TaxTMI 
TaxTMI 
2007 (2) TMI 195
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.... "1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in arriving at the finding, that the purchase of silver vide bill dated October 8, 1985, of M/s. Chouksey Rajnikant and Co., for silver ornaments of 59.547 kgs. amounting to Rs. 1,50,000 which was found recorded in the books of account found at the time of search, was not genuine purchase ? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in arriving at the finding that the purchase of silver ornaments weighing 38.990 kgs., for Rs. 99,552 vide bill dated October 28, 1985, was not genuine purchase ?" 2. The facts which are essential to be stated for....
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....ated as non-genuine and accordingly the addition of Rs. 2,49,552 was made. On an appeal being preferred the entire addition was deleted by the Commissioner of Income-tax (Appeals). On further appeal being preferred before the Tribunal, it reversed the order of the first appellate authority and upheld that of the Assessing Officer. 3. After disposal of the appeal the assessee preferred an application under section 256(1) of the Act seeking reference of seven questions to this court for opinion. The Tribunal referred only two questions, as has been indicated hereinabove for the opinion of this court. 4. We have heard Mr. H. S. Shrivastava, learned senior counsel along with Mr. Akshat Shrivastava for the applicant-assessee, and Mr. Rohit....
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....and the fact that vouchers were given by the applicant and payment made afterwards would entail in the result that it was a genuine transaction. Learned counsel further submitted that as far as the second transaction is concerned, there was no entry in the books of account but it was explained that the partner who was in charge of maintenance of books of account was not available and, therefore, it could not be done, but later on it was done by examining himself. It is contended by him that the Tribunal has unnecessarily laid emphasis on the source of M/s. Chouksey Rajnikant and Co. which is not an essential feature to make the transaction to be genuine. 6. Mr. Rohit Arya, learned senior counsel with Mr. Sanjay Lal for the Revenue submit....
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.... the firm. The moment the firm gives a satisfactory explanation and produces the person who has deposited the amount, then the burden of the firm is discharged and in that case that credit entry cannot be treated to be the income of the firm for the purposes of Income-tax. It is open to the Assessing Officer to take appropriate action under section 69 of the Act, against the person who has not been able to explain the investment. . . ." 9. In the case of Ashokpal Daga (HUF) v. CIT [1996] 220 ITR 452 (MP) another Division Bench of this court relying on the decision rendered in the case of Orient Trading Co. Ltd. v. CIT [1963] 49 ITR 723 (Bom) expressed the opinion that where the entry stands in the name of the third party and the assessee....
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....suppressed source. And, in order to arrive at such a conclusion, even the Department has to be in possession of sufficient and adequate materials." 11. In the case of Nemi Chand Kothari v. CIT [2003] 264 ITR 254 (Gauhati) the Bench ruled as under (page 263) : "Since it is not the business of the assessee to find out the sources(s) from where the creditor has accumulated the amount, which he has advanced, in form of the loan, to the assessee, section 68 cannot be read to show that in the case of failure of the sub-creditors to prove their creditworthiness, the amount advanced as loan to the assessee by the creditor shall have to be read, as a corollary, as the income from undisclosed source of the assessee himself." 12. In the....