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2015 (8) TMI 112 - AT - Income TaxUnexplained gift/loans received - Gift received - explaining source or source - capacity to give gift/loans - Held that:- It is clear from the material on record that donor as well as creditors could not show prima facie the source of funds out of which gift/loans were given. Added to this is the circumstance that on the date when the gift/loans were given, there were cash deposits made in the bank accounts. It is in these circumstances that the donor/creditors were called upon to show their capacity to give gift/loans. We are satisfied that the explanation given with regard to capacity of the donor/creditors is unsatisfactory. With regard to the argument of the ld. counsel for the assessee that the assessee has been called upon to explain the source of source, we are of the view that the said stand taken by the ld. counsel for the assessee is unsustainable. As already stated, the capacity of the creditor alone was questioned by the revenue authorities. This cannot be equated as calling upon the assessee to furnish source of source. The capacity of the creditors has not been prima facie established by the assessee. It is only when credible evidence is let in regarding capacity of the creditor that this argument of calling upon the assessee to explain source of source can be advanced. In this regard, the law laid down by the Hon’ble Calcutta High Court in Shankar Industries (1978 (3) TMI 91 - CALCUTTA High Court ) clearly explains the legal position wherein held that capacity of the creditor has to be established by the assessee.- Decided against assessee.
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