TaxTMI 
TaxTMI 
2017 (2) TMI 327
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....uld be pertinent to mention that this is the second round of litigation. In the first round of litigation, additions were made u/s. 68 of the Act in respect of deposits of Rs. 3.20 lacs and share application money /capital of Rs. 12.50 lacs totaling to Rs. 15.70 lacs. The litigation travelled up to the Tribunal and the Tribunal vide order dated 07.12.2012 in ITA No. 1517/Ahd/2009 restored the matter to the files of the A.O. The relevant findings of the Tribunal read as under:- "We have examined the evidences but the share holder/depositor have not proved the creditworthiness and genuineness in all the cases. Further, the assessee did not furnish whatever confirmation on 13.09.2007 but furnished on 26.12.2007 whereas the assessment was co....
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....essee has successfully discharged the onus cast upon it by the provisions of section 68 of the Act. It is the say of the ld. Counsel that the assessee had produced all the cash creditors except Raniben Jadavbhai Kalsariya. All the creditors were examined. Necessary documents have been filed to establish the creditworthiness of the creditors. The ld. counsel concluded by saying that the assessee has discharged not only the onus but has also fulfilled the directions of the Tribunal given in the first round of litigation. 10. The ld. D.R. strongly supported the findings of the revenue authorities. It is say of the ld. D.R. that the assessee has grossly failed in discharging the initial burden and, therefore, the additions made u/s. 68 are j....
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....bhai Kalsariya Particulars Affidavit of depositor Confirmation letter of depositor B/S of depositor Ledger of appellant in depositor's books Ledger of creditor in appellant's books Statement of depositor Affidavit of father-in-law Confirmation letters of father-in-law Form 7/12 and Form 8-A of land owned by father- in-law Amounts paid through banker cheque Source of investment in statement of depositor: Q.8 Radhaben Ravindrakumar Kalsariya Particulars Affidavit of depositor Confirmation letter Ledger of depositor in appellant's books Statement of depositor Confirmation of father Form 7/12 and Form 8-A of land owned by father Amount paid through State Bank of S....
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....s as under:- "We have considered the rival submissions and have also gone through the order passed by the Assessing Officer, the relevant portion of which we have also extracted in para. 2 above. The Commissioner of Income-tax (Appeals)-more or less confirmed the addition on the reasoning given by the Assessing Officer in the assessment order. A perusal of the chart given by us in para 3 above indicates that out of 21 creditors the Assessing Officer has recorded the statements of only six creditors, viz., creditors at serial Nos. 1, 2, 3, 4, 6 and 7. However, in respect of all the 21 creditors the assessee has furnished their complete addresses along with GIR numbers/permanent account numb well as confirmations along with the copies of a....
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....ived by the assessee by account payee cheques drawn from bank accounts of the creditors and the assessee is not expected to prove the genuineness of the cash deposited in the bank accounts of those creditors because under law the assessee can be asked to prove the source of the credits in its books of account but not the source of the source as held by the Bombay High Court in the case of Orient Trading Co. Ltd. v. CIT [1963] 49 ITR 723. The genuineness of the transaction is proved by the fact that the payment to the assessee as well as repayment of the loan by the assessee to the depositors is made by account payee cheques and the interest is also paid by the assessee to the creditors by account payee cheques. Merely because summons issued....
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.... : "68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year." The phraseology of section 68 is clear. The Legislature has laid down that in the absence of a satisfactory explanation, the unexplained cash credit may be charged to income-tax as the income of the assessee of that previous year. In this case the legislative mandate is not in terms of the words "shall be charged to income-tax as the income of the assessee of that ....