Burden of proof in unexplained cash transactions: assessing authority must prove occurrence with independent corroboration or additions may be deleted.

Issue concerns deletion of an addition under the law treating alleged cash payment as an unexplained investment. The tribunal emphasises that an unsigned photocopied agreement is not cogent, authenticated documentary evidence and that the legal burden to prove that a cash transaction occurred rests on the assessing authority. Requiring the assessee to prove non-occurrence impermissibly shifts that burden. In absence of independent or corroborative evidence by the assessing authority, the appellate deletion of the addition was supportable and therefore upheld.

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Issues: Whether the appellate authority was justified in deleting the addition of Rs. 2,00,00,000/- made by the assessing officer under Section 69B of the Income-tax Act, 1961, where the assessing officer relied on an unsigned photocopied agreement and placed the onus on the assessee to prove non-occurrence of the alleged cash transaction.

Analysis: The assessing officer treated the alleged cash payment as an unexplained investment under Section 69B of the Income-tax Act, 1961, relying primarily on a photocopied, unsigned agreement and on an entry recording receipt for Rs. 2,00,00,000/-. Bank statements produced showed no cheque/ banking transaction for the said amount and the assessee denied execution of the agreement and occurrence of the cash payment. The assessing officer required the assessee to produce independent witnesses or documentary evidence to prove non-occurrence of the event instead of establishing the occurrence of the cash transaction. The appellate authority examined whether the material relied upon by the assessing officer constituted cogent documentary evidence and whether the legal burden of proving that a transaction occurred was discharged by the assessing officer.

Analysis: The unsigned photocopy of the agreement was not a cogent, authenticated document capable of conclusively proving the alleged transaction. Requiring the assessee to prove non-occurrence of a transaction places an impermissible burden on the assessee; the legal burden to establish that a cash transaction of the stated amount took place rests on the assessing officer and must be discharged by independent or corroborative evidence. In the absence of such proof and given the weakness of the primary document relied upon, the deletion of the addition by the appellate authority was supportable.

Conclusion: The deletion of the addition of Rs. 2,00,00,000/- under Section 69B of the Income-tax Act, 1961 is upheld; the assessing officer failed to produce cogent evidence to establish that the cash transaction occurred and wrongly shifted the burden to the assessee.

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