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2012 (12) TMI 484 - AT - Income TaxAssessee had received gifts during her marriage and credit the same in bank account – Such addition first made in hand of HUF where CIT(A) delete the same - Instead of filing appeal before Tribunal AO made addition in hand of assessee - Mere non-supply of copies of the statements which were recorded at the assessment stage would vitiate the entire proceedings – Held that:- Non-supply of copies of the statements which were recorded at the assessment stage of HUF is only procedural lapse but it cannot vitiate the entire proceedings. The AO of HUF had conducted a detailed enquiry. However, the additions were wrongly made in the income of the HUF. As per the findings of the AO sum was credited in the bank account of the assessee. Therefore, the same was liable to be taxed in the hands of the assessee and not in the hands of the HUF. The findings of the CIT(A) in the case of appeal filed by HUF cannot be applied in the present case for the reasons that prima-facie amount was not taxable in the hands of HUF. But, at the same time, that amount cannot escape tax liability. Non-supply of documents/statements by the Assessing Officer to the assessee can be termed as procedural lapse. Therefore, the amount is liable to the taxed in the hands of the assessee. Issue decides in favour of revenue. Disallowance of interest expense – AO argued that assessee had diverted the borrowed funds for non-business purposes – Held that:- As concluding from the facts of the case that it was categorically stated that the personal accounts and business accounts were separately maintained by the assessee and there was no inter-connection transaction between personal and business accounts. The assessee had advanced monies from her personal account. This fact is reflected from bank statement. Issue decides in favour of assessee
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