TaxTMI 
TaxTMI 
2019 (8) TMI 739
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....ddition made by the Assessing Officer. Since in all these appeals the facts and issue involved are common, therefore, all the appeals are heard together and are being disposed of by a common order as it is admitted by the parties that the decision on the questions referred below, would necessarily govern the other appeals. The appeal in the case of Sajid Khan, being Income Tax Appeal No. 14 of 2019 is taken as the leading appeal. 3. The appeal was admitted on the following substantial questions of law: (a) Whether on a proper construction of law, the learned Income Tax Appellate Tribunal did not commit error of law in dismissing the appeal of the assessee/appellant, by holding that the creditworthiness of the creditors, advancing loan to the assessee was not established, ignoring vital fact that the said creditors were also blood relatives and family members of the assessee and the transaction was undertaken through banking channel ? (b) Whether the loan received by a person from his mother, brother or other blood relatives in absence of any cogent evidence to the contrary and merely on conjectures be doubted citing the creditworthiness or genuineness of the tr....
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....of the Act. Since no compliance was made as such the A.O. proceeded to make the assessment under Section 144/147 of the Act vide assessment order dated 23.12.2009 and assessed the income of the assessee at Rs. 3,57,312/- after coming to the conclusion that the assessee has not been able to produce the person from whom loan of Rs. 2,00,000/- was disclosed/claimed to have been taken nor any document in support of the credit worthiness of the said person from whom loan was taken had been filed. 8. Aggrieved by the said order assessee challenged the addition before the CIT (A). The appeal was dismissed considering it to be time barred vide order dated 19.10.2012. Thereafter, assessee preferred appeal before the Tribunal which was decided vide order dated 16.8.2013 setting aside the order of the CIT(A) with a direction to re-decide the appeal afresh after giving adequate opportunity of hearing to the assessee and the assessing officer. Thereupon, the CIT(A) called for the remand report from the Assessment Officer on the issue of addition, which was filed on 3.2.2016 and after considering the remand report as well as the submission of assessee, the CIT (A), Ghaziabad, dismissed ....
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....required the assessee to produce the creditor and establish the genuineness of the transaction and creditworthiness of the creditor. However, despite providing various opportunities, the assessee failed to substantiate the transaction. Infact, the burden was not discharged by the assessee. Thereafter, the A.O. made the additions. 16. Learned Tribunal while dismissing the appeals filed by the assessee and confirming the orders of the authorities below came to the following conclusion:- "After considering the rival contentions, I am not inclined to interfere with the orders of the authorities below in making the additions. It is an admitted fact that assessee made investment in property alongwith other co-owners. Assessee claimed that he had received Rs. 2 Lakhs from Smt Rihana Begum but she was not produced for examination before the A.O. The copy of the Bank Account of Smt Rihana Begum showed that there are cash deposits prior to giving loan to the assessee. The creditworthiness of Smt Rihana Begum was thus not proved. In the absence of examination of Smt Rihana Begum her creditworthiness and genuineness of the transaction could not be examined." ..................
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....39;ble Supreme Court in the case of Sumati Dayal vs. CIT reported in (1995) 214 ITR 801 (SC) has held as follows: 4. It is no doubt true that in all cases in which a receipt is sought to be taxed as income, the burden lies on the Department to prove that it is within the taxing provision and if a receipt is in the nature of income, the burden of proving that it is not taxable because it falls within exemption provided by the Act lies upon the assessee. [See : Parimisetti Seetharamamma (supra) at p. 536]. But, in view of Section 68 of the Act, where any sum is found credited in the books of the assessee for any previous year the same may be charged to income tax as the income of the assessee of that previous year if the explanation offered by the assessee about the nature and source thereof is, in the opinion of the Assessing Officer, not satisfactory. In such a case there is, prima facie, evidence against the assessee, viz., the receipt of money, and if he fails to rebut, the said evidence being unrebutted, can be used against him by holding that it was a receipt of an income nature. While considering the explanation of the assessee the Department cannot,....
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.... the assessee had miserably failed to substantiate its claim of having either received the amount of the said transaction in loan. Therefore, in our view, the authorities below are fully justified in making/confirming the addition. 23. It is also not in dispute that cash deposits were made in the bank account of the creditor just before advancing the loan to the assessee and no explanation was forthcoming before the authorities below and even during the course of arguments before the Tribunal. Therefore, in view of the concurrent findings of fact recorded by the Assessing Officer, the CIT(A) and the Tribunal that the assessee was unable to satisfactorily explain the source of investment in the said property at any stage, no error could be pointed out in the impugned orders which may warrant interference by this Court. 24. The law is well settled that the onus of proving the source of a sum of money found to have been received by the assessee is on him and if he disputes the liability for tax, it is for him to show that the receipt is not income or it is exempted from tax. In the absence of such proof, the revenue is entitled to treat it as taxable income. 25. In Vijaya Kum....