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2018 (9) TMI 209 - AT - Income TaxAddition towards undisclosed income relating to alleged deposits made in all the three years under consideration in a co-operative society - Held that:- The manner of repayment of money, if any, has also not been examined. Since the deposits do not stand in the name of the assessee, effectively the assessee will not have control over the deposits. However, in respect of loan taken, the borrowers would be liable to repay the loans, since the society/bank can always initiate legal action against the borrowers for recovery of loans. A prudent man cannot be expected to enter into such kind of deals. The loans taken through accounting channels can be repaid only through accounting channels only. We have noticed that the loans taken by the relatives have been repaid by them. Neither Shri S.K. Tardale nor the Assessing Officer has brought on record any material to show that the loan amounts have been repaid out of the deposits alleged to have been received from the assessee. Hence the presumption drawn by the AO that the assessee has indulged in the practice of converting the black money into white may not be correct in the facts and circumstances of the case. Apart from the loan transactions, the AO has relied upon the statements given by Shri S.K. Terdale. We have noticed earlier that the statements given by him were not substantiated and hence not reliable. We have also noticed that the assessee cannot be expected to prove a negative fact. Accordingly we are of the view that the statements given by Shri S.K. Terdale cannot be taken support by the Assessing Officer. The assessee has not accepted the statements of Shri S.K. Terdale. D.R mentioned about the failure of the assessee to avail cross-examination. We agree with the contentions of the ld A.R that there was no requirement to make any cross examination, since the assessee was not required to prove any negative fact. Hence, for the detailed reasons, discussed in the preceding paragraphs, we are of the view that none of the evidences support the case of the Assessing Officer. Accordingly we set aside the orders passed by ld CIT(A) on this issue in all the three years under consideration and direct the AO to delete the impugned additions made in all the three years under consideration.
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