TaxTMI 
TaxTMI 
2026 (3) TMI 550
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....granted relief to both of them holding that they were not conclusively proved to be the beneficiary of the funds siphoned off/withdrawn from the bank, but at the same time holding that since they had facilitated withdrawal of funds from the bank, commission income was earned on the same, which he noted both the assessee's to have offered to tax in the return of income filed. The Ld. CIT(A) accordingly deleted the addition made in the hands of both the assessee's. The Revenue is aggrieved by this order of the Ld. CIT(A) and has accordingly raised identical grounds in both the appeals before us. 3. Both the appeals were accordingly taken up for hearing together and are being disposed of by a common consolidated order for the sake of convenience. We shall be dealing with the facts in the case of the assessee Shri Rajeshkumar Mohanlal Shah(the son) in the Department's appeal in ITA No. 575/Ahd/2020 and our decision rendered therein will apply paripassu the other appeal also. 4. Grounds raised by the Revenue in ITA No. 575/Ahd/2020 reads as under: "(1) The Ld. CIT (A) has erred in law and on facts in deleting the addition of Rs. 5,49,98,8847- u/s. 69A of the I.T. Act o....
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....with withdrawal vouchers for withdrawing cash from the savings bank account. Perusal of this information revealed that 9165 accounts were opened by the introduction of the assessee and his father and verification of withdrawal vouchers revealed that all these vouchers were self-cheques and though the savings accounts were held by various individuals the signatures on the withdrawal vouchers were of the respective account holders but the amounts were withdrawn and received by the assessee and his late father by signing on the back side of the withdrawal vouchers. iii. enquiries conducted by the AO on sample basis of the account holders, by issuing letters to approximately 100 such persons revealed that majority of the persons were not available at the address provided by the bank and further that the address were either not proper or the persons were not residing at the address given. Out of 100 letters so issued service could be done only to 4 persons. Statement of the 4 persons were recorded in which they denied knowing both the assessee's before us and also denied opening any account in the Bapunagar Mahila Co. Op. Bank. They also denied conducting any transactions in th....
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.... father; that the amounts withdrawn were received by the assessee and they were not recorded in the assessee's books of accounts. 6. The assessee's stand, however, was that being in the business of cheque discounting, they had only provided the facility of cheque discounting to various persons who were members of workers association and workers of Ambika Mills who were given payment by cheques. Their contention was that the members of the worker association and workers of the Ambika Mills had come to open their account in Bapunagar Mahila Co. Op. Bank with their ID Card issued by the mill. The assesses role was limited to giving cash in lieu of the cheques issued in the names of various persons, which cheques the assesses facilitated in getting deposited in the Bapunagar bank by helping open their bank accounts, and thereafter withdrawing cash from their bank account. The members offered them 1% commission on the money given to the workers. The assessee reiterated that it was duly verified by the office of the official liquidator about the existence and genuineness of the workers and all the cheques issued by the officer of the official liquidator in the name of workers; that th....
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....ll the conditions are satisfied to invoke the provisions of Sec.69A of the I.T. Act. The assessee could not prove the onus cast upon him that the money which he had withdrawn from the fake accounts being introduced and operated by him and his late father did not belong to him. The assessee has merely stated that a Police case has been registered against some of the members of mill workers association alleging that they have siphoned off money belonging to mill workers. However, the assessee has not categorically admitted that the sums withdrawn by him from the fake bank accounts were handed over by him to any other person, including the members of mill workers association. Since the assessee has not came forward & divulged the names of persons to whom he has passed on the sums withdrawn from the bank account, it can be safely concluded that'the assessee remains the owner of the money withdrawn. 7.2 When the assessee is found to be owner of any money, the Income-Tax Officer is entitled to satisfy himself as to the true nature and source of the amounts entered therein, and if after investigation or inquiry, he is satisfied that there is no satisfactory explanation as to ....
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....im is not sufficient to establish the non-owning the money by him which he himself had withdrawn. There must be some supporting documents which relates to the particular transactions and proves and justifies the genuineness of the transactions. Mere statements would not enough to justify that the money withdrawn by him do not belong to him. Some evidences that the money was belonged to someone which he had withdrawn on behalf of him/her was required to be placed by assessee. However, the assessee has failed to establish these facts of his case. 7.5 Thus, it is established that the assessee was the owner of the money withdrawn by him by signing on the back side of the withdrawal slips pertaining to the bank accounts being opened by his and his father's introduction. The assessee has not submitted the nature and source of such money withdrawn with supporting evidences thereof. The assessee could not explain that the money withdrawn by him were not belonged to him. Therefore, it is revealed that the assessee Was the owner of such money withdrawn and therefore, treated as deemed income of the assessee1 for the year under consideration. 7.6 In view of the above rea....
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....opening any accounts in the bank. That despite providing opportunity of cross-examination to the assessee, the assessee's were unable to disapprove the claim of the workers. The accounts holders had denied knowing the assessee at all. The Ld. CIT(A), we find, has noted the accounts to be opened by the workers without controverting the adverse findings of the AO as aforestated. His premise of the assessee being only a facilitator of cheque discounting in the entire fraud rests on the premise that the workers were all genuine and the accounts belonged to the different workers, but this fact, we find, was itself was disproved by the AO during enquiries conducted which revealed that the accounts were all fake and the persons on whose accounts were opened were either not traceable or they denied having any knowledge of the bank accounts opened in their names. Even the assessee was unable to prove the fact that the persons were all genuine persons in whose name bank accounts were opened when provided opportunity of cross examination of the employess by the AO or even independently. Therefore, the Ld. CIT(A)'s finding of the assessee being only a facilitator, we hold, is based on an incor....