TJR PROPERTIES PRIVATE LIMITED,CHANDIGARH V. ASSTT. COMMISSIONER OF INCOME TAX, CHANDIGARH

ITA 994/CHANDI/2025

AI Insights

The case involves cross-appeals by TJR Properties Private Limited and the ACIT Central Circle-2 concerning the assessment year 2018-19. The primary issues revolved around the additions made under Section 68 of the Income Tax Act, 1961, which pertained to unexplained cash credits and unexplained investments. The Tribunal examined the evidences and submissions made during the assessment and appellate proceedings, including the nature and source of the credits in the assessee's bank account. The Tribunal's decision highlighted the distinction between genuine transactions and those lacking substantive evidence, leading to a partial allowance of the assessee's appeal and dismissal of the revenue's appeal.

• Counselvise Citation: [2026] 140 COUNSELVISE.COM (IT) 847961 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-03-2026
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Chandigarh
• Assessment Year: 2018-2019
• Appeal Filed On: 08-08-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: YAMINI LD. VIRTUAL
• Assessee Lawyers: PARIKSHIT AGGARWAL; T.N; ACCEPTING IDENTITY; CREDITWORTHINESS
• Keywords: Unexplained cash credit; Unexplained investment; Capital Gains; TDS; Source of fund
• Section: 147; 148; 143(3); 142(1); 132; 153A; 68; 69; 139; 234B

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, CHANDIGARH HYBRID HEARING BEFORE HON’BLE SHRI RAJPAL YADAV, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM 1. आयकर अपील सं. / ITA No.994/CHANDI/2025 (िनधाŊरण वषŊ / Assessment Year: 2018-19) TJR Properties Private Limited SCO 80-81, Third Floor, Sector-17C, Chandigarh - 160017 बनाम/ Vs. ACIT Central Circle-2, C.R. Building, Sector -17,Chandigarh - 160017 ˕ायीलेखासं./जीआइआरसं./PAN/GIR No. AACCT-8364-R (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) & 2. आयकर अपील सं. / ITA No.1377/CHANDI/2025 (िनधाŊरण वषŊ / Assessment Year: 2018-19) ACIT Central Circle-2, Room No. G02, Ground Floor, C.R. Building, Sector -17 E, Chandigarh - 160017 बनाम/ Vs. TJR Properties Private Limited SCO 80-81, Third Floor, Sector 17C, Chandigarh - 160017 ˕ायीलेखासं./जीआइआरसं./PAN/GIR No. AACCT-8364-R (अपीलाथŎ/Appellant) : (ŮȑथŎ / Respondent) अपीलाथŎकीओरसे/ Appellant by : Sh. Parikshit Aggarwal (CA) and Sh. T.N. Singla (CA) – Ld. ARs ŮȑथŎकीओरसे/Respondent by : Smt. Yamini (CIT) - Ld. DR (Virtual) सुनवाईकीतारीख/Date of Hearing : 04-02-2026 घोषणाकीतारीख /Date of Pronouncement : 24-03-2026 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1.1 Aforesaid cross-appeals for Assessment Year (AY) 2018-19 arises out of an order of learned Commissioner of Income Tax Printed from counselvise.com 2 (Appeals)-3, Gurgaon [CIT(A)] dated 29-07-2025 in the matter of an assessment framed by Ld. Assessing Officer [AO] u/s 143(3) r.w.s. 153B(1)(b) of the Act on 30-12-2019. 1.2 The ground as raised by the revenue read as under: - 1. Whether on the facts and in the circumstances of the case and in law the Ld. CIT(A) erred in not appreciating the fact that the amount of Rs.6,47,72,165/- (3,75,00,000/- +2,72,72,167/-) credited in the bank account of assessee during A.Y. 2012-13 was to be considered as unexplained cash credit u/s 68 of the Act. 2. Whether on the facts and in the circumstances of the case and in law the Ld. CIT(A) erred in not appreciating the fact that the amount of Rs.30,00,000/- has been added by the AO as unexplained investment and no double addition has been made for the same amount of credits. 3. Whether on the facts and in the circumstances of the case and in law the Ld. CIT(A) erred in allowing the appeal of the assessee by accepting identity and creditworthiness of the persons from whom the credit entries have been received and genuineness of the transactions despite the fact that no conclusive justification with regard to genuineness of the transactions with regard to the utilization of the funds generated through credit entries in its bank account have been provided by the assessee either at the assessment proceedings stage or during the appellate proceedings. Thus, all 3 essentials for establishing the transaction to be out of scope of Section 68 has not been fulfilled by the assessee. 1.3 The ground as raised by the assessee read as under: - 1. That the order of Ld. CIT(A) is bad in law and against the facts of the case. 2.That the Ld. CIT(A) has wrongly upheld the assessment proceeding u/s 143(3) r.w.s. 153B(1)(b) of the Income Tax Act, 1961 which is against the provisions of the law as neither any search was conducted on the company nor any Panchnama was prepared in the name of the company. 3. That on the facts and in the circumstances of the case, the Ld. CIT(A) has wrongly upheld assessment order passed u/s 153B of the Act which is wholly illegal and without jurisdiction as no search had been conducted under Section 132 of the Act in any of the business premises of the appellant company. 4. That the Ld. CIT(A) has wrongly upheld additions u/s 68 of the Act simply on the suspicion of genuineness of transactions without mentioning any specific defect in the documents submitted to prove source of the transactions. 5. That the Ld. CIT(A) has wrongly upheld additions of credits in the bank account of assessee company from the following persons: a. Rs. 25,00,000 from M/s Ind Sphinx Precision Limited b. Rs. 29,00,000 from Sh. Jatin Garg c. Rs. 2,00,000 of Cash Deposits d. Rs. 30,00,000 from Sh. T.N. Singla e. Rs. 20,00,000 from Sh. T.N. Singla HUF f. Rs. 49,00,000 from Sh. Sanbir Singh Printed from counselvise.com 3 g. Rs. 40,00,000 from Sh. Sanbir Singh h. Rs. 20,00,000 from Sh. Gurvarinder Singh i. Rs. 30,00,000 from Sh. T.N. Singla j. Rs. 1,10,00,000 from Sh. Sanjit Singh Randhawa k. Rs. 20,00,000 from Sh. Sunil Taneja 6. That the Ld. CIT(A) has wrongly upheld addition of Rs.3,75,00,000/- u/s 68 on surmises and conjectures, without application of own mind. 7. That the Ld. CIT(A) has wrongly upheld disallowance of loss claimed amounting to Rs.8,24,902/-. 8. That the Ld. CIT(A) has wrongly upheld additions made in the hands of the appellant company on the basis of credits in its bank account, regarding which sufficient and credible information including the source by way of evidence had been submitted from discharging its burden. Further these additions are not sustainable in law and no inquiry was undertaken by the Assessing Officer and/or any material brought on record establishing the bank entries as unexplained thereby inviting the application of provisions of the Section 68 of the Act. 9. That the CIT(A) has wrongly upheld addition made by the Ld. AO in the assessment order u/s 143(3) r.w.s. 153(1)(b) of the Act without applying his own mind and merely on the dictates of the third party. 10. That the Ld. CIT(A) has wrongly upheld the assessment u/s 153B of the Act framed in the undue haste, mechanical manner and without application of mind as is evidenced by the documentary evidence on record exchanged between the Assessing Officer as well as ADIT (Inv.), Mohali. 11. That the approval u/s 153D of the Act has been given in undue haste and mechanical manner. 12. That the Ld./ CIT(A) has wrongly upheld penalty proceedings initiated u/s 271AAB(1A)(b) of the Income Tax Act, 1961. 13. That the Ld. Assessing Officer has wrongly charged interest u/s 234A, 234B and 234C of the Act. 14. That the appellant craves leave to add, alter, amend or withdraw any grounds of appeal before the final hearing. 