TaxTMI 
TaxTMI 
2016 (4) TMI 1415
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....rds that Ld. CIT(A) erred in deleting the addition made by Assessing Officer of Rs.40 lakhs as assessee failed to declare the same in the financial statements though these DDs were there in the hands of assessee at the end of the financial year. For this, Revenue has raised following effective ground:- "1. The Ld. CIT(A) has erred in deleting the addition made on account of undisclosed credit balance of DDs amounting to Rs. 40,00,000/- made by the AO. The DDs purchased from disclosed CC A/c, but not reflected in financial statement or bank A/c though these DDs were in the hands of the assessee." 3. The facts in brief are that the assessee in the present case is an individual and engaged in the trading business of fertilizers, potatoes an....
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....ddition made by the AO by observing as under:- "6.2 I have duly considered the submission of the AR of the appellant and seen the details filed. During the relevant year, the appellant was engaged in fertilizer business, having turnover at Rs. 9.03 crores. The AO had not disputed that the appellant purchased Demand Drafts (DDs) worth of Rs. 40,00,000/- from his disclosed CC A/c with UCO Bank on 29/03/2008, which were subsequently deposited in his SB A/c. with ICICI Bank in the next financial year on 02/04/2008. The AO treated the said DDs as unexplained presumably because those DDs were not shown in the asset side of the balance sheet. Here is a case, where the appellant purchased DDs from his disclosed CC A/c on 2903/2008, kept those DDs....
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....e facts of the case, we find that these DDs were made from the disclosed bank account of the assessee and were transferred to his saving bank account. It is also nowhere mentioned that this account of the assessee wasn't disclosed in the return of income. We also observe from the finding of the AO that these DDs were made out of the CC account of the assessee. As per the provisions of Section 69A of the Act unexplained money can be brought to tax if it is not recorded in the books of accounts and assessee offers no explanation about the nature and source of acquisition of money. In the present case, the sources of the DDs have not been doubted. Accordingly, in our considered view that there is no infirmity in the order of the Ld CIT(A) and ....
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....cash. The AO had not questioned the source of deposits and therefore, it is presumed that deposits were duly explained. The withdrawals made from a bank account where deposits stand explained, cannot be termed as unexplained money as per provisions of 69A of the Act, for want of whereabouts or utilization of the said withdrawals. Under the facts and circumstances, the addition of Rs. 7,13,000/- made by the AO in terms of section 69A of the Act is found ill-conceived and bad in law. The addition of Rs. 7,13,000/- is therefore, deleted." Being aggrieved by this order of Ld CIT(A) Revenue is in appeal before us. 10. Before us Ld. DR vehemently supported the order of Assessing Officer whereas Ld AR relied on the order of Ld. CIT(A). 10.1 We ....