9911796707
TMI Blog1989 (12) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... that the individual could not satisfactorily explain the source of that investment and hence vide order dt. 2nd Aug., 1984 under s. 132(5), that amount was treated as unexplained income of Shri Padma Prakash Khandaka individual. In the regular assessment of the individual, he had shown that this amount had been taken as loan from 4 persons, namely, Shri Gajkumar Jain Rs. 15,000, Ramgopal Goyal Rs. 25,000, Smt. Nirmala Devi Goda Rs. 25,000 and Hotel Archana Rs. 35,000. This was accepted in the regular assessment of the individual and the assessments for the asst. yrs. 1984-85 and 1985-86 were completed where the loans taken from four persons and advances made to two parties was shown and interest paid and received was also disclosed. These ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from 4 parties advances to the two parties. During the course of enquires in the case of individual, the ITO had recorded the statement of persons to who loans were given by they never said that they had taken the loans from Prem Prakash Khandaka, HUF and not individual. The learned counsel drew out attention to the notice dt. 6th June, 1984 from the ITO to Shri Padam Prakash Khandaka individual where enquiries regarding this amount of Rs. 1 lakh had been and pages 4 5 of the order under s. 132(5) in the case of the individual where this point had been discussed. On this point, the learned counsel argued that it was not correct on the part of the CIT to say that no proper enquiries were made in this regard. He submitted that in the first i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T's order based on presumption that the amount of Rs. 1 lakh did not pertain to Shri Padam Prakash individual and that it was undisclosed income of assessee-HUF was without any legal jurisdiction and was against the ratio of decision in the case reported as Prahbad Maliram vs. CIT (1987) 63 CTR (Raj) 271 : (1987) 166 ITR 149 (Raj). For same reasons, it was not a just and judicious order. He submitted that the cash credits having been satisfactorily explained in the case of the individual the same could not be again said to be a basis for cancellation of assessment under s. 263. For these propositions, the learned counsel relied on decisions reported at CIT vs. Orissa Corporation P. Ltd. (1986) 52 CTR (SC) 138 : (1986) 159 ITR 78 (SC) and CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Hon'ble Karnataka High Court because there the ITO had accepted assessee's contentions without making proper enquiries. The Gujarat High Court decision is regarding a case where the question was regarding the extent of enquiries, which the CIT expects the ITO to make. In the instant case, we find that the arguments of Shri Ranka, are very reasonable and justified. We find that in the first instance the ITO had made detailed enquiries regarding these promissory notes of Rs. 1 lakh in the case of the individual and hence it cannot said be that the ITO did not make enquiries. In fact, this amount was added to the income of the individual under s. 132(5), which proceedings are with the approval of the IAC. Thereafter, after proper conside ..... X X X X Extracts X X X X X X X X Extracts X X X X
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