2023 (2) TMI 637

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.... the said order being without jurisdiction. 3. In the facts and circumstances of the case and in law the AO has erred in confirming the action of the AO in considering the cash deposits to be unexplained and thereby sustained the addition to the tune of Rs.,13,83,300/-. The action of the AO is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by deleting the addition of Rs.13,83,300/-.'' 2.1 During the course of hearing, the Bench observed that there is delay of 71 days in filing the appeal by the assessee for which the assessee has filed an application dated 10th July, 2020 praying therein that Govt announced lockdown from 20-03-2020 because of COVID-19 break out which has prevented the assessee in timely filing the appeal before the ITAT. Further the ld. AR of the assessee took the resort of Hon'ble Supreme Court dated 10-01-2022 (M.A. No. 21 and 665/2021 regarding cognization of extension limitation from 15-03-2020 till 28-02-2022) and thus prayed that the assessee is prevented by sufficient reasons in filing the appeal within due date and further prayed to condone the delay. 2.2 On the other hand, the ld. DR objected to such del....

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....laim to have a vested right in injustice being done because of a non-deliberate delay." Keeping in view the present facts and circumstances of the case and the Orders of the Hon'ble Supreme Court (supra), the application of the assessee for condonation of delay in filing the appeal is allowed. 3.1 During the course of hearing, the Bench observed that the assessee has raised the Ground No. 1 and 2 for adjudication. It would not be advisable to consider these ground No. 1 and 2 which were not raised before the ld. CIT(A). Hence, the same are dismissed being not adjudicated by the ld. CIT(A) 4.1 Apropos Ground No. 3 of the assessee, the facts as emerges from the order of the ld. CIT(A) are as under:- ''2.5.1The Authorized Representative argued that the addition was made without considering the bank withdrawals and cash sales. He further contended that cash deposit after considering withdrawals is Rs.18,83,300/-, 2.5.2 On perusal of overall facts, I find that neither during assessment nor in appellate proceedings filed any justification of source of cash deposit. Assessing Officer already considered the sales while making the addition therefore objection that cash sales is not c....

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....osition was clearly disenable from the Books of Accounts and Financial Statements submitted by the assesse, before the lower authorities. 2.7. Ld. AO observed that assessee had paid interest of Rs. 57,935 on the outstanding balance of the bank account maintained by the assessee, whereas, assessee was having cash balance with him [AO Order Page 4]. Ld. AO has considered certain percentage at which interest has been paid by the assessee according to him, which is 22.20 %. Ld. AO has not given any basis of arriving at such interest percentage. Also, Ld. AO has not doubted other aspects of the books accounts maintained by the assessee. The assessee might have been not properly maintaining his cash flows but that does not entitle the Id.AO to disregard, the cash receipts generated by him through his Business operations. Against this, elaborate submissions were also made before Id. CIT(A), who has also not controverted to the submissions made by the assessee. 2.8.Ld. AO, during the course of assessment proceedings, also compared the turnover declared by the assessee at the time of filing the return of income pursuant to the notice issued under Section 148, vis a vis the details submi....

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....,90,500/- only. The assessee submitted reply to the AO that he is not required to maintain any books of accounts as income is declared u/s 44AD of the Act for which the assessee furnished copies of P&L account as well as balance sheet. The AO noted that against the cash deposits the assessee issued cheque in the name of share brokers almost on the same date for which no detailed had been furnished by the assesee. Thus the AO observed that it is failure on the part of the assessee to substantiate the unexplained cash deposit of Rs.17,01,150/- in his bank account with Standard Chartered Bank of Rs.11,31,350/- and in Allahabad Bank of Rs.5,69,800/- which the AO treated as income of the assessee under the head ''Income from other sources''. Thus the AO completed the assessment u/s 147 r.w.s. 143(3) of the Act and made addition at Rs.17,01,150/-. In first appeal, the ld. CIT(A) has restricted the addition to the extent of Rs.13,83,300/- giving the relief of Rs.3,17,850/- to the assessee. From the available record, it is noted that the assessee was a vegetable vendor and this fact has not been disputed by the lower authorities. Out of the receipt from the sale of vegetables which took pl....