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2018 (12) TMI 1558 - AT - Income TaxAddition on account of unexplained cash credit - Held that:- We hold that except crediting the cash to the credit of various debtors’ account in the ledger accounts of the assessee, we find that the assessee had not produced any other corresponding evidences from external sources such as from debtors’ confirming this fact of having settled their dues to the assessee in cash. The confirmatory certificate stated to have been filed by the assessee before the CIT(A) is not forming part of Paper Book filed before us and hence the same cannot be taken into account for want of proof. Once the cash is deposited into bank account of the assessee, the onus is primary on the assessee to prove that the said cash is sourced by realization from debtors, which in the instant case has not been proved by the assessee except making an oral statement and taking credence from the entries passed by him in the books of accounts of Rajeev Trading Co. It is not in dispute that the seven notices sent by the AO u/s 133(6) to seven sundry debtors returned unserved. The assessee did not take corrective measures to produce confirmations from these seven sundry debtors either during the assessment proceedings or during the appellate proceedings. Hence we hold that the primary onus and the three ingredients of section 68 has not been discharged by the assessee in the instant case. - decided against assessee Claim of bad debts u/s 36(1)(vii) - alternative argument stating that in case if the said credit to the account of the sundry debtors are not believed to be genuine by the department, it cannot be disputed that the assessee had reduced the debtors’ account balances in its books of accounts which effectively amounts to write off of debts - Held that:- As relying on M/S. D.K. INDUSTRIES VERSUS I.T.O WARD 34 (3) , KOLKATA [2016 (5) TMI 850 - ITAT KOLKATA] we hold that the assessee in the instant case is entitled for deduction as bad debts based on alternative argument advanced by the ld. AR. Accordingly, grounds raised by the revenue are dismissed.
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