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TMI Blog2015 (1) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... r return of income and bank statements and copy of the minutes of meeting of the Board of Directors of the investors wherever they happened to be companies. The least that the A.O. was expected to do, in the circumstances, was to seek recourse to his powers and verify the material by calling statement from the banks and also calling the investors by issuing summons under Section 131. Concededly, he did not adopt that course and instead rested content in relying only upon the statement of Sh. Mahesh Garg and found that in the absence of his cross-examination, the assessee did not discharge the onus of proof which lay upon it. As noted by the ITAT in its impugned order, the onus of proof is not a static one and necessarily shifts dependin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness of investment in shares and fixed deposit in banks, and derived income from dividend and interest. Initially, the return was processed under Section 143(1), thereafter assessment notice was issued to the assessee. On consideration of the material, the A.O. held that fresh share capital to the extent of ₹ 28.40 lac had to be added. This sum is sought to be brought to tax under Section 68 by the A.O. holding that the assessee did not furnish any satisfactory explanation, and had not, in fact, discharged the initial burden under the said provision. The A.O. had, in the course of the assessment proceedings, offered an opportunity to cross-examine one Mr.Mahesh Garg, (whose statement formed the basis for reassessment proceedings) to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by giving the PAN No. confirmation, copy of the income tax return etc. AO has the information which can only give rise a suspicion about the details submitted by the assessee, effectively AO could not rebut the details submitted by the assessee. Ld. CIT(A) thereafter put reliance upon the authoritative pronouncements of Hon ble Delhi High Court in the case of CIT vs. Value Capital Services reported in 307 ITR 334, DCIT vs. Divine Leasing and Finance Ltd. Reported in 299 ITR 268 also referred Lovely Exports 216 CTR 195. In this way Ld. CIT (A) deleted the addition. 3. The findings of the CIT (Appeals) were confirmed by the ITAT in the following terms:- In the light of these observations, if we examine the material placed on record by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court reported as CIT vs. Empire Builtech 2014 366 ITR 110 and also judgment reported as CIT vs. Nova Promotors Finlease (2012) 342 ITR 169. In those cases this Court had occasion to deal with the ruling of the Supreme Court in CIT V. Lovely Exports (P) Ltd. 216 ITR 195. 5. This Court has carefully considered the submissions of the revenue. Whilst the revenue could have legitimately relied upon the statement of Mahesh Garg, which sought to implicate the assessee to reopen the assessment proceedings under Section 148, to elevate that into a finding, the A.O. should have carried out some form of independent exercise as to the veracity and genuineness of the transaction furnished by the assessee. In this context, the assessee had furnishe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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