2025 (12) TMI 172

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....usal of the bank statement it has been seen that very less cash withdrawals were made. From bank statement it is noticed that wherever cash was withdrawn, narration 'Cash cheque- ... paid to ... ' is mentioned. Also, withdrawal mentioning the narration 'Cheque WDL-' is not cash withdrawal but either it is transfer through cheque or withdrawal through bearer cheque by someone else. Therefore, it is observed that assessee has deposited huge cash amount in his bank account which is not commensurate with ether his income or the withdrawals and so Peak credit on the basis of cash deposit and cash withdrawals is derived as under- DATE WITHDRAWAL (IN RS) DEPOSIT (IN RS) BALANCE 3.04.2015 0 60000 (-) 60,000 8.04.2015 0 4900 (-) 64,900 1.05.2015 0 3,60,000 (-) 4,24,900 6.05.2015 0 1,06,000 (-) 5,30,900 8.05.2015 0 5,00,000 (-) 10,30,900 18.05.2015 0 7,00,000 (-) 17,30,900 20.05.2015 0 30,000 (-) 17,60,900 2.06.2015 0 89,000 (-) 18,49,900 18.06.2015 0 25,000 (-) 18,74,900 18.06.2015 0 2,50,000 (-) 21,24,900 1.07.2015 0 59,000 (-) 21,8....

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....o it remains unexplained income in the form of cash credit u/s 68 of the Income Tax Act, 1961 and therefore, this amount is added to the returned income of the assessee under section 68 of the Income Tax Act, 1961. This addition is subject to tax u/s 115BBE of the Income Tax Act, 1961. Moreover, since assessee has concealed particulars of his income, penalty proceedings u/s 271(1)(c) of the Income Tax Act, 1961 are also initiated. 4. In view of the discussions made in the earlier paragraphs the income of the assessee for A.Yr 2016-17 is being computed as below: Returned income Rs 4,24,260/- Add, Addition on account of cash credit u/s 68 of the Income Tax Act, 1961, as discussed in para 3 above Rs 20,81,900/-   Total income Rs 25,06,160/- Assessed as above. Issue demand notice. Give credit for prepaid taxes. Charge interest under section 234A, 234B and 234C of the Income Tax Act, 1961. Initiate penalty proceedings u/s 271(1)(c) of the Income Tax Act, 1961. 3. Ld. CIT(A)/NFAC confirmed the addition made by the AO on the basis of following observations: appellant's declared income or lifestyle, particular....

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.... truthfully. * Though appellant has submitted that he has earned income of more than 64 lacs during the period 2005-06 to 2015-16, yet no details of expenses, investment made in property dealing, money lending, renting of cars has been filed to substantiate the cash flow & claimed opening cash in hand at the beginning of previous year on the basis of self-generated isolated statement of affairs for the previous year. 4. At the time of hearing, Ld. Counsel for the assessee submitted that the assessee is a money lender and explaining the source of such cash deposits he had furnished a table wherein he has explained the following items: (i) IDS Declaration of Rs. 10,00,000/-: That cross checking the said IDS declaration annexed at page 13 of the paper book volume 4, which is made part of this order as follows: 5. It is evident from the aforestated that the said IDS declaration pertains to assessment year 2015-16 whereas the case of the assessee is of assessment year 2016-17, hence, the said explanation is misplaced and incorrect. For FY 2015-16 relevant to AY 2016-17 there is no fund emanating in the IDS declaration hence cannot be a source explaining the cash deposits ....

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....assessee has also not been able to explain why he had withdrawn such money during FY 2014-15 relevant to AY 2015-16 and had deposited in the FY 2015-16 relevant to AY 2016-17. There is no explanation by the assessee why a money lender would keep such huge amount of cash with him idle and deposit it at a later date. Therefore, the assessee had failed to demonstrate the availability of cash of Rs. 30,16,188/- hence the cash deposits remain unexplained. The Department has rightly observed that the opening balance as disclosed by the assessee at Rs. 26,04,762/- was disclosed for the first time in the statement of affairs submitted during the assessment and are not supported by any previous cash flow statement, books or audited records. 9. It was submitted by the assessee that the said cash has been withdrawn from his bank account during the FY 2014-15 and there is no explanation before the subordinate authorities that why such cash withdrawal claimed to have been made was not deposited back in the bank account during financial year 2014-15 itself and why the same were deposited in a segregated manner during FY 2015-16. 10. The CIT(A)/NFAC also holds that as per declaration for ID....