TaxTMI 
TaxTMI 
2017 (4) TMI 534
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.... erred in not appreciating the fact that the old records maintained by the appellant till F.Y. 2005-06 were not available due to the deluge in Mumbai during July 2005 which fact was duly appreciated by the CBDT who had issued a circular directing not to insist on material in respect of the assessment year 2006-07. 4. The learned CIT(A) failed to appreciate that the additions made by the A.O was arbitrary, based on suspicion, surmise and conjectures. The appellant craves leave to add, to alter, amend or delete any or all of the grounds of appeal at any time." That further during the course of the appellate proceedings the assessee had raised the following additional grounds of appeal: - "1. On the facts and in the circumstances of the case & in law, the proceeding initiated by issuance of notice u/s 148 of the I.T. Act is invalid and bad in law. 2. On the facts and in the circumstances of the case & in law, the Assessment order passed U/s. 143(3) r.w.s. 147 of the I.T. Act is invalid and bad in law. The appellant craves to add, to alter, to delete and/or to amend any of the above grounds of appeal at any time." The Ld. Departmental representative (for short 'D.R....
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....,53,000/- Withdrawals Rs. 30,000/- Closing cash balance Rs. 2,69,643/-" The assessee had during the course of the assessment proceedings placed on record substantial documentary evidence in form of summarized cash analysis to explain the genesis of the Opening cash balance, Confirmations from her son, daughters and daughter in law, along with their income tax credentials, viz. copies of income-tax returns, PAN Nos. etc, to support the factum of gifts received from them during the year under consideration and the preceding years, details alongwith confirmations of the parties from whom loans were received by the assessee in cash during the year under consideration, and the details of the persons from whom loans had been received back by her during the year under consideration. The A.O however not finding himself as being in agreement with the explanation of the assessee, therein rejected the same and held the cash deposit of Rs. 10,53,000/- (supra) as an 'Unexplained cash credit', and added the same to the returned income of the assessee by invoking the provisions of Section 68. 4. That the assessee being aggrieved with the assessment therein assailed the....
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....templated under Section 68 and made an addition of Rs. 10,53,000/- in the hands of the assessee. It was submitted by the ld. A.R. that an addition under Section 68 could be made only where any sum is found credited in the 'books of an assessee' maintained for any previous year, and the assessee either fails to offer any explanation as regards the nature and source of such credit, or the explanation offered by him is not found in the opinion of the A.O to be satisfactory. The Ld. A.R submitted that the addition of Rs. 10,53,000/- had been made by the A.O in context of the cash deposit made by the assessee in her Saving Bank account with Punjab and Maharashtra Cooperative Bank, Branch :Bhandup, Mumbai. The ld. A.R in the backdrop of the aforesaid facts therein averred that the A.O loosing sight of the fact that as the aforesaid sum of Rs. 10,53,000/-was not found credited in the 'books of account' of the assessee for the year under consideration, therefore no addition in respect of the said amount could be made under Section 68. It was thus submitted by the ld. A.R that the addition of Rs. 10,53,000/-made by the A.O under Section 68 of the Act was not sustainable in the eyes of law, ....
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....espective confirmations (Page 53-69). It was further submitted by the ld. A.R that as the A.O had not raised any query in respect of the old loans which were advanced by the assessee in F.Y. 2001-02 and were received back during the year under consideration, therefore, there was no occasion for the assessee to furnish the details as regards the same during the course of assessment proceedings. The ld. A.R however in order to remove any scope of doubt as regards the veracity of his claim in context of the old loans which were received back during the year under consideration, thus furnished the complete details of the persons who had repaid the said old loans during the year under consideration, along with his duly deposed 'Affidavit', dated 16.01.2017, furnished before us during the course of hearing of the appeal. It was thus submitted by the ld. A.R that despite the fact that complete details as regards the nature and source of the cash deposit of Rs. 10,53,000/- along with the supporting documents were furnished with the A.O, the latter however had most arbitrarily scrapped the same and had proceeded with in a whimsical manner and drawn adverse inferences in the hands of the ass....
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....e settled position of law that a statutory provision has to be strictly construed and interpreted as per its plain literal interpretation, and no word howsoever meaningful it may so appear can be allowed to be read into a statutory provision in the garb of giving effect to the underlying intent of the legislature, thus confining ourselves within the realm of our jurisdiction, therein construe the scope and gamut of the aforesaid statutory provision by according a plain meaning to the language used in Sec. 68. We are of the considered view that a credit in the 'bank account' of an assessee cannot be construed as a credit in the 'books of the assessee', for the very reason that the bank account cannot be held to be the 'books' of the assessee. Though it remains as a matter of fact that the 'bank account' of an assessee is the account of the assessee with the bank, or in other words the account of the assessee in the books of the bank, but the same in no way can be held to be the 'books' of the assessee. We have given a thoughtful consideration to the scope and gamut of the aforesaid statutory provision, viz. Sec. 68, and are of the considered view that an addition made in respect of ....
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.... a situation "Where any sum is found credited in the books of an assessee....................". The Hon'ble Bombay High Court in the case of Shri Bhaichand Gandhi (supra) has approved the proposition that a bank Pass Book maintained by the bank cannot be regarded as a book of the assessee for the purposes of section 68 of the Act. Factually speaking, in the present case, assessee is not maintaining any books of account and section 68 of the Act has been invoked by the Assessing Officer only on the basis of the bank Pass Book. The invoking of section 68 of the Act has to fail because as per the judgment of the Hon'ble Bombay High Court in the case of Shri Bhaichand N. Gandhi (supra), the bank Pass Book or bank statement cannot be construed to be a book maintained by the assessee for any previous year as understood for the purposes of section 68 of the Act. Therefore, on this account itself the impugned addition deserves to be deleted. I hold so." We further find that a similar view had also been arrived at in a 'third member' decision of the Tribunal in the case of Smt. Madhu Raitani Vs. ACIT (2011) 10 taxmann.com 206 (Gauhati) (TM), as well as by a coordinate bench of the Tribun....