TaxTMI 
TaxTMI 
2023 (3) TMI 505
X X X X Extracts X X X X
X X X X Extracts X X X X
....n to the assessment order, the ld. Sr.DR submitted that the assessee was required to explain the cash deposits during the demonetization period. The reply of the assessee filed before the AO was considered to be not acceptable. 2.1 Inviting attention to para 4.5 of the assessment order the ld. Sr.DR submitted that the assessee was found to be making contradictory replies and ultimately the assessee stated that "the details of the parties from whom such amounts were received were not maintained". It was submitted that the confirmations from the persons from whom cash was received were not produced. As a result of this, addition of Rs.80,94,250/- was made in the hands of the assessee. 2.2 Inviting further attention to the impugned order, it was her submission that without requiring the assessee to explain the sources and the parties from whom the receivables were received and deposited, the addition has been deleted and this is what has been highlighted by the Revenue in the ground raised. Accordingly, it was her prayer that the impugned order may be set aside and the assessment order instead may be upheld as on facts the assessee has failed to identify the parties. 3. The l....
X X X X Extracts X X X X
X X X X Extracts X X X X
....arrived at but also the position of law as considered by the Apex Court referred to for our consideration by the ld. AR. We are further guided by the fact that the factual reasons for deleting the addition as brought on record by the ld. CIT(A) remained unrebutted. Accordingly, first we set out the specific reasoning which has led to the grievance caused to the Revenue. For ready reference, para 4.2 of the impugned order is extracted hereunder : "4.2 Grounds of Appeal Nos. 2 & 3 relate to addition of Rs. 80,94,250/- on account of cash deposited in the bank account of the assessee. The AO has mentioned that the assessee is an individual having salary income from M/s. Sporting India Ltd., partner in M/s. Sobhagia Clothing Company and the return was filed declaring an income of Rs. 1,28,16,731/- which includes apart from the above, rental income, agriculture income and income from other sources. It is further mentioned that the case was selected for limited scrutiny for the reason that the assessee has made large value of cash deposit during the demonetization period and accordingly vide notice u/s 142(1), the assessee was asked to explain the source of cash deposit and also ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uch details were available with the assessee. It was further submitted that the additional incomes of Rs. 50 lacs during the assessment year 2013-14 and Rs.185 lacs during the assessment year 2014-15 were duly declared in the return filed and assessment order was passed on 23.03.2016 where the income declared as business income stand duly accepted. As per the assessee, out of the total income declared, a sum of Rs. 83,65,650/- was outstanding as amount receivable in balance sheet of the assessee as on 31.03.2016 and the same amount was received by the assessee during the months of July, August and October, 2016, the details of parties from whom such amounts were received were not maintained. It was further argued that the amount reflected in the balance sheet were part of the income already offered for taxation which have already been accepted. As per the assessee, he has already discharged his tax liabilities in earlier years in respect of surrendered/recovered income and relied upon the judgment of Hon'ble Punjab & Haryana High Court in the case of DCIT (Inv.) Circle, Faridabad vs. Om Parkash Aggarwal (HUF) reported in 53 Taxmann.com 395 and further the AR referred to the jud....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eliance in the case of CIT vs. Miscellaneous Application Unnerikutty (1985) 154 ITR 844 (Kerala) held that the assessee could not explain the source of cash deposits and the same are considered to be unexplained money u/s 69A of the Income Tax Act, 1961 and addition of Rs. 80,94,250/- was made to the income of the assessee on account of unexplained money u/s 69A of the Income Tax Act, 1961. The facts of the case, the basis of addition made by the AO and the arguments of the AR during the course of appellate proceedings have been considered. The AR reiterated that the appellant declared certain income in the return for the assessment year 2013-14 & 2014-15 which were duly accepted by the then AO while framing assessment u/s 153A for the relevant assessment year, out of which some amount was standing in the balance sheet as amount receivables which was liquidated in cash during the year under consideration and deposited in the bank account. The AR submitted that at the time of demonetization a sum of Rs. 80,94,250/- was deposited and during the course of assessment proceedings, the assessee was asked to submit the details along with the sources, in response to which the asse....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t of his contention and argued that as per the tax laws jurisprudence, a sum when already offered to tax can in no circumstances be taxed again and same would tantamount to double taxation. As per the AR, in such circumstances no deeming provisions should be invoked in the year under consideration by placing reliance on various case laws. It is further submitted by the AR that there is nothing on record to refute the appellant's submissions or to even remotely indicate any other source of income from where the said sum can possible be earned by the appellant during the year under consideration. As per the AR, throughout the assessment proceedings, the AO has not challenged or disputed the statement of affairs already submitted before him and he has not pointed out any defect based upon which it can be said that the amount have not been realized out of the receivables. The AR referred to a case law where the assessee surrendered an income of Rs. 5 crore in the assessment year 2010-11 and disclosed it as sum recoverable in respect of advances to various parties and the same forms part of Statement of Affairs as on 31.03.2010. Further, as and when the advances were liquidated, the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 6881850 Total 18500000 The statement of affair in the shape of balance sheet as on 31.03.2014 was also filled alongwith the letter dated 02.02.2016 where the amount of Rs. 15247500/- was shown on the assets side as 'other assets due to surrender' (with opening balance Rs. 3882500/-). The fact of surrendered of Rs. 18500000/- as undisclosed business income from trading of textile fabrics as per the statement of the assessee and offering of this income as additional income over and about the normal income has also been mentioned in the assessment order dated 23.03.2016 passed under section 143(3) for assessment year 2014-15. The amount reflected in the balance sheets were a part of income early offered for taxation which had duly been accepted by the AO in the relevant year. The bare reading of section 69A reveals that this provision is attracted where the assessee is found to be the owner of any money which is not recorded in the books of accounts maintained by him for any source of income and the assessee offers no explanation about the nature & source of acquisition of money or explanation so offered is not satisfactory. In the present case, the a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....of accounts. Hence, the arguments of the AR are found acceptable and the addition of Rs. 80,94,250/- made by the AO u/s 69A is not found sustainable and therefore deserves to be deleted." 4.1 We find that the position of fact as appreciated in as much as that the receivables have already been subjected to tax is not in dispute. Accordingly, in these peculiar facts, we find no good reason to interfere with the impugned order. We further find support from the decision of the Apex Court wherein in the case of Ashish Plastic Industries (2015) 373 ITR 45 (S.C.), the issue was remanded back to consider whether the assessee was able to prove that tax on the income generated from the sale of material had been paid to that extent, the Court held that the benefit should be extended to the assessee. For ready reference, we reproduce from the Head Notes : " In survey operations conducted at the factory premises of the assessee on September 23, 1993, the stocks at the premises were physically verified and excess stocks worth Rs. 13,92,000 were found and admitted. On this basis the addition was made and the assessment order was passed by the assessing authority in respect of the asse....