Brief of the case:
Tribunal examined that whether addition can be made on account of net increase in the assessee’s capital during the year on account of write back as well as write off of some old credits and debits appearing in her accounts. After examining the facts and circumstances of the case tribunal held that in the absence of cessation of liability the disputed sum is confirmed as income u/s 56 and under the head income from other sources. The issue find support with the decision of apex court in TV Sundaram Iyenger 1996] 222 ITR 344 (SC) and standing to fall to be assessed u/s 56 (1) & 56 (2).
Facts of the case:
- On verification of return of assessee it was observed that a net increase of Rs. 28,09,953/- is reflecting in assessee’ s account, being the difference between the amount of sundry creditors written back and of sundry debtors written off, at Rs.30,42,500/- and Rs.2,32,547/- respectively, to her capital account. The assessee claimed the same to be unsecured loans, received some 15 years ago.
- AO found that assessee being unable to substantiate her claim, could only furnish names of the parties. Assessee even could not explain the reason for the write back.The same was treated as income from other sources by the AO.
- CIT(A) confirmed the decision of AO.
Contention of the revenue:
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