INCOME TAX ACT, 1961

Section 68

Income from undisclosed sources - Addition unders ection 68 - Sundry creditors - Assessee not having retained any sum in back to back transactions between group concerns

Assessee showed sundry creditors amounting to Rs. 9 crores. AO treated the same as unexplained credit under section 68 on the ground that assessee failed to prove genuineness thereof.Held: CIT(A) had recorded a finding of fact demonstrating that creditors amounting to Rs. 9 crores did not deserve to be added in the hands of assessee, because detailed analysis of ufund flow statement and bank accounts showed that amounts have been generated from group concerns, and same were routed through banking channels and nothing had been retained by assessee, which had been considered as unexplained cash credit. The assessee has explained fund flow, i.e., demonstrating that transactions were back to back, and wer in the natue of accommodation entries and accordingly, no addition was called for under section 68.