Brief of the case:
- The ITAT Amritsar bench in case of Sh. Dushiant Kumar vs. ITO held that it is not the responsibility of the assessee to prove the source of funds in the hands of lender so long as he produce the lender before the AO who confirm the fact of lending money to assessee.
- Further, the fact that lender was not paid any interest and could not state the exact date of receiving the amount lent back could not be considered as sufficient reason to assessee the loan as suppressed income of assessee.
Facts of the case:
- AO made an addition of Rs.1,25,000/- , as loan by the assessee from Sh. Rajender Kumar Mittal. The AO observed that although he deposed that he had given loan to the assessee, he also deposed that his earnings are around Rs.1.5 lacs to 2 lacs per annum and the loan was given out of his savings.
- AO also observed that cash deposits had been made in this account before giving loan to the assessee and no deposits out of the savings. The lender (creditor) explained that loan was given out of cash savings kept at home and in response to the question as to when the amount had been received back, the creditor contended that the money had been received back, but he did not remember as to when it was received back.
- From these facts, the AO concluded that the assessee’s own unaccounted money had been brought back in the garb of fresh unsecured loan. Accordingly, AO added the amount of Rs.1,25,000/- to the income of the assessee u/s 69 of the Act. The ld. CIT(A) confirmed the addition.
Contention of the Assessee:
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