1.4 The Ld. AR as well as Ld. CIT-DR advanced respective arguments and referred to various documents as placed on record. The written submissions have also been filed which have duly been considered. Reference has been made to various judicial decisions including the decision of Tribunal in assessee’s own case for earlier years, the copies of which have been placed in the paper-book. Printed from counselvise.com 4 Having heard rival submissions and upon perusal of case records, the appeals are disposed-off as under. Assessment Proceedings 2.1 The assessee being resident corporate assessee was subjected to search action by the department u/s 132 on 16-02-2018. Accordingly, this year is a search year. The case of the assessee belongs to Punjab Sand Mining Auction group of cases. The assessee filed return of income u/s 139 on 08-10-2018 which was subjected to scrutiny. During assessment proceedings, notices u/s 142(1) were issued by Ld. AO from time to time calling for requisite details from the assessee which were duly been responded to by the assessee. 2.2 The search findings alleged that the assessee as well as another group entity by the name M/s Evershine Resorts Pvt. Ltd. (ERPL) was shell entities and existing merely on paper. These entities did not have any profit-earning apparatus and they were not carrying out any kind of business activities. The said entities were being managed by the Singla family including Shri T.N. Singla and Shri Jagdish Rai Gupta. The share capital, revenue receipts and income shown by the assessee-company during AYs 2012-13 to 2018-19 has been tabulated by Ld. AO at Para-5 of the assessment order. The assessee reflected revenue receipts of Rs.99.17 Lacs in AY 2013-14 whereas the receipts in all the other years were less than Rs.10 Lacs. 2.3 During the course of search, the statement of Shri Jagdish Rai Gupta was recorded on oath wherein he was confronted with assessee’s nature of business activities and revenue operations of Printed from counselvise.com 5 these entities. In reply to Q. No.6, it was stated by him that he acted as a director in the assessee-entity and this entity was established to carry out some commercial activity. In this regard, a commercial plot in Sec.5 Panchkula was already bought in the name of the assessee- entity. In reply to Q. No.7, it was stated by him that since incorporation, the assessee-entity was not involved in any business activity. He also stated that he was not aware of any business transaction or banking transactions as carried out by the said entity in the recent past. 2.4 On the basis of this statement, coupled with assessee’s submissions / replies during the course of assessment proceedings, following inferences were drawn by Ld. AO in para-7 of the assessment order: -  That, Sh. Jagdish Rai Gupta has clearly admitted that his one of the director in M/s TJR Properties Pvt. Ltd. and M/s Evershine Resorts Pvt. Ltd.  He has also stated that these companies were incorporated in 2008.  That, Shri, Jagdish Rai Gupta has clearly stated that M/s TJR properties Pvt. Ltd. is not involved in any kind of business activity. Further, Sh. Jagdish Rai Gupta had denied any knowledge of any business transactions or bank transactions carried out by M/s TJR Properties Pvt. Ltd.  Similarly, in case of M/s Evershine Resorts Pvt. Ltd. also, Sh. Jagdish Rai Gupta had stated that any kind of business activity is not being carried out in this company from the date of its establishment.  That, Sh. Jagdish Rai Gupta has denied any knowledge of any bank transaction of this company also,  That, during the course of his statement, Sh. Jagdish Rai Gupta was specifically confronted with the account statement of (Maharashtra Bank Account No. 60086345369) of M/s TJR Properties Pvt. Ltd but in his reply Sh. Jagdish Rai Gupta stated that he had no knowledge of any bank transactions i.e. debit or credit, carried out this company. He further stated that this company was incorporated with him by Sh. Tirloki Nath Singla, Chartered Accountant. He again submitted that he was not aware of any RTGS entries reflected in this bank statement.  Similarly, in case of M/s Evershine Resorts Pvt. Ltd also, Sh. Jagdish Rai Gupta was confronted with the bank account Evershine Resorts Pvt. Ltd. At this Printed from counselvise.com 6 instance also, Sh. Jagdish Rai Gupta was not able to furnish any explanation regarding the debit & credit entries reflected in the bank statement and he simply denied any knowledge of the bank transaction of this company. In this case also, Sh. Jagdish Rai Gupta submitted that M/s Evershine Resorts Pvt. Ltd was also created by Sh. Tirloki Nath Singla and that he himself has never issued nor received any cheque on behalf of this company. It was finally concluded by Ld. AO that the assessee-entity as well as M/s ERPL were shell companies existing only on papers which do not have any profit-making apparatus as such because these entities were not carrying out any business activity whatsoever. For the same reason, the business loss of Rs.8,24,902/- as reflected by the assessee during this year in its Income Tax Return was rejected and not allowed to be carried forward. This is the first issue before us. 2.5 Proceeding further, it was noted by Ld. AO that the assessee made investment of Rs.30 Lacs through the account of Shri Sahil Singla for participation in sand mining business. However, the detail of this investment was allegedly not shown by the assessee-company in its Income Tax return. In the absence of any satisfactory reply to the show-cause notice, the said amount was held to be unexplained investment and added u/s 69 to the income of the assessee. This is the second issue before us. 2.6 The Ld. AO thereafter perused Bank Account of the assessee which had aggregate credit entries of Rs.6,77,72,167/- during this year. The credits were held to be disproportionate to the income, business turnover as well as business affairs as shown by the assessee-company. The credit entries were primarily in the nature of unsecured loans as obtained by the assessee-entity from various Printed from counselvise.com 7 lender parties. The Ld. AO alleged that the assessee failed to prove the ingredients of Sec.68. The assessee, vide its reply dated 20-12- 2019 submitted various details of lenders. However, the assessee, in the opinion of Ld. AO, failed to establish the purposes of these credits and also utilization of the funds so received. Since the assessee was held to be a shell company, the credit so received were alleged to be unexplained cash credit u/s 68 and added to the income of the assessee. The addition thus made by Ld. AO aggregated to Rs.647.72 Lacs after reducing addition of unexplained investment already made u/s 69 for Rs.30 Lacs. This is third issue before us. Aggrieved by assessment thus framed by Ld. AO, the assessee preferred first appeal against the same. Appellate Proceedings 3. During appellate proceedings, the assessee’s submissions and documentary evidences were subjected to remand proceedings. The Ld. AO furnished remand report on 15-07-2022 which has been extracted in the impugned order. In sum & substance, it was stated by Ld. AO that the assessment order was framed after due opportunity of hearing to the assessee and after considering material facts on record. The conclusion was based on detailed analysis and therefore, the assessment findings were to be upheld. The assessee filed rejoinder against the same on 22-08-2022 and opposed the