D.K.Seth, J. - (1.) This matter was disposed of by an order dt. 13th March, 2003. After the order was dictated, Mr. Bagchi appeared and mentioned. He submitted that because of some unforeseen circumstances, he was unable to come to the Court within time and, therefore, he could not present himself at the time of hearing. We therefore, did not sign the order dictated and kept the matter for hearing. The order dt. 13th March, 2003, is hereby recalled. By consent of parties, the matter is treated as on day's list for hearing. The matter is taken up for hearing today.
(2.) Mr. Bagchi points out that he is only concerned with one question that there was a request for issuing summons under Section 131 of the IT Act, 1961, by the assessee which finds mention at p. 13 of the paper book being the order of the Assessing Officer (ITO) and at p. 29 of the paper book being the order of CIT(A). According to him, in the proceeding under Section 68 of the Act, the onus or burden is on the assessee to establish the identity of the subscribers and prove their creditworthiness and the genuineness of the transaction. According to him, in this case the material particulars relating to these ingredients had since been produced. The AO had accepted the contention of the assessee with regard to those persons who were income-tax assessees. But in respect of 21 persons, who were not income-tax assessees, the AO had added the amount to the income of the assessee under Section 68 of the Act. The CIT(A) had held that it was the responsibility of the assessee to establish the identity of the shareholders and prove their creditworthiness and the genuineness of the transactions. By reason of prima facie discharge through disclosure of some materials, the onus did not shift on the Department. Therefore, there was no scope for issuing summons under Section 131 at the request of the assessee. Here Mr. Bagchi joints issue. According to him, as soon as request for issuing summons under Section 131 was made, it was incumbent on the AO to issue the summons. Without such summons, it could not be examined as to whether the assessee was able to discharge the prima facie proof of the genuineness of the transaction. Therefore, failure to do so had vitiated the whole process of the enquiry contemplated under Section 68 of the Act. He relies on two decisions viz. Munnalal Murlidhar v. CIT and Food Corporation of India v. Provident Fund Commr. and Ors. to support his contention.
(3.) Mr. Some. on the other hand, contends that until and unless the prima facie proof was discharged by the assessee, the onus would never shift on the AO. Therefore, there was no necessity of issuing any summons under Section 131 on his part. He secondly contended that even if the assessee had made a request for issuing of summons, such summons could not be issued under Section 131 until and unless the assessee took effective steps for issuing summons as contemplated under Order 16 Rule 1 of the Code of Civil Procedure (CPC). According to him, it was incumbent on the assessee to prove the genuineness of the transaction. Mr. Some relies on the decisions in Thyagaraja Chanties v. Addl. CIT, Sri Jagdish Saran Shukla v. CIT, Shankar Industries Ltd. v. CIT of this Court and Sarogi Credit Corporation v. CIT, (1976) 103 ITR 344 (Pat) to support his contention.;