TaxTMI 
TaxTMI 
2017 (6) TMI 393
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....ned CIT(A) has erred in law and on facts in deleting the addition of Rs. 37,50,000/- made u/s.68 of the IT Act on account of unexplained cash credit made in S.B. Account of the assessee with Corporation Bank, Ahmedabad. ii. The learned CIT(A) has failed to consider the reasons and legal position as discussed by the AO vide para-4, 4.1 to 4.5 of assessment order dated 30/12/2010 on the basis of which addition of Rs. 37,50,000/- was made by the AO u/s.68 of the IT Act. iii. The learned CIT(A) has passed the appellate order on the basis of submission of the assessee filed during the course of appellate proceedings. Before considering the submission, no opportunity has been given to the AO of being heard. Since the same is against princip....
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.... It was also explained that on account of some dispute in the terms and conditions, the sale deal could not materialize and the money received was returned subsequently. All these facts are duly mentioned in Para 4.1 of the assessment order. A show cause notice dated 24/12/2010 was issued to the assessee asking him to explain why the amount of Rs. 37,50,000/-should not be disallowed and added u/s. 68 of the I.T. Act. As mentioned in Para 4.2 of the assessment order the show-cause notice was issued because i. Letter dated 06/12/2010 was issued to Shri T.V. Rajgopal to confirm the contention of the assessee but no reply was received from him. ii. Letter dated 06/12/2010 was issued to I.T.O., salary ward 111(3), Chennai requesting her....
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....by him and the said amount was deposited in the Bank account. It was further explained that he acted as intermediary in this deal, he had no stake directly or indirectly in this deal, he is younger brother of the assessee and as he is residing at Chennai where these plot are situated he was requested to have a deal and sell out the plots as the assessee was in need of money for his son's study at abroad. But unfortunately the deal could not the finalized and the money received was returned to the brother of the assessee by cheques and confirmation in this regard has been duly submitted. It was further clarified that as the deal failed there are no documents available at present and the assessee requested for acceptance of his explanatio....
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....nd evidence with regard to source of cash deposit in Bank account No.5531 with Corporation Bank was given by the assessee, that the assessee has deposited his income from undisclosed sources in cash, and accordingly the total amount of cash deposit has been treated as unexplained cash credit within the meaning of Section 68 and accordingly treated as income of the assessee. Therefore, an addition of Rs. 37,50,000/- as income from undisclosed sources was added to the income of the assessee. 4. Against the said order assessee preferred first statutory appeal before the learned CIT(A) who decided the matter in favour of the assessee and held as under: "I have carefully considered the submission made by the assessee, material placed in....
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....29 it is noticed that he was not asked with regard to his acting as a intermediary for sale of assessee's plots. But he was asked regarding plot advance account confirmed by him to which he replied that he signed the papers without knowing its implications and he also replied that he has not made any deposit in the account of the assessee and he has not purchased any plot for himself or for the assessee. It shows that he has not been asked with regard to his sending money from the prospective buyers and assessee has not contended that the cash in his account was deposited by him and therefore the deposition does not bring out the correct facts regarding sale of plots and he has also not denied the plot advance account confirmed by him a....
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.... should have been considered. In the case of BHARAT ENGG. AND CONSTRUCTION the explanation given by the assessee was found to false but the case credit was not held to be income because Tribunal was of e view that the assessee could not have earned such a huge amount as profit very soon after the start of business and the Supreme Court inferred that it was reasonable to assume that those cash credit entries were capital receipts although for one reason or other the assessee had not come out with the true story as regards the persons from whom it got those amount. In the case of assessee also the amount has been deposited with in a span of one and half months and it has been rightly pointed out that keeping in view the sources of income of t....