Gulshan Verma, Yamunanagar V. DCIT, Yamunanagar

ITA 350/CHANDI/2015

• Counselvise Citation: 35021514 RSA 2015
• Duration Of Justice: 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 10-07-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 09-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: RAKESH JAIN
• Keywords: Unexplained cash credit; Source of fund; Assessment record
• Section: 143(3); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 350/CHD/2015 (ASSESSMENT YEAR: 2005-06) GULSHAN VERMA, VS. THE D.C.I.T., PROP.BHAGWATI ROADLINES, YAMUNA NAGAR. INDUSTRIAL AREA, YAMUNA NAGAR. PAN NO. AFHPG5820Q (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAKESH JAIN RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 10.07.2015 DATE OF PRONOUNCEMENT : 14.07.2015 O R D E R PER H.L.KARWA, VP : THIS APPEAL FILED BY THE ASSESSEE IS DIR ECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), KARNAL DATED 3.3.2014 RELATING TO ASSESS MENT YEAR 2005-06. 2. THE ONLY EFFECTIVE GROUND RAISED BY THE ASSESSE E IN THIS APPEAL READS AS UNDER : 2 1. BECAUSE THE ACTION IS UNDER CHALLENGE ON FACTS & LAW, WHILE UPHOLDING THE ADDITION OF RS.4,25,000/- U/S 6 8 OF THE INCOME TAX ACT, 1961 WHILE THE IDENTITY VERACIT Y AND GENUINENESS OF THE TRANSACTION IS COMPLETELY SATISFACTORY IN ACCORDANCE WITH RATIO DECENDI OF TH E JUDGMENT OF THE HON'BLE HIGH COURT & HON'BLE SUPREM E COURT. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT DURING THE COURSE OF REGULAR ASSESSMENT PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE A CT), THE ASSESSEE WAS FOUND TO HAVE SHOWN A FRESH CREDIT OF RS.4,25,000/- IN THE BOOKS OF ACCOUNT OUTSTANDING A S ON 31.3.2005 AS UNSECURED LOAN IN THE NAME OF SHRI SUS HEEL SHUKLA. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS, THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO PROVE TH E GENUINENESS OF THE TRANSACTION. IN THIS REGARD, T HE ASSESSEE SUBMITTED THAT THE AMOUNT WAS OBTAINED FROM NRE ACC OUNT OF THE LENDER MAINTAINED WITH CENTURION BANK OF PUNJAB . A PHOTOCOPY OF THE BANK ACCOUNT WAS PRODUCED BEFORE T HE ASSESSING OFFICER. ON PERUSAL OF THE BANK ACCOUNT , THE ASSESSING OFFICER NOTICED THAT THE SAID LENDER HAD A NIL BALANCE AS ON 1.4.2004. AN AMOUNT OF RS.4,48,829/ - WAS CREDITED ON 18.5.2004 UNDER THE NARRATION BY BILL , OUT OF WHICH AN AMOUNT OF RS.4,25,000/- WAS GIVEN TO THE A SSESSEE ON THE SAME DAY AND A SUM OF RS.20,000/- WAS DRAWN THROUGH BEARER CHEQUE ON 21.5.2004. THERE WAS NO DEPOSIT IN THE SAID BANK ACCOUNT THEREAFTER TILL 30.3.2007 AND THE CLOSING BALANCE