2012 (4) TMI 695 - AT - Income Tax

Summary

Issues involved: Appeal by revenue against CIT(A) order deleting addition of credit entries in undisclosed bank account.

Summary:
1. The appeal by revenue challenged the CIT(A) order deleting the addition of Rs. 16,26,468 as unexplained cash deposit in an undisclosed bank account.
2. The Assessing Officer made the addition due to lack of explanation from the assessee regarding the cash deposit with ABN Amro Bank.
3. The CIT(A) restricted the peak addition to Rs. 1,95,597 after considering documents submitted by the assessee and the remand report from the Assessing Officer.
4. The CIT(A) found that the assessee failed to explain the sources of cash deposits in the bank account, leading to the peak credit balance being treated as unexplained income.
5. The revenue could not prove that the peak credit assessed by the CIT(A) was incorrect, and the CIT(A) decision was upheld by the Tribunal.
6. The Tribunal confirmed the CIT(A) order, dismissing the revenue's appeal.

This judgment highlights the importance of providing explanations for cash deposits in bank accounts and the application of the peak credit theory in determining unexplained income.