2016 (7) TMI 1713
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....rchants Co-operative Bank Ltd., the details of which are as under : 1 23-11-2011 Rs.10,00,000/- 2 06-01-2012 Rs.4,25,000/- 3 12-01-2012 Rs.5,00,000/- 4 17-01-2012 Rs.5,00,000/- Total Rs.24,25,000/- He, therefore, asked the assessee to explain the source of such deposits. Since there was non- compliance from the assessee's side despite repeated reminders the AO completed the assessment u/s. 144 of the I.T. Act by making addition of Rs. 24,25,000/- to the total income of the assessee. 4. Before CIT (A) the assessee submitted that the copy of the bank statement was available before the AO and in the said bank statement there were huge cash withdrawals. Therefore, before passing order u/s. 144 the AO should have taken into account all relevant materials which he has gathered after giving an opportunity of being heard to the assessee and made the assessment to the best of his judgment. It was submitted that adequate opportunity was not granted to the assessee for making his submissions. It was further submitted that the assessee had withdrawn cash of Rs. 23 lakhs on 03-11-2011 Rs. 2,70,000/- on 22-11-2011 and Rs. 8 lakhs on 3012-3011 from the ....
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....drawal of cash and then re-depositing the same in the bank account as no prudent person will do such an act. It was stated on behalf of the appellant that cash was withdrawn with the intention to buy some agricultural land and since the transaction did not materialize therefore the cash was re-deposited. 4.3.1 The submission filed on behalf of the appellant is not acceptable. The law is well settled that the onus of proving the source of a sum or money found to have been received by an assessee is on him. Where the nature and source of a receipt, whether it be of money or other property, cannot be satisfactorily explained by the assessee, it is open to the revenue to hold that it is the income of the assessee and no further burden lies on the revenue to show that the income is from any particular source - Roshan Di Hatti vs. CIT (107 ITR 938) (SC). 4.3.2 In the case of Sreelekha Bannerji and others vs. CIT 49 ITR 112), Hon'ble Supreme court has held that "if there is any entry in the books of the assessee which shows the receipt of the sum, it is necessary for the assessee to establish what the source of that money is and to prove that the same does not bear the nature of i....
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....ground raised by the assessee." 4.3.5 The explanation being filed in the present appeal is also not found supported by any corroborative evidence. The appellant was asked to furnish details of proposed transaction in land along with copy of agreement etc. if any. However, the appellant expressed his inability to furnish any such details. Neither the details of land nor the name of the proposed seller was furnished. I therefore find the explanation of the appellant as totally unsubstantiated and hollow. No prudent person will withdraw cash and then deposit the same in his account as is being claimed on behalf of the appellant. I therefore find no link between the cash withdrawal and cash deposits. The appellant is in retail business and considering the turnover of the appellant, generation of so much of cash cannot be justified by his own sources of income. It appears that the appellant has deposited his undisclosed income in the bank account and when detected by the Department, tried to explain the same by giving argument that it was related to some land transactions, a claim which has never been substantiated. I accordingly hold that the appellant has not been able to discharge ....
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.... in the case of S.R. Venkataratnam Vs. CIT and another reported in 127 ITR 807 he drew the attention of the Bench to the following observations of the court : "that once the petitioner disclosed the source of Rs. 15,000/- as having come from the withdrawal made on a given date from a given bank, it was not for the ITO or the Commissioner to concern themselves with what the petitioner did with that money, i.e. whether he had kept the money in his house or deposited the same in a bank. The ITO could have either rejected the explanation given by the petitioner as unbelievable on the ground that on investigation it was found that the amount was not deposited in the bank or he could have called upon the petitioner to substantiate his claim by documentary evidence. Since the ITO did not exercise either of these choices, it was not open to him to merely surmise that it would not be probable for the petitioner to keep Rs. 15,000/- unutilized for a period of two years. The ITO should have given an opportunity to the assessee to substantiate his assertions as to the source of his capital outlay." He accordingly submitted that since the assessee had made huge withdrawals of cash ....
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....ows that the gap is only for a few months and not substantial. The first amount of Rs. 10 lakhs deposited on 23-11-2011 as claimed to be out of the withdrawal of Rs. 23 lakhs on 03-11-2011 shows a gap of hardly 20 days. Similarly, the withdrawal of Rs. 8 lakhs on 30-12-2011 and Rs. 2,70,000/- on 22-11-2011 and deposit of Rs. 5 lakhs on 12-01-2012 also show that there is not much time gap. 13. I find the Pune Bench of the Tribunal in the case of Rajinder Kaur Jasbirsingh Sethi (Supra) while deciding an identical issue, following the decision of the Delhi Bench of the Tribunal in the case of Baldev Raj Charla and others (Supra) has deleted such addition by observing as under : "21. I have considered the rival arguments made by both the sides, perused the orders of the Assessing Officer and the CIT (A) and the Paper Book filed on behalf of the assessee. I have also considered the various decisions cited before me. There is no dispute to the fact that the assessee was not maintaining any books of account when the search took place. It is only after the search took place that the assessee, before filing of the returns, prepared the books on the basis of the b....
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....e considered in this case is that the assessment order has been passed u/s. 143(3) and the books of accounts were not rejected by the Assessing Officer. Therefore, once the books are not rejected and since nothing has been found during the course of search that the assessee has diverted its cash for some other purpose, then, in my opinion, the availability of cash in the books cannot be doubted as not available to the assessee merely because there is some time gap between the withdrawal and the deposit. Since the assessee has explained the source of deposits as out of earlier withdrawals either on the same day or on previous occasions and since the cash book produced by the assessee shows that there is sufficient cash balance on the date of deposit of cash in the bank account and considering the fact that the then JCIT in his remand report has also accepted that cash was available in the books for making the deposit in the bank account, therefore, I am of the considered opinion that no addition is called for u/s. 68 of the I.T. Act. In this view of the matter, I set- aside the order of the CIT (A) and direct the Assessing Officer to delete the addition made by him u/s. 68 in all th....