TaxTMI 
TaxTMI 
2017 (4) TMI 1441
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.... filed return of income for the impugned assessment year disclosing income of Rs. 3,10,500/- as ''income from commission on money lending''. Ld. Assessing Officer was having AIR information that assessee had deposits aggregating Rs. 3,67,75,800/- in his saving bank accounts M/s. Axis Bank Ltd, Pudukkottai Branch and T. Nagar Branch. Assessee was required to show source for the deposited amounts. Reply of the assessee as summarized by the ld. Assessing Officer read as under:- ''3. The assessee derives income from money lending commission. 4. The assessee makes/collects advances by cash as well as by cheque. 5. The cash /cheque collected are deposited into the Bank account of the assessee and the same is utilized fo....
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....ply of the assessee to the above query reads as under:- ''(1) Assessee does not maintain any details of the persons from whom the commission was received. (2) The assessee cannot charge uniform rate for all the transactions entered into by him as the same depends on the quantum of the loan. (4) The assessee has not borrowed any money from any person as evidenced by the cash flow statement. Hence, the requirement of filing the name, address and PAN of such persons are not applicable to the assessee. (5) The following factors in the business of the assessee are to be considered (a) The money is advanced both by cash as well as by cheque. (b) The advances are also recovered both by ca....
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....o another are you maintaining any proper accounts for receipt of commission. Ans. I am not maintaining any such books; instead, I make a note in loose sheets (kai chittai) and get my commission. Q. No.7 Give details of persons from whom you have received and to whom you have given money during the period 0110412009 to 3110312010. Likewise, from whom you have received commission. Ans. As I do not remember the details of any transaction at the moment, I would submit the same if available in the residence. Q. No.11 Can you furnish the details such as name, address and PAN number of the persons in both Pudukkottai and Chennai who were advanced money. Ans. I am not able to furnish the particulars in t....
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....uRs. Give details. Ans. Out of the total amount of debit and credit, 1% is my commission and the remaining amount relate to both the lender and the borrower. Q. No. 20 As stated by you in your aforesaid reply, give the details of commission receivable by you, details of borrower and the details of disbursement. Ans. I shall furnish during the next hearing. Q. No. 26 Give the details such as the business connection and the outstanding amount through the same receivable by you from Kavita Shankar, KRV Mani, A. Marimuthu, M. Balu, Kumar Traders, Sagubarnisa, Sivanandam, Kumar, Sri Gokulam Chit & Co., Pee Tee Kay, S. Raja, Selvam Sea Food, Selvam, Spencer, UNI, Eltech, Shince Ph arms, Dipiha, M. Veerapp....
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....an Mohammad Hanif vs. CIT 50 ITR 1 and Roshan Di Hatti vs. CIT 107 ITR 938, ld. Assessing Officer held that onus was on the assessee to prove source for the money claimed to have been received by him. Further, as per ld. Assessing Officer claim of the assessee that withdrawals from the bank were recycled was never substantiated with evidence. He treated the entire cash deposits of Rs. 3,67,75,800/- as unexplained income of the assessee, invested in money lending business and made an addition u/s.69A of the Act. 6. Aggrieved, assessee moved in appeal before ld. Commissioner of Income Tax (Appeals). Argument of the assessee was that the addition was purely based on imaginative figures. Relying on the judgments of Hon'ble Apex Court in the ....
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....artmental Representative strongly assailing the order of the ld. Commissioner of Income Tax (Appeals) submitted that existence of money lending business was proved by the ld. Assessing Officer and accepted by the assessee. According to him, aggregate deposits Rs. 3,67,75,800/- with the bank account represented investment of the assessee in his money lending business and no explanation was offered for the source thereof. According to him, ld. Commissioner of Income Tax (Appeals) had applied the peak credit principle when assessee could not show that the deposits were made out of earlier withdrawals. 8. Contra, and in support of its own appeal, ld. Authorised Representative submitted that ld. Commissioner of Income Tax (Appeals) though he ....