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2023 (1) TMI 709 - ITAT CHENNAIUnexplained cash credit u/s.68 - onus to explain - assessee unable to prove the identity of the debtors and their creditworthiness - CIT(A) confirmed the addition by stating that all sundry debtors said to have received loans from the assessee are persons of meager means and he considered the remand report of the AO and the loan amount received is only a bogus claim and method adopted by assessee to bring his own unaccounted cash into main stream - HELD THAT:- The assessee has filed all the details in regard to debtors from whom the assessee has received back the money. The assessee has filed all the details before the AO in regard to receipt of this money, which has been loaned out to these above stated persons. According to us, the assessee realized the sum of loan amounts from the villagers as per the submitted affidavit, confirmations, source of income and details of land holding filed, the assessee has discharged his onus of proving the sundry debtors. We noted that all these details were referred by CIT(A) back to the AO to verify the veracity and in turn, the AO referred the matter to the Revenue Officer, i.e, Tahsildar on communication from the Income-tax Department, all confirmed the transaction. It is pertinent to note that all the persons admitted have returned the money. Since the assessee has discharged all initial onus and assessee was asked to prove the source of debit entries, the assessee actually proved in the present case. In the case of DCIT vs. Rohini Builders [2001 (3) TMI 9 - GUJARAT HIGH COURT ] held that the amount representing cash credits was not includable in the total income of the assessee as the assessee had discharged the initial onus and the assessee can be asked to prove the source of the source of credit in its books of accounts, which the AO failed to do so. In view of this finding and moreover these being only debtors who have returned their loan amount to the assessee and assessee has declared all these loan amounts in their books of accounts, which were never rejected by the Department and accepted in earlier years, now they cannot go back until that the source are not proved. Thus we are of the view that the debtors cannot be added u/s.68. The assessee has discharged the onus laid u/s.68 of the Act by filing overwhelming evidences which were examined by the AO as well as by the Revenue officials of the Tamil Nadu Government and hence, we delete the addition and allow this issue of assessee’s appeal. Treating the surplus on sale of agricultural land as business income - HELD THAT:- Assessee had earned agricultural income and consistently from assessment year 2007-08 admitted agricultural income. The Revenue records also show that the same are subject to agricultural revenue and lands are agricultural lands. Even the crops are grown and agricultural activities were carried out. Hence, in the given facts, which are un-controverted, we hold that the sale proceeds are of agricultural land and not business asset as is being contended by Revenue. Hence, the same cannot be assessed to capital gains and are exempt. Accordingly, this issue of assessee in both the years is allowed. Unexplained credit being amount received temporarily from the creditor as unexplained cash credit u/s.68 - HELD THAT:- At this stage, when pointed out to ld.counsel, whether he want to file the details before AO to prove the creditor, he undertook to file complete details and to produce whatever evidence the AO wants in regard to this. On this, the CIT-DR has not objected. Hence, in view of the concession given by both the sides, we remit this issue back to the file of the AO, who will examine the creditor and then will decide accordingly.
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