TaxTMI 
TaxTMI 
2017 (2) TMI 176
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....d in law, CIT(A) erred in exceeding his jurisdiction in invoking powers of enhancement and making addition of Rs. 38,83900/- u/s 69/ 69A of the I.T. Act 1961." 2. During the course of hearing, none appeared on behalf of the assessee. Shri Prakash Mane Ld. DR was present on behalf of the Revenue. It is noted that none has appeared on behalf of the assessee earlier on many occasions, despite the fact that notices were duly issued and served on the address mentioned in the appeal memo on all the occasions. It appears that assessee is not interested in representing this appeal. Under these circumstances, we have no other option but to decide this appeal on merits ex-parte qua the assessee. 3. In Ground No.1 the assessee has challenged the action of Ld. CIT(A) in confirming the addition made by the AO of Rs. 14,92,294/- and in Ground No.2 he has challenged the action of Ld. CIT(A) in making enhancement of income by making addition of Rs. 38,83,900/- u/s. 69/69A of the Act. 3.1. During the course of hearing it was noted by the AO that assessee was running a fast food and juice centre under the name & style of M/s. KGN Fast Food & Juice Corner at Virar, Mumbai, it was further noted by ....
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....ssee contained fresh evidences in respect of the sources of cash deposits in the bank accounts, these were forwarded to the AO for cross verification/inquiries and submissions. It is noted from the perusal of the order of the Ld. CIT(A) that AO had carried out and examined during the remand proceedings and thereafter, he submitted his remand report dated 5.09.2013 forwarded through the Jt. CIT, vide her letter08.10.2013. The relevant portion of the remand report is reduced as under: "On going through the records, it is seen that the case was selected for scrutiny under CASS for verification of cash deposits of Rs. 38,83,900 in Bassain Catholic Co-op. Bank and of Rs. 13,89,600 in Saraswat Co-op. Bank. It is seen that before finalizing the ex parte assessment, my predecessor had given opportunities to the appellant as on 07-07-2011, 19-09-2011, 20-10-2011 and 01-12- 2011, but there was no attendance whatsoever on the part of the assessee nor any AR representing the appellant. Under these circumstances, the AO had to pass an ex parte assessment u/s 143(3) r.w,s. 144 of the IT.Act,1961 on the basis of information available on record. The AC) had called for extract of account from both....
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....llant that certain amounts as per ledger accounts brought on record have been received by him against the booking of flats and later its repayments to the depositors, the appellant was asked to produce at least 5 such persons who had given him the said deposits. Accordingly, following person were produced, whose statements to this effect have also been recorded. Sr. No. Name PAN No. Dt. Of generation 1. Shri Sameer Abdul Samad Shaikh CCYPS4451F 31.12.2008 2. Shri Sandeep Pandurang Chavan AQBPC7254P 28.12.2010 3. Shri Hemant Ravindranath Rane BAZPR1150G 22.04.2011 4. Shri Mukesh Singh Negi ALVPN7086P 18.11.2010 5. Shri Bismilla Sardar Khan BRIPK 1334B 14.07.2010 With a view to cross verify the admission and genuineness of such advances by the aforesaid persons and their claim of filing their returns of income with the concerned wards, the available records through the AST system were verified. It/s noticed that none of these persons have ever filed their returns of income. Though all of them are having their PAN but all these have been acquired after 2009-10 except one of Mr. Sameer Shaikh. Thus, in absence of any return of income or even PAS....
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....Co-operative Bank Ltd. You have also claimed cash deposit by yourself in both the accounts respectively at Rs. 3,09,284/- and Rs, 7,14,600/-. However, your income is Rs. 3,01,284/-only as per P/L A/c and hence such huge cash deposits from your own sources is not possible. Please explain? 3. Please note that your claim of receipt of cash from various persons has to be substantiated by fit/rig confirmation, proof of identity and source of such cash. Moreover,, you have not shown such persons as creditor in your Balance Sheet as on 31/0312009. Therefore, same does not appear to be genuine. Thus, you may please now prove the same. Also furnish details of repayment of such receipts of cash giving name & address, date, mode of payment and documentary evidence thereof. 4. On perusal of charts prepared by you for utilization of cash receipts deposited in Bank A/c's, it is noticed that you have made payments to various parties by cheques and hence the purpose of such payment has to be explained in each & every case duly supported by the documentary evidence. You are also required to furnish complete details of repayment received from such parties duly supported by the documentary evidenc....
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.... both the Bank Accounts at Rs. 38,83,900/- only. 4.1. On perusal of the bank statements, i t is not iced that the appel lant has util ized the cash deposited in the bank accounts by making the payments through cheques for following purposes:- I) Advances to various : Rs. 27,75,012/- II) Investment in Mutual Funds/ deposits with Banks, LIC, HSBC, Moneyline, Cholamandalam, Barklays Finace, ING, Vysya, KMBL, ICICI, GE Money, etc. :Rs.7,42,562/- III) Personal Expenses Rs.28,426/- iv) Cash balance Claimed Rs.3,37,900/- Thus, from the above details, it is clear that the cash deposited in the bank accounts has been utilized for various investments and there was no cash withdrawals for repayment of the so called advances received for purchase of flats, No cash withdrawal was made which can he treated as recycle for further deposits in the bank accounts. 4.1.1. On perusal of the summary of the cash deposi ts submi t ted dur ing the course of appellate proceedings, it is noticed that the appellant has claimed sources of the above cash deposits in the bank account as detailed below:- I. From own sources i.e. from Juice Centre.: Rs. 10,24,100/- II. So called advan....
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.... the statements recorded is as under: - i . Shri Bismif la Sardar Khan:- He has claimed having carried out the business of fabrication and welding works filling Income Tax return in ITO, Ward 4(1), Thane. He has stated that he had given Rs. 3,00,000/- to Shri. Zahir Aziz Shaikh, the appellant, for purchase of flat out of business income and personal savings. He, however, failed to furnish any documentary evidences to explain the source of the cash of Rs. 3,00,000/- with the help of documentary evidences. No details of the income disclosed in the return of income and also the Balance Sheet, etc. have been furnished. The amount is also not matching as the appellant has claimed Rs. 2,90,000/- only instead of Rs. 3,00,000/-. The A.O. has also reported that the PAN was acquired on in A.Y. 2009-10 and there is no evidence to ascertain financial capacity in earlier years. ii . Shri Sandeep Pandurang Chavan: He is working as driver with a builder and his family consisted of three members. He has claimed filing of return of income with ITO, Ward 4(3), Thane. He has also stated that he had advanced a sum of Rs. 1,50,000/- to the appellant for purchase of the flat. However, he has failed ....
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....n of flats. In fact, he is engaged in the business of Fast Food & Juice Centre at a very small scale and has no experience as well as capacity to carry out the development and construction. The appellant has f iled merely copies of Power or Attorney cit. 28/07/2008 & 13/11/2008 given by Shri. Soma Rama Ghatal and his wife Smt. Shevanti Soma Ghatal. The perusal of the Power Attorney reveals that even the survey No. and area of land is not mentioned therein. Thus, it is clear that the so-celled Power of Attorney is merely a format of the Power of Attorney which has never been implemented. It is also noticed that most of the cash deposits in the bank accounts were even prior to the date of such Power of Attorney. Under these circumstances, it is clear that the appellant has concocted a story of land development and construction business and receiving o advances just to explain the source of unaccounted money deposited by him in the Bank A/c. Under these circumstances, I am of the considered view that the appellant has failed to explain the source of cash deposits in both the hank accounts under consideration amounting to Rs. 38,83,900/- . Since the cash so deposi ted has been uti l i....