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2022 (5) TMI 775 - AT - Income TaxAddition u/s 68 - genuineness of the credits - Unexplained investment by a partner - HELD THAT:- Even the genuineness of the credits is very doubtful as there is apparently no reason, nor any stands put forward at any stage, for the cash introduction by the partners, who could have introduced capital in the firms” books through the banking channel, and more so, particularly considering the cash availability with them is not shown. Further, there is no justification for holding cash by them for months, if not years, together. That the source thereof is stated to be a loan further adds to its un-creditibility inasmuch as nobody would, normally speaking, take loan only to be held in bank or as cash-in-hand. Partners, being businessmen rather, understand the time value or the opportunity cost of money much more than non-businessmen, while, the said conduct defeats the very purpose of loan/borrowing, said to be interest bearing. The affidavit by the partners (not on record), would only operate as a confirmation from them and, thus, only proves their identity, while, as afore-discussed, both the capacity and the genuineness are highly suspect and, therefore, rightly doubted and found as not satisfactorily explained by the Revenue. Rather, the partner/s, being a related person, an assessee ought to be able even the personal details, normally not accessible for other creditors, in support of it”s claims. The legal position stands examined in Jagmohan Ram Chandra [2004 (8) TMI 46 - ALLAHABAD HIGH COURT] also referring to its previous decisions in the matter, as well as in Kishorilal Santoshilal [1995 (2) TMI 14 - RAJASTHAN HIGH COURT], both relied upon by the ld. CIT(A), in considerable detail. The decision by the jurisdictional High Court in Metachem Industries [1999 (9) TMI 21 - MADHYA PRADESH HIGH COURT] is not in any manner supportive of the assessee”s claims, rather, making it clear, and unless the credit is established, be it from a partner or from another, it would attract s. 68. Appeal of assessee dismissed.
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