PRAVINBHAI MAHADEVBHAI AMBANI,MORBI V. ASSISTANT COMMISSIONER OF INCOME TAX, MORBI

ITA 231/RJT/2025

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The case involves Pravinbhai Mahadebhai Ambani, who is the proprietor of Digvijay Coal Industries, engaged in coal trading and other income-generating activities. For the Assessment Year 2017-18, the assessee declared a total income and agricultural income in his tax return. The case was selected for scrutiny, and during the assessment, the Assessing Officer raised concerns about the unsecured loans received by the assessee, totaling Rs. 5,18,96,036, and the source of cash deposits during the demonetization period. The Assessing Officer rejected the claim of unsecured loans amounting to Rs. 1,19,49,000 due to insufficient evidence of genuineness and creditworthiness. The assessee's appeal to the CIT(A) was partly unsuccessful, leading to the current appeal before the Tribunal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 831402 (ITAT-RAJKOT)
• Duration Of Justice: 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2026
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 11-04-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHIMANYU SINGH YADAV; LD.
• Assessee Lawyers: CHETAN AGARWAL; LD
• Section: 143(3); 68; 69

Judgement Text

" आयकर अपीलȣय अͬधकरण, राजकोट Ûयायपीठ, राजकोट। IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND DR. DINESH MOHAN SINHA, JUDICIAL MEMBER आयकर अपील सं /.ITA No.231/RJT/2025 Ǔनधा[रणवष[ / Assessment Year: 2017-18 Pravinbhai Mahadebhai Ambani Prop. Of Digvijay Coal Industries, Pachvati Society, B/H, Kanya Chhatralaya, Samala Road, Morbi – 363641 PAN No. : ABIPA6387K बनाम Vs. Assisstant Commissioner of Income Tax, Income Tax Office, Aayakar Vibhag, J.K. Chamber National Highway-8, At Lalpar Morbi – 363642 (अपीलाथȸ/Appellant) : (Ĥ×यथȸ/Respondent) Ǔनधा[ǐरती कȧ ओर से/Assessee by : Shri Chetan Agarwal, Ld. AR राजèव कȧ ओर से/Revenue by : Shri Abhimanyu Singh Yadav, Ld.Sr.DR सुनवाई कȧ तारȣख /Date of Hearing : 08/10/2025 घोषणा कȧ तारȣख /Date of Pronouncement : 19/01/2026 ORDER Per, Dr. Dinesh Mohan Sinha, JM: Captioned appeal filed by assessee pertaining to Assessment Year 2017- 18, is directed against the order passed under section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) by the Learned Commissioner of Income-tax (Appeal), (in short ‘Ld.CIT(A)’), dated 21.03.2025, which in turn arises out of assessment order passed by Assessing Officer u/s. 143(3) of the Act on 27.12.2019. Printed from counselvise.com ITA No.231/Rjt/2025 Pravinbhai M. Ambani Page 2 of 6 2. The grounds of appeal raised by the assessee are as under: “The Ld.CIT(A) erred in law as well as on fact in upholding an addition of Rs.1,19,49,000/- made by Ld. AO u/s. 69 of the Act.” 3. The brief facts of the case are that the assessee individual engaged in the business of trading in coal under the name and style of proprietorship M/s. Divyaraj Coal Industries, during the year under scrutiny. Apart from that the assessee has also earned interest income & share in profit from partnership firm M/s. Mahendra Builders. Moreover, the assessee also earned interest income from bank. The assessee e-filed Return of Income for AY 2017-18 on 31.10.2017 declaring total income of Rs. 42,61,970/- plus Agricultural income of Rs.3,86,455/-. The return of income was processed u/s. 143(1) of the Income Tax Act. The case was selected for scrutiny through CASS. A notice u/s. 143(2) of the Act issued on 25.08.2018. In response to the notices issued, the assessee has e-filed his written submission on various dates. The assessee has submitted copy of audited accounts for AY 2017-18, details of bank accounts, details of unsecured loans accepted/repaid, explanation regarding personal expenditure, details of agri. income & expenses along with copy of 7/12 & 8A, copies of sales invoices etc. The details so filed have been duly considered and kept on records. During the course of assessment proceedings, the assessee was requested to furnish the copies of Ack. of ITR, bank statements, Balance sheet, duly signed ledger/contra ledger etc. in respect of persons from whom unsecured loans amounting to Rs.5,18,96,036/- have been accepted during the year. The assessee has only filed copies of unsigned ledger in some cases, copies of ITR in some cases and copies of bank statements in 02 cases etc. in very casual manner. Therefore, the identity, genuineness and creditworthiness of the lenders were not established. Thus, the assessee has not discharged its primary onus in this regard. On perusal of details available on record, it was seen that the assessee has repaid unsecured loans amounting to Rs.1,79,86,521/- to 04 persons during the year. Printed from counselvise.com ITA No.231/Rjt/2025 Pravinbhai M. Ambani Page 3 of 6 However, nothing has been filed by the assessee regarding its source. On perusal of details available on record, it was seen that the assessee has deposited cash amounting to Rs.35,30,500/- in 02 of his bank accounts during demonization period. However, the assessee has failed to explain the source of such cash deposition property. 