Saturday, November 29, 2014

Creditworthiness not established and genuineness of transactions not demonstrated

IT : Where assessee-company had given loans to parties whose identity had not been proved, their creditworthiness not established and genuineness of transactions not demonstrated, addition made was justified
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[2014] 50 taxmann.com 368 (Delhi)
HIGH COURT OF DELHI
Commissioner of Income-tax-VI
v.
T.S. Kishan & Co. Ltd.*
SANJIV KHANNA AND V. KAMESWAR RAO, JJ.
IT APPEAL NO. 1270 OF 2011†
SEPTEMBER  16, 2014
Section 68 of the Income-tax Act, 1961 - Cash credit (Loans) - Assessment year 2005-06 - Assessing Officer made an addition pertaining to unsecured loans credited in books of account of assessee-company being income from undisclosed sources - Whether where identity of parties to whom assessee had given loan had not been proved, their creditworthiness not established and genuineness of transactions not demonstrated, further assessee was unable to file/give PAN number, details of income-tax returns etc. of said parties, addition made was justified - Held, yes [Para 5] [In favour of revenue]

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