₹1.5 Crore Treated as Unexplained Cash Credit u/s 68: ITAT Upholds CIT(A)’s Deletion of Addition [Read Order]
With the AO failing to provide a remand report and records showing the amount was debited, not credited, CIT(A) ruled Section 68 inapplicable
![₹1.5 Crore Treated as Unexplained Cash Credit u/s 68: ITAT Upholds CIT(A)’s Deletion of Addition [Read Order]](https://images.taxscan.in/h-upload/2025/07/28/2070083-treated-as-unexplained-cash-credit-unexplained-cash-credit-unexplained-cash-tascan.webp "₹1.5 Crore Treated as Unexplained Cash Credit u/s 68: ITAT Upholds CIT(A)’s Deletion of Addition [Read Order]")
The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) upheld Commissioner of Income Tax(Appeals)[CIT(A)]’s order deleting a ₹1.5 crore addition treated as an accommodation entry under Section 68 of Income Tax Act,1961. The Revenue-appellant appealed against the order passed by CIT(A) dated 07.11.2024 for the Assessment Year (AY) 2018-19. In this case,United Tech...
The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) upheld Commissioner of Income Tax(Appeals)[CIT(A)]’s order deleting a ₹1.5 crore addition treated as an accommodation entry under Section 68 of Income Tax Act,1961.
The Revenue-appellant appealed against the order passed by CIT(A) dated 07.11.2024 for the Assessment Year (AY) 2018-19. In this case,United Tech Ventures Pvt Ltd,respondent-assessee,filed its return for AY 2018-19 declaring nil income and a loss of ₹6.36 lakh, later revised to ₹19.34 lakh. The return was accepted under regular assessment, but the case was reopened after the tax department alleged a ₹1.5 crore accommodation entry from the Dishman Group.
The assessee explained that no such entry was received and that ₹1.5 crore was instead advanced as a loan to United Polyfab Gujarat Ltd, supported by ledger accounts and bank statements. Despite this, the Assessing Officer (AO) treated the amount as unexplained cash credit under Section 68.
On appeal, the CIT(A) noted confirmations and bank records from two individuals who had each lent ₹75 lakh to the assessee, which was then forwarded to United Polyfab Gujarat Ltd. With no remand report received from the AO, the CIT(A) accepted the evidence and deleted the ₹1.5 crore addition.
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The Revenue aggrieved by the CIT(A) appealed before the tribunal.
The two member bench comprising T.R.Senthil Kumar (Judicial Member) and Annapurna Gupta (Accountant Member) heard both sides and reviewed the records. It found that the assessee had clarified no loan was received from the Dishman Group and that ₹1.5 crore was actually given as a loan to United Polyfab Gujarat Limited. The AO rejected the confirmations for lack of contra‑signatures and added the amount under Section 68.
During the appeal, the assessee produced evidence of the loan’s source. The CIT(A) asked the AO for a remand report, but none was provided. After reviewing the documents, the CIT(A) noted the ₹1.5 crore was debited, not credited, to the assessee’s account and held that Section 68 did not apply.
The tribunal agreed with the CIT(A), found no error in the order, and dismissed the Revenue’s appeal.
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