shri Mallesh Patel Yadav Raju Thagilla, S/o. Anjaiah T, 8-3/1, Samalapally, Nemtoor (v), Warangal (M), Siddipet District, Telangana. 2. The Income Tax Officer, Ward-1, Income Tax Office, 4th Floor, 8-1-44, Krishna Reddy Chambers, Hyderabad Road, Siddipet Town, SIDDIPET – 502 334. Telangana. 3. The Pr. CIT, Hyderabad. 4. The DR ITAT “SM-B” Bench, Hyderabad. 5. Guard File. //By Order// //True Copy// "