TaxTMI 
TaxTMI 
2026 (5) TMI 1704
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....te that the amount of Rs. 22,74,893/- is nothing but incremental cash sales which has been shown to justify & camouflage the cash received from undisclosed sources as cash sales which was deposited in the bank during demonetization period. 3. On facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting addition of Rs. 63,15,000/- made by the AO as unexplained loan u/s 68 of the IT Act, holding that the assessee has produced documentary evidences which conclusively establish the genuineness of the tractions without considering the fact that even after availing sufficient opportunities during assessment proceedings, the assessee failed to prove the genuineness of transactions. 4. That the Ld. CIT(A) failed to appreciate in accepting the claim of the assessee regarding obtaining the unsecured loans, the findings of the AO, which are as under: 4.1 In case Ms. Manju Goel, on of the lenders filed her ITR declaring very meagre income and the major portion of her turnover has been transferred to the bank account of the assessee without any other withdrawal to substantiate the same as business turnover. 4.2 In case of Ms. Anju B....
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....hich has been deleted by the Ld. CIT(A). The Ld. Departmental Representative vehemently submitted that the Assessee could not prove the source of the cash deposits in its bank account during the demonetization period, however, the Ld. CIT(A) erroneously deleted the addition and the Assessee has received the cash from undisclosed sources and claimed as cash sale. Thus, sought for allowing the Ground No. 1 &2 of the Assessee. 6. Per contra, the Ld. AR contended that the entire amount of Rs. 22,74,893/- being cash sale and in order to prove the same, the Assessee has produced all the documents such as complete books of accounts, cash book ledgers, purchase register, VAT Register, VAT Returns and day to day Kilo Gram stocks and bills during the assessment proceedings and after verifying those documents the CIT(A) has deleted the addition which requires no interference at the hands of the Tribunal. 7. We have heard the parties perused the material. In order to prove the source of the cash deposit made during the demonetization, Assessee submitted complete books of account viz. Cash book ledger, purchase register, VAT Returns, day to day Kilo Gram stock register, bills during the a....
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....loans with details of TDS deducted on same. 5.3.1 In the present case, the AO has applied the provisions of section 68 of the Act by rejecting the various documents filed by the appellant and has made the addition in respect of unsecured loans obtained by the appellant. Section 68 of the Act reads as under: "Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year." Section 68 of the Income Tax Act, 1961 is a provision that deals with credits in the books of accounts of an assessee. The burden of proof is on the assessee to explain the nature and source of such credits. However, if the assessee provides the necessary details regarding the identity of the creditors, their financial capacity, and the genuineness of the transactions, then the burden of proof shifts to the Assessing Officer. The necessary details that an assessee needs to provide to prove....
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....of DCIT vs. Rohini Builders [2003] 127 Taxman 523 (Gujarat), the Hon'ble High Court has held that "Assessee had discharged initial onus by providing identity of all creditors by giving their complete addresses, GIR numbers/permanent account numbers and copies of assessment orders wherever readily available. Assessee had also proved capacity of creditors by showing that amounts were received by account payee cheques drawn from bank accounts of creditors. Repayment of loans and interest thereon was also made by account payee cheques by assessee and tax also had been deducted at source on interest payments and remitted. Assessee was not expected to prove genuineness of cash deposited in bank accounts of creditors, because under law, assessee can be asked to prove source of credits in its books of account but not source of source. Merely because summons issued to some of creditors could not be served or they failed to appear before Assessing Officer, could not be ground to treat those credits as non genuine. Considering totality of facts and circumstances of case, especially fact that Assessing Officer had not disallowed interest claimed/paid in relation to those credits i....
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....f business and through normal banking channels by account payee cheques and various documents such as PAN, income tax return, loan confirmations, bank accounts of lenders were produced to establish the identity, genuineness of the transaction and creditworthiness of lenders. It is considered that the appellant has discharged the burden of filing the requisite documentary evidence. AO did not undertake any further investigations to establish that evidences produced by the appellant was not acceptable. Even the loan providers were not examined /investigated. AO had no reason to reject evidences produced by the appellant without undertaking further enquiries. It is also observed that AO has not disallowed interest expenditure incurred by the appellant against the loan provided by the parties mentioned supra. If loans were held to be not genuine, interest expenditure should also have been disallowed. But that is not the case. Appellant has duly deducted TDS from interest payments made to loan providers. A.O. is directed to delete the addition of Rs. 63,15,000/- made u/s 68 of the Act. Thus, grounds of Appeal number 5, 6,7 & 8 are allowed." 11. During the assessment proceedings, in o....