TaxTMI 
TaxTMI 
2022 (12) TMI 442
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.... The Order of the Learned Commissioner of Income Tax (Appeals) is contrary to the law, facts and circumstances of the case. 2. The assessing officer has noted that he has re-opened the assessment for verification of source of cash deposits. It has been held by various courts that reopening can be resorted only when the assessing officer records his belief that income has escaped assessment and cannot be re-opened for verification. Without prejudice to the above, 3. The Commissioner of Income Tax(Appeals) erred in ignoring the confirmation letter produced by the appellant in making the addition in respect of cash deposits made in the bank account. Without prejudice to Ground 3, 4. The appellant had returne....
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....t of his savings, he had given loan of Rs. 12,00,000/- to his brother-in-law in the year 1999 as hand loan, for the purpose of construction of house. His brother-in-law has repaid a sum of Rs. 13,50,000/- in the financial year relevant to assessment year 2009-10 and said amount has been deposited into his savings bank account. The AO, however was not convinced with explanation furnished by the assessee and according to the Assessing Officer, the assessee could not satisfactorily explain source for cash deposits found in his bank account and thus, made addition of Rs. 14,19,000/- as unexplained investment. 4. Being aggrieved by the assessment order, the assessee preferred an appeal before the Ld. CIT(A). Before the Ld. CIT(A), the assesse....
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....s which was recorded for reopening of assessment and make assessment on different reasons. In this regard, he relied upon the decision of Hon'ble Bombay High Court in the case of Nivi Trading Ltd vs Union of India (2015) 64 Taxmann.com 92 (Bombay) and also the decision of Hon'ble Bombay High Court in the case of PCIT vs Sheetal Dushyant Chaturvedi (2022), 134 Taxmann.com 327 (Bom). The Ld. Counsel for the assessee also relied upon the decision of the Supreme Court in the case of PCIT vs Sheetal Dushyant Chaturvedi (2022) 134 Taxmann.com 328 (SC). The Ld. Counsel for the assessee, on merits of the issue submitted that the assessee has explained source of cash deposits out of re-payment of loan by his brother-in-law and for this purpose furni....
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....he assessee could not establish loan given to his brother-in-law in the year 1999 and return of said loan by his brother-in-law in the impugned assessment year. Therefore, the AO has rightly made addition towards cash deposit and their order should be upheld. 7. We have heard both the parties, perused materials available on record and gone through orders of the authorities below. The assessee has questioned legality of re-opening of assessment in light of reasons recorded for re-opening of assessment. The Ld. Counsel for the assessee referring to the assessment order dated 03.03.2016 argued that the AO has re-opened assessment in order to verify source for cash deposits, which is not permissible under law. We find that the ld. DR has fur....
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....n at that stage. In this case, there is a new material with the AO to form a reasonable belief of escapement of income. Therefore, we are of the considered view that there is no merit in arguments taken by the Ld. Counsel for the assessee on legality of re-opening of assessment, and thus, we reject ground taken by the assessee on re-opening of assessment. 8. Having said so, let us come back to addition made by the AO on cash deposits. The assessee has made cash deposits of Rs. 14,19,000/- in his saving bank account maintained with BHEL Employees Co-op Bank Ltd. The assessee claims that source for cash deposits is out of his retirement benefits received from BHEL in the year 1999. The assessee further claimed that out of his retirement be....
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.... we are of the considered view that a benefit of doubt should be given to the assessee to the extent of sum of Rs. 8,50,000/- that the assessee had given loan to his brother-in-law and the same has been returned back by his brother-in-law in the year 2008. Therefore, we are of the considered view that the assessee could able to explain source for cash deposits to the extent of Rs. 8,50,000/-. In so far as, balance amount of Rs. 5,69,000/-, no proper explanation was furnished by the assessee which can be considered as acceptable. Although, assessee claims that he had given loan to his brother-in-law out of his past savings amounting to Rs. 3,50,000/-, no credible evidence was with the assessee to justify his case. Therefore, we are of the co....