TaxTMI 
TaxTMI 
2025 (4) TMI 1908
X X X X Extracts X X X X
X X X X Extracts X X X X
....of evidencing the transactions and wrongly observed that burden of proof shifted to the Assessing Officer. 2.2 The Ld. CIT(A) wrongly held that the Assessing Officer has not brought on record that the seized cash emanates from any other source other than the withdrawals from bank, when It is a settled principle that it is the assessee to explain the source and the Assessing Officer is not under obligation to establish from which source the unaccounted cash emanated. 3. The Ld.CIT(A) has erred in deleting the addition of Rs. 5,91,500/- made towards income from other sources. 3.1 The CIT(A) erred in not observing that as per the sale deed (Doc No. 1283/2020 dated 23-12-2020), the assessee was a POA for Shri P.Stanley Samraj of Chennai and executed the deed on 23-12-2020 to M/s. Stanson Rubber Products and sold the land for Rs. 56,08,500/-. The assessee had settled Rs. 50,50,000/- and Rs. 5,58,500/- to P.Stanley Samraj through Tamilnadu Mercantile Bank. Hence, there was differential amount of Rs. 5,91,500/- & that the assessee is only a POA of the seller and only the purchaser Incurs the cost of the stamp duty and registration charges. 4. The Ld. CI....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Rs. 72,26,450/- 4. While framing the assessment the AO held as under: "...27. The assessee could not prove it to the Static Surveillance Team and again he could not prove it to the Asst. Returning Officer cum Tahsildar, Tuticorin and again he could not prove it to the Income Tax Department and thereby not proving all the chain of checks, when there was a need to prove the validity of the cash. Further, at no place he has mentioned that he is maintaining rough chittas and manual lot entries, which otherwise he could have proved it at any of the places but so far upto this date he has not narrated this that there were chittas and manual lot entries with him and further, he has not produced any chittas and manual lot entries during the assessment proceedings. Hence it is only a statement given to escape the tax and in this pretext the accounts are prepared as per the requirement. The assessee himself stated in his sworn statement dated 12/03/2021 that he had not properly maintained cash book, daybook and ledger on a regular basis up to the date of sworn statement. Further, the assessee had furnished a copy of his cash book on 18-03-2021 for the period from01/04/2020 to....
X X X X Extracts X X X X
X X X X Extracts X X X X
....this amount of Rs. 5,91,500/- is treated as the income under the head income from other sources..." 35..... "...41. From the above, the following points are brought forward: (i) The assessee had categorically mentioned that he could produce the cash book on 11-03-2021 on the ground that the books of accounts are not regularly maintained and further on 12-03-2021 the assessee stated in his sworn statement that cash book, day book, ledger and trial balance are not maintained properly. It means that he could not produce the details called for when it was needed. The assessee had ample of lime to think on this and the accounts could have been prepared as per the requirement. (ii) From the above table given by the assessee, the repayment have been made to creditors is Rs. 58,24,100.00 and in this regard the assessee had not provided any ledger to show the transactions made with the creditors, when the payments were made to them, what is source making payment and in what mode the payment has been made. (iii) Further, the assessee has not given any confirmation from the creditors for the outstanding amount and not even their PAN and address det....
X X X X Extracts X X X X
X X X X Extracts X X X X
....oks of accounts making observation that the cash book was manipulated cannot hold good. 6.3.6 It is significant at this juncture to rely upon the decision of the Hon'ble Apex Court rendered in the case of Roshan Di Hatti vs. CIT (1977) 107 ITR 938 (SC) where in the Hon'ble Apex Court held that the burden of proving the source of the money found lies on the assessee, but once the assessee provides a plausible explanation, the burden shifts to the department to prove otherwise. In the instant case the appellant has claimed that, out of Rs. 67,96,000/- represents the cash withdrawn from bank and the balance amount can only be from the cash in hand as per the cash book. In order to sustain the addition, the AO should have proved that the seized cash emanates from any other source with cogent and corroborative evidence. Further the Hon'ble Apex Court in the case of CIT Vs. K. Chinnathamban (2007) 292 ITR 682 (SC) has held that if the assessee explains the source of the money satisfactorily, the addition under Section 69A cannot be made. 6.3.7 In view of the above discussion and judicial decision relied upon, the undersigned is of the considered view that th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....cularly because it is self-incriminating. Accordingly, it was concluded that no liability could be fastened solely on the basis of sworn statement. In arriving at this decision, the Court followed the judgement in the case of Kailashben Manharlal Choski v. CIT [2010] 174 Taxmann 466(Guj). Further the Apex Court in the case of Pullangode Rubber Produce Co Ltd v State of Kerala [1973] ITR 18 (SC) has held that an admission is an extremely important piece of evidence but it cannot be said that it is conclusive and further observed that it is open to the person who makes the admission to show that it is incorrect. 6.4.6 In view of the above judicial precedence(s) the undersigned is not inclined to sustain the addition made by the AO as commission income. Accordingly, the grounds raised upon this issue is hereby treated as allowed and the AO is directed to delete the addition of Rs, 5,91,500/- for the AY 2021-22." 7. With regard to the addition of Rs..72,26,450/- made towards unexplained income, the ld. CIT(A) deleted the addition by holding as under: "6.5.7 At the outset the AO's approach in treating the difference in the sundry creditors' balances as unexp....
