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TMI Blog1998 (8) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... is in no way related to the assessee. He submitted that Mr. Vasudev is a handicapped person and had advanced the assessee Rs. 6 lakhs. The amount was received through proper banking channels and the assessee had obtaining confirmations which were produced during the course of assessment proceedings. The AO, however, was not satisfied with the confirmation because he was of the view that the creditor must indicate the source from which he had advanced the amount to the assessee together with the information about he being assessed under the Act, etc. The other reason which compelled the AO to disbelieve the confirmation was that Mr. Vasudev did not respond to the summons that was issued under the Act. Mr. Venkatesan submitted that Mr. Vasude ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined by him from the last five years and the agreement with the assessee on 5th Feb., 1996 Because the assessee failed to prove the creditworthiness of the creditor, he refused to delete the addition. 4. Mr. Venkatesan drew our attention to the decision of the Patna High Court in Saraogi Credit Corpn. vs. CIT 1975 CTR (Pat) 4 : (1976) 103 ITR 344 (Pat), for the proposition that when the creditor is not a relative of the assessee and the assessee having shown that the amounts have been received through cheques only and the creditor is equally identified, then, the burden shifts from the assessee to the Department to prove that the credit is an unexplained one. He also referred to the Third Member decision of the Tribunal in ITO vs. Suresh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action. He also referred to another decision of the Calcutta High Court in C. Kant Co. vs. CIT (1980) 18 CTR (Cal) 764 : (1980) 126 ITR 63 (Cal) for the same proposition. The third decision of the Calcutta High Court that was cited for the same proposition was in the case of CIT vs. Precision Finance (P) Ltd. (1994) 121 CTR (Cal) 20 : (1994) 208 ITR 465 (Cal). 6. The rival contentions in this regard have been very carefully considered. The assessee is carrying on the business of production and distribution of motion pictures and has other business activities too. Mr. B.N. Vasudev is supposed to be a local resident of Indiranagar, Bangalore. Going by the proposition of the assessee that Mr. Vasudev is a third party unrelated to the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was a genuine transaction. As observed above, the party being unrelated to the assessee would have definitely taken such precaution so as to ensure that the amount could be recovered. We may observe that the counsel Mr. Venkatesan did not touch upon the observation of the CIT(A) that was made with reference to six sheets of paper purported to be copies of confirmations of loans taken by Mr. Vasudev that has been referred to in his order in para 3. He had noted that all the six sheets were xerox copies with identical printing thereon and the handwritten portion in all the sheets were written by the same person and five of the six sheets bore one person's signature. The handwritten portion indicates that the amounts were lent by Mr. Vasudev b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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