IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “A”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील स.ं / ITA No.1027/PUN/2024 Assessment Year : 2019-20 Meenamani Ganga Builder LLP , Vs. PCIT (Central), San Mahu Complex, Office N5, Pune Bund Garden Road, Opposite Poona Club, Pune 411 001, Maharashtra PAN : AAUFM6455H Appellant Respondent Appellant by : Shri Rajiv Thakkar Revenue by : Shri Amol Khairnar Date of hearing : 28.01.2025 Date of pronouncement : 21.04.2025 आदेश / ORDER PER DR. MANISH BORAD, ACCOUNTANT MEMBER :

This appeal filed at the instance of assessee pertaining to the Assessment Year 2019-20 is directed against the order dated 12.03.2024 passed by PCIT(Central), Pune u/s.263 of the Income-tax Act, 1961 (in short ‘the Act’).

2. The solitary ground raised by the assessee reads as under :

“On the facts and circumstances prevailing in the case and as per provisions and scheme of the Act it be held that the order passed by the Principal Commissioner of Income Tax by invoking the provision of section 263 of the Act is without jurisdiction and hence is improper, unwarranted, unjustified and contrary to the provisions of law and facts prevailing in the case. The order passed u/s.263 be set-aside. The Appellant be granted just and proper relief in this respect.

3. Brief facts of the case are that the assessee is a Limited Liability partnership engaged in Real Estate business. Search u/s.132 of the Act conducted on 10.01.2019 in the case of assessee. The assessee e-filed return of income on 30.09.2020 declaring income of Rs.28,60,630/-. The case selected for scrutiny followed by validly serving of notices u/s.143(2) and 142(1) of the Act. Various details were called for regarding the documents found during the course of search as well as statement given. Information was also called about the on- money received on the immovable properties held as stock in trade sold during the year. Based on these observations, ld. AO made addition amounting to Rs.3,36,95,925/- and after duly taking approval from Addl.CIT u/s.153D of the Act assessed the income at Rs.3,65,56,555/- Subsequently, ld. PCIT having jurisdiction u/s.263 of the Act called for the assessment records of the assessee for A.Y. 2019-20 and after perusal of the assessment records noticed that there are huge unsecured loans standing in the books. However, ld. AO has not called for the necessary details to verify the Identity and Creditworthiness of the unsecured loans and genuineness of the transaction. Ld.PCIT issued following show cause notice :

“02. In the above mentioned case, on verification of case records for A.Y. 2019-20 it has been observed that the assessee company had filed return of income for AY 2019-20 on 30.09.2020 declaring total income at Rs.28,60,630/-. The assessment was completed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred as 'the Act')

on 20.04.2021 by assessing the income at Rs.3,65,56,555/-.

03. On perusal of the assessment records it is seen that it is seen that total unsecured loans outstanding in the books of the assessee as on 31/03/2019 were at Rs.52, 19,93,434/-. Out of the same, an amount of Rs.11,97,71,081/- is shown as unsecured Loans from related parties and an amount of Rs.40,22,22,353/- is shown as unsecured loans from other parties. Further, it is seen that during the course of assessment proceedings only the details of the unsecured loans taken have been called for & placed on record.

However, the confirmation along with the details supporting their creditworthiness, identity and genuineness were not obtained for further verification.

3.1 Further, on perusal of the assessment records, it is seen the assessee had submitted confirmations of 70 cases and stated that the unsecured loan parties were not providing the other relevant documents as called for. Since, the assessee had only submitted confirmation in 70 cases and not submitted the copies of returns of income of the unse