TaxTMI 
TaxTMI 
2016 (3) TMI 1224
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....arb of unsecured loans in the name of following persons, who are assessee's own HUF and family members/near relatives of the assessee : S.No. Name Addition during the year Interest disallowed 1. Shri Ishwar Dass, HUF Rs.1,00,000/- Rs.10,000/- 2. Smt.Satanjala Rs.1,80,000/- Rs.18,000/- 3. Smt.Shimla Devi Rs.2,80,000/- Rs.24,000/- 4. Smt.Seema Rani Rs.2,75,000/- Rs.20,000/- Total: Rs. 8,55,000/- Total: Rs. 72,000/- 3. The assessee was asked to explain the unsecured loans but the assessee failed to attend the proceedings. Therefore, summons were issued to all the creditors from whom the unsecured loans were allegedly taken by the assessee. The assessee in response to summons furnished the notarized af....
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....e because mere filing of confirmation, PAN and that amounts were received through cheques are not sufficient to prove the creditworthiness of the creditors and genuineness of the transactions. It was also noted that since M/s Satyam Commodities and M/s B.K. Commodities have failed to attend the office in response to the summons, therefore, the assessee failed to prove the creditworthiness of the creditors. The learned CIT (Appeals) further noted that in several decisions, it was held that mere filing of confirmatory letters is not enough to prove the genuineness of the transactions in the matter and accordingly, dismissed this ground of appeal of the assessee. 6. I have heard the learned representatives of both the parties and perused the ....
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....Garg, Director of M/s Satyam Commodities in which he has admitted that the cash is received from the clients and payment is made through cheques after making bills of profits in favour of the persons who bring the cash. The assessee was confronted with this fact but the assessee has never asked for cross examination of Shri Ankit Garg. According to SEBI Guidelines, such broker firms are required to become member of Multi Commodity Exchange of India, Mumbai and required to be registered with it. The Assessing Officer on the basis of these facts further noted that the bank accounts of the creditors show that mere entries under the nomenclature of commodity profits are taken by the creditors as above and then immediately after crediting the pr....
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....he assessee may be given one more chance to explain the creditworthiness of the creditors and genuineness of the transactions in the matter by producing all the creditors before the Assessing Officer for verification of the transactions and their examination in order to find out the truth in the matter. 8. In view of the above, I set aside the orders of the authorities below and restore the matter in issue to the file of the Assessing Officer with direction to the assessee to produce all the four creditors before the Assessing Officer for verification and examination and the assessee shall not seek unnecessary adjournment in the matter. The assessee is directed to prove the creditworthiness of the creditors and genuineness of the transacti....