9911796707
TMI Blog2012 (7) TMI 767X X X X Extracts X X X X X X X X Extracts X X X X ..... d - assessee’s appeal is allowed. Addition on account of household withdrawal – assumptions and presumptions - assumption regarding inadequacy is drawn on the basis of the expenditure that any ordinary middle-class family is likely to incur in course of the year. Therefore, simply because the AO did not bring any material evidence on record to show that household expenses had been incurred from out of unaccounted income, the addition cannot be deleted. The presumption made by the AO and estimation made was very much realistic - factum of earning and withdrawal of money by the parent is not taken into account - addition reduced from Rs.73,000/- to Rs.48,000 - Assessing Officer is directed to re-compute the same accordingly - assessee’s appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preferred appeal before Ld. CIT(A) who after considering the sub mission of assessee allowed appeal in part and reduced addition from Rs.8,55,411/- to Rs.5,30,045/-. However, addition made u/s.68 of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') on account of unexplained cash credit and interest thereon and addition made on account of unverifiable expenses and low household withdrawn was confirmed. 3. Now, assessee came in second appeal before us. 4. Ground No.1 relates to confirmation of addition of Rs.4.20 lakh was made by Assessing Officer on account of unexplained cash credit and also confirming the disallowance of interest thereon amounting to Rs.32,780/-. Ld. AR for the assessee submitted that the orders passed by a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judgments cited by the parties. It is observed by Ld. CIT(A) that Assessing Officer has recorded the details of the deposits taken by assessee in para-6 page-2 of his assessment order. The finding of Ld. CIT(A) is reproduced hereinbelow:- "10. It is seen from the above that the Assessee has placed reliance on the decision of the Ahmedabad bench of the ITAT in the Assessee's own case for the A.Y. 2005-06. I have gone through this order which is dated 27.082008. That Hon'ble ITAT has only observed that the findings of the CIT(A) was without any basis and the same was merely on suspicion and surmises. With due respect to the Hon'ble Member and duly keeping in mind the principles of judicial discipline, I find it necessary to reproduce my fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epositors which was not done in the earlier year. This year, the AO issued summons to all the alleged depositors and out of the five depositors, only two appeared, the biggest depositor Shri Lekhraj T Wadhwa (deposits of Rs.2 lacs) simply failed to appear before the AO on some ground or theater. The statements of the two lady depositors clearly showed that they simply did not have the requisite creditworthiness to give the loans. All these cases were case of capital building, which was abated by the assessee himself. It has been a very old practice of building capital in the hands of lady members of household by showing income from stitching, etc. There was no evidence to show that the depositors had actually engaged in such activities. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs.17,066/- out of telephone, mobile and vehicle expenses. It is submitted by Ld. AR for the assessee that 25% is very excessive. 8. In view of the fact that personal element of such expenses cannot be ruled out, however, 25% appears to be excessive, hence, same is restricted to @ 10%. The Assessing Officer is directed to re-compute the disallowance accordingly. This ground of assessee's appeal is partly allowed. 9. Next ground of appeal is with regard to confirming the addition of Rs.73,000/- which was made by Assessing Officer on account of household withdrawal. Ld. AR for the assessee submitted that assessee's family consist of 4 members, however, parents reside at the material point of time. It is submitted that only one child was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an expenditure of only Rs.11,500 for the whole family per month and Rs.1,916 per individual member. What must not be forgotten is that thee are certain unavoidable and inevitable expenses which a family has to incur. 21.1 I am of the view that such withdrawals were grossly insufficient to meet all the expenses of the family of six members. Even if the Assessee may have been living in a modest locality, and leading a simple life; the Assessee would necessarily have had to incur expenses on account of municipal taxes on the residential property, on servants, on gas, water & electricity, repairs to the flat, daily provisions, medical treatment, clothings, laundry, newspapers, on transport, education of the children and most importantly, on s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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