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TMI Blog2019 (2) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... e has advanced a sum of ₹ 50,000/-. The lenders had deposited the cash in their bank accounts and issued cheques subsequently. Since all the lenders did not have sufficient source of income, the explanation of the assessee is not accepted and the addition made under section 68 of the Act is upheld. - Decided against assessee. - ITA No.3072/PUN/2017 - - - Dated:- 28-12-2018 - Ms. Sushma Chowla, JM For the Appellant : None For the Respondent : Shri M.K. Verma ORDER PER SUSHMA CHOWLA, JM: The appeal filed by the assessee is against the order of Commissioner of Income Tax (Appeals) 1, Kolhapur dated 06.10.2017 relating to assessment year 2009-10 against order passed u/s 143(3) read with section 147 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and produced their bank accounts to show that the amounts were transferred through banking channels. The Assessing Officer noted that the bank accounts were opened one day before handing over of the loan and cash was deposited on various dates and immediately the same amount was transferred by cheques in favour of the bank account of the assessee. In order to verify the credit worthiness, genuineness of the transaction and also identity of the persons, summons were issued to furnish copies of returns of income, profit and loss account, balance sheet etc. The parties were also asked to explain whether any interest was received on the aforesaid loans and whether the loan amounts have been repaid. The Assessing Officer also asked them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer made the aforesaid addition under section 68 of the Act. Similar was the case in respect of Vinayak Satale who had advanced sum of ₹ 8 lakhs. The said advance was also made out of cash deposited in the bank account of the assessee on 05-05-2008. The lender explained the source for the said amount to be out of loan obtained from Vijaya Bank which on verification was found by the Assessing Officer to be against mortgage deed dated 22-09-2008. The loan was given in April 2008 and hence, the credit worthiness of the said lender was also not proved by the assessee. In respect of the next lender Vinayak Satale (HUF) wherein a sum of ₹ 6,22,000/- was given as unsecured loan to the assessee out of the savings of tuitions take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editors were submitted does not explain the source of cash deposits in the respective accounts. Even the creditors had not satisfactorily explained the source of cash deposits and hence, the genuineness of the transactions does not get proved. The CIT(A) also noted that in respect of certain loan creditors the ld. Authorized Representative for the assessee had changed his stand and the same cannot be accepted. Merely because the transactions were through the banking channel, does not automatically prove the credit worthiness of the loan creditors. Since none of the loan creditors had sufficient income to justify the credit worthiness, the CIT(A) upheld the addition made by the Assessing Officer under section 68 of the Act. 7. Before me, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kanchan Satale 02-12-2008 634992 1,00,000 Kanchan Satale 01-07-2008 634691 1,00,000 2. Ganesh Satale (HUF) 05-07-2008 Transfer 6,00,000 Cash 47,359 3. Vinayak Satale (HUF) 04-07-2008 Transfer 1,00,000 21-12-2008 Cash 50,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quently. Since all the lenders did not have sufficient source of income, the explanation of the assessee is not accepted and the addition made under section 68 of the Act is upheld. 8. The Ld. Departmental Representative for the Revenue has also relied on the ratio laid down by the Hon ble Gujarat High Court in the case of Blessing Construction Vs. ITO (2013) 32 taxmann.com 366 (Gujarat) wherein also, the issue was in respect of cash credits and the burden of proof is on the assessee. In the facts of the said case, the depositors had deposited the cash in their bank accounts and immediately the entire amounts were withdrawn by issuance of cheques in favour of the assessee. The Hon ble High Court also noted that the taxpayers capacity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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