9911796707
TMI Blog1996 (2) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... ts and from savings, cash was deposited in Bank accounts and ultimately brought in the books of assessee-firm. These ladies also filed returns and got assessed for assessment years 1982-83 to 1986-87 under the Amnesty Scheme. The deposits were made in bank on 31-3-1987 and brought in the books through cheques on 1-4-1987, ie., on the 1st day of business of assessee-firm for the assessment year 1988-89. 3. When called upon to explain cash credits, the assessee relied upon assessment orders passed in the hands of creditors and on bank entries through which amounts were transferred to books of account of the assessee and confirmations of the creditors. The Assessing Officer rejected above explanation of cash credits and held that the credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taining to an earlier year to be the income of a later year. From the relevant records it is seen that both the depositors had filed their returns of income under the Amnesty Scheme which were completed under section 143(1) on 28-5-1987 and 13-10-1987 respectively. In both the cases the returns came to be filed on 31-3-1987 for assessment years 1982-83 to 1986-87. Along with these returns, copies of capital account were also filed. The balance available as per the respective capital accounts for the assessment year 1986-87 were as under : Kumari Priya Aggarwal Rs. 82,000 Kumari Preeti Aggarwal Rs. 78,000 Out of the above balances, it is seen from the respective capital accounts Kumari Preeti Aggarwal deposited Rs. 78,000 in her bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of the same it is held that the amounts in question which had found their way in the books of the assessee during the year relevant to the assessment year in appeal were in existence prior to the beginning of the accounting period 1987-88 and these amounts can be clearly correlated with the date of 31st March, 1987 when these amounts in question were deposited in the respective bank account of the depositor for the first time. The same amounts have been established to have gone into the books of the appellant in the subsequent year under appeal. In this view of the matter for the sake of arguments even if it was correct that the depositors were only name lenders it would not be legally and factually correct to record a finding that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be made in assessment year 1987-88 and not in the year under appeal. 6. We have given careful thought to the submissions of the parties. The Assessing Officer recorded a finding that the amounts did not belong to Kumari Priya Aggarwal and Kumari Preeti Aggarwal and their creditworthiness was not proved. The learned CIT(A) has not disturbed this finding of the Assessing Officer. Although learned counsel for the assessee submitted that the alleged creditors were assessed on disputed income and, therefore, it cannot be held to be income of anybody else, on facts found it is difficult to accept this submission. It is an admitted position that in the explanation, a case of gifts received by these ladies was set up. But as gifts could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t maintained by the assessee in the previous year, it has to be explained and in case the assessee offers no explanation about the nature and source thereof or explanation offered by him is not " satisfactory ", the sum so credited may be charged to tax as income of the previous year. Conversely where explanation offered is satisfactory, the sum so credited cannot be treated as income or ' deemed income ' of the year in which sum is found to be credited. To this extent, the contention advanced on behalf of the Revenue is unassailable. However, explanation offered regarding source or nature of credits has to be considered objectively to see whether whole or any part of it is proved and is, therefore, " satisfactory ". In several cases, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tive evidence relating to availability of the disputed sum by 31-3-1987 cannot be disregarded. In other words, the explanation of the assessee relating to nature and source of creditors and that those sums was not income of period starting w.e.f. 1-4-1987, has to be accepted as " satisfactory ". The above satisfaction was required to be recorded and given legal effect to. The Assessing Officer, in our considered opinion, was not right in ignoring the above aspect of the matter which has been rightly appreciated by CIT(A). The sums of cash credits could not be added in the hands of the assessee as income for assessment year 1988-89. For all the above reasons, we confirm and uphold order of CIT(A). 9. In the result, revenue's appeal is dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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