SATISH KUMAR MITTAL, J. - (1.) BY the Income -tax Appellate Tribunal, Delhi Bench 'I', Delhi ('the Tribunal') in ITA No. 2025/Del/2005 for the asst. yr. 2000 -01.
(2.) IN this case, the dispute is about the addition of Rs. 17,84,000 on account of unsecured loans shown to have been taken by the assessee from various persons which were treated as undisclosed income under s. 68 of the Act by the AO. deleted the aforesaid addition, while observing as under : "The issue has been examined. I have carefully gone through the records which include the statement on oath of the various persons, bank accounts, income -tax details, affidavits and confirmations and hold that the AO was not justified in treating any of the aforesaid sums as undisclosed income of the appellant. It is also now well established in law that once particulars of the loan have been disclosed by the assessee the onus shifts squarely on to the AO to establish that the persons concerned did not have the creditworthiness to give the loan or the transaction was not genuine. A perusal of the assessment order clearly shows that the onus had not been discharged. In three cases the AO had himself recorded the statements of the persons from whom the loans had been taken and in other cases he did not even call the persons for examination in spite of the request made by the appellant. Moreover, on record was the bank statements, confirmations, affidavits and other income particulars which clearly points out that necessary evidence had been adduced by the assessee and further onus was on the AO. Under the aforesaid circumstances, it is held that the AO committed an error in treating all the above loans received from the various persons as undisclosed income of the appellant."
(3.) FEELING aggrieved against the part of the order, the Revenue filed an appeal before the Tribunal. The Tribunal vide its the order, the Revenue has filed the present appeal raising the following substantial questions of law for consideration of this Court : (i) Whether on the facts and circumstances of the case, the Hon'ble Tribunal was right in law in not appreciating the fact that the cash deposits were made into bank account of creditors immediately prior to advancing the loan ? (ii) Whether on the facts and circumstances of the case, the Hon'ble Tribunal was right in law in deleting the addition of Rs. 17,84,000 in respect of alleged loan credits, though creditworthiness of the loan creditors was not established by the assessee ? We have heard the counsel for the appellant and perused the record of the case. In this case, the assessee had taken loan of Rs. 25,49,000 from 18 parties, the details of which are available in the assessment order. The AO accepted the loans taken from three persons, i.e., Rs. 7,65,000 and the balance amount of Rs. 17,84,000 out of total unsecured loans of Rs. 25,49,000 was opined to be not satisfactory explained and was, thus, added of the income of the assessee's firm under s. 68 of the Act. The AO has made the aforesaid addition only on the ground that the creditworthiness of the remaining creditors could not be established by the assessee.;