TaxTMI 
TaxTMI 
2017 (8) TMI 1505
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....ain source of source cannot be a basis to confirm addition u/s 68 of the Act 1.3 That the learned Commissioner of Income Tax (Appeals) has failed to appreciate that appellant has led complete evidence to-demonstrate and discharge the burden that advance was duly received from Sh. Iswar Singh and as such addition is based on fundamental misconception of facts and provisions of law and therefore, untenable. 1.4 That the learned Commissioner of Income Tax (Appeals) has overlooked relevant evidence placed on record and, drawn factually incorrect and legally unsustainable inferences based on irrelevant and extraneous consideration and thus, addition sustained is wholly unwarranted and not in accordance with law. 1.5 That various adverse findings recorded by the learned Commissioner of Income Tax (Appeals) are contrary to record and law and thus unsustainable. 2. That the learned Commissioner of Income Tax (Appeals) Hisar has further erred act in sustaining an addition of Rs. 4,00,000/- representing loan received from wife of the appellant and held to be unexplained cash credit u/s. 68 of the Act. 2.1 That the Ld. CIT(A) has failed to apprecia....
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....ion which he claimed he had sold to Sh. Ishwar Singh; the assessee propounded this story only when he did not find any escape route to explain the entry of Rs. 10,70,000/- in the account of M/s Surya Roshini Ltd. Bahadurgarh; that no entry of Rs. 10,70,000/- on 21.11.2011 or nearby date neither in the ledger capital account nor in the bank account of the assessee had been found credited. He observed that the plea of the assessee is just an afterthought and proved false. The AO on the basis of above facts held that appellant had introduced capital of Rs. 1O,70,000/- out of income from undisclosed sources. AO made addition of Rs. 10,70,000/- u/s. 68 of the IT Act. 2.1 AO further observed that assessee received Rs. 4,00,000/- from Smt. Urmila Devi, wife of the assessee as unsecured loan and found that the assessee had raised Rs. 4,00,000/- on 9.2.2012 from Smt. Urmila Devi as unsecured loan. The assessee has proof, produced copy of account, copy of bank account and copy of ITR before AO. On examination of the bank account, AO found that cash of Rs. 4 lacs had been deposited on 9.2.2012 and cheque issued to the assessee on the same date. AO required the assessee produce the creditor....
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....ife of the assessee who had duly confirmed that loans had been advanced to the assessee and as such, addition so sustained is invalid and untenable. In support of this contention, he relied upon various case laws, as mentioned in the Synopsis filed by the assessee's counsel. 5. On the contrary, Ld. DR relied upon the orders of the authorities below. 6. I have heard both the parties and perused the records and gone through the orders of the authorities below, especially the contention raised in the grounds of appeal and the case laws cited by the Ld. Counsel of the assessee. I find that Ld. CIT(A) has elaborately discussed and adjudicated the issues in dispute vide para no. 3.3 & 5.1 of his impugned order. For the sake of convenience, I am reproducing the said relevant finding as under:- "3.3 I have carefully considered the facts of the case, Appellant has relied on the fact that he had ancestral property situated at village Sarsana, Distt. Hisar on 21.11.2011. That the amount of Rs. 10,70,000/- was received from Shri Ishwar Singh in cash as advance for sale of ancestral property. Here the plea of the appellant that it was not granted opportunity to cross examine Shri....
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....he same date on which cheque was issued and also the fact that income declared by the creditor is only Rs. 64,007/-, it is held that the creditworthiness of the creditor is not established. The action of the AO in adding Rs. 4,00,000/- received from Smt. Urmila Devi as unexplained cash credit u/s. 68 is therefore, confirmed. This ground of appeal is dismissed." 6.1 After perusing the aforesaid finding of the ld. CIT(A), with regard to addition of Rs. 10,70,000/- is concerned, I find that assessee had ancestral property situated at village Sarsana, Distt. Hisar on 21.11.2011 and amount of Rs. 10,70,000/- was received from Shri Ishwar Singh in cash as advance for sale of ancestral property. Assessee has claimed that Shri Ishwar Singh had given said advance of Rs. 10,70,000/- to the assessee out of sale proceeds received against sale of JCB Machine and as advance against sale of ancestral property for which possession was with Shri Ishwar Singh. Assessee has claimed that there was no requirement to form an agreement in writing, verbal agreement is more than sufficient. However, it is a fact on record that the creditor has, not filed any return of income, did not have PAN, did not r....