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TMI Blog2015 (7) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... i) deleting the addition of Rs. 20,73,876/- made by the A.O. on account of unexplained investment in construction of house despite the fact that the addition was made to the extent which the assessee could not furnish any source of investment. (ii) Observing that the investment in construction ought to have been considered in two years i.e. F.Y. 2008-09 and 2009-10 which was contrary to the assessee's written submission filed on 26/09/2011. (iii) Restricting the addition of Rs. 1,19,73,500/- to Rs. 8,01,050/- being the peak credit as on 29/11/2008 despite the fact that the peak theory is applicable only in cash deposits and not in cheques deposited. (iv) Restricting the addition made on account of unexplained credits even though the assessee could not prove (i) the identity of the creditor, (ii) the genuineness of the transaction and (iii) the creditworthiness." 2. Brief facts of the case are that the assessee is a widowed house wife. Her husband Shri Sugan Chand Rangwani was also assessed to income tax with ITO Ward 1(2), Jaipur with PAN number ABIPR 6405 R. He expired in August, 2012 after prolonged suffering from Malignant Brain Tumor and a spell of being bed ridde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise break-up was also given along-with details of the withdrawals made from bank accounts for the purpose. However ld. AO summarily rejected assessee's contentions and made addition for alleged undisclosed investment in AY 2009-10 only. 2.3 Aggrieved assessee preferred first appeal, while appreciating the above contentions of the appellant, the ld. CIT (A) deleted the addition of Rs. 20,73,876/- on account of the alleged un-explained investment in the construction of residential house in the order vide para 3.1 at page nos. 7 to 10. 2.4 The second addition of Rs. 1,19,73,500/- made on account of the alleged un-explained bank transactions was also reduced to Rs. 8,01,050/- by adopting 'Peak Theory'. 2.5 Aggrieved both the parties are before us. 2.6 Assessee's sole ground and revenue ground (iii) and (iv) raise common issue. 2.7 Ld. Counsel for the assessee contends that the surplus funds as worked out by the ld. AO as per Annexure 'B' is replete with following flaws and discrepancies:- (i) In this chart no credit for the withdrawals of Rs. 6,36,000/- made in the names of family members had been given despite of the fact that affidavits of the family members were submitted cer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above, even the cheque deposits could not have been doubted as these funds flowed from the bank statement from the overdraft facility availed by the husband of the appellant. It was evident from the bank statement (account no.4114) that there was only rotation of overdraft funds whereby the funds advanced on earlier dates were received back subsequently and there were no fresh deposits." 2.9 Ld. CIT (A) over-looked the vital fact that assessee was hardly operating the account and was mainly operated by her husband. Merely because the assessee was constructing the house it has been lost sight of that she was only joint beneficiary and not sole holder of the said bank account. Consequently the peak amount cannot be added in the hands of the appellant alternatively if assessee's contention is not accepted than legally only ½ of the amount alone may be considered. Ld AO himself in the body of the assessment order, has acknowledged that most of the entries were operated by her husband. 2.10 Ld. Counsel contends that ld. CIT(A) grossly erred in holding disclosed entry of Rs. 8,01,050/- dated 29.11.2008 as 'undisclosed income' without objectively rebutting the contentions. While ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat too at Rs. 46,55,800/- whose yearly income was Rs. 1.25 lac which has been accepted by the AO himself for last so many years. There is no such asset or any other business activities from which it can be said that the assessee had earned a sum of Rs. 46,55,800/- from undisclosed income. following the case of Smt. Pratibha Goyal (ITA No.705/JP/2009). This judgment has been accepted by the Department as no appeal/reference has been filed against it. (v) Again, the honorable ITAT, Jaipur Bench, Jaipur have been consistently holding the view that all the bank transactions and deposits cannot be taken as undisclosed income of the assessee. The same can be taken as turn-over of the assessee and prevalent g.p. be applied and be taken as income of the assessee. Some cases are referred here-under for ready reference: (i)Shri Arvind Bakliwal, Madanganj, Kishangarh(287/JP/10) (ii)Shri Vineet Darda, Madanganj, Kishangarh (647/JP/2009) (iii) Shri Gajanand Agarwal, Madangarh, Kishangarh (1440/JP/10) It is contended that the remaining addition of Rs. 8,01,050/- confirmed by the ld. CIT (A) is unjustified and deserves to be deleted. 2.11 The remaining revenue grounds pertain to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ues issued directly for material and other expenses as per chart enclosed and relevant entries duly highlighted Rs. 1,32,176 Total Rs.39,07,176 The A.O. verified the bank account submitted by the assessee and observed that though the assessee had claimed to have withdrawn cash from the bank account however there were 10 entries whereby the amount of Rs. 8,34,000/- was transferred to the accounts of Sh. Suganchand Rangwani, Sh Rakesh , Sh Manoj or cash was deposited in the said bank accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the said house was declared on the basis of withdrawals made from the said bank account. Further the construction of the said house was carried out in FY 2008-09 and FY 2009-10. However, the AO had chosen to make the impugned addition one year only. The AO also did not accord any cognizance to the fact that part of cash amounting to Rs. 6,36,000/- was withdrawn through other family members also as the appellant being a housewife did not visit the bank. Further the husband of the appellant had also withdrawn cash of Rs. 13,50,000/- from another bank account (account No.268387) which was utilized in the construction activity however no credit for the same was given by the AO. The details of such cash withdrawals made by the husband from the bank account No.268387 on various dates were given by the counsel of the appellant vide lettler dated 26-09-2011 to the AO. Further the opening cash on hand available with the appellant had her husband was of Rs. 2,75,000/- however the AO had not allowed credit for Rs. 1,00,000/- withdrawn in cash by the husband of the appellant in March, 2008. If there amounts are taken into consideration, it would exceed the addition of Rs. 20,3,876/- made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while discussing this addition in the body of the assessment order. These vital facts emerging from record cannot be ignored on ipsi-dixit by manufacturing some lacunae in assessee's reply. Therefore ld. CIT(A)'s clear finding of fact that the investment in construction of house was made in AY 2008-09 & 2009-10 is based on proper verification of facts on record and there is no reason to disturb such findings of facts. It is further contended that ground iv of the revenue has no meaning inasmuch as the merits of all the credit entries stand proved by the assessee which is manifest from the order of ld. CIT(A). consequently there remains no issue about identity, genuineness and creditworthiness of these entries. In the light of above observations and working, the conclusions so arrived at by the learned CIT (A) are very fair, reasonable and logical so we rely upon such findings of the learned CIT (A). 2.14 Ld. Sr. DR is heard on both assessee's and revenue appeal. 2.15 We have heard the rival contentions and perused the material available on the record. Following facts emerge from the record:- i. Assessee being a house hold leady, her husband being a cancer patient and critical d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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