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2018 (5) TMI 803 - AT - Income TaxUnexplained cash credit - unexplained source of source of loan received - non appearance of creditors on summon orders - Held that:- In ‘Kalyan Memorial’ (2009 (7) TMI 874 - ITAT AGRA) AO held that the creditworthiness of the creditors was not proved. The Third Member Bench of the Tribunal held that when the particulars regarding Income Tax Assessment and bank accounts had been filed, the initial burden on the assessee stood discharged and no material had been brought by the Department to show that what was explained by the assessee was not the correct state of affairs; that if any sum is found credited in the accounts of the creditors, the creditors may be examined to explain the credits; and that so far as regards the source of the deposit in the account of the assessee. In the present case the creditors chose not to appear in response to the summons, but they filed replies, again filing the documents filed by the assessee. Now, for the non-appearance of its creditors, the assessee cannot be faulted. If the AO was not satisfied with the creditors’ replies, it was well within his powers to ensure their presence. This, however, was not done and the matter was decided against the assessee, holding that the assessee could not prove the source of the source of the loans received by it. This is not tenable in law - Decided in favour of assessee.
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