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TMI Blog2024 (5) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... as further held in the case of Nemi Chand Kothari [ 2003 (9) TMI 62 - GAUHATI HIGH COURT] wherein it was held that it cannot be said that a transaction, which takes place by way of cheque, is invariably sacrosanct. Once the assessee has proved the identity of his creditors the genuineness of the transactions, and the creditworthiness of his creditors vis- -vis the transactions which he had with the creditors, his burden stands discharged and the burden then shifts to the revenue to show that though covered by cheques, the amounts in question, actually belonged to, or was owned by the assessee himself. Similar findings have been given in case of N. R. Portfolio Pvt. Ltd. [ 2012 (12) TMI 762 - DELHI HIGH COURT] We are of the considered opinio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brief, are that the assessee, a company, engaged in the spinning, weaving and finishing of textiles, filed its Income Tax Return [In short, the ITR ] on 07.10.2016 declaring loss of Rs. 2,41,02,350/-. The case was picked up for limited scrutiny for the following reasoning:- Unsecured loans from persons who have not filed their Return of Income (form 3CD) Whether unsecured loans are genuine and from disclosed sources. Mismatch in sales turnover reported in Audit Report and ITR (Form 3CD and Total Sales/Gross Receipt in part A-P L of ITR) Whether sales turnover/receipts has been correctly offered for tax. 4. During the course of scrutiny proceedings, the Assessing Officer (In short, the AO ) sent 11 statutory notices to the assessee, as deta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al difficulties being faced out by the AO in conducting the requisite and desired investigations for submitting the remand report, again sent further additional evidence to the AO on 15.10.2019 for submitting the remand report. Since the AO did not ensure submission of the remand report within the fortnight [The CIT(A) s letter dated 15.10.2019] after carrying out the requisite and desired investigations in faceless environment after fulfilling all technical requirements, therefore, the CIT(A) disposed of the matter on 05.11.2019. 6. This case was scheduled 7 times for hearing. However, none from the respondent/assessee side attended ever except seeking adjournment once. We heard the Senior Departmental Representative (In short, the Sr. DR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to do the needful. Accordingly, he prayed for remitting the matter back to the AO for ascertaining the creditworthiness of lenders after doing requisite enquiries/examinations/ investigations. 7.1 The Ld. Sr. DR, placing emphasis on various parts of the appellate order and the submissions of the assessee extracted in the appellate order, demonstrated that the assessee has failed to submit the bank accounts and statement of affairs/balance sheet of all lenders who advanced the money to the respondent/assessee. The crucial limbs of section 68 of the Act did not get examined /investigated. The Ld. Sr. DR placed emphasis on the ground of appeal where the decision of the Hon ble Jurisdictional Delhi High Court in the case of N. R. Portfoli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s found credited in the books of assessee, the assessee offers no explanation about the nature and source of the same or explanation offered by him is not found satisfactorily in the opinion of the AO, the sum credited may be charged to tax as the income of the assessee of the relevant year. The identity, creditworthiness and genuineness of transactions have to be explained by the assessee if in his books of account that sum is found credited. The identity, creditworthiness/ financial strength of the lenders and genuineness of such loans have to be proved/established by the respondent/assessee. The burden of proof of these is on the respondent/assessee. 10. Here, in this case, we are of the opinion that the identity of lenders had been prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 29855 of 2018, referring the decision of Hon ble Delhi High Court in the case of Oasis Hospitalities Pvt. Ltd. 333 ITR 119 (Del.) observed that merely proving the identity of the investor does not discharge the onus of the taxable in the capacity or creditworthiness has not been established. 11. In the present case, the AO did not make any independent inquiry as no such details were made available by the assessee however the CIT(A) before whom certain details were furnished did neither carry out investigation nor allowed the AO to do so by providing reasonable sufficient opportunity to the AO to carry out the investigation for verifying the creditworthiness of the parties, the source of funds and the genuineness of transaction. This vie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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