REMAINED BELOW RS.4000/- THROUGHOUT THE SUB SEQUENT PERIOD OF ABOUT THREE YEARS. THEREFORE, THE ASSES SING OFFICER 3 OPINED THAT THE ASSESSEE FAILED TO DISCHARGE THE O NUS TO PROVE THE CAPACITY OF THE LENDER TO ADVANCE THE LOAN. F URTHER, THE ASSESSEE COULD NOT PRODUCE ANY CONFIRMATION FROM TH E SAID LENDER. CONSEQUENTLY, THE ASSESSING OFFICER MADE T HE ADDITION OF RS.4,25,000/- UNDER SECTION 68 OF THE A CT. THE ADDITION WAS UPHELD BY THE LEARNED CIT (APPEALS). WHEN THE MATTER CAME UP IN APPEAL BEFORE THE TRIBUNAL IN ITA NO.404/CHD/2009, THE TRIBUNAL VIDE ITS ORDER DATED 11.9.2009 SET ASIDE THE ORDER OF THE LEARNED CIT (A PPEALS) AND REMANDED THE MATTER TO THE ASSESSING OFFICER FOR CO NSIDERING THE ISSUE AFRESH AFTER OBTAINING NECESSARY EVIDENCE FROM THE ASSESSEE WITH REGARD TO FINANCIAL CAPACITY OF THE L ENDER TO ADVANCE THE IMPUGNED SUM AND THE GENUINENESS OF THE TRANSACTION. THE RELEVANT OBSERVATIONS MADE BY TH E DIVISION BENCH OF THIS TRIBUNAL ARE REPRODUCED HEREINBELOW : 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULLY. SECTION 68 OF THE ACT EMPOWERS AN ASSESSING OFFICER TO CALL UPON THE ASSESSEE TO EXPL AIN THE NATURE AND SOURCE OF THE CREDITS APPEARING IN T HE BOOKS OF ACCOUNT AND IF HE IS NOT SATISFIED WITH TH E EXPLANATION FURNISHED, THE UNEXPLAINED CREDITS ARE DEEMED TO BE THE INCOME OF THE ASSESSEE. IT IS QUI TE WELL SETTLED THAT THE BURDEN IS ON THE ASSESSEE TO SATISFACTORILY EXPLAIN THE NATURE AND SOURCE OF THE CREDITS APPEARING IN THE BOOKS OF ACCOUNT. IT IS EQUALLY WELL SETTLED THAT THE BURDEN CAST U/S 68 CA N BE SAID TO BE DISCHARGED IF THE ASSESSEE PROVES THE IDENTITY, CREDIT WORTHINESS OF THE LENDER AND THE GENUINENESS OF THE TRANSACTION. IN THIS CASE, AFTE R CONSIDERING THE MATERIAL ON RECORD, WE FIND THAT TH ERE IS NO DISPUTE WITH REGARD TO THE IDENTITY OF THE 4 LENDER. ADMITTEDLY, THE LOAN IN QUESTION HAS BEEN RECEIVED FROM ONE SHRI SUSHIL SHUKLA, AN NRI AND HA S APPARENTLY BEEN RECEIVED FROM NRE ACCOUNT OF THE LENDER MAINTAINED WITH CENTURIAN BANK OF PUNJAB. THE ONLY ASPECT HELD AGAINST THE ASSESSEE BY THE CIT(APPEALS) IS THAT THE ASSESSEE HAS FAILED TO FURNISH ANY INFORMATION ABOUT THE INCOME OF THE CREDITOR AND THE SOURCE OF THE CREDIT APPEARING IN THE BANK ACCOUNT. NO DOUBT, THE ASSESSEE CANNOT BE SADDLED WITH LIABILITY TO PROVE THE SOURCE OF THE SOURCE. HOWEVER, THE DUTY TO SUBSTANTIATE THE FINANCIAL CAPACITY OF THE CREDITOR STILL REMAINS ON THE ASSESSEE. IN THIS CONTEXT, EVEN IN THE AFFIDAVIT, FURNISHED BY THE CREDITOR, THERE IS NO MENTION OF T HE SOURCES OF HIS INCOME. DEFINITELY, THERE