TMI Blog2003 (7) TMI 268X X X X Extracts X X X X X X X X Extracts X X X X ..... e of further proceedings, the assessee-filed affidavits of some persons in support of unsecured loans on 25th March, 1996. The AO did not accept affidavits or letters of confirmation allegedly filed on behalf of the creditors and treated the following' cash credits as assessee's income from undisclosed sources. This-way, he made addition of Rs. 95,000 to the income of the assessee: ----------------------------------------------- "S.No. Name of person Amount (Rs.) ----------------------------------------------- 1. Sh. Suba Singh 19,000 2. Sh. Subhash Jain 19,000 3. Sh. Laxman Singh 15,000 4. Sh. Manoj Kumar 15,000 5. Sh. Mangla Ram ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r face value. Had the loans taken by the assessee been genuine he would have discharged his onus by producing the above persons atleast after having been given so many opportunities. Assessee's intentional avoidance to produce all such persons further strengths my observations. Therefore, keeping in view the overall facts, the above cash credits are held to be in genuine as the assessee has failed to prove their genuineness and given any evidence to prove the capacity of the alleged persons. It is also, therefore, held that all the above amounts represent assessee's own income from undisclosed sources which he has introduced in his books of account in the garb of cash credits. Accordingly, total amount of all the above squared up cash credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sh. Jain, on the other hand, supported the impugned order of the CIT(A). He drew my attention to the submission made before the learned CIT(A). He argued that all the requirements to establish genuineness of cash credits were satisfied in this case and, therefore, the impugned order of CIT(A) should be upheld. 6. I have given careful thought to the rival submissions of the parties. The AO had asked the assessee to produce creditors for his examination. This was not doen. This failure was condoned on appeal on the ground that sufficient time was not allowed to the assessee to prove cash credits. The assessee had alternatively filed affidavits of creditors in support of cash credits. It is, therefore, necessary to refer to affidavits. For e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is false. (I.T.I, of Mangla Ram) Deponent" The other affidavits of the creditors are on the same line. 6.2 It is accepted by both the parties that to prove a cash credit in terms of s. 68 of the IT Act, the assessee has also to establish credit worthiness of the creditor. The assessee has to show that creditor had the capacity to advance loan. In my view, credit worthiness of creditors in this case has not been established, and affidavits do not advance assessee's case. The alleged creditors are uneducated labourers. Some are earning income from brokerage. No detail of their total income is available to show that these persons had capacity to advance loan to the assessee. It is not the law that every affidavit is to be accepted on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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