conclusion of Ld. AO by referring to various judicial decisions holding the field qua addition u/s 68. It was, inter-alia, contended that the primary requirements of Sec. 68 were fully satisfied by the assessee Printed from counselvise.com 8 and the assessee could not be alleged to be a shell entity. The nature, source, credibility and genuineness of each credit as received in the bank account was duly explained by furnishing various documentary evidences as filed by the assessee by way of tabulation in its reply. It was brought to the notice that substantial loans stood repaid subsequently. The loans were duly evidenced by financial statements, confirmation of lender parties, their respective bank account statements, ledger extracts and copy of Income Tax Returns of the lenders. These loans were nothing but loans and advances received from directors or their relatives / friends who were assessed by the same Assessing Officer accepting the sources of such loans and advances. Few of the credit were stated to be representing advances received back by the assessee. The same mainly pertained to State Geologist Department. Some credit entries represented income of the assessee. The assessee, thus, explained each and every credit entry aggregating to Rs.660.08 Lacs in the bank account. In subsequent replies, the assessee vehemently opposed the conclusion of Ld. AO and pleaded for deletion of impugned adjustments / additions. 4. The Ld. CIT(A), in para 9.3, noted that the assessee had purchased a land during FY 2007-08 which was sold in AY 2012-13 by way of registered sale deed. The Ld. AO assessed capital gains in the hands of the assessee. Further, the assessee paid earnest money during FY 2016-17 for purchase of a plot to build flat / apartment and deducted due TDS against the same. Thus, the assessee was having sufficient income generating apparatus in past as well as in future Printed from counselvise.com 9 years and it was undertaking business activities. Therefore, the assessee could not be held to be a shell entity. The conclusion of Ld. AO, therefore, could not be accepted. 5. On merits of addition as made by Ld. AO u/s 68, the AO did not discuss each and every credit separately before drawing any adverse inference against the assessee. As against this, the assessee established that it received credits of Rs.660.08 Lacs in its bank account and furnished various documentary evidences in support of identity and creditworthiness of lender entities and also to establish genuineness of the transactions. These documents were duly furnished during the course of assessmentproceedings also. In the remand report, Ld. AO did not record any adverse finding on identity and creditworthiness of the lenders and genuineness of the transactions except for alleging that the assessee was a shell entity and it was not having any profit-earning apparatus. No enquiry was made during remand proceedings also and Ld. AO merely relied upon the facts as discussed in the assessment order. Therefore, the assessee pleaded for deletion of impugned addition on merits. 6. The Ld. CIT(A), thereafter, went on to examine the documentary evidences as furnished by the assessee to establish each of the bank credits. The outcome of this exercise has been summarized at para 9.4 of the impugned order, as under: - No. Name Amount Documents Remarks 1. M/s. Ind Sphinx Precision Rs. 9,00,000/-, Rs. 9,00,000/-, And Rs. 7,00,000/- Bank account statement, ledger, confirmation, ITR, Balance Sheet Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as loan from M/s Ind Sphinx Precision Ltd. From the ledger account Printed from counselvise.com 10 On 10.04.2017 it is observed that the appellant has not paid any interest to M/s Ind Sphinx Precision Ltd. on such loan. From such facts, genuineness of transaction is not established as it is beyond the principle of preponderance of probability that someone would give loan of Rs. 25,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. 2. Sh. Satish Goel Rs.25,00,000/- received on 10.04.2017 and repaid on 25.04.2017 Bank account statement, ledger account, affidavit and ITR of Sh. Satish Goel Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. The transaction has been found to be accounted as routed through the bank account of Sh. Satish Goel and there was sufficient credit balance in the bank account. There are no immediate cash deposits. The identity and creditworthiness has also been established from the ITR details (Income of Rs.92,96,200/-). 3. Sh. Ajay Garg Rs.15,00,000/- on 10.04.2017 and Rs. 10,00,000/- repaid on 25.04.2017 Bank account statement, confirmation ledger account and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The transactions have been found to be accounted as routed through the bank account of Sh. Ajay Garg and there was sufficient credit balance in the bank account. There are no immediate cash deposits. The identity and creditworthiness has also been established from the ITR details (income of Rs. 1,04,53,880/-). 4. Sh. Jatin Garg Rs. 29,00,000/- on 11.04.2017 Bank account statement, confirmation ledger account, affidavit and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. Upon perusal of the documents furnished by the appellant it is observed that Sh. Jatin Garg has advanced sum to Sh. Sanjit Singh Randhawa Prop. M/s Rajbir Enterprises. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. Further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Jatin Garg on such loan. From such facts, genuineness of transaction is not established it is beyond preponderance of probability that someone would give loan of Rs.29,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. Printed from counselvise.com 11 5. State Geologist department Rs. 53,08,092/- Bank account statement of the appellant This amount has been received back from State Geologist department. Earlier the appellant has paid the said amount to the State Govt from its bank account on 12.04.2017. Once the AO has added all the credits in the bank account in the case of the appellant as unexplained, further addition in the hands of the appellant on account of payments received back from the State Govt from the payments made from the same bank account amounts to the double addition of the same transaction. 6. Cash Deposited Rs.1,00,000/- Each on 17.04.2017 and 18.08.2017 Cash book extract and copy of P&L account The cash deposits were explained as made on account of income generated during the year under consideration which was duly reflected in P&L account. However, no evidence/details giving the particulars of person from whom such cash was received, nature of transaction with them have been furnished. Therefore, source and nature of cash deposits of Rs.2,00,000/- remain unexplained. 7. Sh. TN Singla Rs.30,00,000/- each on 25.04.2017 and 02.06.2017 Bank account statement, ledger account, confirmation and ITR of Sh. TN Singla Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The appellant has not been able to prove genuineness of source of such credits. 8. Sh. TN Singla HUF Rs.2,00,2000/- Bank account statement, confirmation and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The appellant has not been able to prove genuineness of source of such credits. 9. Sh. Sanbir Singh Rs.49,00,000/- on 10.05.2017 Ledger, bank account statement confirmation and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received by the appellant from Sh. Sanbir Singh on behalf of Sh. Sanjit Singh Randhava. