TaxTMI 
TaxTMI 
2024 (4) TMI 496
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.... is a delay in filing of appeals by the revenue by 1 day for both the years. Considering the reasons given in the delay condonation petition by the revenue, the delay is condoned and appeals of the revenue are hereby admitted for adjudication. 4. Let us take up the appeal of the revenue for the Asst Year 2012-13. 5. Though the revenue has raised several grounds of appeal before us, the effective issue to be decided in this appeal is as to whether the ld. CIT(A) was justified in deleting the addition made on account of cash deposit of Rs 2,69,97,300/- made in the bank account as unexplained cash credit u/s 68 of the Act in the facts and circumstances of the case. 6. We have heard the rival submissions and perused the materials available on record. The assessee has been carrying on the business of exchanging the soiled, mutilated, torn Indian currency notes with clean or new Indian currency notes and the Indian currency notes of higher denomination with Indian currency notes of lower denomination. This business has been carried on by the assessee for the last few decades from his shop cum office located in the area of Chandni Chowk, Delhi. People from different places visit the as....
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....k from the different parties. The assessee further submitted that funds so received from different parties so credited in his bank account were withdrawn by the assessee as "Cash" and was given to its customer. It was further submitted by the assessee that the torn and old currency received from the customer were also deposited in his bank account, the assessee generally had the practice to with draw new and fresh currency from the bank whenever he required. b. In this regard, the information was sought from the concerned bank Axis Bank who submitted as under:- "We have retrieved to vouchers of 2010 and 2011, all the deposits are normal cash deposits by client and no details of torn notes are mentioned on the vouchers..." In the reply the bank categorically denied assessee's claimed that on certain specific dates he had received new notes from the bank. In view of above, facts were established that the assessee Sh. BR Goel & Sons was indulged in the business of money laundering. He arranged funds to give it to further to the persons who required." 8. The ld. AO observed that since the modus operandi of the business of the assessee is not accepted by the revenue, the as....
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....this Tribunal in assessee's own case for the Asst Year 2011-12 in ITA No. 9084/Del/2019 dated 21.2.2023 wherein it was held as under:- "8. Apropos ground nos. 7 to 11 the learned counsel submitted that from the copy of the assessment order for A.Y. 2007-08 para 2 it is clear that the AO himself noted that the assessee is engaged in the business of Exchange of Torn/Soiled/Mutilated Indian Currency Notes into New/Fresh and vice-versa discount/commission basis. The learned counsel further submitted that the assessee during the course of reassessment proceedings clarified to AO that torn currency notes were deposited with normal currency notes while providing date wise details of cash withdrawn and cash deposited in the bank account. The learned counsel further submitted that the assessee used to withdraw cash out of its bank account and used to deposit the cash in its bank accounts from time to time and the cash transactions were duly recorded in the cash book available at page no. 14 to 39 of assessee's paper book. The learned counsel further pointed out that at no point of time during FY 2010- 11 there was any negative cash balance and the opening cash in hand/stock was of Rs.....
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....ee is in the business of Exchange of Torn/Soiled/Mutilated Indian Currency Notes into New/Fresh and vice-versa on discount/commission basis. 11. From the submissions of the assessee and facts noted by the authorities below it is clearly discernable that the Assessing Officer made addition of Rs. 1,09,49,000/- which was the total amount of cash deposited to the two bank accounts of the assessee. The learned Senior DR could not controvert that the assessee also withdrew Rs. 1,99,30,000/- from the same bank accounts during FY 2010-11. When the assessee is in the business of exchange of old Torn/Soiled/Mutilated currency noted then the modus operandi of business would be the same as stated by the learned counsel of the assessee that is the assessee has to deposit old Torn/Soiled/Mutilated notes to the bank account and he is required to withdraw amounts from the bank account for the purpose of giving the same in exchange to its customer and clients. Therefore we declined to approve basis taken by the AO for making addition of entire cash deposited to the bank accounts of the assessee and ignoring the high amount of cash withdrawn by the assessee for the purpose of its business. Theref....
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.... Book for FY 2011-12 Particulars Cash Outflow Cash Inflow Opening Cash as on 01.04.2011 15845704 Cash withdrawals 26450000 Cash Deposited 26997300 Cash Commission 2950280 Cash Utilization (Expenses etc.) 703397 Closing Cash in hand 17545287 Total 45245984 45245984 13. From the above table, it is evident that the entire cash deposits made in the bank account stood properly explained. We have also gone through the cash book for the whole year which are already forming part of the records and there is absolutely no negative cash balance on any given day in the year. Hence the entire cash deposits made in the bank account stood properly explained by the assessee. In our considered opinion, given the business model of the assessee, the nature and source of credit within the meaning of section 68 of the Act stood properly explained in the instant case and accordingly no addition could be made as unexplained cash credit u/s 68 of the Act. Accordingly, the grounds raised by the revenue are dismissed. 14. The assessee has preferred Cross Objections before us challenging the validity of assumption of jurisdiction u....