2011 (3) TMI 143

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..... Held that: - It is settled law that for proving the credit u/s 68 of the Income-tax Act, identity and creditworthiness of the lender as well as genuineness of the transaction are needed to be established by the assessee - The creditor of the assessee had received a gift from his maternal uncle and in any case, the addition should be in the hands of the creditor - Explanation by Dinesh Goyal was fa .....

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..... Goyal from his relatives by bank draft and deposited in his bank account and thereafter deposited in his bank account and thereafter deposited with the Appellant firm was not genuine and belongs to the firm as unexplained cash credit and liable to be assessed under section 68 of the Income Tax Act, 1961 as income of the Appellant Firm? (II). Whether in the light of the law established and based .....

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..... nting the application of S.68 of Income Tax Act against the appellant? 2. The assessee is a firm running a petrol pump and in its account credited a sum of ₹ 2 lacs as loan from one Dinesh Goyal. The Assessing Officer asked the assessee to explain thegenuineness of the said cash credit. Accordingly, Dinesh Goyal was examined. It was found that he had no sources of his own and he claimed th .....

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..... was very meager balance in the account and creditor had received Rs.2,00,000/- by demand draft which has been given by cheque to the assessee firm as loan. The said creditor has clearly stated that he has obtained the gift as he was in "need" of the gift. No confirmation etc. on the so-called donor was produced. Hence the creditworthiness of the donor has not at all been established. The circumsta .....

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..... We are unable to accept the submission. The finding of fact recorded concurrently by the three authorities is that the assessee had no explanation for the credit entry and the same represented its undisclosed income. Explanation by Dinesh Goyal was false as he did not have any source of money. His plea of receipt by way of gift was also false. The said findings are based on appreciation of materia .....

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