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhava during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. Further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sanbir Singh/Sh. Sanjit Randhawa on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs. 49,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. 10. Sh. Sanbir Rs.40,00,000/- on Ledger, confirmation and Upon perusal of the documents furnished by Printed from counselvise.com 12 Singh 11.05.2017 ITR the appellant it is observed that the said amount has been received by the appellant from Sh. Sanbir Singh on behalf of Sh. Sanjit Singh Randhawa. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. Further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sanbir Singh/Sh. Sanjit Randhawa on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs. 40,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. 11. Sh. Gurvarinder Singh Rs. 20,00,000/- Bank account statement, Ledger, confirmation and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. The transaction has been routed through the OD account of Sh. Gurvinder Singh. It is beyond preponderance of probability that a person with income of Rs. 3,53,790/- would give loan of Rs. 20,00,000/- from the OD account (interest bearing funds) to the appellant without any explicit purpose without any interest without any business purpose. Thus, the genuineness of transaction has not been established. Further, in his bank account he has undertaken transactions with M/s Rajbir Enterprises which is Prop. Of Sh. Sajit Singh Randhawa. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. 12. M/s Rajbir Enterprises Prop. Sh. Sanjit Singh Randhawa Rs. 1,10,00,000/- No documents furnished It has been explained that the appellant transferred amount of Rs. 50,00,000/- and Rs. 60,00,000/- to Sh. TN Singla which was transferred to the bank account of M/s Rajbir enterprise which was subsequently transferred to the appellant’s account. However, upon perusal of the material available on record, it is observed that the appellant has not been able to establish identity, creditworthiness in respect of this credit and genuineness of transaction by failing to furnish necessary documentary Printed from counselvise.com 13 evidences. The explanation furnished in this respect has not been substantiated. Moreover, Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa Prop. M/s. Rajbir Enterprises during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. Proceedings under the Benami Transaction Act have been initiated in the case of Sh. Sanjit Singh Randhawa which have been upheld by the Adjudicating Authority. 13. M/s Evershine Resorts Rs. 12,00,000/- on 23.06.2017 Rs. 22,00,000/- on 19.01.2018 Rs. 57,00,000/- On 23.02.2018 Bank account statement, ledger, confirmation, ITR, Balance Sheet The credits in the bank account of M/s Evershine resorts were independently examined by the A.O. and made additions on account of unexplained credits in the order passed u/s 143(3) of the Act for A.Y. 2018-19. The amount of Rs. 91,00,000/- has been received by M/s TJR during the year under consideration from the said credits. On the facts, it is found that addition of R.91,00,000/- in the hands of the appellant on account of credit received from M/s Evershine Resorts tantamounts to double addition. 14. Sh. Sunil Taneja Rs. 20,00,000/- on 16.10.2017 and Rs. 40,00,000/- on 06.07.2017 Bank account statement, ledger account, confirmation and ITR of Sh. Sunil Taneja Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received back by the appellant from Sh. Sunil Taneja against advance given earlier (opening balance of Rs. 40,00,000/-) and fresh loan of Rs. 20,00,000/-. IN respect of fresh loan of Rs. 20,00,000/-, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sunil Taneja on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs. 20,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. 15. Smt. Kiran Singla Rs.50,00,000/- Bank account statement, confirmation, ledger account, affidavit and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received from Smt. Kiran Singla as repayment of earlier advance given on 10.07.2017 & 01.02.2018. The amounts have been sourced out of available credit balance in the bank account of Smt. Kiran Singla. Therefore, identity, creditworthiness and genuineness has been established. 16. Smt. Urmila Rs.1,50,00,000/- on Agreement to purchase The appellant entered into an agreement to Printed from counselvise.com 14 Kaushal 23.01.2018 the property purchase the property vide agreement dated 28.06.2016 with late Sh. Baldev Kaushal and paid earnest money of Rs. 1,50,00,000/- on 28.06.2016 and 02.07.2016. On 23.01.2018, the said agreement was canceled and payment of Rs. 1,51,50,000/- was received back. The observation for each of the lender entity has been mentioned by Ld. CIT(A) in the above tabulation. It could be seen that Ld. CIT(A) partially accepted the claim of the assessee and confirmed addition to the extent of Rs.375 Lacs. The details of unsecured loans & advances which has not been accepted by Ld. CIT(A) to be satisfying the requirement of Sec.68 could be summarized as under: - No. Name of Lender Amount of Loan (Rs.) 1. M/s Ind. Sphinx Precision Ltd. Rs.25.00 Lacs 2. Shri Jatin Garg Rs.29.00 Lacs 3. Cash Deposited Rs.2.00 Lacs 4. Shri T.N. Singla Rs.60.00 Lacs 5. Shri TN Singla HUF Rs.20.00 Lacs 6. Shri Sanbir Singh Rs.49.00 Lacs 7. Shri Sanbir Singh Rs.40.00 Lacs 8. Shri Guravinder Singh Rs.20.00 Lacs 9. M/s Rajbir Enter. (Prop. Sanjit Singh Randhawa) Rs.110.00 Lacs 10. Shri Sunil Taneja Rs.20.00 Lacs Total Rs.375.00 Lacs With respect to above credits, it was held by Ld. CIT(A) that the assessee failed to discharge the onus of Sec.68. Finally, the addition to the extent of Rs.375 Lacs was confirmed and the remaining addition of Rs.272.72 Lacs was deleted. The business loss of Rs.8.24 Lacs was not allowed to be carried forward on the ground that the assessee did not furnish documentary evidences for such loss. The separate addition of Rs.30 Lacs was deleted considering the fact that Printed from counselvise.com 15 all the credits in the bank accounts were independently examined and the addition of Rs.375 Lacs was confirmed. Adding the amount of Rs.30 Lacs separately would amount to double addition. The adjudication of Ld. CIT(A) has led to cross-appeals before us. Our findings and Adjudication 7. From the facts, it clearly emerges that the assessee is a corporate entity which has regularly field its return of income since past many years. The same is evident from the detail of share capital, revenue receipts and income / loss of the assessee during AYs 2012- 13 to 2018-19 as tabulated by Ld. AO at Para-5 of the assessment order. The Ld. CIT(A) has well appreciated the fact that the assessee had purchased a land during FY 2007-08 which was sold in AY 2012- 13 by way of registered sale deed. The Ld. AO assessed capital gains in the hands of the assessee. Further, the assessee paid earnest money during FY 2016-17 for purchase of a plot to build flat / apartment and deducted TDS against the same. Thus, the assessee was indeed having income generating apparatus in past as well as in future years and it was undertaking business activities. In fact, Ld. CIT(A) as well as ITAT during AYs 2012-13 to 2017-18, in their respective orders, have held the assessee-entity to be a genuine entity which position stood accepted by the revenue in those years. Further, this finding of Ld. CIT(A) has also not been disputed by revenue in