INCOME TAX ACT, 1961

Section 68

Income from undisclosed sources - Addition under section 68 - Unsecured loan - Assessee duly discharged his primary onus---Treatment as unexplained cash credit

AO made addition towards unexplained cash credit under section 68 in respect of unsecured loan obtained by assessee from a person named 'S'. Assessee submitted that he duly discharged his primary onus by providing name, PAN, address as well as confirmations, ITR, financial statements and bank statements in respect of the said loan obtained by him. He further submitted that such loan was taken through banking channel and therefore, the said addition was liable to be deleted. Held: Assessee duly filed necessary information in terms of name and address, PAN, ITR, bank statement and confirmation from 'S'. Further, the notice issued under section 133(6) and summons under section 131 were duly served on 'S', however, he explained his non-appearance due to health problem. In absence of any adverse finding of the AO on the documents so submitted, merely on account of non-appearance for which reasonable cause was explained, no addition was called for in hands of the assessee. Hence, the addition made under section 68 would not be sustainable.

REFERRED :

FAVOUR : In assessee's favour

A.Y. : 2014-15

INCOME TAX ACT, 1961

Section 68

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