2016 (2) TMI 911

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....) has erred in upholding the addition of Rs. 3,60,000 on account of unexplained source of deposit in the bank account whereas the assessee-appellant has duly explained the source of deposit as sale of property before the Assessing Officer as well as during the appellate proceedings. As such, the addition of Rs. 3,60,000 be deleted. 2. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in upholding the addition of Rs. 2,10,000 on account of unexplained source of deposit in the bank account whereas the assessee-appellant has duly explained the source of deposit as agricultural income before the Assessing Officer as well as during the appellate proceedings. As such,....

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....unt without appreciating that the assessee- appellant is having no other source of income except fixed sources, i.e., rental and agricultural income. As such, addition made on account of unexplained deposits in the bank account by rejecting the explanation in summary manner by passing non-speaking order is against natural justice and law. As such, the same be deleted." 2. The assessee has also raised the following additional grounds : "1. That the Assessing Officer was not justified in invoking the provisions of section 68 of the Income-tax Act, 1961, and thereby making addition of Rs. 5,70,000. 2. That the authorities below did not appreciate that the provisions of section 68 are not at all applicable in this case as t....

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.... in the books maintained by the bank, a bank does not act as an agent of its customer. It also cannot be said that the banker maintains a passbook under the instructions of the account holder. The provisions of section68 of the Act are, therefore, not attracted where the assessee does not maintain books of account. The Commissioner of Income- tax (Appeals) in this regard has rightly placed reliance on CIT v. Bhaichand H. Gandhi [1983] 141 ITR 67 (Bom), Sampat Automobiles v. ITO [2005] 96 TTJ (Jodhpur) 368, Ms. Mayawati v. Deputy CIT [2008] 113 TTJ (Delhi) 178 and Sheraton Apparels v. Asst. CIT [2002] 256 ITR 20 (Bom). It is correct that since no books of account are maintained in the ordinary course of the business of the assessee, in the a....