TaxTMI 
TaxTMI 
2022 (8) TMI 1439
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....er under section 143(3) of the Income Tax Act, 1961 (in short 'the Act'), dated 30.12.2016. 2. The grounds of appeal raised by the Revenue are as follows: "1. On the facts and circumstances in the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs. 20,87,54,237/- made by the assessing officer on account of unsecured loan. The Ld. CIT(A) failed to appreciate the fact that during the assessment proceedings, the assessee could not discharge the onus cast upon him to establish the genuineness of the transactions and identity & creditworthiness of the depositors advancing unsecured loan to him. 2. On the facts and in the circumstances of the case, the Ld. CIT(A) ought to have upheld the additions made b....
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....e for the year under consideration u/s 68 of the Act. In response, the assessee submitted details and documents in respect of these parties. 4. It was noted by assessing officer that these companies are running from rented one room and occasionally change their addresses. Some of these parties have closed down their activities after squaring up their unsecured loan transactions. Moreover, on verification of the details filed by the assessee, it was noted by assessing officer that these parties have extended unsecured loan almost equal to their turnover. The turnover of Redeem exports Pvt. Ltd. is Rs. 35,83,30,074/-, cost of raw material is Rs. 36,34,27,887/- where as it has extended unsecured loan of Rs. 12,04,35,153/- to the assessee. M....
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....t at the address; unserved Rs. 7,42,978/- Summons u/s. 131 of the Act were issued to three parties as mentioned above for cross examination, but were returned unserved as the parties were not available in the addresses given by the assesses. 5. Based on these facts, assessing officer noted that creditworthiness boasted by the assessee is only temporarily created creditworthiness and not the real one. The materials available on record and the enquiries conducted reveals that these parties are not traceable. Mere the fact that these companies are registered with ROC, were filing return of income or having PAN/bank accounts does not establish the identity of the above companies. These companies are existing on papers but are specifica....
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.... was issued to ascertain the genuineness of these transactions but nothing was heard from these parties. Further, it was noted by assessing officer that these companies were running from one rented room premises and occasionally change their addresses. Some of these parties have closed down their activities after squaring up their unsecured loan. Moreover, on verification it was observed that two of the companies namely Kashish Diam Pvt. Ltd. & Redeem Exports Pvt. Ltd. have extended unsecured loan almost equal to their turnover. Summons u/s.131 of the Act issued to three parties namely, Shri Bharatbhai M Chauhan, Shri Jagdishbhai P Havijan & Shri Arvindbhai H Bhabhor to ascertain the identity & genuineness of the transactions returned unser....
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....ecord. We note that assessee has heavily relied on the judgment of Hon`ble Supreme Court in the case of Orisa Corpn. Pvt. Limited 159 ITR 78 and stated that it was the duty of assessing officer to verify the genuineness of transactions by enforcing the provisions of section 131 of the Act. We note that assessing officer conducted the field inquiry and issued notices under section 131 of the Act on the address provided by the assessee, however these notices were returned back, as the parties were not existed on the given address. In these circumstances, now burden shifts on the assessee to produce these parties before the assessing officer, however assessee failed to do so, therefore we note that identity of these parties have not been prove....
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....f address has been changed, however assessee has failed to do so. Similarly, if Assessing Officer at any stage of probe reaches to a dead end, and inform assessee about the same, it is duty of assessee to help him and provide whatever is asked. This position of shifting of onus from assessee to Assessing Officer & Assessing Officer to assessee is tricky one, which depends on the facts of the case. In this regard Hon'ble Apex Court in case of CIT v. Durga Prasad More [1971] 82 ITR 540 (SC) has stated: "Now, coming to the question of onus, the law does not prescribe any quantitative test to find out whether the onus in a particular case has been discharged or not. It all depends on the facts and circumstances of each, case. In some c....