| Question And Answer | |
|---|---|
| Subject: | SEC.28 AND SECTION 68 |
| Category: | Income-Tax |
| Querist: | Prakash |
| Answered by: | KSA Legal Chambers |
| Tags: | cash credits, return not filed |
| Date: | October 8, 2023 |
whether AO made addition as business receipt in A Y 2017-18 on the ground that unsecured loan accepted during the year by account payee cheque is not reflected in the bank account of the assessee and disclosed in the Balance sheet and cit a has confirm the same as unsecured loan u/sec 68 on the ground that assessee though has submitted confirmation , PAN , bank statement , however the depositer has not filed the ROI , assessee has not explained the source of money of depositer .
whether it is permissible under income tax act 1961 ?
Whether addition can made on the ground that depositor has not filed ROI ?.
Pl guide
The initial burden is on the assessee to explain the source , genuineness and capacity of the lender . Merely because the Depositor has not filed the return of income the addition is not justified . It may be desirable for the assessee to get the affidavit from the Lender explain the source of the investment . The affidavit can be filed as an additional evidence . Section 68 is amended with effect from 1-4 -2023 , wherein the assessee has to explain the source also . The assessee can relay on PCIT v. Ami Industries (India ) P.Ltd ( 2020) 424 ITR 219 ( Bom)( HC), wherein the Court held that the assessee is not required to prove source of the source .