TaxTMI 
TaxTMI 
2015 (2) TMI 107
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....das. 3. While scrutinizing the return of income for the A.Y. 1987-88, the A.O. noticed that the balance has been drawn by the assessee in the Andhra Bank, Fort branch account amounting to Rs. 6,69,35,305/-. The assessee was asked to furnish full details of sale and purchase transactions of securities and units. The assessee filed a statement of Andhra Bank account along with copy of some bank advices. The A.O. observed that the details were incomplete as there was no mention about the counter parties nor any confirmation was furnished in this respect. The assessee was asked to explain why liabilities of Rs. 6,69,35,305/- shown in the Andhra Bank, Fort branch should not be treated as bogus liability. Vide letter dtd. 5-1-1995, the assessee took a stand that it has not entered into any security transactions. The broker has arranged the fund by entering into certain transactions with Andhra Bank and further stated that the details of these transactions can be obtained from Andhra Bank. The A.O. did not accept this explanation of the assessee and proceeded by making addition of Rs. 6,69,35,305/- u/s 68 of the Act holding that the assessee was not able to explain nature, source and gen....
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....made by the ld. Counsel for the assessee, the ld. D.R. strongly submitted that the assessee was notified as a notified person on 8-6-1992 and the Janaki Raman Committee was constituted to examine the large scale transaction in Government securities through the medium of brokers Post 1-4-1991. it is the say of the ld. D.R. that the transactions involved in the year under consideration pertained to the period 1-10-1985 to 30-9-1986, therefore, the same cannot be considered akin to the securities scam transaction. The ld. D.R. further stated that the additions have been made only on the basis of books of account of the assessee and the assessee has not furnished any confirmation either from Andhra Bank, Fort branch or from the broker M/s Champaklal Devidas. The ld. D.R. concluded by saying that the assessee is not able to explain the source of deposit in the bank therefore the addition deserved to be confirmed. 7. We have heard the rival submissions and carefully perused the orders of the lower authorities. We have also considered the relevant document referred to and relied upon by the ld. Counsel for the assessee. The issue before us is whether the addition of Rs. 6,69,35,305/- mad....
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....s required is some prime facie evidence given to the person in order to cast the burden in the case in hand. We find that the books of account of the assessee show the transaction as purchase and sale of securities and the assessee was asked to explain the same. Now the ld. Counsel for the assessee time and again constantly took a stand that the transactions are akin to the security scam transaction. Thus this fact is within the special knowledge of the assessee itself, therefore, the burden of proving this fact squarely lies upon the assessee. 13. The Hon'ble Madras High Court in the case of CIT vs. Krishnaveni Ammal, 158 ITR 826 has observed:- "But when, even according to the assessee, there is other documentary evidence of corroborative value and the same is within the reach of the assessee, the judicial body cannot act on the interested testimony of the assessee alone. The Law of Evidence mandates that if the best evidence is not placed before the court, an adverse inference can be drawn as against the person who ought to have produced it". 14. Even before us, the assessee could not adduce any conclusive evidence in support of its contention that the impugned transaction is ....
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....est by the assessee is dismissed. The findings of the ld. CIT(A) is confirmed. The second contentious issue is also dismissed. Now, we shall take up the appeal for A.Y. 1988-89. 20. The only issue relates to the disallowance of Rs. 1,06,27,875/- being amount of finance charges payable. 21. The assessee has claimed to have paid finance charges on borrowings from Andhra Bank and M/s Champaklal Devidas. The assessee was asked to furnish full details of such transaction. The A.O. observed that no such details have been furnished. The A.O. further observed that the assessee's claim of borrowing from Andhra Bank as well as Champaklal Devidas is not supported by assessee's own books. According to the A.O., the onus was on the assessee to show that the borrowing was actually made and the same were utilized for business purposes. The assessee has utterly failed in its responsibility, the A.O. disallowed the claim of Rs. 1,06,27,875/-. Aggrieved by this, the assessee carried the matter before the ld. CIT(A) but without any success. 22. Before us, the ld. Counsel for the assessee referred to the debit and credit not in support of his contention that the claim of finance charges is genuine....