MoU and Bank Records Support Loan Deal and Repayment: ITAT Flags Gaps in AO’s Unexplained Income Investigation

The ITAT ruled in favor of the assessee, noting that an MoU and bank statements sufficiently substantiated a loan and its repayment. It criticized the AO for failing to investigate these documents before labeling the transaction as unexplained income. The judgment reinforces that proper documentary evidence, if unrefuted, carries legal weight and that tax authorities must thoroughly verify records before invoking income tax provisions on unexplained credits.