TaxTMI 
TaxTMI 
2014 (8) TMI 1042
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....rcumstances of the case and in law, the ITAT was justified in upholding the self-contradictory order of the CIT(A), who while upholding the addition of unexplained cash deposits in the assessee's bank account, allowed the assessee relief on account of cash withdrawals thereby reducing the addition made by the Assessing Officer, even though the CIT(A) has himself held that the assessee has failed to explain the requirement of cash withdrawals satisfactorily? (2) Whether on the facts and circumstances of the case and in law, the ITAT was justified in upholding the decision of the CIT(A) that only the peak of unexplained cash deposits is liable for tax without appreciating that the assessee had failed to discharge its onus to prove the requ....
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....ssment order and determined the total income of the assessee at Rs. 45,80,020/. [2.1] Feeling aggrieved and dissatisfied with the aforesaid addition of Rs. 39,70,500/, the assessee preferred an appeal before the learned CIT(A) and the learned CIT(A) partly allowed the said appeal and restricted the addition to Rs. 7,95,160/on account of unaccounted income being peak/maximum cash balance of Rs. 7,95,160/on 26.08.2008 and consequently deleted the addition of the balance amount of Rs. 31,75,604/. [2.2] Feeling aggrieved and dissatisfied with the order passed by the learned CIT(A) restricting the addition to Rs. 7,95,160/, the Revenue preferred appeal before the learned Tribunal and by impugned judgment and order the learned Tribun....
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....s case. Making above submissions, it is requested to admit/allow the present appeal. [4.0] Heard Shri Parikh, learned advocate appearing on behalf of the Revenue at length and we have considered in detail the decision of the learned CIT(A) as well as the impugned judgment and order passed by the learned Tribunal. At the outset it is required to be noted that the AO directed to make the addition of Rs. 39,70,500/as unexplained cash on the ground that the assessee had withdrawn the same from his own bank account and again redeposited the same in his bank accounts. The AO also made the aforesaid addition by observing that the assessee withdrew the cash instead of sufficient cash balance available with him. However, the afore....
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....th regard to the requirement of cash in his line of business. The AO's case rests on the issue that though sufficient cash balance was available with the appellant but he kept on withdrawing money from the bank accounts and during the course of proceedings he did not explain satisfactorily the requirement of such withdrawals. Therefore, considering the surrounding circumstances and applying the test of human probabilities, the AO concluded that the explanation offered by the assessee is not genuine. To that, assessee's contention is that there is no requirement under the law with regard to the limit of cash carried from day to day and also there is no requirement with regard to the reasons for carrying such cash balance. According to ....
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....ng to the point of high pitch assessment. During the course of assessment proceedings as well as before the undersigned the appellant has produced cash book showing daily cash balances. From this statement it is observed that appellant was having maximum cash balance of Rs. 7,95,165/on 26/08/2008. Considering that whatever income the appellant earned is being ploughed back into his business and he could have at the most earned income to the extent of the maximum cash balance as per his cash book, accordingly maximum addition is restricted to the peak of cash balance during the year. Under the circumstances, addition of Rs. 7,95,160/on account of unaccounted income is being confirmed and the assessee gets relief Rs. 31,75,604/. This....