TaxTMI 
TaxTMI 
2019 (3) TMI 1712
X X X X Extracts X X X X
X X X X Extracts X X X X
....section 148 of the Income Tax Act, requested the AO to treat the original return filed earlier as return in response to notice under section 148. Subsequently the AO issued notice under section 143(2). During the course of assessment proceedings the AO noted that the assessee has made cash deposit of Rs. 4,97,452/- during the financial year 2006-07 relating to impugned assessment year. In absence of any satisfactory reply given by the assessee to substantiate the source of such deposit and since the assessment was getting time barred, the AO made addition of Rs. 4,97,452/- to the total income of the assessee. 3. Before the learned CIT(A), the assessee filed elaborate submission based on which the learned CIT(A) called for a remand report from the AO. Even after several reminders, the AO did not submit any remand report. Therefore, the learned CIT(A), on the basis of material available before him and after considering the submissions of the assessee upheld the action of the AO by observing as under:- "4.6. I conclude that the AO has treated the matter of sending the report very causally. Since the AO's report has not been received till date, I am proceeding to adjudi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....olved in such business activities and credits/cash deposits in the bank accounts have remained unexplained. 5. In final analysis, I uphold the action of the AO-(i) With regard to addition on account of unexplained deposits in bank account amounting to Rs. 4,97,452/- However the AO will verify and grant relief to the extent of income from the house property, as (and if) has already been shown by the appellant in his return of income. This will avoid double addition." 4. Aggrieved with such order of the learned CIT(A), the assessee is in appeal before the Tribunal by raising the following grounds:- "1(i) That on the facts and circumstances of the case, the Assessing Officer has wrongly assumed jurisdiction u/s. 148 without proper appreciation of facts, recording of satisfaction and requisite approval in terms of provisions of sec. 151 and CTT(A) was not justified in confirming order of AO. (ii) That there is no case of any income escaping assessment and whole basis of reassessment is illegal and without jurisdiction. 2(i). That on the facts and circumstances of the case, the observation of the CIT(A) regarding addition of Rs. 4,97,452/- is highl....
X X X X Extracts X X X X
X X X X Extracts X X X X
....explained and therefore, no addition is called for. 7. The learned DR, on the other hand, heavily relied on the order of the learned CIT(A). 8. I have considered the rival submissions made by both the sides and perused the orders of the authority below. I find the AO on the basis of the information received from the investigation wing of the Department that the assessee has made cash deposit of Rs. 4,97,452/- reopened the assessment by issuing notice under section 148 and thereafter made addition of Rs. 4,97,452/- to the total income of the assessee by invoking the provisions of Section 68 of the I.T. Act, 1961. I find the learned CIT(A) upheld the action of the AO, the reasons of which have already been reproduced in the preceding paragraph. It is the submission of the learned counsel for the assessee that there is complete non application of mind of the AO while recording the reasons and he has not verified the facts properly and the reopening was made on the basis of report of the investigation wing. Further the deposits in the bank accounts are fully explained and therefore no addition is called for. 9. I find force in the above arguments advanced by the learned counse....
X X X X Extracts X X X X
X X X X Extracts X X X X
....and even the source/confirmation(s) of credits in bank accounts have not been produced/provided such investments/credits have remained not explained satisfactorily. Merely producing some agreements of transactions does not show whether the amounts were actually received from the named persons, and what was the source thereof. As such, the additional evidence sought to be submitted by the appellant is not worthy of admission. The same is therefore not admitted. An examination of facts at hand clearly establishes that the appellant has been buying and selling properties in a systematic manner. The appellant is also in the business of being a builder. I find that the appellant is depositing cash in bank accounts as and when cheques needed to be issued. Similarly, source of cash deposited in the bank account(s) remains unexplained. The appellant is presenting a proposition that transactions carried out through banking channels are to be treated as explained. Routing a transaction through bank, in itself, does not give a certificate of the transaction being genuine. The source of cash deposits has remained unexplained. In fact, the appellant has created balance in the bank acco....
X X X X Extracts X X X X
X X X X Extracts X X X X
....explained credit or unexplained investment. (iv) That impugned addition is highly arbitrary and unjustified and merely based on presumption and surmises 3. That the assessee crave leave to add, amend, alter or forgo any or all of the grounds as may be necessary and in the interest of justice. 4. That orders of the lower authorities are not justified on facts and same are bad in law." 14. I have considered the rival submissions made by both the parties and perused the orders of the authorities below. A perusal of the reasons recorded by the AO shows that Clause 3 of the notice under Section 148 is again blank and it is not known as to whether the AO has obtained approval from the higher authorities and if so from whom. Even otherwise a perusal of the details filed by the assessee shows the following reconciliation statement explaining the various deposits in the bank account. Statement showing cash, credit in ICICI Bank A/c No. 031101505014 A.Y. 2009-10 Date Addition made by A.O. Addition upheld by CIT(A) Details 21.04.2008 100,000 100,000 Security Money Deposit received from tenant (paper book page 10-12) 25.05.2008 ....