2022 (6) TMI 1534

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....ssessment Year 2008-09. 2. The assessee has raised the following grounds of appeal: We state the grounds of appeal as under are without prejudice to one another. These are alternate grounds and one ground may be treated as independent of others. 1. The re-opening of Assessment is bad-in-law. 2. The Assessment Order under section 143(3) of the Act, is bad in law as well as facts. 3. The Order of the learned Commissioner of Income Tax (Appeals) is bad in law as well as facts. 4. The learned Commissioner of Income Tax (Appeals) erred on facts as well as in law by in confirming assessed Income at Rs. 12,57,060/-against returned income of Rs.1,02,710/ -. 5. The learned Commissioner of Income Tax (Appeals) erred on facts as well as in....

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....that there was cash aggregating to Rs. 11,54,350/- deposited in the bank account of the assessee, held with Punjab National Bank Rajkot from different location. Accordingly, the question was posed to the assessee to explain the sources of cash deposit but the assessee failed to make reply. Accordingly the AO treated the same as income from undisclosed sources and added to the total income of the assessee. 8. The aggrieved assessee preferred an appeal to the CIT-A. 9. The assessee before learned CIT-A submitted that he is working as commission agent for sale of vehicle parts. On sale of vehicle parts customer used to make payment by depositing cash in his bank account which was immediately withdrawn to make payment to actual supplier of ve....

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....how-cause notice was issued to the assessee. Therefore, this claim tantamounts to additional evidence/claim which was not made by the Assessing Officer. I am of the considered opinion that such claim is just after thought and not supported by any evidence and therefore the same is not tenable. As regards the contention that only the peak balance could be taxed I find that entire deposit by assessee have been withdrawn almost immediately after depositing and therefore it cannot be said that this amount were deposited back. When the nature of business of assessee or the nature of the withdrawals or deposit is not clear, the claim of assessee of peak balance as income is not tenable. In view of the above, action of Assessing Officer calls for ....

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....t the assessee was actually carrying out commission agency business as contended by him. Accordingly, we reject the contention of the assessee. 14.1 Be that as it may be, on perusal of the bank statement, placed on record, we note that there were regular deposits of money in cash which was withdrawn in cash. Thus the amount withdrawn from the bank was also available with the assessee for depositing the same in cash. Accordingly, the amount of cash deposited cannot be treated as income of the assessee without considering the corresponding withdrawal. In such a situation the principles of peak credit theory should be adopted for determining the income of the assessee. The concept of the peak credit proceeds on the fundamental premise that th....