IS AN AVERMENT THAT THE MONEY HAS BEEN ADVANCED OUT OF HIS BANK ACCOUNT MAINTAINED WITH CENTURIAN BANK, SO HOWEVER, THERE IS NO EVIDENCE AT ALL WHICH SHOWS TH E SOURCES OF HIS INCOME OR HIS ABILITY OR CAPACITY TO ADVANCE THE IMPUGNED AMOUNT. WHEN THIS ASPECT WAS CONFRONTED TO THE LEARNED COUNSEL FOR THE ASSESSEE DURING THE COURSE OF HEARING, IT WAS STATE D THAT THIS SPECIFIC REQUIREMENT WAS NOT ADDRESSED TO BY THE LOWER AUTHORITIES. IN ANY CASE, ACCORDING T O THE ASSESSEE, THE AMOUNT HAVING BEEN ADVANCED FROM A NRE ACCOUNT, WHEREIN THE REMITTANCE HAS COME FROM ABROAD, THE SAME SUFFICIENTLY DISCHARGED THE ONUS CAST ON THE ASSESSEE. 4. IN PURSUANT TO THE ORDER OF THE TRIBUNAL DATED 11.9.2009, THE ASSESSING OFFICER VIDE HIS LETTER DA TED 26.8.2010 ASKED THE ASSESSEE TO FURNISH NECESSARY E VIDENCE REGARDING THE FINANCIAL CAPACITY OF THE LENDER AND THE GENUINENESS OF THE TRANSACTION. THE ASSESSING OFF ICER ASKED THE ASSESSEE TO FURNISH THE FOLLOWING DOCUMENTS : 5 I) COPY OF THE INCOME TAX RETURN OF THE LENDER FOR THE RELEVANT ASSESSMENT YEAR I.E. 2005-06. II) DETAILS OF THE SOURCES OF INCOME OF THE LENDER. III) COPY OF THE BANK ACCOUNTS OF THE LENDER IN THE COUNTRY OF HIS RESIDENCE. IV) EVIDENCE REGARDING REMITTANCES INTO THE NRE ACCOUNT. V) COMPLETE BOOKS OF ACCOUNT FOR THE RELEVANT YEAR. 5. IN RESPONSE TO QUESTIONNAIRE, THE ASSESSEE HAS FURNISHED ONLY A COPY OF INCOME TAX RETURN FILED B Y THE LENDER SHRI SUSHEEL SHUKLA FOR THE YEAR 2004, WHEREIN THE ANNUAL INCOME OF 22,201 US DOLLAR WAS DECLARED. ACCORDIN G TO THE ASSESSING OFFICER, THE ASSESSEE FAILED TO PRODUCE T HE COPY OF THE BANK ACCOUNT OF THE LENDER IN THE COUNTRY OF HI S RESIDENCE WHEREFROM THE FUNDS WERE TRANSFERRED TO HIS NRE ACC OUNT MAINTAINED WITH CENTURION BANK OF PUNJAB IN INDIA. THE ASSESSEE ALSO FAILED TO SUBMIT ANY EVIDENCE REGARDI NG THE REMITTANCE INTO THE NRE ACCOUNT. THE ASSESSING OF FICER HELD THAT IN THE ABSENCE OF THE ABOVE DOCUMENTARY EVIDEN CE, THE CREDITWORTHINESS OF THE LENDER IS NOT ESTABLISHED. THE ASSESSING OFFICER CONCLUDED THAT IN VIEW OF THE ABO VE AND ALSO IN VIEW OF THE FACTS AND CIRCUMSTANCES EXPLAINED IN THE ORIGINAL ASSESSMENT ORDER UNDER SECTION 143(3) OF T HE ACT DATED 20.12.2007, THE ASSESSEE FAILED TO DISCHARGE THE ONUS REGARDING THE FINANCIAL CAPACITY OF THE LENDER SHRI SUSHEEL 6 SHUKLA AND ADDED A SUM OF RS.4,25,000/- UNDER SECTI ON 68 OF THE ACT. 6. ON APPEAL, THE CIT (APPEALS) VIDE HIS ORDER DAT ED 3.3.2014 CONFIRMED THE ADDITION OBSERVING THAT THE ASSESSEE HAD NOT ESTABLISHED THE FINANCIAL CAPACITY OF THE L ENDER BEFORE THE ASSESSING OFFICER. 