the present appeal in its grounds of appeal. This fact is further fortified by the fact that the assessee duly furnished its books of accounts before lower authorities during the course of assessment Printed from counselvise.com 16 proceedings itself. Pertinently, the assessee was subjected to search action wherein books of accounts were found at the business premises and all such data was taken in the hard disk. In the statement on oath, Shri Jagdish Rai Gupta, clearly stated that he acted as a director in the assessee-entity and this entity was established to carry out some commercial activity. In furtherance of the same, a commercial plot in Sec.5 Panchkula was already bought in the name of the assessee-entity. In reply to Q. No.7, it was stated by him that since incorporation, the assessee-entity was not involved in any business activity. He also stated that he was not aware of any business transaction or banking transactions as carried out by the said entity in the recent past. However, it has nowhere been admitted by him that this entity was a shell entity which was existing merely on papers and the assessee was not having any profit-making apparatus. Merely because the business activities had not started and no substantial activity was carried out by the assessee, the same would not make the assessee a shell entity. The assessee is a corporate entity and it is a separate assessable unit under the Act. Therefore, the conclusion of Ld. AO that the assessee was a shell entity is bereft of any substance. On the given set of facts, the inevitable conclusion would be that the assessee could not be held to be a shell entity or it could not be said that the assessee was not having any profit-making apparatus. We concur with this conclusion of Ld. CIT(A). This being so, the business loss of Rs.8.24 Lacs as claimed by the assessee in the return of income is to be accepted and the same would be allowed Printed from counselvise.com 17 to be carried forward for set-off in subsequent years. We order so. The assessee succeeds in its corresponding grounds of appeal. 8. Proceeding further, it could be seen that the assessee, during the course of assessment proceedings as well as during remand proceedings, filed detailed documents and explanations for each of the bank credits. Each of the bank credit stood explained by the assessee and sufficient documentary evidences were filed by the assessee to establish the primary ingredients of Sec.68. In fact, the detailed submissions and explanations of the assessee were subjected to remand proceedings wherein Ld. AO could not controvert the same. Going by the underlying belief / conclusion that the assessee was merely a shell entity, Ld. AO completely ignored these documents and submissions and reiterated the stand taken in the assessment order. No independent enquiry, whatsoever, is shown to have been done by Ld. AO to dislodge these evidences. Nothing has been shown that any effort has been made by Ld. AO to ascertain the genuineness of these loans from any of the lenders. It is trite law that no addition could be made merely on the basis of presumption, assumption, conjectures or surmises. 9. It could further be seen that as against the allegation of Ld. AO, the assessee furnished detailed documents for each of the lender entity. The documents as furnished by the assessee with respect to ten lender entities which has not been accepted by Ld. CIT(A) are tabulated as under: - Printed from counselvise.com 18 No. Name Amount Document furnished CIT Remarks Appellant Remarks 1. Ind. Sphinx Precision Ltd. Rs.9,00,000, Rs.9,00,000 and Rs.7,00,000 on 10.04.2017 out of this Rs.20,00,000/- repaid on 19.09.2018 and Rs. 5,00,000/- On28.09.2018. Ledger Accounts, Confirmation, Balance Sheet, ITR and Bank Statements. Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as loan from M/S Ind Sphinx Precision Ltd. From the ledger account it is observed that the appellant has not paid any interest to M/S Ind Sphinx Precision Ltd. on such loan. From such facts, genuineness of transaction is not established as it is beyond the principle of preponderance of probability that someone would give loan of Rs.25,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. The said amount of Rs.9,00,000/- ,Rs.9,00,000/- and Rs.7,00,000/- on 10.04.2017 are inter corporate borrowings, out of which Rs.20,00,000/- was repaid on19.09.2018 and balance amount of Rs.5,00,000/- was repaid on 28.09.2018. The Confirmation and Ledger Accounts of Ind sphinx Precision Ltd. in the books of appellant company are attached vide PB pg no. 1-4. Further the bank statements of Ind Sphinx Precision Ltd. highlighting all the transactions are attached vide PB pg no. 25-38. Loan of Rs. 75,00,000/- was also received during earlier years from this company and accepted as genuine. (PB pg. No.l). The said company was assessed u/s 143(3) during assessment year 2018-19 and taxable income of Rs.2,87,03,950/- was declared and assessed. Copy of Assessment order is attached at PB pg. No. 635.The Net profit before tax was Rs. 5,25,15,571/- as perP&L A/c (PB. pg No. 6). 2. Sh. Jatin Garg Rs.29,00,000 on 11.04.2017 and repaid on03.06.2017 Affidavit, Bank Statements, ITR, Ledger Accounts, Assessment order of AY 18-19, ITAT order for the AY 18-19 Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. Upon perusal of the documents furnished by the appellant it is observed that Sh. Jatin Garg has advanced sum to Sh. Sanjit Singh Randhawa prop. M/S Rajbir Enterprises. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Jatin Garg on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs. 29,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. The Amount was received as unsecured loan and was repaid on 03.06.2017 after two months. The Confirmation are attached vide PB pg. no. 39-40. Further the Bank Statements of Sh. Jatin Garg highlighting all the transactions and ledger account of Sh. Jatin Garg in books of Appellant company are attached vide PB pg. no. 41-47 and pg 49 respectively. The Assessment of Sh. Jatin Garg was completed simultaneously u/s 153A read with Section 143(3) for Assessment Year 2018-19 by the same Assessing Officer and all credits in his account were examined/assessed. The Assessment order and ITAT order in his case are attached at PB Page No. 50-80. Further, this amount was received as loan by the Appellant and said sum has no link to Sanjit Singh, Rajbir Enterprises, Punjab Sand Mining, Amit Bahadur, Ajit Paul Singh, Kulwinder Singh etc., and the CIT(A) has wrongly mentioned these facts to mislead the Hon'ble ITAT or Higher Courts. 3. Cash deposited Rs.1,00,000/-each on 17.04.2017 and 18.08.2017 Cash book extract and copy of account The cash deposits were explained as made on account of income generated during the year under consideration which was duly reflected in P&L account. However, no evidence/details giving the particulars of person from whom such cash was received, nature of transaction with them have been furnished. Therefore, source and nature of cash deposits of Rs.2,00,000/-remain unexplained. The Cash deposited on 17.04.2017 and 18.08.2017 was out of the income earned during the year and shown as receipt in ITR. To prove the genuineness and credit worthiness of the transactions Income and Profit and Loss account is attached (PB pg. no. 423). Cash book of Appellant company is attached vide PB pg. no. 414. 