Section 68 burden of proof on unsecured loans upheld; unsubstantiated confirmations and non-compliance did not justify deletion.

For an addition under section 68 of the Income-tax Act, the assessee must prove the creditor's identity, creditworthiness and the genuineness of unsecured loans; repeated non-compliance and mere filing of returns and photocopy confirmations were insufficient, so the addition was sustained. A plea of denial of proper opportunity also failed because the record showed repeated opportunities before the assessing authority, the first appellate authority and the Tribunal, with the assessee remaining absent and uncooperative, so no interference was warranted.

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Issues: (i) Whether the addition made under section 68 of the Income-tax Act, 1961, in respect of unsecured loans was liable to be deleted. (ii) Whether the plea of denial of proper opportunity and ex parte disposal warranted interference.

Issue (i): Whether the addition made under section 68 of the Income-tax Act, 1961, in respect of unsecured loans was liable to be deleted.

Analysis: The assessee did not comply with repeated notices during assessment and failed to produce evidence establishing the identity and creditworthiness of the creditors as well as the genuineness of the unsecured loans. Mere filing of returns of income and photocopies of confirmations, without corroborative material, was found insufficient to discharge the burden cast on the assessee for proving the source and nature of the credits.

Conclusion: The addition under section 68 was sustained and the challenge to it failed, in favour of the Revenue.

Issue (ii): Whether the plea of denial of proper opportunity and ex parte disposal warranted interference.

Analysis: The record showed repeated opportunities before the Assessing Officer, the first appellate authority, and the Tribunal, but the assessee remained consistently non-compliant and absent. In these circumstances, the claim of lack of proper opportunity was not accepted.

Conclusion: The plea of denial of opportunity was rejected, in favour of the Revenue.

Final Conclusion: The Tribunal upheld the addition and declined to interfere with the appellate order, resulting in dismissal of the assessee's appeal.

Ratio Decidendi: For an addition under section 68 of the Income-tax Act, 1961, the assessee must satisfactorily prove the identity and creditworthiness of the creditor and the genuineness of the transaction; persistent non-compliance and unsubstantiated confirmations do not discharge that burden.

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