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2013 (10) TMI 1074 - AT - Income TaxApplication of section 69 of the Income Tax Act - Addition on account of Deposits in the bank account of Francis Joseph - Rs.3,00,000/- - Held that:- Tax authorities have not placed reliance solely on the sworn statement given by Shri Francis Joseph – They have taken into consideration the conduct of the assessee, capacity of the assessee, capacity of Shri Francis Joseph and the surrounding circumstances also in deciding this issue - Under these circumstances, the question of violation of natural justice does not arise by not providing opportunity of cross examination to the assessee - AO issued summons to Shri Francis Joseph more than one time, but the said person declined to appear before the AO, as he was scared of the assessee. Thus, it cannot be said that the AO did not offer opportunity of cross examination, but the external circumstances blocked the AO to provide such an opportunity to the assessee. It is also pertinent to note that the assessee, being brother in law of Shri Francis Joseph, could not produce him before the AO to retract the statements already given by him before DDIT. On the contrary, Shri Francis Joseph, despite the alleged threat from the assessee, has firmly stood by his statement that the impugned bank account belongs to the assessee only. Tax authorities have corroborated the statement given by Shri Francis Joseph with sufficient material and surrounding circumstances. Accordingly held that the transactions found in the bank account, except the first two transactions, belong to the assessee only – Thus, confirmed assessment of deposits found in the bank account standing in the name of Shri Francis Joseph, in the hands of the assessee. Addition u/s 68 of the Income tax act - Unexplained credit in the capital account of the firm - Rs.5,60,000/- - Amount found credited in the capital account of the assessee in the books of partnership firm - Held that:- Assessee did not claim that he received a sum of Rs.10,15,000/- on slaughter tapping and sale of trees before the AO either during original assessment proceeding or during reassessment proceeding. He has made this submission for the first time before Ld CIT(A). In any case, the assessee could not substantiate his submissions with any credible evidence. On the contrary, the Ld A.R has only presumed that the copies of agreements might be available in the assessment record - Assessee did not make any attempt to inspect the assessment record in order to find out the availablity of the three agreements – Decided against the Assessee. Addition of loan of Rs.4.00 lakhs taken from Shri George Joseph – Held that:- It is well settled proposition that the initial burden of proof is placed upon the assessee u/s 68 of the Act, i.e., the assessee has to discharge three main ingredients viz., the identity of the creditor, genuineness of transactions and credit worthiness of the creditor - Assessee has failed to prove the credit worthiness of the creditor and also the genuineness of the transaction - Ld CIT(A) was justified in confirming the addition of Rs.4.00 lakhs made u/s 68 of the Act. The Ld A.R contended that the provisions of sec. 68 cannot be invoked in the absence of credit in the books of account. However, assessee cannot use the fact of his failure to maintain the books to his advantage to raise contentions to suit his purpose – Decided against the Assessee. Addition of interest income of Rs.15,911/- - Held that:- Assessee has declared the above said interest income in cash flow statement, but it was not included in the return of income - Assessing officer did not include the above said income in the reasons recorded for re-opening of assessment - AO is very much entitled to assess the escaped income during the reassessment proceedings, which comes to his notice during the course of assessment – Decided against the Assessee. Interest u/s 234B of the Act – Held that:- Charging of interest is consequential in nature, therefore interest to be charged on the assessee – Decided against the Assessee.
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