4. Sh. T.N. Singla Rs.30,00,000/ on 25.04.2017 and Rs.30,00,000/ on 02.06.2017. Confirmation and Ledger Accounts, ITR, Bank Statements, Assessment order and ITAT order for AY 18-19 Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The appellant has not been able to prove genuineness of source of such credits. The amount received of Rs. 30,00,000/- on 25.04.2017 was unsecured loan from Sh. T.N. Singla and Rs.60,00,000/- was paid on 22.05.2017 to him, and out of this Rs. 30,00,000/- was again received back on 02.06.2017. Ledger Account of Sh. T.N. Singla in the books of Appellant Company is attached vide PB pg. No. 81. Further Bank Statements of Sh. T.N. Singla Printed from counselvise.com 19 highlighting all the transactions are attached vide PB pg. no. 83-88. The assessment of Sh. T.N. Singla was completed u/s 153A read with Section 143(3) simultaneously by the same Assessing Officer and all credits in the bank accounts of Sh. T.N. Singla were examined and accepted as genuine. Copy of Assessment Order and ITAT Order for Assessment Year 2018-19 are at PB pg. No. 89-95 5. Sh. Tirloki Nath HUF Rs. 20,00,000/- received on 25.04.2017 and returned on 07.02.2018 ITR, Ledger Account, Confirmation, Bank Statements, Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The appellant has not been able to prove genuineness of source of such credits. The amount of Rs.20,00,000/- was received on 25.04.2017 and was repaid back on 07.02.2018. Ledger account of Tirloki Nath HUF in the books of Appellant Company is attached vide PB pg. no. 97. Further, the bank statements of Sh. Tirloki Nath HUF highlighting all the transactions are attached vide PB pg. no. 98-99. The said loan was given out of Rs. 28,00,000/- received from Sh. Tirloki Nath Singla on 11.04.2017, who was assessed simultaneously with the same Assessing Officer and all credits in his bank accounts were accepted as genuine. Copy of Assessment/Appellate order of Sh. Tirloki Nath Singla is attached as per point 4 of this submission. 6. Sh. Sanbir Singh Received Rs.49,00,000/- on 10.05.2017andreturned on06.06.2017 Affidavit, Bank Statements ,Ledger accounts, ITR ,Assessmen torder, CIT order and TAT order for the AY 18-19 Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received by the appellant from Sh. Sanbir Singh on behalf of Sh. Sanjit Singh Randhava. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. Further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sanbir Singh / Sh. Sanjit Randhawa on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs.49,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. The amount was received as unsecured loan on10.05.2017 and was repaid on 06.06.2017. Ledger Account of Sh. Sanbir Singh in the books of Appellant Company are attached vide PB no. 107-108. Further the Bank Statement of Sh. Sanbir Singh highlighting all the transactions are attached vide PB pg. no. 102-106. The Assessment of Sh. Sanbir Singh was completed u/s 148 read with Section 143(3) for assessment year 2018-19 and all the credits in his bank accounts were accepted as genuine. Copy of Assessment Order, CIT Order and ITAT Order are attached at PB pg. No. 110- 231. 7. Sh. Sanbir Singh Rs.40,00,000/-on 11.05.2017. Repaid on 06.06.2017 Ledger confirmation 1TR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received by the appellant from Sh. Sanbir Singh on behalf of Sh. Sanjit Singh Randhava. Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Shi Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established Further, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sanbir Singh/Sh. Sanjit Randhawa on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs.40,00,000/- in the appellant without any explicit purpose without any interest without any business purpose. The amount was received as unsecured loan on 11.05.2017 and was repaid on 06.06.2017. Ledger Account of Sh. Sanbir Singh in the books of Appellant Company are attached vide PB no. 107-108. Further the Bank Statement of Sh. Sanbir Singh highlighting all the transactions are attached vide PB pg. no. 102-106. The Assessment of Sh. Sanbir Singh was completed u/s 148 read with Section 143(3) for assessment year 2018-19 and all the credits in his bank accounts were accepted as genuine. Copy of Assessment Order, CIT Order and ITAT Order are attached at PB pg. No. 110-231. Printed from counselvise.com 20 8. Sh. Gurvarinder Singh Rs.20,00,000/- received on 16.05.2017 and repaid on06.06.2017 Affidavit, Bank Statements, Ledger Accounts, ITR, Assessment order, CIT order and ITAT order for the AY 18-19 Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. The transaction has been routed through the OD account of Sh. Gurvinder Singh, is beyond preponderance of probability that a person with income of ?3,53,790/-would give loan of ?20,00,00()/- from the OD account (interest bearing funds) to the appellant without any explicit purpose without any interest without any business purpose. Thus, the genuineness of transaction has not been established. Further, in his bank account he has undertaken transactions with M/S Rajbir Enterprises which is prop, of Sh. Sanjit Singh Randhawa Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Sh. Kulwinder Paul Singh has not been established. The amount was received as unsecured loan on 16.05.2017 and was repaid on 06.06.2017. Ledger Account of Sh. Gurvarinder Singh in the books of Appellant Company are attached vide PB pg. no.238. Further the Bank Statement of Sh. Gurvarinder Singh highlighting all the transactions are attached vide PB pg. no. 234-235. The Assessment of Sh. Gurvarinder Singh was completed u/s 147 read with Section 144b for Assessment Year 2018-19 and all credits in his bank accounts was accepted as genuine. Copy of Assessment Order is attached at PB pg. No. 239-245. 9. Sh. Sanjit Singh Randhawa Proprietor of M/s Rajbir Enterprises Rs.1,10,00,000/- Flow Chart of the Funds, Ledger Accounts, Banks statements of Rajbir Enterprises, Assessment order of Sanjit Singh Randhawa for the AY 18-19 And following Documents of Sh. Sahil Singla: Bank Statements, ITR, Assessment Order and ITAT Order for the AY 18-19 It has been explained that the appellant transferred amount of Rs.60,00,000/- and Rs.50,00,000/- to Sh. TN Singla which was transferred to the bank account of M/S Rajbir enterprise which was subsequently transferred to the appellant's account. However, upon perusal of the material available on record, it is observed that the appellant has not been able to establish identity, creditworthiness in respect of this credit and genuineness of transaction by failing to furnish necessary documentary evidences. The explanation furnished in this respect has not been substantiated. Moreover, Genuineness of transactions undertaken by Sh. Sanjit Singh Randhawa prop. M/S Rajbir Enterprises during the Punjab Sand Mining Auction in the Benami names of Sh. Amit Bahadur, Sh. Ajit Paul Singh and Shi Kulwinder Paul Singh has not been established. Proceedings under the Benami Transaction Act have been initiated in the case of Shi Sanjit Singh Randhawa which have been upheld by the Adjudicating Authority. M/s Rajbir Enterprises (Proprietorship of Sh. Sanjit Singh Randhawa) repaid this amount of Rs.1,10,00,000 to M/s TJR Properties Pvt. Ltd. directly on 06/06/2017 and M/s TJR Properties Pvt. Ltd. returned this amount to Sh. Sanbir Singh & Sh. Gurvarinder Singh Sidhu on 06/06/2017. The Assessment of Sh. Sanjit Singh Randhawa (proprietor of M/S Rajbir Enterprises) was completed u/s 153A read with Section 143(3) simultaneously by the same Assessing Officer and all the credits in his bank accounts were added in his hands as per order at PB pg. No. 308-355. 