Assistant Commissioner of Income Tax vs. Bijwasan Realty One P. Ltd.

Parties Involved

Facts Summary

The case involves an appeal by the Revenue against the order of the Commissioner of Income Tax (Appeals)-29, New Delhi, for Assessment Year 2018-19. The respondent, Bijwasan Realty One P. Ltd., a private limited company engaged in construction, development, and sale of land, filed its return of income declaring Nil income. The case was reopened under section 147 of the Income Tax Act, 1961, and notice under section 148 was issued. During reassessment proceedings, the Assessing Officer noted a transaction of Rs.25,97,503/- with M/s KG Finvest Pvt. Ltd., representing interest paid on an unsecured loan. The AO considered M/s KG Finvest Pvt. Ltd. to be a dummy/shell entity and made an addition of Rs.25,97,503/- under section 69C of the Act. The respondent challenged this addition before the CIT(A), which deleted the addition, holding that the respondent had established the identity and creditworthiness of the creditor and the genuineness of the transaction.…

Legal Issues

• 1. Validity of reassessment proceedings
• 2. Addition of Rs.25,97,503/- under section 69C of the Act

Judgment Outcome

Decided in favour of Assessee.

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