7. I HAVE HEARD SHRI RAKESH JAIN, LEARNED COUNSEL FOR THE ASSESSEE AND SHRI S.K.MITTAL LEARNED D.R. AT LE NGTH AND HAVE ALSO PERUSED THE MATERIALS AVAILABLE ON RECORD . IN THE INSTANT CASE, THE DISPUTE RELATES TO THE ADDITION O F RS.4,25,000/- MADE UNDER SECTION 68 OF THE ACT. S ECTION 68 OF THE ACT READS AS UNDER : 68. WHERE ANY SUM IS FOUND CREDITED IN THE BOOKS OF AN ASSESSEE MAINTAINED FOR ANY PREVIOUS YEAR, AN D THE ASSESSEE OFFERS NO EXPLANATION ABOUT THE NATURE AND SOURCE THEREOF OR THE EXPLANATION OFFERED BY HI M IS NOT, IN THE OPINION OF THE ASSESSING OFFICER, SATISFACTORY, THE SUM SO CREDITED MAY BE CHARGED TO INCOME-TAX AS THE INCOME OF THE ASSESSEE OF THAT PREVIOUS YEAR. 8. IT IS WELL SETTLED THAT IN ORDER TO DISCHARGE T HE ONUS UNDER SECTION 68 OF THE ACT, THE ASSESSEE MUST PROV E THE FOLLOWING INGREDIENTS : I) THE IDENTITY OF THE CREDITOR, II) THE CAPACITY OF THE CREDITOR TO ADVANCE THE MO NEY; III) THE GENUINENESS OF THE TRANSACTION. 7 9. AFTER THE ASSESSEE HAS ADDUCED THE PRIMA FACIE EVIDENCE, THE ONUS SHIFTS TO THE DEPARTMENT. IN THE INSTANT CASE, THERE IS NO DISPUTE WITH REGARD TO THE IDENTI TY OF THE LENDER. NOW, THE CASE OF THE REVENUE IS THAT THE ASSESSEE FAILED TO PROVE THE FINANCIAL CAPACITY (CREDITWORTH INESS) OF THE LENDER AND GENUINENESS OF THE TRANSACTION. IN THI S CASE, THE ASSESSEE HAD SUBMITTED A CERTIFICATE FROM THE MANAG ER OF HDFC BANK, LIMITED, NEAR NIRANKARI BHAWAN, JAGADHRI ROAD, YAMUNANAGAR (CENTURION BANK OF PUNJAB MERGED INTO H DFC BANK LIMITED). THE BANK HAS CERTIFIED THAT SHRI S USHEEL SHUKLA S/O SHRI SUDAMA SHUKLA, HOLDER OF NRE ACCOUN T NO.77SB1351960 HAD TRANSFERRED RS.4,25,000/- THROUG H CHEQUE NO.295291 TO THE SB ACCOUNT NO.0210100016176 0 OF SHRI GULSHAN KUMAR VERMA S/O SHRI ANGREJ LAL FROM H IS NRE ACCOUNT ON 18.5.2004. THE BANK HAS ALSO CERTIFIED THAT THE CENTURION BANK OF PUNJAB MERGED INTO HDFC BANK LTD. THE ASSESSEE HAS ALSO PRODUCED A BANK STATEMENT OF CENT URION BANK OF PUNJAB BEFORE THE AUTHORITIES BELOW TO DEMO NSTRATE THAT SHRI SUSHEEL SHUKLA HAS TRANSFERRED RS.4,25,00 0/- VIDE CHEQUE NO.295291 TO SHRI GULSHAN VERMA. THE ASSESS EE HAS ALSO PRODUCED CONFIRMATION LETTER IN THE FORM OF AF FIDAVIT OF SHRI SUSHEEL SHUKLA S/O SHRI SUDAMA SHUKLA DULY ATT ESTED BY MR.THOMAS BREEN, NOTARY PUBLIC STATE OF MARYLAND, W HEREIN SHRI SUSHEEL SHUKLA HAS STATED THAT HE IS RESIDENT OF 7056 HANOVER PKWY CITY, GREENBELT STATE MARYLAND, PIN-#2 0770 U.S.A. HE HAS ALSO CONFIRMED HAVING GIVEN INTEREST FREE LOAN FOR RS.4,25,000/- TO THE ASSESSEE BY CHEQUE NO.2952 