10. Sh. Sunil Taneja Rs.20,00,000/-on 16.10.2017 and Rs.40,00,000/-on 06.07.2017 Bank Statements, Ledger Accounts, ITR. Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received back by the appellant from Sh. Sunil Taneja against advance given earlier (opening balance of Rs.40,00,000/-) and fresh loan of Rs.20,00,000/-. In respect of fresh loan of Rs.20,00,000/-, from the ledger account it is observed that the appellant has not paid any interest to Sh. Sunil Taneja on such loan. From such facts, genuineness of transaction is not established as it is beyond preponderance of probability that someone would give loan of Rs.20,00,000/- to the appellant without any explicit purpose without any interest without any business purpose. An amount of Rs.40,00,000/- was given on 30.03.2016 to Sh. Sunil Taneja, which was received back on 06.07.2017. Later on Rs.20,00,000/- was received from him on 16.10.2017, which was repaid to him on 31.03.2019. Ledger Accounts of Sh. Sunil Taneja and Raunak Taneja in the books of Appellant Company are attached vide PB pg. no.358-360. Further the Bank Statement of Sh. Sunil Taneja highlighting all the transactions are attached vide PB pg. no.356-357. As per return of Sh. Sunil Taneja (PB. Pg. No. 361), he has declared taxable income of Rs. 55,05,867/-. Further, Sh. Sunil Taneja was given Rs. 40,00,000/- during earlier years and said loan of Rs. 40,00,000/-wasp received backed during the year through banking transactions at PB pg. No. 356-357. Printed from counselvise.com 21 From the above tabulation it could be seen that the loan of M/s Ind. Sphinx Precision Ltd. was repaid in subsequent year. The assessee furnished confirmation of the lender, ledger extract, Income Tax Return (ITR) and bank statement of the lender evidencing exchange of funds through banking channels. The loan of Rs.75 Lacs was received from this entity in earlier years which ultimately stood accepted to be genuine loan. The lender entity was duly assessed u/s 143(3) for AY 2018-19 accepting the returned income. This entity returned income of more than Rs.287.03 Lacs. The same has not been accepted by Ld. CIT(A) merely on the ground that no interest was charged from this party which is not of much relevance to support impugned addition u/s 68. Similarly, the loan of Shri Jatin Garg stood repaid within two months. The assessee furnished affidavit of the lender, ITR, bank statement, ledger extract etc. The assessment of this lender was completed u/s 153A r.w.s. 143(3) for this year by the same AO and all credits in his bank account were examined / assessed. The source of funds for this lender has ultimately been accepted. The Ld. CIT(A) has not accepted the same on non-irrelevant consideration i.e., interest was not charged against the same. The cash deposit of Rs.2 Lacs is sourced out of income earned by the assessee during the year. The deposits are duly recorded in the cash book. The financial statements are duly audited and no discrepancy has been found in the cash book. The assessee has credited income Printed from counselvise.com 22 in the financial statement. Therefore, there is no reason to make any addition on this account. The loan from Shri T.N. Singla stood repaid on 22-05-2017 and fresh loan was again received. The assessee furnished ledger account of the lender, confirmation, ITR and bank statement. The assessment of the lender was done u/s 153A r.w.s. 143(3) by the same AO. All the credits have ultimately been accepted to be genuine. Similar facts exist for Shri Tirloki Nath HUF. On these facts, the genuineness of these two loans could not be doubted. The amount of Rs.49 Lacs as received from Shri Sanbir Singh stood repaid on 06-06-2017. The loans are evidenced by affidavit of the lender, bank statement, ledger extract, Income Tax Return (ITR) and assessment details of the lender. The assessment of the lender was completed u/s 148 r.w.s.143(3) and all the bank credits ultimately stood accepted to be genuine. Similar facts exist for loan of Rs.40 Lacs as received from Shri Sanbir Singh on 11-05-2017. Therefore, the ingredients of Sec.68 stood satisfied for this lender. The Ld. CIT(A) has not accepted the same merely on the ground that this amount has been received by the assessee on behalf of Shri Sanjit Singh Randhawa for whom genuineness of transactions have been doubted. The same is irrelevant consideration for the purpose of Sec.68. The ingredients of Sec.68 have duly been satisfied for this lender entity. The loan of Shri Guravinder Singh is evidenced by affidavit, bank statement, ledger extracts, copy of ITR and assessment & appellate Printed from counselvise.com 23 orders wherein all credit ultimately stood accepted for this person. The Ld. CIT(A) has not accepted the same on the ground that the lender has undertaken transactions with Shri Sanjit Singh Randhawa for whom genuineness of transactions have been doubted. The same is irrelevant consideration for the purpose of Sec.68. The ingredients of Sec.68 have duly been satisfied for this lender entity. The credit of Rs.110 Lacs by Shri Sanjit Singh Randhawa represent amount earlier transferred by the assessee to Shri T.N. Singla which was then transferred to this entity. The funds have subsequently been received by the assessee. The transactions are evidenced by flow chart of the funds, ledger account, bank statement etc. The assessment of this lender entity has been completed u/s 153A. Therefore, this amount could not be held to be unexplained cash credit u/s 68 so far as the assessee is concerned. The assessee earlier advanced Rs.40 Lacs to Shri Sunil Taneja on 30-03-2016 which was repaid by him on 06-07-2017. The fresh loan of Rs.20 Lacs was received from him which also stood repaid by the assessee on 31-03-2019. The assessee duly furnished confirmation, bank statement, ledger and ITR of the lender. Merely because no interest was charged, the same could not be held to be unexplained cash credit u/s 68. 10. Proceeding further, it could be seen that Ld. CIT(A) has partially accepted the claim of the assessee against which the revenue has preferred further appeal. The documents as furnished by the assessee Printed from counselvise.com 24 for those lender entities which has been accepted by Ld. CIT(A) could be tabulated as under: - No. Name Amount Documents Furnished Remarks of CIT (A) Reference to Paper Book Remarks 1. Sh. Satish Goel Rs. 25,00,000/- received on 10.04.2017 and repaid on 25.04.2017 Bank account statement, ledger account, affidavit and ITR of Sh. Satish Goel Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received as unsecured loan. The transaction has been found to be accounted as routed through the bank account of Sh. Satish Goel and there was sufficient credit balance in the bank account. There are no immediate cash deposits. The identity and creditworthiness has also been established from the ITR details(lncome of Rs.92,96,200/-). PB. Page No. 755-760 2. Sh. Ajay Garg Rs. 15,00,000/- received on 10.04.2017 and Rs. 25,00,000/-given by Appellant on 25.04.2017 and balance of Rs. 10,00,000/-were received back by the appellant on 11.05.2017 Bank account statement, confirmation, ledger account, and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amounts have been received as unsecured loan. The transactions have been found to be accounted as routed through the bank account of Sh. Ajay Garg and there was sufficient credit balance in the bank