The Income Tax Appellate Tribunal (ITAT), Chennai upheld the deletion of addition on proof of source of money and identity of creditors by assessee.
The assessee, M/s. Sporting Pastime India Ltd company is engaged in project of developing golf course and related works in East Coast Road of Chennai. During the course of assessment proceedings, the Assessing Officer on the basis of information furnished by the assessee opined that the assessee has derived benefit in the form of cessation of liability towards amount received from M/s. M/s.Cheran Holdings Pvt Ltd. upon takeover company by M/s. KCP Ltd. and thus, made additions of Rs.25 crores as unexplained income of the assessee.
The Counsel for the assessee, referring to various documents submitted that source of money has been explained and also genuineness of payment is not in doubt, because money has been transferred from bank account to the assessee. Further, so called money received from M/s. Cheran Holdings Pvt Ltd. is not belonged to the assessee and thus, same cannot be added in the hands of the assessee. The learned Commissioner of Income Tax (A), after considering relevant facts has rightly deleted additions made by the Assessing Officer and their order should be upheld.
A Division Bench consisting of V Durga Rao, Judicial Member and G Manjunatha, Accountant Member observed that “It is very clear that source of money has been explained by the assessee, including identity of the creditors and further said amount has been transferred through proper banking channel only. The learned Commissioner of Income Tax (A), after considering relevant facts held that the assessee has identified creditors and hence, deleted additions made by the Assessing Officer towards amount received from M/s. Cheran Holdings Pvt Ltd. as unexplained income of the assessee.”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
