Case Law Details
The legal position in respect of an accommodation entry provider seeking the benefit of ‘peak credit’ appears to have been totally overlooked by the ITAT in the present case. Indeed, if the Assessee as a self-confessed accommodation entry provider wanted to avail the benefit of the ‘peak credit’, he had to make a clean breast of all the facts within his knowledge concerning the credit entries in the accounts. He has to explain with sufficient detail the source of all the deposits in his accounts as well as the corresponding destination of all payments from the accounts. The Assessee should be able to show that money has been transferred through banking channels from the bank account of creditors to the bank account of the Assessee, the identity of the creditors and that the money paid from the accounts of the Assessee has returned to the bank accounts of the creditors. The Assessee has to discharge the primary onus of disclosure in this regard.
Full Text of the High Court Judgment / Order is as follows:-
1. This appeal by the Revenue under Section 260A of the Income Tax Act, 1961 (‘Act’) is against an order dated 12th February, 2004 passed by the Income Tax Appellate Tribunal (‘ITAT’) in ITA No. 4514/Del/2003 for the Assessment Year (‘AY’) 1995-96.
Question of law
2. While admitting this appeal on 28th November, 2008, the following question of law was framed:
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