91 ON 18.5.2004 FROM HIS NRE ACCOUNT NO.77SB1351960 MAINT AINED 8 WITH CENTURION BANK OF PUNJAB, INDIA. THERE IS NO DISPUTE THAT SHRI SUSHEEL SHUKLA IS MAINTAINING NRE SAVING ACCOUNT NO.1351960 WITH CENTURION BANK OF PUNJAB SINCE 2004 . THE ACCOUNT WAS OPENED WITH INITIAL DEPOSIT OF USD 10,0 00, THE AMOUNT I.E. RS.4,48,829/- WAS CREDITED TO THE ACCOU NT ON 18.5.2004. THE CENTURION BANK OF PUNJAB HAS ISSUE D A CERTIFICATE TO THIS EFFECT ON 12.12.2007 THAT THE A MOUNT OF RS.4,48,829/- CAME IN NRE ACCOUNT OF SHRI SUSHEEL S HUKLA FROM USA WHERE SHRI SUSHEEL SHUKLA WAS STAYING. T HE ASSESSING OFFICER RAISED THE OBJECTION THAT THE ASS ESSEE FAILED TO FILE COPY OF THE BANK ACCOUNT OF THE LENDER IN T HE COUNTRY OF HIS RESIDENCE FROM WHERE THE FUNDS HAVE BEEN TRANS FERRED TO HIS NRE ACCOUNT IN CENTURION BANK OF PUNJAB IN INDI A. IN MY OPINION, THE ABOVE OBJECTION OF THE ASSESSING OF FICER IS IRRELEVANT PARTICULARLY WHEN THE CENTURION BANK OF PUNJAB HAS CERTIFIED THAT A SUM OF RS.4,48,829/- (10,000 US DO LLAR) HAS BEEN CREDITED ON 18.5.2004 UNDER THE NARRATION BY BILL, WHEREIN THE REMITTANCE HAS COME FROM ABROAD I.E. U. S.A. FURTHER, THE ASSESSING OFFICER HAS ADMITTED THAT TH E ASSESSEE HAS SUBMITTED COPY OF RETURN OF INCOME OF SHRI SUSH EEL SHUKLA FOR THE YEAR 2004. AS PER THE SAID RETURN , SHRI SUSHEEL SHUKLA HAS DECLARED AN INCOME OF 22,201/- U S DOLLAR UNDER THE HEAD (COL.NO.VII) WAGES, SALARY, TIPS, E TC. AS PER THE SAID RETURN, AT THE RELEVANT TIME SHRI SUSHEEL SHUKLA WAS EMPLOYED WITH V PAUL ASSOCIATES INC 1010 ROCKVILLE PIKE SUIT 206, ROCKVILLE MD 20852. 10. THERE IS NO DISPUTE THAT THE LENDER SHRI SUSHE EL 9 SHUKLA HAD NRE BANK ACCOUNT WITH CENTURION BANK OF PUNJAB IN INDIA. IT IS ALSO AMPLY CLEAR FROM THE RECORDS THAT THE LOAN AMOUNT HAS BEEN ADVANCED FROM A NRE ACCOUNT, WHEREI N THE REMITTANCE HAS COME FROM ABROAD, I.E. BANK OF AMERI CA, SOVERNA PARK U.S.A. SHRI SUSHEEL SHUKLA HAS SUBMI TTED AN AFFIDAVIT IN ORDER TO CONFIRM THAT HE HAS GIVEN DEP OSIT OF RS.4,25,000/- TO THE ASSESSEE BY ACCOUNT PAYEE CHEQ UE. THE SAID SUM IS APPEARING IN THE BANK ACCOUNT OF THE AS SESSEE. THE LOWER AUTHORITIES HAVE NOT DOUBTED THE AUTHENTI CITY OF THE AFORESAID AFFIDAVIT. THE ONLY OBJECTION OF THE RE VENUE IS THAT IN THE SAID AFFIDAVIT THE LENDER HAS NOT DISCLOSED HIS SOURCE OF INCOME. THE LOWER AUTHORITIES HAVE ADMITTED THIS FACT THAT THE LENDER WAS RESIDING IN U.S.A. THE ASSESSEE HA S FURNISHED A PHOTOCOPY OF PASSPORT OF SHRI SUSHEEL SHUKLA. T HERE IS NO DISPUTE THAT THE SIGNATURE ON PASSPORT AND AFFIDAVI T IS THAT OF SHRI SUSHEEL