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2014 (9) TMI 1073
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....ained cash deposits in the Saving Bank Ale with HDFC Bank U/S 69A of the I.T.Act, 1961, ignoring the fact that the cash was allegedly withdrawn form partnership firm which itself withdrew the cash from its bank ale out of business OD account with Corporation Bank where debit balance remained in the range of 57 lac to 64 lac on whch heavy interest was paid by the firm and thus the alleged withdrawals by the partner did not relate to firm's business in any way. 2. Whether in the facts and circumstances of the case the Ld. CIT(A) has erred in law in holding hat there was no negative cash balance and that there is no law of land mandating assessee to keep her balance in bank only but ignoring that the capital ale of assessee in the firm a....
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....61 (for short the Act) for A.Y. 2009-10. 3. The aggrieved assessee preferred an appeal before CIT(A) which was allowed by passing the impugned order. Now the aggrieved Revenue is before this Tribunal with the grounds as reproduced herein above. Ground No. 1 & 2 of the Revenue 4 Apropos these grounds we have heard arguments of both the sides and carefully perused the relevant material placed on record. The ld. Departmental Representative (DR) placed his reliance on the decision of the Hon'ble Supreme Court in the case of Sumati Dayal Vs. CIT 214 ITR 801(SC) and Durga Prasad Mourya Vs. CIT 82 ITR 540 (SC) and submitted that the cash was withdrawn from partnership firm bank account out of business overdraft account with corporation Bank whe....
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.... Traders, Meerut, respectively but this fact was not appreciated by the AO and the CIT(A) was quite justified in accepting the explanation of the assessee. The AR drawn our attention towards audited accounts of the partnership firm and submitted that no adverse inference can be drawn against the assessee about the impugned cash deposits as this is not the case of the AO that the amounts withdrawn from bank were utilized somewhere else for some irrelevant purpose. The AR supported the impugned order and submitted that the appeal is devoid of merits and case laws relied by the Revenue are distinguishable. 6. On a careful consideration of above submissions and contention we observe that the AO made addition u/s 69A of the Act with following c....
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.... for the F.Y. 2008-09." 7. During first appellate proceeding the CIT(A) called remand report from the AO on the submissions of the assessee and after considering the submissions of the assessee, remand report of the AO, assessee's rejoinder and assesee's additional submissions the CIT(A) deleted the addition with following observations and findings: I have considered the facts of the case, AR's submissions, AO's remand report, AR's rejoinder and further submissions of the AR carefully. The only reason harped on the AO for the addition is that it was hard to believe by her that cash was kept by the assessee for deposit back in the bank. She has noted that the explanation offered by the assessee appeared to be impractical and illog....
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.... 31 Tax World 198 (JP) In the light of the totality of the facts, the addition made by the AO is deleted." 8. In view of above we noted that the AO, in his remand report could not bring out any fact that the cash withdrawn from Saving Bank Account and partnership overdraft account was used for other purpose anywhere else then, merely because there was a time gap between withdrawal of cash and its further deposit to the bank account, the amount can not be treated as income from undisclosed sources u/s 69 of the Act in the hands of the assessee. The AO rejected the explanation of the assessee on hyper technical basis which is not acceptable. On careful perusal of the decisions relied by the Ld. D.R. we are of the view that the facts of the....