TaxTMI 
TaxTMI 
2025 (10) TMI 225
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in failing to appreciate that the cash deposit made in the bank account was out of the past cash withdrawal made from the bank account and hence the addition made by the Id AO was unsustainable in law. 3. That the learned Commissioner of Income Tax (Appeals) has grossly erred in observing that appellant could not provide verifiable evidence which establishes that it was having cash balance on the date of demonetization, failing to appreciate that unless there is evidence that cash in hand were utilized for any other purpose, addition made by the Id AO is unsustainable in law. 4 That the learned Commissioner of Income Tax (Appeals) has grossly erred in upholding the action of the Id AO in not allowing the set off of loss of Rs. 9,53,049/-." 2. The only effective ground raised in this case is the addition on the basis of cash deposit in bank accounts during demonetization period. During the proceedings before us the learned counsel appearing for the assessee argued that whatever cash deposits were made in the bank account by the assessee during demonetization period, the entire amount was either withdrawal from the bank accounts earlier or they were available in....
X X X X Extracts X X X X
X X X X Extracts X X X X
....that just before the demonetization, the appellant was having a cash balance of Rs. 38,68,845/-, and hence after the declaration of the demonetization, the appellant out of the aforesaid cash balance, deposited a sum of Rs. 13,90,000/-in its Andhra Bank account and a sum of Rs. 21,23,000/- in Punjab National Bank account. 4. In fact, after the demonetisation, the queries were raised in respect of the aforesaid cash deposit, and the appellant also filed the response wherein it was stated that cash deposited was out of cash withdrawals. Copy of the replies filed by the assessee has been placed at pages 64-75 of PB. 5. It is submitted that Id. AO did not dispute the cash withdrawal made from the bank account in the earlier years, however it was held by him that the assessee in the return has disclosed cash-in-hand as on 31st March, 2016 was Rs. 14,590/-, as such, cash withdrawals made in the earlier years was rejected by him. It is submitted that in the income tax return, only the cash in hand of the proprietary business concern of the appellant was required to be disclosed, and hence cash in hand of the appellant was not mentioned in the return. In fact, if the ITR-....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f income and since all the household expenses are born by them, as such the appellant don't have to incur any expenditure as such, assumption that the appellant has spent a sum of Rs. 5,00,000/- towards his maintenance is erroneous. Infact from the perusal of the cash book, it would be seen that the appellant has shown drawing/expense of Rs. 69,950/- for his personal expenses and apart from the aforesaid no further sum was spent by the appellant for his personal needs, and hence the assumption of the Id AO that the appellant has spent a sum of Rs. 5,00,000/-towards his maintenance is erroneous. 8. It is submitted that there is no material or any adverse information against the assessee which shows the assessee had utilized the cash available with it on account of the withdrawal made from the bank account. It is submitted that there is no provision in the Income Tax Act requiring that cash withdrawn/available with an assessee, if remains unutilized, has to be redeposited immediately. [ITO v. Baburao K. Paisal [IT Appeal No. 6091/Mum/2012 dated 22-12-2014]. It is further submitted that in the case of CIT v. K. Sreedharan [1993] 201 ITR 1010 (Ker.) it was held that non-sp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nder any law. 11. It is submitted that while making the impugned addition, learned AO did not bring any evidence to rebut the evidences furnished by the assessee and made the addition on suspicion and speculations. It is settled law that, no addition can be made on the basis of surmises, suspicion and conjectures. Reliance for this proposition is placed on 37 ITR 271 (SC) Uma Charan Shaw & Bros. Co. v. CIT. It has been further held in the following cases that suspicion howsoever strong cannot take the place of proof: i) 26 ITR 775 (SC) at 782 (SC) Dhakeswari Cotton Mills Ltd. vs. CIT ii) 37 ITR 151(SC) Omar Salay Mohammad Sait v CIT iii) 37 ITR 288 (SC) Lal Chand Bhagat Ambica Ram v CIT iv) AIR 1977 SC 796 Krishnand vs. State of Madhya Pradesh 12 In view of the aforesaid, it is submitted with respect since the appellant has made the cash deposits out of the sale of the properties as such, addition made by the learned AO purely on suspicion and without any material is unsustainable in law." 4. Ld. CIT(A) did not accept the submissions filed by the assessee and rejected the claim of withdrawal of money by the assessee from bank....