Ground not press at the time of hearing deserved to be dismissed

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
We first take up the dispute relating to additions of unsecured loans under section 68 of the Act. The AO during the assessment proceedings noted that the assessee who was engaged in the business of film production and marketing, had declared unsecured loans to the tune of Rs.2.16 crores out of which a sum of Rs.1.81 crores had been raised during the year. The AO asked the assessee to file loan confirmations along with copy of the bank pass books and copy of returns of income of the creditors. The assessee filed loan confirmation on 9.4.2008 without any supporting evidence such as bank pass book etc. With a view to verify the genuineness of loans, the AO issued letters under section 133(6) to the creditors who did not reply to these letters. The AO noted that the assessee had filed only photocopies of confirmations and not the originals. Further all the confirmations had handwritten addresses and the same pen had been used for signing the confirmations. The AO also noticed differences in signatures on the confirmations with respect to signatures of creditors in the returns of income and PAN card. The AO, therefore, issued summons to the creditors under section 131 of the Act in response to which only one creditor i.e. Shivpujan P. Tiwari attended. Shri Tiwari denied having given any loan to the assessee and also stated that he was a man of meager means and there was no question of giving loan of Rs.2.00 lacs. As per the AO, the statement of Shri Tiwari was shown to authorized representatives of assessee who showed helplessness in the matter. The AO thereafter asked the assessee to produce loan creditors but despite several opportunities, the assessee could not produce loan creditors for examination. The AO, therefore, concluded that the assessee was deliberately avoiding to produce the creditors for cross examination and that the assessee was trying to prevent appearance of creditors to avoid being exposed as the only creditor who appeared had denied the loan. The AO observed that under section 68 of the Act, the burden was on the assessee to prove the identity of the creditors, their credit worthiness as well as genuineness of the transactions which had not been discharged by the assessee.

Citation :
M/s. Oracle Entertainment Pvt. Ltd. Plot No.184, Kaira Shopping Centre, Opp. Raghunath Vihar, Sector-13 Kharghar Navi Mumbai-410 610. PAN No. AAACO 6741 P (Appellant) Vs. Income tax Officer Ward-1(4), Kalyan Rani Mansion, 2nd Floor, Kalyan Murbad Road Kalyan (West) Mumbai.(Respondent)