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2014 (12) TMI 291 - ITAT PUNEAssessment u/s 153A - Addition of unexplained gifts – Genuineness of transactions established or not -Held that:- For the purposes of establishing the nature and source of any credit appearing in the books of account, the burden is on the assessee in terms of the provisions of section 68 of the Act - an assessee is required to establish the identity of the creditor, creditworthiness of the creditor as well as genuineness of the transaction - assessee claims that such onus has been discharged because it has filed the return of income, copy of bank account, PAN numbers, details of assessment, confirmations, etc. of the donors - assessee and his family members had obtained bogus gifts i.e. unaccounted monies were introduced in the guise of gifts - a few transactions of gifts were surrendered by the assessee group as unexplained also - so far as the three gifts in question are concerned, there was no surrender by the assessee - the assessee could neither produce the donors and nor provide their correct addresses – CIT(A) have correctly come to a finding that the genuineness of the present gifts has not been established by the assessee – thus, the invocation of section 68 of the Act is upheld– Decided against assessee. Addition of lesss GP declared by assessee – Held that:- The AO as well as the CIT(A) have succinctly brought out infirmities/discrepancies in the account books maintained by the assessee - Ostensibly, the enquiries during the course of search/survey action clearly pointed out that the trading results declared by the assessee are impaired inasmuch as the sales as well as the stock figures are recorded on estimation and not on actual basis - The excess physical stock found on the date of search also justifies the inference of the Assessing Officer that the book results are not reliable - the lower authorities made no mistake in disregarding the book results declared by the assessee and estimating the Gross Profit @ 6% - thus, the order of the CIT(A) sustaining the addition on account of low Gross Profit for the three AYs of 2000-01, 2002-03 and 2003-04 respectively – Decided against assessee. Addition of unexplained cash credits u/s 68 – Held that:- The onus is on the assessee to establish the nature and source of the cash credits appearing in the books of account, having regard to the provisions of section 68 - the CIT(A) has reproduced the bank account statements of the creditors to show that cash deposits have been made immediately before issuing Demand Drafts to the assessee for the loans – both the AO and CIT(A) was of the view that the creditors have not explained the source of such cash deposits - No doubt, the assessee furnished the income-tax particulars, etc. of the creditors, but their failure to even prima facie explain the source of cash deposits in their bank account coupled with the fact that assessee has been found indulging in introducing unaccounted income by way of cash credits, the loans cannot be considered as genuine - there is no material to infer otherwise than what has been concluded by the AO as well as the CIT(A) - the assessee has introduced his unexplained income in the guise of loans – thus, the order of the CIT(A) that the source of unexplained cash credit can be assumed to have come out of the intangible additions on account of low Gross Profit is upheld – Decided against assessee.
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