2013 (5) TMI 1044 - AT - Income Tax

Summary

Issues involved: Appeal against deletion of unexplained cash credit u/s 68 of the Income Tax Act, 1961, acceptance of self-serving documents, denial of opportunity to examine additional evidence, and request for re-examination of fresh evidences.

Issue 1: Unexplained Cash Credit u/s 68

The appellant, a proprietor of a trading business, declared income but faced scrutiny due to a cash deposit discrepancy. Despite explanations, the Assessing Officer added an unexplained cash credit of Rs. 12,05,500. The CIT(A) deleted this addition citing the availability of cash from withdrawals, sales, and debtors, emphasizing the rotation of money. The deletion was based on the failure to credit the appellant for cash withdrawals and redeposits, supported by evidence. The Tribunal upheld the CIT(A)'s decision, noting the appellant's cash book substantiating the source of bank deposits.

Issue 2: Acceptance of Self-Serving Documents

The CIT(A) accepted the appellant's submissions regarding cash sources, highlighting the failure of the Assessing Officer to credit cash withdrawals and redeposits. The Tribunal found the CIT(A)'s reasoning sound, emphasizing the appellant's evidence and the proper maintenance of a cash book to support the cash flow into the bank account. The Tribunal dismissed the revenue's appeal, affirming the deletion of the unexplained cash credit.

Issue 3: Denial of Opportunity to Examine Additional Evidence

The Assessing Officer requested specific details and justification for the cash deposits, but the appellant's explanations were deemed incomplete. Despite subsequent submissions and a cash flow statement, the Assessing Officer maintained the unexplained cash credit. The CIT(A) overturned this decision, considering the appellant's evidence and reasoning. The Tribunal found no fault in the CIT(A)'s order and dismissed the revenue's appeal.

Issue 4: Re-examination of Fresh Evidences

The revenue sought to set aside the CIT(A)'s order and have the matter re-examined by the Assessing Officer. However, the Tribunal upheld the CIT(A)'s decision to delete the unexplained cash credit, emphasizing the appellant's proper documentation and the failure of the Assessing Officer to credit cash withdrawals and redeposits. The Tribunal found no grounds to overturn the CIT(A)'s order and dismissed the revenue's appeal.