TaxTMI 
TaxTMI 
2023 (11) TMI 699
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....f facts qua the issue are that the assessee filed his return of income for assessment year (A.Y.) 2017-18 on 01.08.2017, declaring total income of Rs. 3,17,960/-. The assessee`s case was selected for limited scrutiny under CASS on reason that there is large cash deposit during the year. Accordingly, notice u/s 143(2) was issued on 14.08.2018 and the same was duly served upon the assessee. Thereafter, notices u/s 142(1) of the Act was issued on 23.01.2019 calling for submission of details on or before 31.01.2019. However, the assessee failed to comply with the statutory notices, therefore, a show cause notice u/s 144 of the Act was issued to the assessee, on 17.10.2019, proposing therein to finalize proceedings u/s 144 of the Act. In response, assessee submitted that he (assessee) is distributor of IDEA Cellular and cash deposits was out of payments received on distribution of recharge balance to different sales persons. Assessee furnished computation of income, 26AS and copy of response made by him in cash transactions 2016. 4. The assessing officer noted that assessee made partial compliance vide letter dated NIL received through e-assessment portal. Accordingly, another notice....
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....and as on 01.04.2016 and relying upon figures shown by you as cash sales, cash deposits and cash expenses, your cash balance goes negative in the month of Nov. 2016, and therefore remained negative cash balance of Rs. 3,39,365/- as on 31.12.2019. In view of the above, you are required to show cause, as to why negative cash amounting to Rs. 3,39,365/- should not be treated as unexplained and added to your total income for the year under consideration. Further, on perusal of debtor ledger submitted by you, narration of certain entries appearing with narration "Dummy Bank_Cont" and "Prepaid Debtor". On perusal of your bank statement no such debit entries were found appearing. You are therefore required to justify the nature and mode of all such payments to the company alongwith with necessary evidentiary proof- Please note that in case of failure, adverse inference shall be drawn." 5. In response to the above show cause notice, the assessee has submitted its response. Having gone through the reply of the assessee, the assessing officer, noted that during demonetization period, the assessee had made substantial cash deposit in his bank accounts. Accordingly, accoun....
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.... negative cash balance, the assessee had submitted that he had received cash gift of Rs. 2,77,120/- from his wife, however, no supporting evidentiary proof has been furnished by the assessee. Hence, the claim of the assessee remained unjustifiable. Therefore, the differential amount of Rs. 3,99,365/- was treated as unexplained u/s 68 of the Act and accordingly added to the total income of the assessee for the year under consideration. 8. Aggrieved by the order of Assessing Officer, the assessee carried the matter in appeal before the ld. CIT(A) who has adjudicated the assessee's appeal on merit considering the statement of facts and assessment order. Before ld. CIT(A), the assessee did not appear, during the appellate proceedings, despite of issuance of notice of hearing four times, therefore ld. CIT(A) has adjudicated the issue considering the statement of facts and assessment order, dated 16.09.2018 and confirmed that addition made by the assessing officer to the tune of Rs. 3,99,365/-. Aggrieved by the order of ld. CIT(A), the assessee is in further appeal before this Tribunal. 9. I have heard the rival arguments made by both the sides and perused the material available on....
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.... the impugned addition made by the Assessing Officer to the tune of Rs. 3,39,365/- with help of the bank account and reconciliation which is reproduced below: 11. Therefore, with help of the above reconciliation statement, Ld. Counsel contended that after considering the rectified figures in the cash deposit amount to the bank, there would not be any difference at all; therefore addition made by the Assessing Officer should be deleted. 12. On the other hand, Learned Senior Departmental Representative (ld. Sr. DR) for the Revenue submitted that first of all the assessee did not appear before the appellate proceedings, however the ld. CIT(A) has adjudicated the issue on merit by taking into account the statement of facts and assessment order, even then, the matter may be restored back to the file of Assessing Officer with the direction to the assessing officer to examine the explanations provided by the assessee with help of reconciliation of the bank account and the cash book. 13. In rebuttal, the Ld. Counsel submitted that the bank account and the cash book were already submitted before the Assessing Officer; therefore, there is no logic to remit the issue back to the file....
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.... the contention of the Assessing Officer in any manner and hence the addition so made is deleted. Hence this ground of the assessee is allowed. 16. In the result, appeal filed by the assessee is allowed. Order is pronounced on 31/10/2023 in the open court. ============= Document 1 Total of Credit side in SBI Total Cash Deposit Notes: 1. The major reason of such error is that while submitting the table to AO, I had considered the total credit of the month as cash deposit in the bank which is not true for following reasons. Total of Month wise credit is as follows: Month Total Cheque/ Other Deposit Apr-16 20,99,955 19,98,455 101,500 (See Note: 2) May-16 18,49,625 18,49,625 Jun-16 19,87,905 19,87,905 Jul-16 21,99,840 21,99,840 Aug-16 23,37,200 22,36,110 1,01,090 (See Note: 3) Sep-16 19,81,890 19,81,890 Oct-16 28,66,800 28,26,800 40,000 (See Note: 4) Nov-16 16,28,650 15,63,350 65,300 (See Note: 4) Dec-16 16,99,690 14,42,790 2,56,900 (See Note: 4) Jan-17 19,03,650 19,03,650 Feb-17 17,49,140 17,49,140 Mar-17 23,64,490 22,44,490 1,20,000(S....