2011 (11) TMI 836 - AT - Income Tax

Summary

Issues involved: Appeal challenging addition u/s 68 & interest charged u/s 234B and 234C of the Income Tax Act.

Addition u/s 68:
The appellant contested the addition of Rs. 38,50,000 as unexplained cash deposit, arguing it was based on suspicion without concrete evidence. The appellant explained the cash deposits were from available book cash, accepted by the AO. The CIT(A) upheld the addition, citing technical breach under Section 145. The Assessing Officer linked cash deposits to property transactions, suspecting unaccounted cash generation. The DVO's report indicated a substantial difference between declared and fair market values of properties sold, implying unaccounted cash deposits. Legal precedents emphasized the burden on the assessee to prove the source of cash deposits. The appellant's reconciliation of cash deposits was disregarded, leading to the conclusion that the addition lacked a factual basis. The Tribunal found the addition speculative and unsupported, ultimately deleting the addition.

Interest charged u/s 234B and 234C:
The CIT(A) confirmed the interest charged by the AO under Sections 234B and 234C. The appellant argued against the confirmation, but no specific details of this argument are provided in the judgment. The Tribunal's decision focused on the addition u/s 68, and there is no specific mention of the interest charged in the final outcome of the appeal.

Conclusion:
The Tribunal allowed the appeal, ruling in favor of the assessee and deleting the addition made u/s 68. The decision was based on the lack of concrete evidence supporting the addition and the speculative nature of the Assessing Officer's conclusions. The judgment did not provide specific details regarding the interest charged u/s 234B and 234C, indicating the primary focus on the addition u/s 68 in this case.