Q. Regarding non payment of unsecured Loan
GOPAL KUMAR AGRAWAL (PARTNER) (205 Points)
02 May 2009Q. Regarding non payment of unsecured Loan
M.M.SURANA
(Director -Taxation )
(532 Points)
Replied 02 May 2009
Mr. Gopal Krishanan
First of all U hav to prove that U hav taken loan from so and so. If U fail to prove it may be treated as unexplained Cash Credit u/s 68 of I T Act, Onus is on U to prove it. Secondly AO power has been restricted to 6 yrs from the end of A.Y. in which U accepted the loan. beyond that he can not open yr. case and can't make addition in income. If U r able to prove the Loan received by U and it because of Limitation Act, Your creditors is not able to sue U can write off the same in yr. capital A/c.There will not be tax.
Surana,Chennai
9952967237
Piyush Jain
(CA)
(283 Points)
Replied 02 May 2009
Bang on Surana ji, cant agree more. Just wanted to add that you can show that the amount was received by chq(if it was) and provide the AO his PAN no. That will be sufficient from your part. This case could have been opened uptil 31.03.2009 and therefore now you can capitalise this amount without any tax liability.
As regarding your second question, provide the PAN no. to the AO and he will issue notice under 133(6) to the party for his confirmation and your job ends there.
Regards
Piyush