4. That the Assessment order dated 27/12/2019 was framed by the Ld. AO was as under: 5. Aggrieved by the order of the AO, the assessee came in appeal before the Ld. CIT(A) who had partly allowed the assessee’s appeal by observing as under: “It is further seen from the submission that tone and tenor of the appellant's submission is that documents to substantiate the loans accepted were produced to the extent possible. However, due the fear in mind of the lenders that submission of documents would lead to adverse action their case has made it difficult for appellant to collect documents. It is seen that the appellant fails to discharge onus u/s 68 of the IT Act as discussed in case of each of lender. Hence, the ground of appeal raised fails. The Ground No (1) is rejected.” Printed from counselvise.com ITA No.231/Rjt/2025 Pravinbhai M. Ambani Page 4 of 6 6. Aggrieved by the impugned order of the Ld. CIT(A), the assessee came in appeal before us. 7. During the course of herring, the Learned AR submitted that the assessee submitted written submission before the Ld.CIT(A), whereby the alleged that assessee has submitted all documents relating to assessment however, some parties were not given their details in spite of many request made by the assessee, due to fear of their assessment case may be re-open due to this reasons. It was further submitted that the unsecured loan should not be treated as in-genuine. 8. On the other hand, the Learned DR for the revenue relied on the findings of the Ld.CIT(A). 9. We have heard both the parties and perused the material available on record. We note that before the Ld.CIT(A) the assessee submitted written submission, no documents has been furnished against the unsecured loan, however, in the statement which has been arrived “will provide soon if possible”. the assessee further claimed that the parties who have given loan were not giving the confirmation because of fear that the assessment case may not be re-opened. We further note before the assessing officer the assessee submitted Audited Balance- sheet, detailed expenditure, detail of bank account, detail of unsecured loan, and detail about the personal expenditure incurred during the year. Copies of ITR of the lenders, and ledger copy, the assessing officer observed that detail furnished in respect of unsecured loan is very casual manner. The assessing officer has rejected the claim of unsecured loan amounted of Rs.1,19,49,000/- from the 12 different parties, name of the parties given below:  Sanjaybhai Sanariya  Rameshbhai Vashrambhai Printed from counselvise.com ITA No.231/Rjt/2025 Pravinbhai M. Ambani Page 5 of 6  Pritiben M Kanabar  Sureshbhai G. Boricha  Rambhai P Boricha  Ravibhai N. Solanki  Vikkibhai (Virenddra Aravdia)  Payal Fashion (Vallabhbhai A Savaliya)  Mahadevbhai Naranbhai  Shivlal N Rankja  Jatinbhai A Kagathara  Bhavikbhai 9. In the above unsecured loan, the assessee could not established the genuineness of transaction and creditworthiness of the parties before the Ld. AO. We further note that before the Ld.CIT(A) the assessee file only written submission, no documentary evidences has been placed before the Ld.CIT(A) in respect of genuineness of transaction and creditworthiness of the parties. However, we are of the view that the assessing officer, as well as the Ld.CIT(A) has not taken care to verify the genuineness of the transaction of the assessee. That an independent inquiry should be conducted by the lower authority u/s.133(6) is reproduced for kind reference: “require any person\", including a banking company or any officer thereof, to furnish information in relation to such points or matters, or to furnish statements of accounts and affairs verified in the manner specified by the \"[Assessing] Officer, the [Deputy Commis sioner (Appeals)] [, the [Joint Commissioner] or [the Joint Com-missioner (Appeals) or] the Commissioner (Appeals)], giving informa-tion in relation to such points or matters as, in the opinion of the 16 [Assessing] Officer, the \"[Deputy Commissioner (Appeals)] [, the [Joint Commissioner] or [the Joint Commissioner (Appeals) or] the Commissioner (Appeals)], will be useful for, or relevant to, any [enquiry or] proceeding under this Act” Printed from counselvise.com ITA No.231/Rjt/2025 Pravinbhai M. Ambani Page 6 of 6 10. After considering the facts and circumstances of the case, in the interest of justice, we are of the view that one more opportunity should be given to the assessee as well as to the Department to establish the genuineness of the transaction and the Ld. AO should conducted do inquiry a pass an assessment according to law. 11. In the result, the appeal filed by the assessee is allowed for statical purpose. Order is pronounced in the open court on 19/01/2026. Sd/- Sd/-p (Dr. Arjun Lal Saini) Accountant Member (Dr. Dinesh Mohan Sinha) Judicial Member राजकोट /Rajkot िदनांक/ Date: 19/01/2026 By order/आदेशसे , /T Assistant Registrar/Sr. PS/PS ITAT, Rajkot Printed from counselvise.com "