BLESSING CONSTRUCTION Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) Assessee is in appeal against the judgment of the Income Tax Appellate Tribunal ("the Tribunal" for short) dated 29.12.2011 raising following questions for our consideration:

(2.) During the course of assessment, it was noticed that the assessee had received unsecured loans from 8 different individuals totalling to Rs. 13 lakhs. The Assessing Officer questioned the assessee with respect to such amounts received during the year relevant to the assessment year 2005-2006. It was pointed out that such loans were received through individuals from Account Payee cheque. Their details were also supplied. Some of them also presented themselves before the Assessing Officer upon inquiry. The Assessing Officer however, held that the capacity and creditworthiness of the depositors was not proved. It was observed that there is no such type of cash deposits before or after the cash transactions in case of such depositors other than loan amounts, as appeared in their account. He concluded that the assessee did not prove the genuineness of the transaction as also the capacity and creditworthiness of the creditors.

(3.) The assessee carried the issue in appeal. The Commissioner (Appeals) reexamined the entire issue at length. He observed as under: