2026 (4) TMI 410

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....ncome-tax Act, 1961 (hereinafter referred to as the "Act") for Assessment Year 2017-18. 2. The assessee has raised following grounds of appeal:- "1. On the facts and circumstances of the case as well as law on the subject, the learned CIT(A) has erred in confirming the action of assessing officer in making the addition of Rs 80,00,000/- on account of alleged unexplained cash credits in bank account u/s. 68 of the Act. 2. On the facts and circumstances of the case as well as law on the subject the learned assessing officer has erred in taxing the addition by taking the rate @77.25% by attracting S. 115BBE instead of taxing as per normal tax slab 3. Even otherwise on the facts and circumstances of the case as wel....

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.... for investment in immovable property. Since the proposed investment did not materialise, the withdrawn cash remained on hand and was subsequently re-deposited during the demonetisation period. It was further submitted that the books of account were audited and not rejected u/s 145 of the Act, and therefore, the provisions of section 68 could not be invoked. The Ld. AR also contended that the amendment to section 115BBE could not be applied retrospectively. 7. The Ld. DR, on the other hand, supported the orders of the lower authorities and submitted that the assessee failed to establish the identity, creditworthiness, and genuineness of the transactions. It was argued that the explanation offered was unsupported by evidence, contrary to ....

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....as real when unsupported by evidence. 8.2 The explanation offered by the assessee does not stand the test of human probabilities and normal business conduct. No prudent person would withdraw borrowed funds in cash, keep such a huge amount idle for nearly five months; and thereafter re-deposit the identical cash into the banking channel. Such conduct is wholly unnatural and commercially imprudent. The Hon'ble Supreme Court in Sumati Dayal v. CIT (214 ITR 801) has categorically held that where the apparent story put forward by the assessee is against human probabilities, the same deserves to be rejected. 8.3 We also find considerable merit in the observation of the Assessing Officer that the plea of cash withdrawal for purchase of immov....