SHUKLA. KEEPING IN VIEW THAT THE TRA NSACTIONS ARE THROUGH BANKING CHANNELS AND THERE IS NO MATERI AL ON RECORD TO PROVE THE CONTRARY, I HAVE NO HESITATION IN HOLDING THAT THE ASSESSEE HAD DISCHARGED THE BURDEN OF PROV ING THE GENUINENESS OF THE CASH CREDIT. UNDER THE LAW, T HE AMOUNT OF RS.4,25,000/- CANNOT BE TREATED AS THE INCOME FR OM UNDISCLOSED SOURCES OF THE ASSESSEE, WHEN THERE IS NEITHER DIRECT NOR CIRCUMSTANTIAL EVIDENCE ON RECORD TO HOL D THAT THE SAID AMOUNT ACTUALLY BELONGED TO OR WAS OWNED BY TH E ASSESSEE. AS REGARDS THE CREDITWORTHINESS OF THE L ENDER, I MAY POINT HERE THAT THE ASSESSING OFFICER ADMITTED THAT THE ASSESSEE HAD SUBMITTED A COPY OF I.T.R. FILED IN U. S.A. BY SHRI SUSHEEL SHUKLA FOR THE PERIOD 1.1.2004 TO 31.12.200 4 RELEVANT 10 TO ASSESSMENT YEAR 2004, WHEREIN ANNUAL INCOME OF 2 2,201 U.S. DOLLAR HAD BEEN DECLARED. A COPY OF RETURN IS AVAILABLE IN ASSESSMENT RECORDS OF THE ASSESSEE, WHICH WAS PR ODUCED DURING THE COURSE OF PROCEEDINGS BEFORE THIS BENCH. IT IS RELEVANT TO OBSERVE HERE THAT BOTH THE AUTHORITIES BELOW HAVE NOT QUESTIONED THIS DOCUMENT I.E. I.T.R. SUBMITTED BY SHRI SUSHEEL SHUKLA. THE OFFICER WHO HAS FRAMED THE AS SESSMENT OF THE ASSESSEE IS ASSESSING OFFICER AS WELL AS INV ESTIGATING OFFICER. HE HAS NOT GIVEN ANY COMMENTS AS REGARDS THE GENUINENESS OF THE I.T.R. FILED BY SHRI SUSHEEL SHU KLA. THE LEARNED CIT (APPEALS) HAS ALSO NOT OFFERED HIS VIEW S ON THIS DOCUMENT. THUS, IT CAN BE CONCLUDED THAT THE REVE NUE HAS ACCEPTED THIS DOCUMENT AS GENUINE. IN THIS RETUR N , SHRI SUSHEEL SHUKLA HAS DECLARED ANNUAL INCOME OF 22,201 U.S. DOLLARS FOR THE YEAR 2004. THE SOURCE OF INCOME I S SHOWN FROM WAGES, SALARY, TIPS, ETC. AS PER THE SAID RE TURN, SHRI SUSHEEL SHUKLA WAS EMPLOYED WITH FIRM NAMELY V PAUL ASSOCIATES INC 1010 ROCKVILLE PIKE SUIT 206, ROCKVI LLE MD 20852. EMPLOYERS EIN NO. IS 52-178748 AND PHONE NO. IS 301- 315-9172. AS PER THE SAID RETURN , THE TOTAL TAX TO BE PAID WAS 1,784 U.S. DOLLARS. THERE IS NO DISPUTE THAT SHRI SUSHEEL SHUKLA WAS RESIDING IN U.S.A. SINCE LONG. CONSIDERING TH E ABOVE, FINANCIAL CAPACITY OF THE LENDER TO PAY 10,000 U.S. DOLLARS CAN NOT BE DOUBTED. IN VIEW OF THE DECISION OF HON'BLE GA UHATI HIGH COURT IN THE CASE OF NEMI CHAND KOTHARI VS. CIT, 2 64 ITR 254, A CREDITORS CREDITWORTHINESS HAS TO BE JUDGED VIS-- VIS TRANSACTION, WHICH HAS TAKEN PLACE BETWEEN THE ASSESSEE AND THE CREDITOR AND, IT IS NOT THE BUSINESS OF THE ASSESSEE TO FIND OUT 11 THE SOURCE OF MONEY OF HIS CREDITOR OR GENUINENESS OF THE TRANSACTION. THE RELEVANT OBSERVATIONS MADE BY TH