account. There are no immediate cash deposits. The identity and creditworthiness has also been established from the ITR details (income of Rs. 1,04,53,880/-) PB. Page No. 761-766 3. State Geologist Department Rs. 53,08,092/- received back on cancellation of Tender Bank account statement of the appellant This amount has been received back from State Geologist department. Earlier the appellant has paid the said amount to the State Govt from its bank account on 12.04.2017. Once the AO has added all the credits in the bank account in the case of the appellant as unexplained, further addition in the hands of the appellant on account of payments received back from the State Govt from the payments made from the same bank account amounts to the double addition of the same transaction 4. M/s Evershine Resorts Received Rs. 12,00,000/- on 23.06.2017, Rs. 22,00,000/- on 19.01.2018 and Rs. 57,00,0000/-on 23.02.2018 Bank account statement, ledger, confirmation, ITR and Balance Sheet The credits in the bank account of M/s Evershine Resorts were independently examined by the AO and made additions on account of unexplained credits in the order passed u/s 143(3) of the Act for AY. 2018-19. The amount of Rs.91,00,000/- has been received by M/s TJR during the year under consideration from the said credits. On such facts, it is found that addition of Rs.91,00,000/- in the hands of the appellant on account of credit received from M/s Evershine Resorts tantamount to double addition. PB. Page No. 747-754 The appellant had running account with this Company. The opening balance was Rs. 16,00,000/- and during the year Rs. 91,00,000/-received from Evershine Resorts and Rs. 1 Crore were repaid to Evershine Resorts by the appellant. Further, assessed simultaneously by the same assessing officer on the same date. 5. Smt. Kiran Singla Received Rs. on 26.02.2018 against advance given on 10.07.2017 and 01.02.2018 Bank account statement, confirmation, ledger account, affidavit and ITR Upon perusal of the documents furnished by the appellant it is observed that the said amount has been received from Smt. Kiran Singla as repayment of earlier advance given on 10.07.2017 & 01.02.2018. The amounts have been sourced out of available credit balance in the bank account of Smt. Kiran Singla. Therefore, identity, creditworthiness and genuineness has been established. PB. Page No. 739-746 Further, assessed simultaneously by the same assessing officer on the same date. 6. Smt. Urmila Kaushal Rs. 1,50,00,000/-given in 2016 and received back during the year on 23.01.2018 Advance against Agreement to purchase the property received back with TDS of Rs. 1,50,000/- The appellant entered into an agreement to purchase the property vide agreement dated 28.06.2016 with late Sh. Baldev Kaushal and paid earnest money of Rs. 1,50,00,000/- on 28.06.2016 and 02.07.2016. On 23.01.2018, the said agreement was cancelled and payment of Rs. 1,51,50,000/-was received back. PB. Page No. 767-772 Printed from counselvise.com 25 It could be seen that the assessee has furnished sufficient documentary evidences for each of the lender entity which include confirmation, bank statement of the lender, ledger account, affidavit, ITR etc. All the lenders were having sufficient credit in their bank account to make advances to the assessee. Finding these documents and submissions to be sufficient compliance of Sec. 68, Ld. CIT(A) has deleted the addition for these lenders against which the revenue is in further appeal before us. These factual findings on the documentary evidences remain uncontroverted before us. Therefore, we see no reason to interfere in the findings of Ld. CIT(A) to that extent. 11. We find that as per the provisions of Section 68 of the Income Tax Act, 1961, where any sum is found credited in the assessee's books and assessee offers no explanation about the nature and source thereof or the explanation furnished is found to be unsatisfactory, the sum so credited may be charged to Income-Tax as the income of the assessee of that previous year. A proviso has been inserted to the said section by Finance Act, 2012 w.e.f. 01-04-2013 to provide that where the assessee is a company and the sum so credited consists of share application money, share capital, share premium etc., the explanation furnished by the assessee shall be deemed to be not satisfactory unless the person in whose name such credit is recorded also offers an explanation about nature and source of sum so credited and such explanation is found to be satisfactory. However, this proviso is not applicable to the facts of the present case Printed from counselvise.com 26 since the we are dealing with case of unsecured loans and advances. Such additional onus / requirement for unsecured loans / advances has been introduced by Finance Act, 2022 which is applicable only from AY 2022-23 and therefore, for the impugned AY 2018-19, there is no obligation on the assessee to establish the source of source of unsecured loans and advances. Proceeding further, it would be primary onus of the assessee to establish the identity of the lender, creditworthiness of the lenders as well as genuineness of the loan transactions. Once all the supporting documents have been furnished by the assessee, the primary onus of the assessee would stand discharged and it would be the onus of Ld. AO to rebut the claim of the assessee by bringing on record cogent / concrete evidences to dislodge the claim of the assessee. Unless this exercise is done by Ld. AO, no such addition of unexplained cash credit could be made in the hands of the assessee. We find that no such concrete evidences have been brought on record by Ld. AO or Ld. CIT(A) to rebut the claim of the assessee. 12. In the light of above factual matrix, we find that the assessee has duly discharged the onus of Sec.68 for all the lender entities and therefore, no such addition could be made in the hands of the assessee u/s 68. In the result, the impugned addition has made by Ld. AO in the assessment order u/s 68 and partly confirmed by Ld. CIT(A), stand deleted in toto. We order so. The assessee succeeds in its corresponding grounds of appeal. The grounds of appeal as raised by the revenue stand dismissed. Since all the bank credits have been Printed from counselvise.com 27 accepted to be genuine, the separate addition of Rs.30 Lacs on account of unexplained investment would not survive. We order so. 13. Ground No.1 of assessee’s appeal is general in nature. Grounds Nos.2 & 3 are the legal grounds which are not pressed by Ld. AR for the reason that the same stood decided against the assessee by Tribunal in earlier years. In Ground Nos. 4 to 6, 8 & 9, the assessee has assailed the confirmation of quantum addition u/s 68 on merits. These grounds stand allowed. Ground No.7 is related with allowance of business loss. This ground stand allowed. No arguments have been made on other grounds. The appeal of the assessee stands partly allowed. The revenue is aggrieved by partial relief as granted by Ld. CIT(A). This appeal stand dismissed accordingly. 14. ITA No.994/Chandi/2025 stands partly allowed whereas ITA No.1377/Chandi/2025 stand dismissed. Order pronounced on 24th March, 2026. -Sd- -Sd- (RAJPAL YADAV) (MANOJ KUMAR AGGARWAL) VICE PRESIDENT ACCOUNTANT MEMBER Dated: 24-03-2026 आदेश की Ůितिलिप अŤेिषत /Copy of the Order forwarded to : 1. अपीलाथŎ/Appellant 2. ŮȑथŎ/Respondent 3. आयकरआयुƅ/CIT 4. िवभागीयŮितिनिध/DR 5. गाडŊफाईल/GF ASSISTANT REGISTRAR ITAT CHANDIGARH Printed from counselvise.com "