TaxTMI 
TaxTMI 
2025 (7) TMI 1154
X X X X Extracts X X X X
X X X X Extracts X X X X
....t the issue involved in all the three appeals filed by the Department was identical, pertaining to addition made to the income of the assessee society on account of cash found deposited in its bank account, source of which remained unexplained. The addition was made by the Assessing Officer under Section 69A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') and the quantum pertaining to each year amounted to Rs. 2,18,39,700/- Rs. 2,19,73,195/- & Rs. 1,36,49,800/- for the A.Ys. 2015-16, 2016-17 & 2019-20 respectively. 3. The facts pertaining to the addition made in all the three years, it was stated, was identical with majority of the cash found deposited in the Bank of Baroda account of the assessee and some amount in the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ee submitted the source of cash deposited in its bank account being attributable to the trading in quota items and commission income and recovery of KCC loan and interest income receipt on KCC loan given to its members. The Ld. CIT(A) noted that the assessee was duly registered as a Co-operative Society, from the copy of certificate of registration furnished by the assessee. He further noted that the assessee had obtained loan from Mehsana District Central Co-operative Bank, from the certificate furnished by the assessee in this regard obtained from the said bank certifying the amount of loan given to the Society. He further noted that the assessee's books of account were audited, from which he noted the financials of the assessee society a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....essee had deposited Rs. 44,85,000 in its loan accounts with a co-operative bank, but could not explain the source of these deposits. Further, the assessee's cash flow statement showed an opening cash balance of Rs. 18,73,224, but it did not provide adequate records before AO (such as previous ITRs or audited accounts) to justify this. Consequently, the assessing officer concluded that the total cash deposits of Rs. 2,18,39,700 remained unexplained and invoked section 68 of the Income Tax Act, which permits the addition of unexplained cash credits to the income of the assessee. As a result Rs. 2,18,39,700 was added to the assessee's returned income under the head "Income from other sources," and penalty proceedings under sectio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rtificate of registration as co-operative society, Mehsana which is pasted below: 4.5 Further, the source of loan distribution amount which has been given to members of the society as loan is pasted below: As per appellant, the source of funds to the society has been obtained from the Mehsana District Central Cooperative bank, Mehsana. 4.6 The appellant has also submitted audit report of the society for the financial year 2014-15 from Commissioner and Registrar (Cooperative societies), Gujarat States, Gandhinagar dated 21.09.2015 showing economic condition of the society as below: 4.7 The above audit report shows that the claim of the appellant regarding cash deposit and source of funds is sufficiently explained. Appellant is in ac....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to bring out the facts clearly. A.Y cash deposited in banks 2015-16 Rs. 2,18,39,700/- 2016-17 Rs. 2,19,73,195/- 2019-20 Rs. 1,36,49,800/- This cash was found deposited both in the Bank of Baroda account of the assessee Society and its loan accounts. We have perused orders of the authorities below and we are in agreement with the Ld. CIT(A) that the assessee has discharged the initial burden cast on it of demonstrating the source of cash deposited in its bank account during the year. The assessee's claim all along has been that the source of cash deposit is attributable to its activities of trading in quota items and recovery of KCC loan given to its members. It is a fact on record that the assessee had furnished its audited financ....