TaxTMI 
TaxTMI 
2011 (1) TMI 706
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....s.25 lacs made on account of unexplained credits u/s. 68? [B] Whether the Appellate Tribunal erred in law in not appreciating that in view of the categorical admission by late Shri Mahendra H Shah in his statement recorded during the course of search u/s. 132 (4) of the Act, the concerns from which the said credits were shown in the books of accounts of the assessee were only utilized by Shri Shah for providing the accommodation entries and the assessee could not furnish any evidence to establish that the said transactions were genuine? [C] Whether on the facts and in the circumstances of the case, the Appellate Tribunal erred in law in deleting the addition of Rs.25,500/- as interest payment on the said bogus loans and the ....
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....dhupuri Metal Industries Pvt. Ltd., were not in the nature of loan transactions, but advances against sale of goods. The Assessing Officer did not accept the assessee's explanation and observed that the transactions were not in the nature of sale but were accommodative loan entries and the cash provided for getting such entries had not been accounted for by the assessee in its books. He, accordingly, observed that in the case of the assessee firm the surrounding circumstances suggested that the creditors had no capacity to advance moneys to the assessee and the transactions were not genuine. The Assessing Officer worked out the peak of credits during the block period at Rs.25 Lacs and made addition of the said loans under section 68 of the ....
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....appellant assailed the impugned order of the Tribunal submitting that the Tribunal was not justified in holding that the proceedings under section 158BD were initiated against the assessee not on the basis of any material or evidence gathered during the search but on the basis of post search inquiry. It was submitted that the impugned order of the Tribunal does give rise to questions of law as proposed or as may be formulated by the Court and that the appeal deserves to be admitted. 4. As can be seen from the impugned order of the Tribunal, the Tribunal has recorded the following findings of fact: i. The statement of Shri Mahendra H Shah referred to by the Assessing Officer in his order, nowhere mentions that the tax payer company ....
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....ri Mahendra H. Shah could not have been made use of while drawing adverse inference against the assessee in view of the fact that the same had not been provided to the assessee. The Tribunal further took note of the fact that the revenue had not disputed the findings of the Commissioner (Appeals) that proceedings under section 158BD were initiated against assessee not on the basis of material/evidence gathered during the search, but on the basis of post search inquiries carried out by the DDIT from the assessee itself. The Tribunal was of the view that burden of showing that the assessee had undisclosed income is on the revenue. The burden cannot be discharged by merely referring to general statement given by third party without alluding to....