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2015 (6) TMI 570

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....he Act. In the case of Shri Suresh Chandra, HUF in I.T.A. No.185/Lkw/2010 also, the assessee has raised as many as 10 grounds but the only grievance of the assessee is regarding addition made by the Assessing Officer of Rs. 23.08 lac u/s 68 of the Act. 2. It was submitted by Learned A.R. of the assessee that for all the cash creditors in the case of both the assessees, the assessee has bought on record sufficient evidence to establish the identity of loan creditors, their creditworthiness and also genuineness of the transactions. He submitted that the assessee has submitted confirmations from all the creditors and copy of bank statement of all the creditors along with the copy of income tax return filed by each of the creditors. He submitted that under these facts, it has to be accepted that the assessee has established the identity and creditworthiness of the creditors. He further submitted that in some of the cases, in the bank account of the loan creditors, there is cash deposit before issue of cheque by the creditor to the assessee. He submitted that merely on this basis that cash was deposited in the bank account of the loan creditor prior to the issue of cheque, it cannot be....

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....equires the assessee to disclose the source from which the money has been received by the assessee. This does not require the assessee to disclose the source of that source, i.e., the source from which the donor or investor has received the money which has been invested, (b) It consists of offering an explanation which is "satisfactory" in the opinion of the Income-tax Officer. What explanation would be considered "satisfactory" and how much of details should be furnished to make the explanation "satisfactory" normally depend upon the facts. (b) In the case of Ram Lal Agarwal Vs. CIT 280 ITR 547 (All) Hon'ble High Court observed as under as per head note:- "Under section 68 of the Income-tax Act, 1961, if any amount is found credited in the books of account of the assessee, the burden lies upon the assessee to prove its nature and source, while proving the same the assessee has to prove the identity of the person, genuineness of the transactions and creditworthiness of the person, who has given the money. Held, that in the resent case though the identity of the person, who had given the money had been established the assessee had failed to prove the creditworthiness of those....

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....see did not produce any evidence to rebut the presumption drawn against him under Section 68 of the Act, by producing the parties in whose name the amounts in question had been credited by the assessee in his books of account. In the absence of any cogent evidence, a bald explanation furnished by the assessee about the source of the credits in question viz., realization from the debtors of the erstwhile firm, in the opinion of the assessing officer, was not satisfactory. It is well settled that in view of Section 68 of the Act, where any sum is found credited in the books of the assessee for any previous year, the same may be charged to income tax as the income of the assessee of that previous year, if the explanation offered by the assessee about the nature and source thereof is, in the opinion of the assessing officer, not satisfactory." 3. In view of the above Hon'ble Bench may be Pleased to confirm the action of CIT(A) and Assessing Officer." 5. As per the above written submissions, learned D. R. has placed reliance on several judgments and we consider and examine the applicability of these judgments in the facts of the present case. 5.1 The first judgment cited by learn....

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....rotoman and only after the enquiry from the Department, it was informed by letter dated 30/09/96 that Ariavan Thotan and Suprotoman are same person. It was also noted that even at that time, no mention was made about Sampathkumar and for the first time, Sampathkumar's name figured in the letter dated 30/08/96 and thereafter, it was stated that the names of Ariavan Thotan and Suprotoman are the other names of Sampathkumar. It is also noted by the Assessing Officer that the letters suggested that Sampathkumar reserved his right to receive suitable compensation from the respondents-assessees. Under these facts, the Assessing Officer came to the conclusion that the gifts though apparent are not real and accordingly treated all those amounts credited in the books of the assessee as the income of the assessee. Hence, it is seen that in this case, the dispute is regarding receipt of money from abroad and not a loan from local source and there is no contradiction in the present case regarding the names of the creditors as in that case. Therefore, this judgment is not applicable in the present case. 5.4 The next judgment cited by learned D. R. is the judgment of Hon'ble Apex Court rend....

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....acts, the Assessing Officer added this sum as assessee's income under the head unexplained cash receipts. These facts show that in that case, this was the fact that the assessee was not able to establish the identity and creditworthiness of the loan creditors. In fact in that case, the assessee's explanation was that the amount received was in respect of old debtors of a partnership firm but this claim could not be established by the assessee by producing books of account of the said firm and therefore, the Assessing Officer treated the said receipt as income of the assessee. In the present case, the facts are different and therefore, this judgment is not rendering any help to the revenue. 6. As per above discussion, we have seen that none of the judgments cited by Learned D.R. of the Revenue is rendering any help to the Revenue. 7. Now we examine the applicability of various judgments cited by Learned A.R. of the assessee. 7.1 In the case of CIT vs. S. Kamaljeet Singh (supra), it was held by Hon'ble Allahabad High Court that where the assessee has brought on record the confirmation of creditor, their affidavits, their full address, GIR/PAN, the assessee's burden stood disch....