TMI Blog2012 (5) TMI 186X X X X Extracts X X X X X X X X Extracts X X X X ..... e creditors, the action taken by the AO in examining the lenders of the assessee was a wrong approach - Tribunal below rightly set-aside the deletion made by the Assessing Officer, based on erroneous approach by wrongly shifting the burden again upon the assessee without verifying the Income Tax return of the creditors – in favour of assessee. - TAX APPEAL NO. 50 OF 2011 - - - Dated:- 20-3-2012 - BHASKAR BHATTACHARYA, J.B. PARDIWALA, JJ. Mrs. Mauna M. Bhatt for the Appellant. ORDER Bhaskar Bhattacharya, Actg. CJ This Appeal under Section 260A of the Income Tax Act, 1961 is at the instance of the Revenue and is directed against the order dated 25th August 2010 passed by the Income Tax Appellate Tribunal, Rajkot Bench, Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... persons stated that before receiving the cheques, the assessee had given cash to them which was deposited in the account of M/s. Vaibhav Enterprises on different dates, and against that, they had received cheque and out of that balance they had deposited the money with the assessee. 7. The assessee was given opportunity to cross-examine two of the lenders. In the cross-examination, both the lenders had confirmed giving loan to the assessee, and in response to the question of the assessee about the source of the money, it was stated that they had received cash from the assessee which they had deposited in M/s. Vaibhav. Enterprises and from that account cheques were issued in favour of the lenders, and in turn, the lenders issued cheques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine the books of account of M/s. Vaibhav Enterprises. The appellate authority further came to the conclusion that suddenly the lenders made confessional statement to the Assessing Officer that the appellant had given them money and the same were deposited in the bank account; however, later on, they had stated that the money was given by some other person whom they did not know. According to the Commissioner of Income Tax (Appeals), the statement of the lenders were full of inconsistency and incongruity and thus it was not a fit case of believing those persons. 11. The Commissioner of Income Tax (Appeals), thus, deleted the said amount. 12. Being dissatisfied, the Revenue preferred appeal before the Commissioner of Income Tax (Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 68 of the Income Tax Act. 17. If on verification, it was found that those lenders did not disclose in their income tax return the transaction or that they had not disclosed the aforesaid amount, the Assessing Officer could call for further explanation from the assessee to prove the genuineness of the transaction or creditworthiness of the same. However, without verifying such fact from the income tax return of the creditors, the action taken by the Assessing Officer in examining the lenders of the assessee was a wrong approach. Moreover, we find that those lenders have made inconsistent statement as pointed out by the Commissioner of Income Tax (Appeals) and in such circumstances, we find that both the Commissioner of Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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