E HON'BLE GAUHATI HIGH COURT READ AS UNDER: A PERSON MAY HAVE FUNDS FROM ANY SOURCE AND AN ASSESSEE, ON SUCH INFORMATION RECEIVED, MAY TAKE LOAN FROM SUCH A PERSON. IT IS NOT THE BUSINESS O F THE ASSESSEE TO FIND OUT WHETHER THE SOURCE OR SOURCES FROM WHICH THE CREDITOR HAD AGREED TO ADVANCE THE AMOUNTS WERE GENUINE OR NOT. IF A CREDITOR HAS, BY ANY UNDISCLOSED SOURCE, A PARTICUL AR AMOUNT OF MONEY IN THE BANK, THERE IS NO LIMITATION UNDER THE LAW ON THE PART OF THE ASSESSEE TO OBTAIN SUCH AMOUNT OF MONEY OR PART THEREOF FROM THE CREDITOR, BY WAY OF CHEQUE IN THE FROM OF LOAN AND IN SUCH A CASE, IF THE CREDITOR FAILS TO SATISFY AS TO HOW HE HAD ACTUALLY RECEIVED THE SAID AMOUNT AND HAPPENED TO KEEP THE SAME IN THE BANK, THE SAID AMOUNT CANNOT BE TREATED AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCE. IN OTHER WORDS, THE GENUINENESS AS WELL AS THE CREDITWORTHINESS OF A CREDITOR HAVE TO BE ADJUDGED VIS--VIS THE TRANSACTIONS, WHICH HE HAS WITH THE ASSESSEE. THE REASON WHY WE HAVE FORMED THE OPINION THAT IT IS NO T THE BUSINESS OF THE ASSESSEE TO FIND OUT THE ACTUAL SOURCE OR SOURCES FROM WHERE THE CREDITOR HAS ACCUMULATED THE AMOUNT, WHICH HE ADVANCES, AS LOAN, TO THE ASSESSEE IS THAT SO FAR AS AN ASSESSEE IS CONCERNED, HE HAS TO PROVE THE GENUINENESS OF THE TRANSACTION AND THE CREDITWORTHINESS OF THE CREDITO R VIS--VIS THE TRANSACTIONS, WHICH HAD TAKEN PLACE BETWEEN THE ASSESSEE AND THE CREDITOR AND NOT BETWEEN THE CREDITOR AND THE SUB-CREDITORS, FOR, IT IS NOT EVEN REQUIRED UNDER THE LAW FOR THE ASSESSEE TO TRY TO FIND OUT AS TO WHAT SOURCE OR SOURCES FROM WHERE THE CREDITOR HAD RECEIVED THE AMOUNT, HIS SPECIAL KNOWLEDGE UNDER SECTION 106 OF THE EVIDENCE 12 ACT MAY VERY WELL REMAIN CONFINED ONLY TO THE TRANSACTIONS, WHICH HE HAD WITH THE CREDITOR AND HE MAY NOT KNOW WHAT TRANSACTION(S) HAD TAKEN PLACE BETWEEN HIS CREDITOR AND THE SUB-CREDITOR. NO SUC H ADDITIONAL BURDEN CAN BE PLACED ON AN ASSESSEE, WHICH IS NOT ENVISAGED BY SECTION 106 OF THE EVIDENCE ACT. 11. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND ALSO KEEPING IN VIEW THE OBSER VATIONS OF THE HON'BLE GAUHATI HIGH COURT REFERRED TO ABOVE, I AM OF THE OPINION THAT NO ADDITION IS REQUIRED TO BE MADE IN THE HANDS OF THE ASSESSEE UNDER SECTION 68 OF THE ACT. THER EFORE, THE IMPUGNED ADDITION IS DELETED. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE STAN DS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 14 TH DAY OF JULY, 2015. SD/- (H.L.KARWA) VICE PRESIDENT DATED : 14 TH JULY, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 13