Article Details

Addition on account of cash credit- In favor of Assessee

DEPUTY COMMISSIONER OF INCOME TAX vs.VKA FINANCE & INVESTMENT CO.

AHMEDABAD TRIBUNAL

IIncome—Cash credits—

AO noticed assessee’s unsecured loans to the tune of Rs.39,79,773 from 15 creditors—AO thereof added this entire sum as assessee’s unexplained credits u/s 68—

CIT(A) partly accepted assessee’s contentions and restricted addition of unexplained cash credit to Rs.15,33,376 by granting relief of Rs.24,26,370—

Held,

it was held by CIT that once the assessee had submited all assessments details of its creditors, it was not supposed to do anything further and the primary onus of proving identity, genuineness and creditworthiness stood discharged—

- That it was Revenue’s job thereafter to rebut the same

- Assessee had successfully proved genuineness/creditworthiness of all the impugned unsecured loans

- Merely because some of the creditors had not been served the postal letters in question does not form a valid ground in rejecting assessee’s plea of genuineness and creditworthiness of the impugned credit to the extent of Rs.15,33,376 as affirmed in the lower appellate order

-Revenue’s appeal dismissed