TaxTMI 
TaxTMI 
2015 (5) TMI 747
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....peak balance available with the appellant." 2. The brief facts qua the issue involved are that, assessee is an individual and has claimed to be in the business of money transfer to various places in the State of Uttar Pradesh from Mumbai. The trade name of the said business was known as "Raj Quick Services". Before the assessing officer, the assessee had explained the modus operandi, that he collects the money from persons who are mostly labourers and working class in Mumbai who intended to sent their money to the their family and relatives in various places in U.P. His brother, Shri Irfan A. Shaikh is based at Lalbaug in District Azamgarh of Uttar Pradesh, who receives the money in his ban account and disburses the money to the respective persons. The transfer of money is through banking channel services where cash is deposited and collected from the branch located in Azamgarh. In this process the assessee gets 3% commission as his income. It was also stated by the assessee that he has registered himself under the category of "Business Auxiliary Services" of service tax, under service tax laws. The assessing officer noted that, the assessee had shown net profit from money trans....
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....ncome filed regularly. Alternatively, it was submitted that if the cash has been deposited in the bank account, then there are corresponding withdrawals also from the same bank account and therefore, entire cash deposit cannot be taxed. The assessing officer should have the worked out the peak balance of the cash for the purpose of making the addition. The assessee had also filed certain additional evidences in the form of list of the persons from whom the cash was collected and transferred to various places in UP along with copy of certain demand drafts to show the genuineness of the transaction. The Ld. CIT(A) directed the AO to verify all the relevant bank accounts which has not been disclosed by the assessee in his regular books of account and in the balance sheet. AO was also directed to verify the claim of the assessee regarding transfer of money through banking channel. In the remand report, the AO submitted that assessee had submitted list of five bank accounts, the details of which relevant as under:- Sl No. Name of the Bank Branch Type of account Account no. (i) Canara Bank Sakinaka OD 1208 (ii) Canara Bank Sakinaka SB 27731 ....
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....e held that the positive peak cash balance during the relevant accounting year worked out for all the undisclosed bank accounts should be considered as unaccounted income of the assessee. The peak credit worked out to at Rs. 29,69,518/- He further observed that the credits maintained in the bank account with SBI Lalganj Azamgarh is also to be considered as part of assessee's total turnover, because the money was deposited in the said bank account for disbursement and therefore, it is also part of his turnover. Thereafter he held that commission income @ 3% should be separately added on account of total credits deposited in the bank accounts i.e. three undisclosed bank account and one that of the SBI Lalganj, Azamgarh. The aggregate credit deposits in these bank accounts was at Rs. 1,29,18,737/-. Thus, he worked out the commission income of Rs. 3,87,562/- on such turnover. Finally the addition to the extent of Rs. 33,57,080/- which consisted of peak credit of Rs. 29,69,518/- and commission income of Rs. 3,87,562/- was sustained by the Ld. CIT(A). 5. Before us, learned counsel, Shri Rakesh Joshi, after explaining the entire facts and the nature of assessee's business, submitted th....
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....unable to explain the source of cash deposits vis-a-vis any corroborative evidence. Whatever material has been placed on record though establishes that assessee was in some kind of money transfer business, however, the onus is upon the assessee to correlate the cash deposits with some evidence or the same has been recorded in regular books of account. It is also an undisputed fact that three of the assessee's bank accounts was not disclosed, either in the balance sheet or in the books of account. In such a case ones lies heavily upon the assessee to prove the source of the cash deposits in the bank account. Since there was a regular cash deposits and regular withdrawals from same nature of transaction, then positive peak credit has to be worked out for the purpose of addition which has rightly done by the Ld. CIT(A). Accordingly, the Ld. CIT(A)'s conclusion that peak credit should be added is affirmed. 8. However, it is noted that while arriving at the peak credit of all the bank accounts, it is seen that firstly, the Ld. CIT(A) has not given credit of opening balance as on 1st of April 2005 and secondly, he has also included the cash deposits made SBI bank account of Lalganj Az....