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2014 (4) TMI 433 - ITAT AHMEDABADAddition u/s 68 of the Act - Unexplained cash credits – Held that:- If there is an entry in the accounts of the assessee, which shows the receipt of a sum the burden is on the assessee to explain the nature and source of such credit - the cash creditors shown in the name of Hira Bai Meghji Savla at Rs.2 lacs where no copy of return had been filed only copy of PAN card given to the AO - The source of income has not been explained - The full copy of bank account maintained with HDFC, Vapi has not been filed by the assessee - there were cash deposits also in bank account – thus, there is no reason to interfere in the order of CIT(A) – Decided against Assessee. Disallowance of labour expenses u/s 40(a)(ia) of the Act – Held that:- The assessee is in construction business - The expenses debited in the P&L account and had not been doubted by the A.O - In construction business, the labour is required and it is an unorganized sector and some persons are required to arrange the labour for construction work - The assessee paid this amount through mukadam - The mukadam has further distributed these payments in labourers - The mukadam had not given any margin money as profit on distribution of labour charges among labourers - When there is no profit element in payments, the TDS is not required to be deducted – the decision in DCIT vs. Laxmi Protein Products (P.) Ltd. 2010 (2) TMI 989 - ITAT AHMEDABAD] followed – The individual payment is not exceeding the prescribed limit and once this is not the case, the assessee is not supposed to deduct tax under section 194C of the Act - The assessee is not required to deduct TDS u/s. 194C on labour payments made through the mukadam – Decided in favour of Assessee. Restriction of addition u/s 68 of the Act – Held that:- The decision in BLESSING CONSTRUCTION Versus INCOME TAX OFFICER [ 2013 (10) TMI 154 - GUJARAT HIGH COURT] followed - there is no creditworthiness of the cash creditor to give loan of Rs.1,30,000/- to the assessee - the assessee had not proved creditworthiness of the cash creditor as he had shown only income of Rs.99,260/- in the return - The bank account shows that cash has been deposited in the bank account of the cash creditor - the identity and the genuineness of the transaction had been proved by the assessee but cash creditor did not have creditworthiness to advance Rs.1,65,000/- to the assessee and also in bank account substantial cash has been deposited and thereafter loan was advanced by the cash creditor to the assessee - it is not the duty of the AO to prove that unaccounted income of the assessee routed through this cash creditor as held by various Courts - the creditworthiness has not been discharged by the assessee - Thus, the order of the CIT(A) is reversed – Decided in favour of Revenue.
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