X X X X Extracts X X X X
X X X X Extracts X X X X
....M/s.Stanson Rubber Products and sold the land for Rs. 56,08,500/-. The assessee had settled Rs. 50,50,000/- and Rs. 5,58,500/- to P.Stanley Samraj through Tamilnadu Mercantile Bank. Hence, there was a differential amount of Rs. 5,91,500/- & that the assessee is only a POA of the seller and only the purchaser Incurs the cost of the stamp duty and registration charges. 11. Further, the ld. DR advanced his argument that the Ld. CIT (A) has also erred in deleting the addition of Rs. 72,26,450/- made u/s.69A, without appreciating the fact that the assessee has not furnished any ledger, details of payment made and mode of payment in respect of repayment made to the tune of Rs. 58,24,100/- and also not furnished any ledger for the cash purchases shown to the tune of Rs. 14,14,850/-, as stated in the reconciliation statement for sundry creditors submitted before the Assessing Officer, during the course of assessment proceedings. 12. In view of the above, the ld. DR prayed for setting aside the order of the ld.CIT(A) and confirm the additions made by the AO. 13. Per contra, the ld.AR for the assessee submitted the following written submissions in support of the ld.CIT(A) order. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hat a statement made u/s 132(4) of the Act is a piece of evidence but the same is not conclusive particularly because it is self-incriminating. Accordingly, it was concluded that no liability could be fastened solely on the basis of sworn statement. c) Apex Court in Pullangode Rubber Produce Co Ltd Vs State of Kerala ITR 18 held that an admission is an extremely important piece of evidence but it cannot be said that it is conclusive and further observed that it is open to the person who makes the admission to show that it is incorrect. III. Overstated creditors u/s.69A r.w.s. 115BBE - Rs. 72,26,450/- 3.1. The addition was made solely based on a trial balance which was in draft stage and subject to alterations based on real transactions which were corrected when the accounts were subject to audit. 3.2. The AO's addition of discrepancy found as unexplained income u/s 69A is legally flawed. 3.3. Section 69A of the Act is unsustainable as the said provision applies to unexplained money, bullion, jewellery or other valuable articles found in the possession of the assessee. 3.4. The AO did not undertake sufficient inquiries to ver....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ld prove that the cash balance held has already been used for some other investment. Hence, the action of the ld.CIT(A) in deleting the addition of Rs. 67,96,000/- as unexplained money u/s.69A cannot be interfered. It is also observed that the ld.CIT(A) has clearly recorded in his order that the cash withdrawals made from his bank account from 06.11.2020 to 26.02.21 was Rs. 68.82 Lakhs, which was available with the assessee. We note that the reliance on the decision of the Hon'ble Apex Court in the case of Roshan Di Hatti Vs. CIT (supra) by the assessee along with the decision of Tribunal of Bangalore in the case of Col. Ranjan Sharma Vs ITO (supra) and in the case of Manish Kumar Dubey Vs. ITO (Supra) are applicable to the present facts and circumstances. In view of the above discussion and respectfully following the judicial precedents (supra) we are of the considered view that the action of the ld. CIT(A) in deleting the addition of Rs. 69,76,000/- cannot be faulted with and hence we dismiss the grounds raised by the revenue. 18. The next ground raised by the revenue is Ld.CIT(A) has erred in deleting the addition of Rs. 5,91,500/- as income received over and above the sale c....