TaxTMI 
TaxTMI 
2024 (9) TMI 1966
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....failing to appreciate that unless there is evidence to show that the amount withdrawn from the Bank had been spent by assessee somewhere else, explanation that cash withdrawn has been used to deposit in the bank account cannot be rejected. 4. That the learned NFAC has erred in upholding the addition made by the learned assessing officer to the extent of Rs. 7,74,000/- on assumption and presumption without bringing any adverse material rebutting the submissions of the assessee." 3. Facts giving rise to the present appeal are that the assessee filed his return of income at INR 6,86,910/- on 15.07.2017. Thereafter, the case of the assessee was taken up for scrutiny assessment. The basis for scrutiny was to verify the source of cash deposited by the assessee in his bank accounts maintained with different banks amounting to INR 12,74,000/-. The Assessing Officer ("AO") issued statutory notices to the assessee. In pursuance to the statutory notices, the assessee filed his explanation about the source of cash deposited in his bank accounts. The AO treating the explanation as not cogent, he added back the amount to the income of the assessee. Thus, he assessed the income of the....
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....k 2,50,000.00 Total Cash deposit 12,74,000.00 4. The appellant during the course of the assessment proceedings, submitted that cash deposit made in the bank account was out of cash withdrawal from banks of the appellant. The details of withdrawals made by the appellant from his bank accounts are tabulated hereunder: Date Bank Amount (in Rs.) See Page 29-Jun-16 SCB Bank (Pg 41-50 of PB) 9,50,000.00 See Page 41 of PB 12-Jul-16 SCB Bank (Pg 41-50 of PB) 7,50,000.00 See Page 42 of PB 15-Jul-16 SCB Bank 5,00,000.00 See Page 42 of PB 18-Jul-16 Axis Bank (Pg 23-29 of PB) 8,40,000.00 See page 24 of PB 24-Oct-16 Axis Bank (Pg 23-29 of PB ) 5,00,000.00 See page 26 of PB Total withdrawal 35,40,000.00 5. The appellant also submitted that aforesaid cash was withdrawn for the purpose of purchase of a property and also for the purpose of his marriage. 6. It is submitted that the appellant has purchased a property vide sale deed dated 26.08.2016 (see page 66-79 of the PB). From the perusal of the same, it would be seen that market value of the property is Rs. 30,00,....
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....ense/investments in nature which results in outflow of cash and the claim of the assessee that the cash deposited was out of these cash proceeds contradict itself and no other documentary evidence was provided by the assessee in support of claim". 11. In the appeal filed by the appellant, learned CIT(A), only accepted the deposit to the extent of Rs. 5,00,000/- on the ground that appellant has withdrawn a sum of Rs. 5,00,000/- on 24.10.2016, which is proximate to the date of deposit and sustained the addition of remaining sum by upholding the finding of learned AO that amount withdrawn was for expense/ investments which result in out flow of cash. 12. From the aforesaid facts, it would be seen that in this case, assessee has made cash withdrawals to the tune of Rs. 35,40,000/- from June, 2016 to October, 2016 and out of the said sum he has deposited a sum of Rs. 12,74,000/-. It is submitted that learned CIT(A) has accepted the cash deposit to the extent of Rs. 5,00,000/- on the ground that same was withdrawn on 24.10.2016, however amount withdrawn by the appellant in the month of June and July, 2016 of Rs. 30,40,000/- out of which a sum of Rs. 7,74,000/- was lying....
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....bank account could not have been available with the assessee, as, she must have utilized a major part of it in the marriage of her daughter. However, while coming to such conclusion, the Assessing Officer has completely discarded assessee's contention that she did not incur much expenditure in the marriage as, firstly, it was a love marriage and secondly, it was performed in a Gurudwara in the presence of close relatives. 5. In my view, the explanation furnished by the assessee is believable, when the Assessing Officer has not brought on record any contrary material to demonstrate that the assessee must have incurred more expenditure in her daughter's marriage than what she claimed. In fact, it is not a case where the Assessing Officer has completely disbelieved assessee's contention that the cash deposits made in the bank accounts were out of withdrawals available with her. This is so because, though, amount of Rs.22,01,000/- was deposited during the demonetization period, however, ultimately, the Assessing Officer has added an amount of Rs. 12,01,000/-. Having considered overall facts and circumstances of the case, I am of the view that the addition made by t....
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....s. 2.5 lakhs on account of cash amounting to Rs. 3,76,800 found in the bed room of the assessee at the time of search. 15. The assessee has not disputed this recovery. However, the case of assessee is that this represented cash remaining from the withdrawal from his bank account from time to time and a sum of Rs. 2 lakhs was received on 4-12-2000 by cheque No. 345947 and the assessee has furnished cash flow statement to this effect also. 16. This cash flow statement furnished by the assessee was rejected by the Assessing Officer which is on the basis of suspicion that the assessee must have spent the amount for some other purposes. The orders of Assessing Officer as well as Commissioner of Income-tax are completely silent as to for what purpose the earlier withdrawals would have been spent. As per the cash book maintained by the assessee, a sum of Rs. 10,000 was being spent for household expenses every month and the assessee has withdrawn from bank a sum of Rs. 2 lakhs on 4-12-2000 and there was no material with the Department that this money was not available with the assessee. It has been held by the Tribunal that in the instant case, the withdrawals shown by th....
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....ces before him. One was to reject the explanation as not believable for the reason that on his investigation no such pigmy deposit was ever made in the bank. In the alternative he ought to have called upon the assessee- petitioner to substantiate his claim by documentary evidence. Having exercised neither of the choices, it was not open to the ITO to merely surmise that it would not be probable for the assessee to keep Rs. 15,000 unutilised for a period of two years. The ITO should have given an opportunity to the assessee to substantiate his assertion as to the source of his capital outlay." 16. It is respectfully submitted that the Ld. CIT(A) failed to recognize that addition cannot be sustained once the source of deposit was established as cash withdrawn earlier and the same is substantiated with the Pass Book of the Assessee. Without binging any adverse material on record intimating that the cash so withdrawn is not the same cash which was later deposited by the Appellant during the demonetization period the addition made merely stating the source of deposit as unexplained is a complete disregard of established position of law as can be referenced through the decisions....
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....e no reason to believe that the amount was withdrawn on 18.07.2016 was lying with the appellant for being spent for expenses. It stands to no reason as to how so much of cash was lying with the appellant as still he had to obtain another loan from ICICI bank on 01.09.2016. 9.4. Therefore, taking the explanation of the appellant as per facts and circumstances of the case, the appellant's explanation is that the amount of cash of Rs.5,00,000/- was re-deposited in the banks during the demonetization period is accepted and the explanation the amount of Rs.8,40,000/- was withdrawn on 08.07.2016 and re- deposited is rejected. Therefore the Assessing Office is directed to restrict the addition to Rs.5,00,000/-. 9.5. The Assessing Officer's reason is also correct with regard to invoking the provisions of section 69A of Income Tax Act, 1961. The appellant has riot given any other evidence for the source of Rs.7,40,000/- during demonetization period, hence, the action taken by the Assessing Officer u/s 69A of Income Tax Act, 1961 in this regard is sustained. The appellant gets relief of Rs. 5,00,000/-. " 9. From the above finding of Ld. CIT(A), it is clear that i....